When I moved the adjournment of this debate a short while ago I pointed to the sound condition of the country’s finances, as appeared from the budget speech of the hon. the Minister of Finance. The fact of our finances being sound places our country in a tremendously strong position to be able to cope with any diffiulties which we shall needs have to face in consequence of our participation in this war. I put the question, which will undoubtedly occupy the minds of many people in our country in considering our financial position, namely, how soon, and to what extent this position may unfortunately be destroyed? This budget is already beginning to show evidence of this process, which undoubtedly will proceed at an increasing pace. In past years we have been able to reduce taxation in many respects, thereby improving the condition of the taxpayer. The Treasury has surrendered millions of pounds of revenue by which the economic position of the taxpayer has been strengthened. So far as indirect taxation is concerned, customs tariffs on a number of commodities have been reduced. To a large extent it was only the existence of practical difficulties in finding goods in respect of which we could proceed with the reduction of duties, without harming the protective policy for our secondary industries, which prevented us from going further. So far as the payer of income tax is concerned he has for a number of years had the advantage of an important rebate, or reduction, in the tax which normally was paid by him under the original scheme of the Income Tax Act in this country. By granting that rebate we relieved the position of the middle-class man in particular. It is he who in the main bears the country’s burden in providing the revenue. Now my hon. friend comes along with this budget of his and in order to balance his accounts he starts—he does so very modestly—by bringing about an increase in our customs tariff. In this instance he lays his hand, not too lightly, on the ladies. Well, I do not want to say much about that; I shall leave it to them to settle with him. What is of more actual importance, however, is his proposal in respect of the abolition of this 30 per cent. rebate which the income tax payer has enjoyed the last few years. The income tax payer is going to feel this. As I have already indicated, it is particularly the middle-class man who will feel it, notwithstanding the correctness of what my hon. friend has said, that our income tax payers in comparison with men and women in other countries are in a favourable position. In spite of this fact, however, income tax payers in our country have had this benefit for a number of years and they are going to feel the effect of losing it. They have become accustomed to this benefit. But that possibly is the least that could be expected, in existing circumstances, to remind us and to make us realise that we are taking part in this war. And it will unquestionably not stop at that. But, Mr. Speaker, as regards the estimates of expenditure submitted by my hon. friend, I notice that emphasis is laid on the fact that in no sense has there been any great curtailment in the so-called essential services. My hon. friend tells us, and points out that in connection, for instance, with labour and social services, and education — which latter incidentally also falls under the Minister of Finance—he proposes this year to spend about £250,000 more than last year, and then he adds, to my mind rather reproachfully, that so far as last year was concerned the expenditure had actually been reduced. I want to congratulate my hon. friend on this fact. I only hope that he will be able to keep it up, and it will be interesting to note how the part of an enthusiastic social reformer is going to go hand in hand with that of Minister of Finance. What has further to be noted in connection with the estimates of expenditure is this, and it is something which possibly may considerably affect the accounts of my hon. friend at the end of the financial year, namely, that evidently no account is being taken here of claims, I should perhaps say with probable claims, which may come from the members of our public service in connection with increased cost of living. I do not know whether my hon. friend has borne this in mind. We notice that he has very definitely taken account of an increase in the costs of the gold mining industry, and that he leaves them £3,000,000 to provide for the expected increase in labour costs. I hope to refer to this at a later stage. Then there is another matter which will probably have to be taken into account, and this may also affect my hon. friend’s accounts, and that is the position of our farmers, and the assistance which may appear to be essential in connection with the loss of export of the surplus products of the farming industry. We are all pleased at the fact that the wool position has improved, and that the anxiety which existed in connection with this matter has disappeared to a certain extent, but I am not so sanguine of the position of our other large export commodity, namely our mealies. I do not know to what extent the prevailing drought is going to affect the position here, but I can imagine the possibility of my hon. friend being called upon to place his hands fairly deep into his pocket in order to relieve the position, because we have already found in past years that under the schemes in existence in connection with the increase of production it is imposisble for the local consumer to bear the whole of the loss suffered in respect of the export surplus. While discussing the position of our farming industry and prices in that industry, I should like very briefly to emphasise again what I said in this House a few days ago, namely that in these times of difficulties and of war, when there is an increase in all the necessities and requirements which the farmers have to buy, and while further increases may be expected, while the Minister of Finance is following a policy under which prices of the farmers’ products are to be fixed and controlled, it will be necessary for the Government to give its attention to this position, so as to ensure that such fixed prices shall be fair and reasonable, and to take account of the increased costs which the farmer has to bear in connection with the necessary articles and materials which he has to buy. That then brings me to the position of our wool farmers. The wool position has been discussed in this House and outside in the country and, as was the case in the past, politics have needs again been dragged into this matter, but in my remarks I wish to deal with this matter entirely on its merits, and entirely objectively. My friend, the Minister of Finance, some time ago issued a challenge to this side of the House, and asked members on this side to tell him and the Government definitely whether we did not want this wool scheme. That was not the point at all. Let us analyse the position and see what the issue really is. When war broke out an announcement was made almost immediately of a scheme, which evidently had been prepared long before, under which the British Government had bought up the whole of the Australian and New Zealand wool clips. That announcement was made, and as our wool market was open, there was an immediate influx of buyers from neutral countries, because they realised that if Great Britain had purchased the wool clips of Australia and New Zealand, and was going to have control of these clips during the war, it would be in their interest to ensure that they would be able to obtain their supplies from other countries which were still free. The immediate result was that there was a great rise in wool prices in our country. What happened then? This position could naturally not be allowed to continue, because it would have meant the wrecking of the whole scheme prepared by Great Britain, and for that reason we had the immediate announcement that those buyers need not be afraid to buy wool in South Africa and other neutral countries, because the British Government had not just bought the New Zealand and Australian wool for herself, for her own requirements, but Great Britain would be prepared to supply the other countries from those quantities of wool which she had purchased. This naturally had to lead to a collapse of the price level in the Union as it did. And what happened then? It was thereupon announced that we were to have an open market here and that Great Britain would in any case be prepared to make a bid on our markets from time to time, for wool that was not sold on the basis applying to the Australian and New Zealand wool. That did have the effect of bringing about an improvement in the market, but it should be noted that even to-day the prices paid on our wool market are considerably higher than the fixed prices applying to Australia and New Zealand. This fact has already led to dissatisfaction in Australia where people are pointing out that in all fairness they should also be entitled to an increase in the level of prices. And why should that be so? Simply because their complaint is that the British Government is not disposing of the wool which it has bought from Australia quickly enough to America and other countries, with the result that America and other countries are now buying here in South Africa. I should just like to quote what happened in the Press a few days ago indicating the feeling in Australia—

I am quoting this with one object, namely to prove that the price of wool is actually being controlled by the British Government, and to the extent that they supply other countries, to that same extent is the price level fixed. If they supply wool freely to America and other neutral countries, the price level will go down. I am only mentioning this because I want to make an appeal to the Government and I want to ask them to see to it, in view of the position—and that is the least we can expect as this control does exist, and the market is not a free market, and as the British Government is exercising the control not in the interest of our wool farmers but in their own interest (for which we do not blame them)—I appeal to them to keep a careful check on the position and to ensure a reasonable price being maintained. Great Britain has the quantities, the supplies in hand, and actually fixes the price levels, she influences those levels to a very large extent, and as we have not got free and open competition in the circumstances, but as a basis has definitely been fixed, we want to appeal to the Government to do everything it possibly can in times like the present to ensure a reasonable price being maintained in respect of this important commodity produced by the wool farmer. It is possible for the British Government, as I have already shown, to bring down prices. They have the position in their own hands. As the British Government fixes the prices, and as the British Government has purchased the Australian and New Zealand wool, and are able to control prices in respect of the surplus wool, I think it is reasonable to expect that they will do so, that they will control those prices. I have shown, and we know for a fact, that it is the policy of the principal belligerent countries to-day to control the prices of products, especially the prices of farm products, so as to prevent a tremendous rise in prices, as occurred in the last war. That evidently is a policy with which our Government is in agreement. Only in respect of one product is this policy apparently not to apply according to the Government; apparently this principle is not to apply to one product, a product which in the past, in the very nature of things has always had a stable price in this country and in the world, namely our gold. And this brings me to the principal proposals made by the Minister, his proposals in connection with the gold policy which I now wish to discuss. It was in August last, a few days before the outbreak of war, when after the prices of gold had been constant for a comparatively long time, the British Treasury suddenly withdrew its support from the stabilisation fund, as a result of which sterling depreciated in value in relation to the dollar, in consequence of which the price of gold naturally went up at once. The withdrawal of this support naturally was a very important event in the economic world, and the Treasury immediately realised what this might lead to, and steps were immediately taken. The wisdom of the steps which were taken became evident when we noticed that within a comparatively short time the price of gold went up from 148s. to 150s., and eventually to 168s. where it stands today. This was the outcome of the policy followed by the majority of this Government which is to-day responsible for the affairs of the country. I, primarily, had to take the responsibility for that proposal, but those steps were taken with the full support of all my colleagues, and a declaration was issued explaining the reasons for these steps—a declaration which was issued to the people of South Africa.

What did we say in the declaration which we issued? It was stated that as a result of the withdrawal of support from the British Stabilisation Fund and the consequent rise in the price of gold a condition of affairs must of necessity be created which would lead to unhealthy speculation, which would certainly not be in the interests of the population as a whole. For that reason we decided to take these measures. We had to do so, as the Minister of Finance stated, because we had confirmed our previous decision not to break the link with sterling. That is the reason, that is the stroke of the pen by the Minister of Finance, referred to by my hon. friend in his budget speech. That step was taken because we did not concern ourselves with the interests of the Stock Exchange speculator, but with the interests of the general public. There is another important point I wish to refer to. We noticed that my hon. friend in one part of his budget speech let it be understood that it was to be assumed that this step had been taken in order to impose higher taxation on the gold mining industry, so as to help the country in the difficulties which would be caused by the aggravated international situation. It must be quite evident from this declaration, however, that that was not the cause of this extra taxation. No, what I said on behalf of the Government was that the time had come, as we could not break the link with sterling, we at least had to ensure having stabilisation of the price of gold; because as a result of the deterioration of the international position, and the depreciation of the value of sterling, problems were arising which must necessarily arise as the result of the depreciation of the value of sterling. That was the motive, and that was made clear by the declaration which my colleagues in the Cabinet approved of together with me and sent forth into the world, and which received the almost general approval of the country. When we went off gold in 1933 we deliberately laid down the policy of linking our pound to sterling by which, naturally, great development in our mining industry was to be achieved. We laid down that policy which aimed at developing and encouraging the working of low-grade ore, as a result of which the life of the mining industry would be greatly extended. That was our main motive, and we further said that we would deal with the mining industry fairly and justly. We wanted to provide every opportunity for development and expansion, but at the same time we had to ensure the state securing its legitimate share from the increased profits resulting from this stroke of the pen by the Minister of Finance. That was our policy, and for years I had to deal with charges that, according to the views of a certain section of the community, I was too well disposed to the gold mining industry, while on the other hand I was being attacked because it was alleged that I was treating the gold mining industry unfairly and unjustly. On every occasion I said, not on my own behalf but on behalf of the Government of which I was a member, that we were balancing the scales evenly, as between the two extremes. But what we felt all the time was this, that the time must come when we would have to say “So far and no further,” and that it would be impossible for us to continue improving the position of the gold mining industry and to enable it to lower the grade of the ore worked any further, if this had to be done by the depreciation of our currency. The depreciation of your currency may be allowed once in a lifetime when an illbalanced relationship has to be restored, but it cannot be allowed every time troubles arise. Thus we have the position that it would be foolish for us to say to the mining industry, and to the country as a whole, that it was beneficial to depreciate your currency continually. It cannot be done. And now my hon. friend comes along and destroys the whole position. I must say that it surprised me, and I can hardly credit it to be the work of my hon. friend. Tremendous pressure must have been brought to bear on him, and I am even disposed to ask whether there is any truth in the statement which was made at the time, that there was a crisis on this very question. I say that that policy—not my policy, but the policy of the Government, the majority of which sits on the benches opposite—was destroyed, and what is the result? It is true—I grant this to my friend—that, as he says, this year under his new scheme and proposals the state will get practically the same amount as it would have collected under the other scheme, but what of the future? It is not to be wondered at that we should learn from the Press that there was tremendous activity on the Stock Exchange immediately after the announcement of the Minister’s budget proposals. It is no wonder that we are being told that people are singing “Happy days are here again.” That is the sort of thing which we have tried to guard against. I only hope that my hon. friend and the country will not allow this to pass by unnoticed. What strikes one immediately on an analysis of the proposals made by my hon. friend, and which are now before the House, is that he agreed with this policy of the 30th August, and approved of it, although he has told us that he was not a member of that Government — that he goes out of bis way to defend that policy, that he adduces the strongest reason for that policy, and then, immediately after, he throws that policy overboard. That is so, and perhaps I might refresh the memory of hon. members somewhat by referring to what my hon. friend said in his budget speech when discussing this policy. I shall quote what he said—

And then my hon. friend goes on—

I have already pointed out that that was never my idea, nor was it evidently the Government’s idea, but that is merely a remark made by my hon. friend in passing, because after discussing this point he goes on to say—

And then he goes on, and after mentioning that we had to decide what our policy was going to be in connection with the maintenance of the link with the British pound, and after we had decided to maintain that link, he says—

And then he says—

And then he goes on to say this in his Budget speech—

After this one would expect that only the best possible reasons would have provided a justification for jettisoning that policy; and what were the reasons given by the Minister? They are known to us. We know that the industry immediately came along with two specific arguments. The first argument was our old friend which we have had on every possible occasion, and which was used as a lever whenever the industry wanted to force us to grant some additional facilities of some kind, namely the exploitation of low grade ore. The other was the effect this would have on obtaining fresh capital for developing mines. So far as this latter argument is concerned, my hon. friend in his Budget speech said that that argument had been represented very strongly to him, and he himself in reply had produced other arguments to show how little there really was in those contentions, or in the grounds raised to prove that particular point. He proved to the House that we were faced with war conditions, and with difficulties on the money markets of the world. He pointed out that people who wished to invest their money had ample opportunities for the investment of such money. He called this particular argument an exaggerated reason. So far as the other argument was concerned, naturally if we were prepared to depreciate our currency sufficiently because of the effect this would have on the price of gold, we would eventually be able to work ore on the basis of 1 dwt. per ton. That argument is very soon reduced to a reductio ad absurdam. My contention is this, that we have succeeded over a period of years in bringing down to a very low figure the ore that is workable, and if it has to be reduced further by depreciating the currency, then the price paid for such reduction of the ore definitely becomes too high. [Time limit extended.] I thank you, Mr. Speaker; I shall not detain the House very much longer. I say therefore that all the reasons adduced by my hon. friend are to my mind not sufficient to overthrow the strong case made out at the time, and which even he himself has made out. My hon. friend himself admits what the results of this step may be. I again admit that apparently there will not be any loss to the State this year. But what of the future? Does my hon. friend imagine that there is not going to be a further break in the value of sterling? He himself contemplates one. But he says, if that should happen it will mean an increase which will come quickly, suddenly, and which will be of importance—it will not be a slight increase, taking place steadily— and if it does take place he will step in with the powers which he possesses under the Currency and Exchange Act. That may be, but in that event it will be a case of closing the stable door after the horse has bolted. My hon. friend must be aware of the fact that the position I was concerned with when I wanted to take steps in connection with the speculation, was to define what the price of shares to be taken as a basis was. As soon as a rise takes place shares are bought and all sorts of vested interests are created on the basis of new prices, and it is almost impossible for the Treasury to change the position through the imposition of a tax. By the time the Treasury is able to interfere, under the provisions of the Currency and Exchange Act, it will be found that it has to cope with conditions which can no longer be controlled, and which can no longer be corrected by applying the provisions of the Currency and Exchange Act. Those vested interests will not allow the Minister to do so, and if he did interfere there would definitely be an allegation of his prejudicing the interests of the general public. There are a few other points which I should like to touch upon in connection with this matter. In the calculations of my hon. friend in which he tries to show that this new scheme will not prejudice the interests of the state, at least not during the current year, he brings up an amount of £3,000.000 to which the mine-owners would be entitled in respect of a probable increase in working costs in the gold-mining industry. The Minister in his Budget Speech pointed out that the previous scheme was associated with an undertaking given by him that the mines would not be in any worse position if there should be an abnormal increase in working costs, and that a scheme would be devised to compensate them in respect of such an increase in working costs. That point was brought before me immediately after we had taken our decision in August last year by one or two of the representatives of the mining industry, when I notified them of the Government’s intention, and I told them that although I was not prepared to give them a guarantee as asked for by them, I was prepared to tell them that if that position should arise it would be no more than fair for the Government to consider the whole question on its merits, and that compensation would be given. I therefore do not wish to raise any objections to this general principle laid down by my hon. friend, namely, that this plan carries with it an obligation on the part of the state to act fairly and justly. But what I want to know is this: What particulars have been given to the Minister, and what proof has been supplied to him, that this £3,000,000 will actually be required to meet this expected increase in working costs? Does this include, and does he contemplate, a rise in wages to mine workers? I should like to know from him what is actually included in this £3,000,000? I should also like to know what guarantee my hon. friend has in the event of such an increase in working costs not taking place, or not taking place to that same extent—what guarantee has he that the benefit will not go to the mines at the expense of the general interest of the country? I feel that in connection with a matter of this kind the House is entitled to have this information from him. Now I wish to say a few words on the subject of the defence expenditure. I do not wish to talk at this stage about the large amount in contemplation which this country will have to find. We are at war, and the responsibility for the present position rests on my friends on the Government benches. It is their policy and they consider they are entitled to carry it out. I only wish to point to one fact, and it is this: my friend on my left here is continually being attacked because over a period of about six months—after Parliament last year had made provision for a few millions in connection with defence— only about £100,000 was spent. Now we find that since that time, in seven months, the present Government has evidently only spent £500,000. What is even more striking is this, that the millions of pounds for which provision was made, have actually been spent, but not on the objects intended by my hon. friend, and the purposes for which the money was voted have still to be carried out. It would appear to me that the position is as follows: The Minister of Finance has used that money to meet the recruiting expenses. Those accounts will still have to be placed before us. But I want to touch on the question of the financing of this expenditure. I feel that we should be gratified, and that we should have been reassured to a certain extent when we learned that this was a “pay as we go budget,” as the Press called it. The hon. the Minister himself remarked that we were doing all these things “without burdening posterity.” That is all camouflage. What we are doing here in respect of the major portion of this expenditure—I am not talking now of the £2,000,000 coming out of loan expenditure—but the major portion of the expenditure is found by my hon. friend from the proceeds of the sale of gold to the end of December, for which the mines were paid 150s. per ounce. The Minister also told us, and it was a fact, that this special amount by which the Treasury benefited, had never been intended by me for ordinary revenue to cover ordinary expenditure. That money was credited to loan account. That certainly was what I had contemplated, that this new revenue would be used to enable us to ease the capital expenditure of the country, because as the hon. the Minister rightly stated, I had been very much concerned in the past, and the Government and the country had been very much concerned at the large capital expenditure from loan funds, and we felt that this revenue would relieve the position. That is not to be done now. That money is to be spent on the war, and the only difference this will make is that so much more money will have to be borrowed for the other necessary capital expenditure. No, Mr. Speaker, we are busy deluding ourselves and the country. It has been rightly stated that loan expenditure and expenditure from capital account have caused considerable anxiety to the country and to the Government. My hon. friend now proposes to carry on with this sort of expenditure, but this does not mean that we are paying for the war out of revenue. It only means that we shall have to borrow so much more money and that our debt will be increased all the faster by ordinary capital expenditure. I am sorry that my hon. friend was unable to lay the Loan Estimates on the Table. I know that there are certain difficulties with which I have always been faced, but I had hoped—and we tried it once—that it might be possible in future to have the Loan Estimates before us when the ordinary estimates were under discussion; because the position to-day is that our capital expenditure is very largely affected by the Loan Estimates, and so are our general financial schemes which are usually explained by the Minister of Finance at the time. It is impossible to obtain a thorough perspective of the real financial position, if it is necessary to cut out certain services, and to curtail others, unless we have the Loan Estimates before us, and I hope it will be possible in future. Then I notice that the hon. the Minister proposes carrying forward the expected surplus of the current financial year. I do not wish to raise any objections to his doing so. This course, however, is in conflict with the tradition which has been in existence for a number of years. I am prepared to admit, however, that it has been done on occasion, and it may happen in future that there will be occasion when there may be extraordinary expenditure, and such a carry-over may be justified. What, however, has made me feel somewhat uneasy, is that my hon. friend, without saying a word in justification, has simply notified the House that the surplus is to be carried forward. I hope that this does not mean that for the future we are to depart from the, to my mind, sound policy of the accounts for every year standing on their own feet, and if possible balancing, so that the surplus available shall be applied to the purposes to which they have been applied so far. I want to conclude by making a few remarks in connection with what to my mind is another important question, and I wish to make my remarks as the result of what my hon. friend said in this House on a previous occasion when he discussed the future of our currency, and dealt with the policy to be pursued. The hon. member on that occasion tried to point to apparent conflicting opinions held in connection with this matter on this side of the House. He then said that he wanted to know from the Opposition, from responsible members, what the Opposition’s policy was in regard to this matter. Well, I think the time has come that the country should know what my hon. friend’s policy is in connection with this matter, and I think the time has come for this question again to become a matter of actual importance to this country. So far as I am concerned I have never hesitated, or refrained from saying, nor do I hesitate to-day—and I am here expressing my own opinion—although I have been, and am still in favour of our not breaking the link with sterling, at this juncture — I say the time has come when we should seriously consider this whole matter. I feel that if a further break has to come, an important break will have to come, and it will then become a very real problem so far as this country is concerned. Notwithstanding the struggle which we have had here and the apparent feeling that this is a good way of bringing prosperity to the country—that it is sound to bring prosperity to the country by continually depreciating one’s money—I cannot help thinking that that in the long run cannot be the opinion of the right thinking section of the population in this country. I wish to remind the House of what I announced as the policy for this country in connection with this matter, when in 1933 the Currency Act was passed by this House. I then said this, and it was accepted as the country’s policy—

I again wish to emphasise what I said in another part of my speech this afternoon, and that is that it must be clear to all of us that one cannot continue in the long run, and that one cannot expect to have prosperity in the country by continuing with a depreciation of one’s currency and by welcoming a depreciation in the value of one’s currency. With the countries of the world engaged in a life and death struggle, and bearing in mind the inevitable exhaustion which must result, I am not prepared to agree that it must necessarily be in the interests of our country to adhere to the currency of another country, irrespective of what may happen to it. This is a matter which is going to be of very real importance to us, and I hope that the Minister will realise that his policy and the Government’s policy in connection with this matter must become a very real problem.

Mr. Speaker, I should begin this afternoon by endorsing the chivalrous reference which the Minister of Finance made to the hon. the former Minister of Finance, who has just spoken this afternoon. The hon. member for Fauresmith (Mr. Havenga) entered the House at the same time that I did, and for 15 years he guided the financial destinies of this country in a manner which I followed with respectful attention inside this House, and in a manner, sir, for which I cannot refrain from expressing my appreciation. I would also like to congratulate the Minister of Finance on the sensible, well-balanced Budget which he has presented. And it did seem to me, sir, that in the extremely moderate criticism which fell this afternoon from the hon. member for Fauresmith, you find the best appraisal of the value of that Budget. Mr. Speaker, this is a war Budget. We must not forget that, rightly or wrongly, we are living in time of war, and this, the first Budget presented by the Minister of Finance, is a war Budget. Yet, sir, the burdens which in that Budget he lays upon the people of this country are such as would be envied by most countries even in times of peace. And certainly, sir, will be envied by neutral countries who live in or near the zone of belligerency. Members of this House were shocked, or professed to be shocked some weeks ago when they were told, in answer to a Question, that our daily war expenditure is £36,500. Did they read the other day, sir, that it is costing Holland, little Holland. £250.000 a day to defend her neutrality? So that whatever views we may have on the war, we can at least, as South Africans, congratulate ourselves that we are, as the last speaker has said, in the happy financial position in which to-day we find ourselves. Our Minister of Finance is the only Minister of Finance, as far as I know, in the whole world, who possesses such a purse of Fortunatus in the gold mining industry, and by a happy paradox that industry produces a revenue which appears to be: self-adjusting to the needs of this country. In times of peace, Mr. Speaker, it helped my hon. friend the member for Fauresmith, not only to balance his budget, but to produce that series of surpluses which delighted his followers for many years, and in time of war, from the very fact of war itself, the price of gold has gone up, and the industry is now asked to help to finance the war burden. Seven-tenths of our additional war burden will fall upon the mining industry. That industry was described some years ago as a balancing fly-wheel in the economic life of South Africa, and I think that is an apt and happy description. In no other country but South Africa, in no other belligerent country, would the Minister of Finance attempt the task of finding a very substantial war expenditure, leaving little or none of it to be met by posterity. Let me remind this House, sir, that in the last war the total amount of our public debt arising from the war expenditure was over £28,000,000. That is to say, at the close of the last war the country had an additional public debt due to the war and the rebellion of £28,000,000, and we had a liability for war pensions which, over the period since the war, has cost us £13,500,000. Therefore it is right to recall that the last war cost this country, by a permanent addition to our financial burden, no less than £42,000,000. I think the Minister of Finance, in this present budget, has been successful in adjusting the burden of war expenditure very fairly and very equally among all classes of the community. He has put seven-tenths on the mines, two-tenths on the income tax payers, and one-tenth in the form of excess profits duty on the commercial community. I have heard it said that this budget does nothing for the poor man! I read that criticism in some of the Rand papers. Mr. Speaker, I can remember the present Minister of Finance making exactly the same criticism last year about the budget of his predecessor, the present hon. member for Fauresmith. But, Mr. Speaker, a budget can only do something for the poor man if the poor man is taxed, and in this country, sir, with minor exceptions, the poor man is not taxed. Our customs revenue, our scheme of taxation from customs, has long been recognised as having reached a point where there is practically no further room for a remission of customs duty, unless you interfere with the established system of protective taxation under which so many of our industries have grown up. And therefore, sir, it is merely superficial and uninformed criticism to say that this is not a poor man’s budget. In the negative sense, of course, this is definitely a poor man’s budget, because no share of the additional war burden which this country is carrying is laid on his shoulders as it is in every other belligerent country in the world. The burden is laid on the mines, the income tax payer and the commercial community. In this country the income tax payer is not a poor man: he is the middle-class man of fairly substantial means. And do not let us forget that this extra £12,000.000 of war expenditure will fall throughout this country in a fertilising stream upon the shoulders not of the rich people, but of the poorer classes of this community. Finally I would remind the House and the critics that there is this year an increase of £264,000 upon the votes for social services. No one, sir, on these benches will, I believe, raise a single word of protest against the very heavy additional burden that has been cast upon the shoulders of the mines. But I am one of those, and there are many in this House, who have felt the gravest doubts as to the wisdom, as a permanent policy—I repeat those words, the wisdom as a permanent policy—of the change inaugurated by the then Minister of Finance, with the consent of the whole Cabinet, towards the end of August last. We were told by the heads of the mining industry, and I for one accept that statement, that that step which had been taken was an unsound step. It was an unsound step in this sense only. I do not say it was unsound in circumstances at that time. I do not say that the Minister of Finance or the Ministry of that day acted wrongly in taking the step they did. It would, however, have been unsound to perpetuate it as a permanent policy in this country.

Does that mean we will never have stabilisation even in regard to the mining industry?

It means this, that any step by which the price of gold is artificially pegged at any definite figure is, in my opinion, unsound. That is the point which I shall endeavour to develop in the course of a moment or two. That is the answer to my hon. friend’s question. That matter came suddenly upon the country. Gold jumped 20s. overnight by reason of the circumstances mentioned by the hon. member for Fauresmith, and I do not criticise him or the Ministry of the day for taking the steps they did in those circumstances. But I believe that it would have been wrong to perpetuate that step as the permanent policy of this country. I was one of those who approached the present Minister of Finance and pointed out to him what, in our opinion, were the unsound features of that step as a permanent policy. What are the fundamental features of any sound scheme for the gold mining industry of this country? The hon. member for Fauresmith has laid down these principles on many occasions. I am prepared to accept those principles. I well remember that in his budget speech of 1936 he devoted a great deal of attention to a discussion of the proper fundamentals of cold mining taxation, and I should like to remind him of what those fundamentals are. This matter is a difficult and technical question. It was discussed by a select committee in 1918 and also by a commission in 1919. It was investigated at very great length by the Low Grade Mines Commission of 1930, and that commission in its report, which it only came to in 1932, pointed out that if we reduce the working costs of gold by 2s. per ton that would increase the life of the industry by 50 per cent. If we reduce the working costs by 4s. a ton that would increase the life of the industry by 100 pet cent. Speaking to that report the hon. member for Fauresmith, then the Minister of Finance, said this—

In 1936, after the Departmental Commission on Gold Mining Profits had reported, the Minister recast his scheme of taxation and put in into a more scientific form, and the threefold results he said he had to achieve were (i) to produce the same revenue, (ii) to extend the mining of low grade ore, and (iii) to encourage the development of smaller gold mining propositions. I shall tell the House what happened as a result of that sound policy. The tonnage milled rose from 34,500,000 in 1932 to 58.500,000 in 1940, while the grade fell from 6.3 dwts. to 4.2 dwts. The price of gold had risen from 85s. to 148s. per ton milled, but because of this policy of mining low grade ore, profits had risen only from £8 3s. to £12 2s. Here I know that I shall have the enthusiastic agreement of the hon. member for Fauresmith. Had the Government yielded to the Uninformed clamour that came from certain sections in this House, from some of the new colleagues of the hon. member, and perhaps from certain of my own friends on this side of the House, and fixed the gold price at 85s., and taken all the profits beyond that as many people demanded should be done, what would have happened? The Rand to-day would have been operating on a basis of 20,000,000 tons instead of on a basis of 57,000,000 or 58,000,000. In the last six years the sum of £80,000,000 has been spent on capital expenditure on the mining industry in developing new propositions. I make bold to say that not a single penny of that £80,000,000 would have been spent had the mines been limited to a gold price of 85s.

It is 168s. to-day.

Yes, I know, but so far I think I have the hon. member with me.

Is there no limit you can put on these mines?

I am coming to that. I am dealing with the principles the hon. member laid down in the past. Had that not been done Johannesburg to-day instead of being the most prosperous spot on God’s earth would have been a dying town. When gold was 150s. the payable limit was 2.57 dwts. With gold at 168s., the limit is 2.2 dwts. The extraordinary feature of the Rand is that there is no known physical limit to the quantity of auriferous ore available for mining. The fixing of limits on the Rand to-day is unknown. There are only two practical limits upon the industry. The first is the margin of payability, and the second is the labour force available. If you can surmount these, mining can go on on the Rand for another thousand years. Therefore I think that any artificial fixing of the limit of payability is unsound. What did the ex-Minister of Finance do? He artificially pegged the price of gold at 150s. In doing so he pegged the limit of payability at 2.57 dwts.

Which will happen in any case if you come to a sound basis of stabilisation.

I hope that no one in this House will ever be concerned artificially to place a limit on the expansion on the mining industry on the Rand. What my hon. friend did was to peg the gold price at 150s. and in doing so he fixed the limit beyond which the mining industry could not expand at 2.57 dwts. I believe this, that if the ex-Minister of Finance himself had been sitting in that chair this afternoon, he would, from the very logic of the case, have been compelled to take the step which his successor has taken. I am certain that if he had listened to the arguments presented to him he would, with that levelheadedness which we all admire in him, have compelled himself to recede from the attitude he took up in August last. We are getting to-day exactly the same yield in taxation. The hon. member has not attempted to deny that. He has not attempted to deny that we are getting exactly the same yield from the industry, but we are getting it in a much sounder way. The Stock Exchange position has shown how well that industry has received the changes. The stimulus which the market has received will reverberate throughout the length and breadth of the Union. A good market is better than a bad market. No government wants to see a bad share market because the share market is the barometer of trade and commerce in this country. The favourable market reaction is the best indication of how the industry has received this change. Let me repeat it and go on repeating it, and I hope that other hon. members will repeat it, that the mining industry is paying exactly the same under the Hofmeyr scheme as it would have paid under the Havenga scheme. The hon. member for Fauresmith spoke of the time when the price of gold would go above 168s. Automatically, if the price goes above 168s., most of that extra profit goes back to the Treasury under the formula already in existence. But if there was any unconscionable rise beyond that it is the policy of this Government to take the major portion of it into the revenues of the country. So the only difference, so far as I can see, between the Havenga scheme and the Hofmeyr scheme is that the Havenga scheme unnecessarily limits the expansion of the gold mining industry, destroys confidence, negatives the supply of fresh capital and puts a stop to development; whereas the Hofmeyr scheme will get the same yield for the Union taxpayer but in a way which will not put any of these artificial limits or barriers upon expansion. I now want to deal very briefly with one other financial point. That is the position of the Post Office as a taxing machine. Here I am afraid that my hon. friend the Minister of Finance is repeating the sins of his predecessor. He is shamelessly, and I am using the word with respect, continuing this policy of using the Post Office as a taxing machine. The present estimates show that there should be a revenue of £6,147,000, an increase of £450,000. The estimate of expenditure is £4,398,000, showing an increase only of £62,000. Therefore, the revenue is up by £450,000 and the expenditure is up by only £62,000. I think I am right in saying that the present Minister is almost worse in this respect than his predecessor. That expenditure includes an amount of £186,000, artificially estimated as a contribution to. Loan Account. But now let me come to the actual commercial balance sheet of the Post Office. The Postmaster-General every year publishes a commercial balance sheet. According to that balance sheet the Post Office Profit and Loss Account, after making allowances for every possible expenditure, including interest and the £186,000 and so forth, shows a profit of £767,000, and of this profit telephones alone account for £709,000. I say quite plainly, if the Minister of Finance will allow me, as a town representative, as one who speaks on behalf of the urban taxpayers, that the time is long overdue for a revision in that downward trend of our telephone charges. All recent concessions — and they are trifling in any case, but whatever concessions have been made—have been made solely to the rural community. Farm telephones to-day show an annual loss of £100,000, and the only concession to the telephone user mentioned by the budget is a concession in relation to smaller exchanges and costing, I think, £19,000, which I have the authority of the Minister of Posts and Telegraphs for saying will be overtaken in a very short time, if not in this financial year. No, the time has come for a revision in a downward direction of telephone charges, more especially in call-box charges. They charge 3d. for a call-box call of three minutes—an iniquitous charge, and members of the community who do not happen to live in their own homes particularly feel the iniquity of that charge. Members of Parliament who, during the session, live in boarding-houses well know the annoyance and the tax which that imposes upon them, and no single concession which the Minister could make would be more popularly received than a revision of the call-box charges, in fact a revision generally of the telephone rates. Now I have a few minutes left and during those few minutes I am going to leave the broad field of finance, and I shall try during that time to deal with the economic future of this country. The future of South Africa, as I see it, at any rate during the next five or ten years, depends on confidence. If we can instil into the minds of the investing classes, into the minds of the business world in South Africa, a feeling of confidence, then I believe that we are in for a very wide and prolonged period of prosperity in this country.

If!

But there is a doubt at the back of the mind of the average business man to-day as to whether the present Government will last, and how long it will last, and how long certain policies which they regard as subversive receive support in the country at large. With that in mind I propose doing a little political stocktaking and to review the position in the country during the last six months since war was declared, and the United Party was broken up and a fresh orientation of parties took place. At the time of fusion in 1933 the present Prime Minister was the leader of the South African Party and he brought —no one will question this figure—95 per cent. of the strength of the South African Party into the United Party. I have grave doubts if the hon. member for Smithfield (Gen. Hertzog), the present Leader of the Opposition, brought 10 per cent. of the then existing National strength into the United Party. And as a witness of that estimate I shall call the hon. member for Piquetberg (Dr. Malan). Speaking at Carnarvon, shortly after fusion, the hon. member for Piquetberg said that Gen. Hertzog did not take into fusion 2 per cent. of the Nationalist strength in the Cape Province, and in the other provinces not more than 10 to 15 per cent. What inference do I draw from these figures? I draw this inference, that one of the greatest political bluffs ever perpetrated in the political history of this country was put over the United Party by the ex-Prime Minister when he demanded, and got, the Prime Ministership, when he got the key positions of the Cabinet, and half the seats in the Cabinet.

And when he left you out.

And his contribution to the strength of the United Party was comparatively insignificant. To-day he is attempting to do the same thing inside his new party, but with less success.

Why do you worry about it?

I have never heard such rot in my life before.

I shall tell you what has happened during the last six months. When the testing time came on the 4th September the majority in favour of the present Prime Minister was thirteen.

An unlucky number.

Five months later, on an identical motion by the hon. member for Smithfield, the majority was twenty-two. Since the outbreak of war there have been four Parliamentary elections and eleven Provincial elections, and out of these three Parliamentary elections and eight Provincial elections have resulted in favour of the Government. I do not say that that is a complete test, because some of these vacancies were created by….

If you are so satisfied about the position why do you not go to the country and have a general election?

There were five elections in which the Government’s war policy was the main issue.

Why do you worry?

In all these constituencies the majority of the population was Afrikaans-speaking, and in each case the present Opposition loudly acclaimed its victory in advance, but they acclaimed their victories too early. The constituencies in which these by-elections took place were Kuruman, Hopetown, Brakpan, Losberg, Bloemfontein East, and in those five elections—the only five in which the war issue was fought out—the total for the present Government, the total number of votes cast for the present Government were 13,882. And the number of votes against the present Government and for the present Opposition was 11,840.

Have you analysed the figures?

Yes, I have done so, and I shall come to that. Now I repeat that these five constituencies were the constituencies in which the war issue was fought out, and everyone of these constituencies was a constituency in which the Afrikaansspeaking vote predominated.

What about Brakpan?

Yes, most definitely.

And Bloemfontein?

Bloemfontein, too. And the result, after eliminating the unopposed returns, and eliminating the elections in Natal, and taking only these five elections, four of which were on the platteland….

Why do you worry about them?

I am not worrying, I am leaving the worrying to the hon. member. I am trying to reassure public opinion which is made nervous by the type of speech made by the hon. member for Gezina at Robertson and Piquetberg over the week-end, and I am trying to assure them that there is no need to worry. I am glad that the hon. member for Fauresmith agrees with me that there is no need to worry. The elections as a whole reveal in my opinion the following— the United Party have not lost a single urban election. Neither party have gained any seat, but every Opposition seat has been filled by a Malanite and not by a Hertzogite, and the Hertzogite vote has been negligible. Even in the platteland the overwhelming majority of the people who supported the United Party in the days of Fusion still do so.

Where do you get your figures?

I want to tell the Minister of Finance that he was too conservative the other day when on an analysis of the result of Kuruman, he placed the proportion of Afrikaans-speaking people who supported the Government at three-eighths. I make the figure at least four-ninths. The other day the hon. member for Hoopstad (Mr. J. H. Viljoen) stood up in this House and said that this Government had no mandate either to govern this country, or to carry on a war policy. The truth is this, that not a single hon. member opposite who is a follower of the hon. member for Smithfield, had any mandate whatever to vote as he did six months ago, and had no mandate whatever to go into opposition. So far as they sit there at present, they sit there with the support not of the people who sent them to Parliament, but of the people who tried to keep them out of Parliament, and if an election took place to-day ninety per cent. of those who voted to send them to Parliament would vote to keep them out.

Do you remember who opposed you at the last election?

And if they were returned it would be on the votes of their erstwhile Malanite opponents. The hon. member for Smithfield and his immediate followers in this House are almost without exception politically doomed. They cannot stand on their own political legs, and if they do survive in the political life of this country it will be by the grace of their former opponents, the Malanites, whom, on every possible occasion, the ex-Prime Minister used to vilify, and whom he cut on every occasion when he was on this side of the House, as he is cutting us to-day.

You were not too complimentary to him.

Let us consider the Hopetown election. That took place in the North-West of the Cape Province, a part of the country which has always been traditionally hostile to the old South African Party, and there the Nationalists got 2,721 votes, an increase in their vote of 112, and the United Party got 2,482 votes, an increase of 61. Now what are the deductions to be drawn from that? To-day in this purely Afrikaans-speaking constituency there are more United Party supporters under the present Prime Minister than there were in the past with Fusion. In other words, Smuts alone is worth more than Smuts plus Hertzog. A more decisive vote of no confidence in the ex-Prime Minister it would be impossible to imagine. The Losberg result was even more shattering. This constituency is known to be the most purely rural constituency in South Africa. It has not one town in it. The largest “town” in Losberg is the little village of Fochville. It is therefore the most rural constituency in South Africa, and in Losberg 3,225 voters supported the Government policy and the majority increased from 582 to 758. And therefore I would say this, that my conclusion from these figures, my summing up of the analysis in which I have permitted myself to indulge, is this— the Government is winning the war on the home front, the Government is going from strength to strength in this country, and the policy for which the Prime Minister stands is the policy which is going to win out in South Africa.

The speech by the hon. member for Kensington (Mr. Blackwell) consisted of two parts. The first part was a paean of praise for the mining industry, and the second was a long dissertation which aimed at proving that the Government Party had the majority of the people behind them.

I am very pleased to know that the hon. member for Kensington’s conscience is pricking him. It would appear to me that the hon. member is not quite so certain in his mind that the Government really does represent the will of the majority of the people, and now he is trying to console himself and put some courage into himself by talking the way he is doing. All I can say to the hon. member for Kensington and to hon. members opposite is this, if they want to know who represents the majority of the people let them have an election. Let them have it to-morrow. And this we do know that if the people are only given an opportunity to express what they feel in regard to what happened here on the 4th September last year, it will put an end to the Smuts Government and to the war policy.

There have been fifteen by-elections.

We shall get a good many more. The hon. member is terribly pleased with Losberg—the only ewe lamb in the Transvaal.

Yes, which you are crying about such a lot.

Let us take the first part of the speech by the hon. member for Kensington. He is very pleased indeed. I have listened to a lot of speeches by that hon. member made on budget debates, but I have never yet seen him so pleased and so satisfied with the financial policy, and with the budget speech of the Minister of Finance as he is on this occasion. Last year the hon. member for Kensington was rather critically disposed towards the policy of the Government. I remember his getting up and criticising the Minister of Finance on account of the increasing expenditure of the country. He warned us against that increasing expenditure, and he told us that we must be on our guard because our administrative expenditure was getting too large. This year the expenditure of the country has gone up—the expenditure has been driven up as never before in the history of the country. This year the expenditure has for the first time been again pushed up to far over £50,000,000. Have we had one word of criticism from the hon. member in connection with the ever rising expenditure? No, not a word, he is quite satisfied.

Do not forget that this is war time.

He is satisfied, not simply because of that, but also because of another reason, and that reason is that the Government for the umpteenth time has capitulated to the mine bosses in Johannesburg. That is the reason why the hon. member is satisfied. The hon. member for Fauresmith (Mr. Havenga), the previous Minister of Finance, has drawn our attention to the position, and the hon. member surely knows what the attitude of the Minister of Finance used to be in the past. Yet the hon. member for Kensington comes along now and tells us that the hon. member for Fauresmith, if he had been on the Government benches to-day in the position of Minister of Finance, would have done exactly the same as the present Minister of Finance is doing. The hon. member is aware of the fact that representations were made to the previous Minister of Finance by the Chamber of Mines, and he knows what the decision of the then Minister of Finance was in face of those representations. We know that the then Minister of Finance submitted his policy to the Cabinet, and we were told this afternoon that there is a majority of the Cabinet in favour of the policy of the Minister, that the Cabinet as a whole approved of that policy, because it knew that it was in the interest of South Africa. But in the meantime the mining industry has brought pressure to bear on the present Minister of Finance, and such was the strength of that pressure that he unfortunately has again submitted to it. Although that same man in August of last year decided that the policy of the then Minister of Finance was in the interest of South Africa, he has now departed from that policy, not because it is in the interest of South Africa to do so, but because it is in the interest of the Chamber of Mines. The Chamber of Mines is satisfied. South Africa is at war, a condition of war prevails, which the Chamber of Mines is glad to see. The Chamber of Mines is anxious that we should assist England, without their having to pay for it.

Who paid for it?

What is the position? Under the Budget proposal of the present Minister the Chamber of Mines is actually benefiting from the condition of war as we heard this afternoon from the former Minister of Finance. Before the war commenced Mr. Havenga, in those days in his capacity as Minister of Finance, stated that he was going to fix the gold price for the mining industry at 150s. The gold price has gone up to 168s., and now the present Minister of Finance has departed from the policy laid down by his predecessor. The Minister tells us here to-day that there is not going to be any reduction of revenue for the State from the mines. But how can the Minister tell us a thing like that? I have his Budget speech in front of me. The price of gold has gone up from 150s. to 168s. and the extra revenue for the mining industry amounts to a little more than £10,000,000. Every shilling increase in the price of gold signifies an extra amount of £600,000 for the mining industry.

Eighteen times £600,000 is more than £10,000,000. In this Budget the Minister of Finance is not proposing to take £10,000,000 from the mines, he is only proposing to take £7,000,000. Surely these are hard facts. The increase in revenue to the Treasury under the formula is about £3,500,000.

You are losing sight of realisation charges amounting to 3s. and 4s.

And you are also losing sight of the additional working costs.

We are coming to that. The policy laid down by the hon. member for Fauresmith would have meant an extra revenue of more than £10,000,000 to the State. Now the present Minister of Finance proposes to take £7,000,000, so that the Chamber of Mines will be more than £3,000,000 in pocket. That is what the hon. member for Fauresmith also told us here this afternoon.

No, he himself admitted that the revenue to the State would be the same.

He asked what the Minister was including in the increased cost of production.

He himself stated that we would get exactly the same amount under this scheme as under the scheme which he had decided on. And after that he put the question: “What of the future?” I shall reply to that question later on.

The hon. the Minister will have to explain things. The difference between his policy and that of the hon. member for Fauresmith is an amount of £3,000,000—that is the difference to the State. The hon. member for Fauresmith then asked the Minister what he calculated the increased working costs to amount to. The Minister of Finance in his Budget speech said this—

Yes, on the formula.

The difference is £3,000,000 and the increase in production costs is shown by the Minister himself as being an amount of £1,500,000.

You do not understand it.

Well, let the Minister make it clear to us, because that is what he himself states in his Budget speech.

On the formula it would mean an amount of £3,000,000 to the industry, of which the Government itself in any case would bear 55 per cent.

But how do you wipe out the £3,000,000?

I shall tell you. In my Budget speech I dealt with the matter generally, but I shall give further details later on.

Anyhow we know that the gold mining industry is in its glory to-day. The industry is quite happy, not because a larger amount of money is being taken from them, but because a smaller amount is being taken by the State. And then we come to an important point. The hon. member for Kensington stated this afternoon that the gold mining industry was practically carrying the State in these difficult times. He said that the gold mining industry was carrying practically more than £20.000,000 of the revenue of the state. But that is taxation, and there is a great difference between the attitude adopted by this side of the House and the other side on the conception of what taxation really means. The gold premium of which the state takes a large share is not a tax. From our point of view the gold premium is in actual fact a subsidy by the people of South Africa to the gold mining industry. The gold premium has been created by the depreciation of the currency of the people. The people lose in the purchasing power of their currency, and the gold mining industry gains as the result of the gold premium. So as the state is taking a share of the gold premium, the state is taking only a portion of the large amount which in the form of a subsidy flows from the rest of the country to Johannesburg, where it is concentrated. That is not a tax. So the hon. member is wrong, and it is impossible to emphasise this too strongly. The gold premium is created to all intents and purposes as a result of a subsidy: it is a subsidy by the people to the gold mining industry, and as the state is taking part of it, the state is only taking that to which the people are entitled. That is the definite attitude adopted by us on this side of the House. Now I wish to say a few words on the attitude adopted by the Minister of Finance towards the gold mining industry. He told us that South Africa could consider itself fortunate in having the gold mining industry, and he calls it the pillar and the support of South Africa in present days. We are able to appreciate that, but the people and the Minister, too, should realise that the gold mining industry finds itself in such a strong position because of the fact that it has, in the way I have just explained, been receiving a subsidy which in the past seven years has amounted in total to an amount of £120,000,000. The subsidy paid to the gold mining industry has run to a total of £200,000,000, but the state has received portion of that, while the gold mining industry has in the last seven years taken about £120,000,000. I say that if the Government had assisted the farming community in the same way in the last seven years. South Africa would to-day have been happier, stronger and economically sounder,

Where would you have got the money?

The misfortune is that as a result of the special protection and assistance rendered to the gold mining industry in the past seven years, the development of South Africa has become entirely one-sided. All our eggs are in one basket, and if anything should happen in the world to wreck this one basket, to wreck the gold mining industry, I do not know what the future of South Africa will be. But if the same assistance had been extended to the farming industry, as was extended to the gold mining industry, the whole of South Africa would have experienced a greater degree of prosperity and happiness. That is our great objection to the policy which is now being pursued by the Minister of Finance. There is too great a differentiation between the gold mining industry on the one hand and the farming population on the other hand.

The farmers have had exactly the same subsidy as the mines, so far as depreciation is concerned.

The farmers have suffered in many respects. The gold mining industry received the cash.

Depreciation helps the farmers just as much as it helps the gold mining industry.

The depreciation of our currency has caused the price of gold to go up from 85s. to 168s. The farmers did not have the same benefit in the shape of an increase in the price of their products. Does the Minister want to tell us that the prices of the farmer’s products have gone up in the same degree as the price of gold? Does he want to tell me that the price of wool, mealies, meat and fruit has gone up in the same degree as the price of gold? No, in South Africa things are not measured by the same measure. The price of gold may go up—then there is no damage to South Africa, but the products of the farmer have to be drastically controlled, and their prices are not allowed to go up. Does the Minister consider this to be just? I want to point to a few other matters to which I want him to give his attention. The hon. member for Zoutpansberg (Mr. Rooth) referred the other day to profiteering which was being indulged in by industrialists, and he specially quoted the rise in the price of a commodity produced in South Africa, namely fruit boxes. I wish to emphasise this, because this is also happening in my constituency. There is a factory there which is to-day paying exactly the same price for the product of the forests, its tender price has not gone up, nor have the wages gone up, and it is paying exactly the same wages as it paid before the outbreak of war. Yet the price of these fruit boxes has been increased by more than 100 per cent. How can the Minister justify that sort of thing? My main objection in regard to this matter is that this profit is being made at the expense of that section of the population which is suffering most hardships in consequence of war conditions, namely the fruit farmers. They have been deprived of their markets and they are the greatest sufferers as a result of the war. In spite of everything the Minister is allowing exorbitant profits to be made at the expense of that section of the population which is suffering most. Let the Minister tell us how he can justify this with his conscience. If there has to be a stabilisation of prices, let there be such a stabilisation for everyone, for the gold mining industry and for people running factories, because if it is not beneficial to stabilise prices so far as they are concerned, then similarly it cannot be beneficial to the farmers. The hon. member for Fauresmith, when speaking here the other day, drew attention to the cause of the great difficulties in which the farmers find themselves. That cause lies in the fact that the products of the farmer are still on the same depression level, and he told the House that he had been waiting for the day when the prices of farmers’ products would rise normally. Now that the time has come for the prices of farming products to go up, the Minister is making use of the control boards against the farmers themselves. I feel that the Minister of Finance can do only one of two things in South Africa in order to achieve a happy and satisfied population here: he has either to allow the farmers’ products to rise until they reach an economic level, otherwise he will have to bring down the level of the mortgage burdens resting on the farmers. The Minister will have to do one of these two things, and the question to-day is what is he going to do? The Minister has to make his choice, but one of these two things he has to do, because if he does not take some action the farming population of South Africa must go under. There is one other financial matter which I wish to discuss with the Minister. I have in my hand here the speech made by the Minister in the course of the Budget debate last year when he spoke in a way which really pleased me. He then criticised the Minister of Finance for having failed to do enough for the poor man. I shall quote his own words—

And as though that were not strong enough he went on and he repeated—

When the Minister spoke like that he raised great hopes in our minds and among the public. In those remarks he pleaded with the Minister as a man with a feeling of sympathy, for the people who were suffering great hardships. We had expected the Minister in his Budget to do something with a view to improving the lot of those people. And now I put the question to the Minister —what is he doing in his Budget? The Minister came along and said that the globular amount which he had made available for four votes had been slightly raised. We admit that, but I ask the Minister to mention a single instance where a poor man in the service of the state, or an individual being assisted under any one of our schemes, is one penny better off than he was under the Budget of his predecessor. Let him mention a single instance, and I shall be very pleased. I believe that the Minister realises that the lot of the poor man to-day is much worse than it was twelve months ago when he made that speech in this House, to which I have referred. Since the Minister spoke on that occasion the cost of living has gone up, in spite of anything the Minister might have told us. Every housewife in South Africa knows that the cost of living has gone up. I feel we are entitled to say that the cost of living in the past six months has gone up by at least 15 per cent. to 20 per cent. The lot of those people has been rendered even more difficult in South Africa, and I feel that we are entitled to ask the Minister to help those people who are suffering greater hardships to-day, seeing that he has held out certain prospects for the future. I think the least the Government can do is to do what I am going to ask for now. I have on previous occasions in this House advocated the establishment of a minimum wage for unskilled labourers in the service of the state, and I have pleaded for a wage of 8s. per day. If ever there was a time for such a minimum to be laid down, that time is to-day. At the moment the minimum wage is 5s. 6d. per day, which I regard as an unworthy wage, and if that was an unworthy wage a year ago, it must be a starvation wage to-day. I consider that one of the first steps to be taken by this Government should be to increase the wages of the most lowly paid labourers in the service of the state. Secondly, this Government should compensate the officials in its service for the increase which is taking place, and has taken place, and will continue to take place in the course of this year, in the cost of living. What I am advocating now is that a war allowance should be granted, as was granted in the previous war. It is the Government’s moral duty to pay such a war allowance, and not only to the officials; I wish to refer to two large groups of people who are suffering great hardships, namely the people in receipt of small pensions, or the people in receipt of mothers’ pensions, and those people in receipt of an invalidity allowance. Those people cannot come out on the small amounts they are getting to-day, and I feel that they, too, should be assisted by an additional allowance being granted to them under present-day conditions. If the Minister asks where the money is to come from, my reply must be: “Take a little of the money which you are spending on the war.” If the Minister can afford to spend £14,000,000 for war purposes—to be fired through the big guns, then he should make something more available in order to provide that the poorest people amongst our population can be kept alive, and in order to maintain the health of our population. This is what we ask: An increase in wages for all the low-paid labourers in the service of the state—a wage of 5s. 6d. a day is a wage on which the people Cannot manage to-day, it is a starvation wage. We have found that in normal times malnutrition has come about in consequence of those wages. Then there is all the more reason to-day for the wages being increased. In the second place, there should be an increase in the pay of officials and people who get small pensions or invalidity allowances. If the Minister asks us where the money is to come from, then I say he should spend a little less on the war. I want to put a question to the Minister in that connection. The Minister said that he was now opening a special account, and was going to put that £14,000,000 into it. Is that all? I notice that the Minister, in his Budget speech, said that in the past £6.000,000 bad been provided for the Minister of Defence for a big defence scheme, but here I notice, at the same time, in the Minister’s Budget speech that £500,000 of that amount has been spent. What becomes of the £5,500,000, has that been put to a special account, or has it been spent?

There never was a vote of £6,000,000; that was the programme.

Then what was on the estimates last year?

It was £3,000,000.

The Minister said that £500,000 had been spent. Was that on a special account, was that spent or was it available for the following year?

No, there is none of that amount available. It was spent.

So then we know that there is an amount of £14,000,000 available for the current year. The hon. member for Kensington belittled that amount. He said: “What is £14,000,000?” But we know this, if the Government goes on spending £14,000,000 every year for the war, then all the good work done in the past fourteen years towards building up a sound financial policy will be destroyed. This we do know, that the impression which we get from the Minister’s Budget is that the Government has lost all financial conscience in regard to war expenditure. It would appear that the Government starts off on the assumption that any expense in respect of defence is justified, and that it is impossible for money to be wasted on war expenditure. That is the assumption from which the Government starts. I say that that attitude is not only unfair towards those people who are in favour of the war, because they expect the money to be spent wisely, but it is even more unfair to those people on whom the war is forced, and who regard the war as senseless and inequitable. And what is even worse, the money which is being spent against the will of the latter section of the population, is being wasted from day to day. I want to remind the Minister of 1914 and subsequent years. In those days, too, the money was wasted, and when I came to Parliament a few years later we heard about the scandals in which members of Parliament were concerned — the purchases of horses and things of that kind. I want to warn the House that rumours of similar scandals are again current in the country. There is a beginning of that sort of thing, and what most of all sticks in people’s gullets is the creation of unnecessary administrative posts to which very old men, who are already on pension, are appointed. I wonder; the way in which defence expenditure is going up gives one the impression that Treasury control over war expenditure has disappeared to all intents and purposes — I wonder whether that is the reason why the Prime Minister himself has taken over the Portfolio of Defence. If the Prime Minister says anything, nobody is allowed to contradict it. If he wants money for defence, nobody is allowed to refuse it. The Minister of Finance and the Cabinet are not allowed to deny what he wants; there is no arbiter on defence expenditure, and that is an unsound state of affairs. It means that so far as defence expenditure is concerned the Minister of Finance has no say and the Minister of Defence has complete say. Before I sit down I just wish to say these few words. It is the duty of the Minister of Finance in this time of war to see to it that the burdens of the war shall not rest more heavily on one section of the population than on another section. That is the first and main duty of the Government. The burden of war must as far as possible be divided equally among the different sections of the population, and if one section suffers hardships, similar hardships should be suffered by other sections. If the one section benefits, the other sections should benefit. That is not the position in this country to-day. There are some people who are feeling the effects of the war in their homes and in their children, while others again are filling their pockets as a result of the war. That is what the people who, are in favour of the war do not want, nor do the people who are against the war want that. We are all in the same boat, and it is the Government’s duty to see to it that the burden of war shall be divided justly and equally among all the sections of the community.

How are you going to do that?

By seeing to it that no usurious profits shall be made. The industrial magnates are making usurious profits, for instance, at the expense of the fruit farmers who are suffering most of all from the war. The one is suffering, while the other is having a good time, and that surely is not right. We feel that what is going on in Europe will also have its effects on South Africa. There are some people who expect the one nation to be exterminated by the other. There is another possibility, namely that as a result of this war the capitalistic system in Europe will go under; that is to say the millions of people who are suffering harships as a result of the war will rise up against the Government, and we shall get a position of affairs in Europe similar to that which was experienced in Russia in the last war. There is only one way in which we can safeguard South Africa against those consequences, and that is to have in this country a happy and contented population. If the population is satisfied then that is our first line of defence. We should not spend all the money of the state on armaments; we should spend it in making the citizens of this country happy and contented, and that is the best safeguard against the enemy, against revolution and anarchy, which may be the fruits of this war.

I want to say a few words in the time at my disposal on one of the most important matters which is facing the agricultural industry, and perhaps the whole of the public, and that is the rapid rise in the costs of both agricultural and" industrial production. These increases are only just becoming apparent now. So far as the agricultural industry is concerned the crops last year were reaped under the old scale of costs, but from now on agriculture will be faced with a very difficult position. I have noticed in the Press of late leading articles in which they tell us that agriculture is faced with a very prosperous future, and they even go so far as to say that during the next year or two the farmers will be able to make up their losses of the past. Nothing is further from the truth than any suggestion of that kind. The position is sound no doubt in regard to one or two products. It is sound in regard to wool, and in regard to wattle bark perhaps, and in regard to a few other products, but on the whole the position of the farming industry in respect of other farming products is getting from bad to worse.

We know that.

Before I go further I want to substantiate my case, although I think everyone realises the position, from figures which I have obtained from official sources. The price of fertilisers is up by 25 per cent., bags are up by 100 per cent., wire standards and fencing material 40 per cent., paraffin and petrol 20 per cent.; the prices of implements have risen by anything — 30 per cent. and over. I have a long list of articles which I shall not enumerate; almost every article used in production has gone up from 20 per cent. to 30 per cent. Let me just quote a letter which only came to hand on Saturday from a farmer in my district, in which the writer asks whether the Government realises the alarming rate at which prices are going up. Plough discs, which my correspondent purchased in Durban at pre-war prices at 23s., have now gone up to 43s. 6d.; second-hand bags have gone up to, 1s. 1d., superphosphates to £5, and so on. He gives a number of other instances of big increases. And he finishes up by saying: “I think that prices for our products will have to go up and farmers will find themselves in a very serious position next year at this rate.” The position is realised, I think, by everyone connected with agricultural organisations outside this House. From your agricultural unions, from your farmers’ associations, from your control boards, from producers’ organisations of all sorts you are getting the same representations made, made in a temperate tone, but in such terms that one cannot but be impressed with the urgency of the position as it is now, and as it is probably going to be accentuated in the very near future. I believe the Government realises it and is equally perturbed at what they know is bound to become more serious in all costs of production; they know the rise in costs is bound to go on. What makes the position worse is that agriculture is not in a position to stand these rises in costs. It is not wealthy enough to be able to stand the shock of this increased cost of production. Let me quote from a White Paper which was laid on the Table of the House last year on the index of wholesale prices. Here the position is made very clear. They take the index of prices in this country at 100 in 1927 to 1929. In 1938 the index figure of all commodities was 87, but of agricultural commodities it was only 77. Now if you take the index of all commodities and deduct from that agricultural commodities you will probably find that in all commodities other than agricultural products the index figure will be about 95, while the index figure for agricultural prices is only 77. A little footnote at the bottom calls attention to the fact that the general wholesale price index for the year 1938 was again higher than that for the year 1937, while the agricultural index for 1938 was lower than for 1937. The footnote goes on to say this—

I only quote that to stress the fact that agriculture is not in a position to stand the shock. Those increases indicate how far agriculture has lagged behind in the general recovery that has been setting in during the last few years. Now let us just analyse the position with regard to industries outside of agriculture. You have the National Supplies Board set up to control prices of industrial and other products, and to control retail prices. To quote a letter which I have from the Board of Trade it shows that various merchants have advanced prices of many items in terms of the board formula permitting account being taken of average costs and exchange depreciation. Now just one word to the hon. member for George (Mr. Werth) so far as profiteering is concerned. The National Supplies Board and the Board of Trade is controlling the position as far as it is possible to control it, and they are only allowing an increased price over increased costs of production, plus pre-war profits, and to say that there is wholesale profiteering in industry is quite wrong. The retailing of goods in this country and the wholesale prices is being controlled, but that price is receiving the benefit of all increases in costs of production and added to that a fair profit on the sale of goods, but such profit may not exceed pre-war profits. How happy the farmer would be if he was guaranteed a price for his products which included all the additional costs of production, plus a living wage. You would have no happier body in this country than the farmers if they were in a position to receive a living wage for all they produce. But that is the fortunate position which industry and the distributing trade is in to-day under our war policy—if I may put it that way. And I think everyone in this House would agree, if it were possible, for agriculture to be put in the same position. Now let me make just this point, as far as prices are concerned. Where agricultral prices have been controlled by the various control boards, I think everyone will admit, and the consumer will admit, that these boards have played the game up to now. They have not increased prices, although pressure has been brought to bear on them to do so, and they have endeavoured to maintain pre-war prices, but they cannot go on doing that, and some move will have to be made in the direction of increased prices in the near future. But while I stress this point, and I want to emphasise that the position must be met, I must say that we have to look at the other side of the position, we have to realise the necessity of pursuing a policy of alleviating the position of the farmer, of the primary producer; we have to look and see where that policy may lead us. If we raise the prices too high, if we attempt to force the price of primary products too high, we are going to create a position that in view of the fact that we are now an exporting country, we shall make the situation even worse. It must not be forgotten that in the last few years South Africa agriculturally has developed very largely into an exporting country. A hundred per cent. of our wool probably goes overseas. Forty per cent. of our maize, forty-five to fifty per cent. of our dairy produce and eighty to ninety per cent. of our wattle bark goes overseas. Ninety-five per cent. my friend says. Then there is fruit. What shall I say, 50 per cent., 60 per cent. or 70 per cent.? Almost everything we produce has its price fixed by the oversea price, and if we raise our local prices too high we are going to check consumption in this country, we are going to encourage the use of substitutes, and we are going to increase our export surplus, which is going to lower the average return and create further difficulties. We must not forget that. The more we export the less we consume at home, and the more we export the lower our average prices become. There is only one market practically in the world to-day, and that is Great Britain. With the possible exception of wool, England is the market for almost all we export, and she fixes the price. She is not going to pay exorbitant prices, and the other exporting countries in the world are willing to take her price, so it makes our position all the more difficult. We cannot control the overseas price for the benefit of our producers in this country. As the Minister of Finance emphasised recently, a lot of our troubles in agriculture are due to the last war. At that time we had prices soaring overseas, and local prices followed suit, and what happened? Inflation followed, increased land values, and we had land bonded at those inflated values, with the result that every farmers’ organisation to-day is emphasising that the great burden on agriculture to-day is over-capitalisation of our farms and too much interest to pay. If we are not careful we will have that same evil intensified after this war. I want to be fair, and point out both sides of the question. While I stress the need for something to be done, I also say that it has got to be done very carefully, otherwise we may have disastrous results following. If prices are unduly raised, the person who is going to suffer is the wage earner, and the salary earner, that great middle class which has been discussed in connection with the budget. Then we are immediately faced with this danger of the vicious circle, prices going up, coupled with an insistent demand for an increase of wages and salaries and a general price rise all round. That is the danger, and we farmers have to face it. Whatever is done to raise prices, and I hope that something will be done, this must be done with due regard to the dangers of inflation and an upsetting of the social and economic position of the country. We are not the only pebbles on the beach, and we have to adopt a policy which will be fair and just for every section.

How do you suggest it should be done?

We must have a proper enquiry into the whole matter, to see if we cannot devise some solution. One thing I do suggest out of the various remedies which occur to one. You can fix prices on say local subsidies and export subsidies. I dare say these matters will be considered, but I do not think the true rehabilitation of agriculture lies along those lines at all. It has always been suggested to the farmer through the Press, through consumers’ organisations and others, that agriculture must reduce its production costs, and I ask whether that has ever been taken seriously into consideration. Have we ever done anything in this country, has the Government ever done anything to reduce costs? The farmer himself has no control over what he buys, he has no control over the price at which all his requisites are sold, and he is compelled to buy in a market where possibly profiteering is going on.

[inaudible],

Yes, it is a fact that South Africa is a poor country. The average wheat production in Great Britain, and in other European countries, is round about 30 bushels to the acre, and the average South African production is not six bushels to the acre, and that is due to climatic conditions and worn out soil. This consideration leads me to the question of fertilisers. There is no expenditure which is more necessary for the farmer to undertake than the expenditure on fertilisers, and there is probably no article which is more wastefully applied than fertilisers. How many men take any need of the chemical needs of their soil, and obtain suitable fertiliser for those soils? One man applies nothing but supers, one man buys a complete mixture and so on, and there is generally an uneconomical use of this article and probably the distribution of it is also uneconomical. Let us here, in South Africa, try and make the fullest use of every fertiliser ingredient we have, let us endeavour to rationalise the production and use of fertiliser, and combine with the fertiliser distributors to get them to use, to the best advantage every ingredient we have here, whether nitrogen, phosphate, or whatever else it is. I think if we do that we can cheapen the cost. Possibly in conjunction with the Imperial Government giving us assistance in shipping, we may get phosphates from overseas cheaper than we get them now. The whole business offers ground for a considerable reduction in cost, which might be passed on to the farmer and result in lower production costs. Then take implements. Was there ever a more wasteful system than that employed in this country? Every merchant is importing various types of machinery. You have competitors selling different types of ploughs, harrows etc. Why cannot we standardise two or three or four types of agricultural machinery, and then let Iscor make the spares which are always the most expensive items in one’s agricultural bill? Let us determine what is the most useful type in the country, and produce the shares, the spare parts and other requirements locally. I am perfectly certain it can be done, and it only needs organisation. The whole business needs reorganising, and if that is done we can probably bring costs down considerably. I ask hon. members not to think I am holding this out as a final solution of our troubles, because our troubles go deeper than that. But if we can rationalise the production of the articles which we need, we can do a great deal, in my opinion, to put agriculture on a sounder footing than it is to-day. May I mention one criticism which I want to pass on the hon. minister of Finance. I do think that it is a pity that just at this juncture it has been found necessary to raise the interest on future Land Bank loans from 4½ per cent to 5 per cent. After all, if one looks at the papers this morning one notices that Port Elizabeth had just raised all the money necessary, £1,000,000 I think at 3¾ per cent, and Johannesburg has raised a larger loan than that. If money can be got by municipalities at that price, money can also be got for Land Bank loans at less than 4½ per cent. to the bank, and 5 per cent. to the landowner, who borrows that money. I put that up to the Minister, because I do feel that this is not an opportune time to make that increase, and I hope he will abandon it in the light of the fact that cheap money is to be got. I think the Minister realises that the position in regard to production costs is serious. We don’t want to make a political issue of this matter of production costs. Farmers, wherever they are, realise the position, and are asking for some steps to be taken, and I would suggest that some body be set up, whether a departmental committee or some other body, and I would suggest that whatever body it is, one or two experienced farmers should be put on it in order to bring the practical troubles of the farmer to the notice of whoever is going to adjudicate in the matter. Let us have a thorough investigation as to what steps can be taken to compensate the farmer for increased costs to-day. Let the investigating body go further still and see if we cannot rationalise the production and distribution of some of the most important agricultural requirements such as implements and fertilisers, and so help to put agriculture on a firmer basis in the future.

This Budget will probably be known as the largest Budget of Expenditure in the country’s history. Where is it going to end? I hope it will remain the highest budget, and that we shall from now on reduce our expenditure, because I feel that our country is unable to stand this tremendous expenditure. Even the hon. member for Kensington (Mr. Blackwell) warned us last year against the increase of expenditure, but this year he is not doing so; he justifies the Budget because it is a War Budget, and he makes a comparison between our country which is spending £36.000 per day for war purposes, and Holland which is spending £250,000 for war purposes. I do not think that that comparison is justifiable. Holland, when it wakes up in the morning practically faces the guns which are trained on it. We, however are 6.000 miles away from the theatre of war. We do not even know whom we are at war against, all we know is that many of our innocent people have been put into concentration camps. I imagine that if a larger number of them had only had the influence which some of them have, many of them would not have been kept there, or would have left the camp long ago. What we are worried about is that the world, and our country as well, has not yet returned to a normal condition of affairs since the last Great War. One finds especially that matters in connection with our farming operations are not normal. I cannot put up a better plea on behalf of our farmers than the hon. member for East Griqualand (Mr. Gilson) has done—he also has pointed out that we are by no means in the position in which we were before the Great War. The farmers are in a position to-day in which they have no control over the prices they have to pay for their requirements, and in this connection their expenses are continually mounting up. They have to pay more for everything they need. The hon. member for Fauresmith (Mr. Havenga), made it very clear on Friday that the Government had decided to pay the interest subsidy and so on, and he also pointed out that the products of the farmers had by no means reached the price level which they should reach in order to create a sound economic condition. So long as that continues to be the position the farmers would have to be assisted. As I have said, I can do no better than the hon. member for East Griqualand, who is also a farmer, has done. Now, a few years ago we passed the Marketing Act here, and we, as farmers, entertained the highest expectations from this Marketing Act. Unfortunately, we feel very disappointed at the results of this Act. First of all we are disappointed at the composition of the control boards. For every product coming under the Marketing Act a control board has been appointed, and the constitution of those control boards has caused us the greatest disappointment. If we look at the oldest control board, the Dairy Control Board, I should like to tell the House why the farmers are disappointed. First of all the control board reduced the price of milk for the production of cheese from 6d. to 5½d., on top of which the producer has to pay 1d. per gallon for transport to the factory, so that he only gets 4½d. At Bedford a great agitation has been started by the farmers supplying the cheese factories with milk. This does not affect members of co-operative societies, because the co-operative societies are allowed to pay out any surplus at the end of the year. We have now had a meeting at Bedford and the managers of cheese factories stated there that they could pay 7d. for milk for the production of cheese although the control board has reduced the price from 6d. to 5½d.

That is due to the fact that the export value of cheese is no greater.

The hon. member does not follow me, I am referring to the price of milk for cheese.

Yes, but the price of cheese overseas has been reduced.

That should not be the position.

Yes, under the Government scheme.

But that is in conflict with what the hon. member said just now. Our requirements, anything needed by the farmers, have gone up in price, while the price of milk for cheese has been reduced. The hon. member is not replying to what I said, namely that the managers of private factories in my presence stated that they are able to pay 7d. for milk to produce cheese.

They cannot pay it.

That is what they said at the meeting where I was present, and I take it they know their business, and that they know what they are talking about. I had a wire this morning from the Bedford district, in which a meeting of dairy farmers asked me to make representations to the Government because they were unable to carry ch with the prices they are getting, and they asked me to arrange for the establishment of a co-operative cheese factory. The telegram reads as follows—

The difficulty is that as we are under the control of the Dairy Control Board farmers are not allowed to say that they are going to establish a factory for the production of cheese. If the farmers want to set up a factory to make cheese, the control board has the power to say that they shall not do so, and it has the power to tell them to deliver their milk to a certain factory. Then they lay down the price of milk at 5½d. and the farmer has to pay the costs of transport. I wish to urge very strongly that the Minister should assist the farmers in this respect. The price of milk cans in which the milk has to be carried has gone up by at least 100 per cent. and in spite of that the price of milk for cheese has been reduced. I hope the Minister will give his attention to this matter. Now I come to the wool position. I imagine that the Minister must have had a few sleepless nights over this question, and I feel that he must be very worried when he hears the word wool. I have not spoken on this subject since listening to the Minister’s statement, but I must say that it did not appear to me as if we had anything like an explanation from the Minister, and he certainly has not in any way convinced me. The Minister of Labour, and I believe also the Minister of the Interior, have tried to defend the Government’s actions, but theirs was only a weak defence. Now what was the position? Our societies, although there was talk of such a scheme, took the matter in hand and held auction sales which were most successful. Then the Minister came along with his Imperial scheme, which had the effect of prices dropping immediately, so that there was a state of uncertainty everywhere. If finality had been reached it would possibly have been better, but this uncertainty hindered and handicapped the market throughout the season. The scheme was only announced in December, but even at this stage we do not yet know where we stand. It is stated that we are on the same basis in regard to price as they are in Australia, which is 10¾d., which would mean 30 per cent. above the prices which we obtained last year. But let me assure the Minister that I can show him auction accounts indicating that we sold our wool the year before for 10.5d. Unfortunately the position seems to be that the scheme has not been properly worked out. I am prepared to admit that if the scheme had been worked out we should probably get different prices for the different types of wool, and where we have got 10.5d. we might possibly have got 13d. or even 14d. or 15d. Those farmers who obtained 10.5d. obtained 17d. and 18d. the year before on the open market; but England did not buy that wool. As a result of the uncertainty which prevailed people did not know from day to day where they stood. We have to take it that this scheme had been devised some considerable time ago, and I think I can do no better than quote what Mr. Foster du Plessis, the South African representative on the Wool Secretariat, stated in a broadcast speech. This has been taken from the Eastern Province Herald of the 6th December, 1939, and it reads as follows—

What are you reading from?

The hon. member probably did not listen. This is a speech broadcast by Mr. Foster du Plessis, who is described here as South Africa’s representative on the Wool Secretariat. He goes further and says that England immediately required wool of the gross type and for that reason she bought up the Australian and New Zealand clips. I was not aware of the fact that they only produce gross wool in Australia. And then he went on to say that because they felt sorry for South Africa they also bought our wool, our Minister having asked them to do so.

Hear, hear!

I do not know whether the hon. member for Kimberley (District) (Mr. Steytler) agrees with those “Hear, hears” because he is a wool farmer, and he looks to his wool for his income, and he is concerned over the price he gets for it.

There is no maximum price laid down.

There is a maximum price which England is prepared to pay, but on the open market we get much more.

That is not a maximum price; that is a minimum price.

I have quoted this to show that long before the war it was arranged that England should obtain all the wool from the Dominions, and I am quite sure that the Minister would have tried to sell all our wool to England under that scheme if he had not been obliged to take into account the question of what the farmers and the large farmers’ associations would say. If he had his way he would have sold all our wool to England under this scheme.

Do you want us to give up this scheme?

For all the good it has done us in the past we might just as well not have it. Now I wish to plead with the Minister on behalf of certain producers in connection with the expression which we have heard so much about, “lying and rotting.” I am not saying that products will lie there and rot, but there are producers to-day who are really in difficulties. It has been pointed out that fruit farmers are in trouble, but I want to draw attention to the position of the citrus farmers right throughout the country. They are really in trouble, because when the war broke out their last consignments were on the water on their way to England, and as a result of the outbreak of war the costs in connection with those consignments were increased by certain amounts. The Minister is conversant with all the details. They are now asking primarily for compensation for those increased costs in connection with their products which were already on the sea. I would like to urge, if the Minister can see his way — we do not want to be unfair — that be should give them compensation in respect of those losses. We shall be very pleased if he can do so. But I particularly want to emphasise the fact that the new season’s crop is on the way. Let the Minister now, as he did in connection with wool — where there was no need for him to do so — try and find a market for those products. The House and the country are not aware of the difficulty in which that industry is already finding itself. In part of my constituency, particularly along the Sundays River, there are thousands of people who have to make their living out of citrus growing. There are hundreds of producers, but there are thousands of people who have to make a living out of the industry and who, during certain seasons of the year, earn certain sums of money in regard to packing and so on. Even at the best of times this industry has a difficult course to hoe, and it was difficult for the farmers to make a living because their position was uncertain and they never knew whether in a particular year they were going to come out on the right or the wrong side of the ledger. Their biggest market was the overseas market, and we want to put up a plea with the Minister to help those people as far as he is able to. It is quite impossible for those people to cut down their trees and to take up something else; nor should one allow those people to go under. They, too, are going to cause the Minister a few sleepless nights, and they are not going to give him any peace until he comes to their aid. I am sorry that the Minister of Lands is not in his seat, because we really want to, plead with him in connection with our settlement schemes. I hear that the Minister is considering the question of re-organising our land settlement policy. I want to urge that he should expedite the whole matter and that he should give it his very serious consideration. I know that so far as the Minister and his department are concerned, one of the most unpleasant duties they may be called upon to perform is to drive people off their land, but in our area there are people on our settlements who find it extremely difficult to meet their obligations. They have given the best part of their lives, and they have invested their money in their enterprises. In spite of that there are many of them who have received notification from the department informing them that they will have to go. I think the Minister of Lands will have the assistance of the Minister of Finance in reorganising the whole position, and I hope that this will be done as speedily as possible. There is one final point which I wish to bring to the notice of the Minister and the Government. The Minister of Posts and Telegraphs is not here, but I trust that the Minister of Finance will bring to his notice the fact that there are applications from farmers for telephone lines, and there are even applications from people in the large towns for telephones, but what do we find? The Government’s answer is that there is no money available for that purpose. If I remember that the Department of Posts last year had a profit of about £700,000, then surely that £700,000 should not go into the ordinary revenue of the country. I believe that the time has come for the Post Office, like the Railways, to be administered on its own, and the profits made by the Post Office should be applied for the expansion of that department itself. There are many applications from farmers for telephone lines — from people living far away from the towns or villages, and far away from their places of business. There are hundreds of applications, and the reply always is that there is no money. The same thing applies to applications for telephones in the large towns, and surely that is wrong. We want to, urge very strongly that the Minister of Finance should not take the money belonging to the Minister of Posts, but that he should say to him: “Take that money and go in for further expansion of your telephone system.”

This budget which we are considering in the House this afternoon is one that has been considered by the business community, by the industrial community, and so far as I know, by the financial institutions of this country, and it must be of interest to this House to know that these communities consider the budget a very good budget indeed—and even in some regards it is considered as a brilliant budget, Listening to the debate which we have heard this afternoon, particularly from the opposite benches, one would never for a moment conclude that it was either a good budget or a brilliant budget, and yet we are in the happy position in this country of facing in the coming year an excess of expenditure of something like £15,000,000 over last year, and so far as the ordinary taxpayer is concerned, he is asked to contribute less than £2,000,000. I have been wondering whether we in this Parliament, and in this country, understand and realise for one moment what a very happy position we are in to-day. Where is there any other country in the world that could put up a case like this, and where is there any country in the world, if such a position could be put up, where there would be anything but paeans of praise for the Government, instead of nothing but criticism as we have had from the other side of the House? Everything that is done is forgotten, and everywhere a little more is wanted. I do think sometimes that what we should have in this country instead of political meetings are thanksgiving services. If some of our friends who used to wear the cloth would organise throughout the country thanksgiving services they would do much better than they are doing to-day with their political meetings.

Would you join those meetings?

Yes, I would attend the meetings.

The Chamber of Mines have done that already.

I listened with great interest to the hon. member for Fauresmith and I find it, I must admit, extremely difficult to follow him. First of all he dealt with the Government wool scheme. I am only a plain business man, but I would say that what he asked for was an impossibility. He said this Government should appeal to the British Government to give us a still higher price than the minimum which they have given us. On the other hand, we are complimenting ourselves that we have an open market, and still have buyers for our wool on the open market. We have buyers for our wool because the minimum price fixed by the British Government was not too high, and did not drive the buyers away. The moment you fix your price at such a level as indicated by the hon. member for Fauresmith, you must, of course, drive all your buyers away. Then, of course, the British Government will collar all your wool clip, and the British Government will have a complete monopoly of the wool of the whole world. That is the position. This is a matter of business and not a matter of politics, and it is plain as a pikestaff that if you fix a price which is not too high you will attract competitive buyers, but otherwise you will drive away all competition. In other words, you cannot have a high fixed minimum and an open market. If you want an open market you must have a fairly low minimum. There is another aspect of the case which apparently has never entered the minds of critics of the Government. Hon. members will recollect the motion in favour of neutrality which was proposed in September last. Under that motion the supporters of it were prepared to do their duty by the other members of the Commonwealth of Nations. Every Opposition member voted for that. And under that motion it was implicit that South Africa would carry out its duty to the other members of the Commonwealth of Nations. Now the Commonwealth of Nations is faced at present with a life and death struggle, and it does seem extraordinary that every time you grumble about this low minimum price and say that we want a bigger price—it means that we are asking for a bigger price than our fellow-members in the Commonwealth of Nations are getting. As a matter of fact because of the differentiation between greased and scoured wools, we have an advantage over these people. But is this playing cricket? Are you going to say to the British Government: “You have to give us a higher price than you give to the Australian wool farmers?” If you say that, you are acting contrarily to the motion supported by all hon. members opposite, which lays it down that we would play the game by the Commonwealth of Nations during this period of war. After all, whether we like it or not, we are a company of nations fighting for our existence at present, and it should be the last thing in the world that we here in South Africa should appear to try and take one single advantage over any other member of that company of nations; that is how I look upon it. You may call it the sentimental point of view, but both from a sentimental point of view and from a business point of view, I fail to understand the criticism of the hon. member for Fauresmith. And the same applies to his criticism of the gold taxation. The speech he made here this afternoon is similar to the speeches which the hon. member made when the gold standard controversy was on. Every argument he used against the Minister of Finance in his scheme of gold taxation, he used against our going off the gold standard. In 1934-’35 when gold went to 120s. the Government decided that they would not recognise cost of production. They simply said, “Anything over 120s. we shall take half of as gold premium.” By experience it was found that that policy did not help the development of our mining industry, but on the contrary was a hindrance to its development, and in those circumstances a change was made in the incidence of the taxation. I submit, if that change was necessary when gold stood at 120s. or anything over that, I submit that the same arguments can be produced with gold standing at 168s. In other words, if the then Minister of Finance was right, then the present Minister of Finance is also right. Of course this argument is used that the then Minister tried to fix the price at 120s., and that was the length to which he was prepared to depreciate our pound. In the same way he says now we have depreciated it to the extent of the difference between 120s. and 168s. That is the argument he certainly used, but, sir, the whole thing about it is this, the Minister must realise hard facts. This position has not been initiated in this country at all, but abroad, and where we are tied up to sterling there is only one thing for us to do, and that is what the Minister of Finance has done, and I am very pleased that the hon. member for Fauresmith (Mr. Havenga) has no more criticism than that to offer. As a matter of fact, I consider the Minister of Finance is to be congratulated on the plan he has adopted in regard to the gold tax in this country. It is nothing less than what we sometimes in business call a stroke of genius to have formulated this scheme, and I am perfectly certain we are going to see in the near future the wisdom of this scheme in contradistinction to what we would have seen had we simply stuck fast to saying everything over 150s. we are going to take. If we had done that, in a year’s time we would have found a steady dwindling in the gold mining industry at a time when we should have had a great expansion of that industry. One comfort which we on this side take from the speech of the hon. member for Fauresmith, and that is that unlike his colleague, who I am sorry to find is not in his seat, he is still going to hold to conservative methods of finance. It is a rather extraordinary thing, sir, that his fellow bench member, the former Minister of Defence, should go down to Swellendam the other night and there advocate a policy of complete inflation. It seems an extraordinary thing to me that one front-bencher on the Opposition side should get up and criticise us for going in for a policy of inflation, while another member goes out into the platteland, my platteland, and condemns us because we are not going in for a policy of inflation. There we have divided counsel in the Opposition, and I for my part sincerely hope that the hon. member for Fauresmith has with him the vast majority of the Opposition in his contention that we should leave things as they are. Before I leave that I would like to deal further with the hon. member for Fauresmith in regard to this question of rising costs and wages. The hon. member for George (Mr. Werth) this afternoon held forth about the need for increasing wages because costs are increasing. Well, sir, if we go in for increasing wages we are going still further to increase the cost of commodities, that is so obvious that one almost need not speak it. I say that we in this country want to do everything we possibly can, to first of all keep down the cost of living, the cost of necessary commodities, and in that regard, sir, the Government has done well in establishing a control board specially charged with that duty. Profiting by our failures during the last war, we set up immediately, almost at the outbreak of war a board to control prices, and to see that there is no profiteering in the country. In that regard we will be able to do far, far more for the working man than by merely raising his wages, because after all it is the purchasing power of wages that really creates the value of the wage, and if we increase the purchasing power of the working man’s wage, we will not only be helping the working nan, but keeping this country from inflating its currency and otherwise saving it from financial deterioration. The mines, in this regard, have a very important duty to fulfil. One reason given by the late Minister of Finance was that in taking the whole premium he was afraid of speculation, and afraid of rising costs on the mines. He, as Minister of Finance for sixteen years, knows how important it is to see that costs of production do not rise, and in this regard one is pleased to see that the mines are doing what they possibly can to allow the miners to share in the prosperity. They are not doing it in the form of wages, but they are giving their workers holiday benefits and so forth, and they have established a provident fund, and in that regard have given the workers to understand that they are going to have a square deal. I should like to say, as an employer of labour myself, that this call should go out to every employer of labour in this country. He should make his workers understand that if there is any profit to be made out of this war, which I hope there will not be, they may rest assured that they will get a share of that, not necessarily by raising wages, but seeing to it that these people are provided for in the way that the mines have provided for their people. I think that that is a rather important thing, and I want to say that far from doing a public service, any man who gets up in this House and advocates higher wages, is doing a distinct disservice to the country. On the other hand, let us do all we can to keep down the cost of living, and see to it that the pound has a spendingvalue not much different from what it had before the war. If we can accomplish that, sir, and I think to a large degree we can, then we will be doing something for the working man and at the same time making a contribution to the financial stability of this country. I have a few words to say to the Minister of Finance in his spending departments. In his Budget he has tried to bring home to the public of South Africa that this is a time when we should not indulge in luxuries, but should save every penny we can. He is giving some kind of benefit to the small saver who will put his money in the post office. That kind of thing is what this country wants at the present moment. I want him to go further. I want him to institute in his spending departments a rigorous regime that will see to it that waste is cut out everywhere. You remember during the last war how we saved on our paper bill, we saved on our printing bill, we saved in a hundred and one ways. We did that towards the end of the war. We are doing it in other directions at the beginning of this war, and I would suggest that the Minister starts now in his various departments to see that waste is cut out in every possible way. Reading the Auditor-General’s report the other day, it struck me as something extraordinary how transportation and subsistence allowances have been growing. While in 1933—34 when our Budget requirements were £34,000,000 we are to-day budgeting for just over £42,000,000, an advance of 23 per cent. Now, if you examine the cost of these subsistence and transportation allowances, you find they have gone up by no less than 62 per cent. In other words, when we budgeted for £34,000,000 our transportation and subsistence allowances for public servants amounted to £440.000. to-day they have gone up to £716,000, an advance of 62 per cent. on a Budget that represents an advance of only 23 per cent. I emphasise the point that very much can be done by eliminating waste in all the spending departments. I also realise that the big problem we have at the beginning of this war, I don’t know about the end, is the position of our agricultural industry. The other day we had a debate initiated in this House which was closed at 6 o’clock, to the regret of some of our friends. One realises that this is a problem of the first magnitude, even in peace time. In war time it becomes more accentuated. In this regard various suggestions have been thrown out, but I personally am very interested in this industrial and agricultural commission that has been set up. I think the personnel of that commission has the confidence of the whole country, and I want to make a special appeal to the Government that when this commission is investigating the problems of industries, particularly during this war period, they should examine the agricultural position. For a long time I have advocated something of the kind, and last year in a few words on the Budget I suggested the setting up of a permanent advisory council. In this new body we have got the sort of thing that I want, because they are the people who will look at this thing from a business point of view. It is all very well for the farmers to say that they want it looked upon from a farming point of view, but any solution of our farming problems must be along business lines, otherwise it can be no permanent solution. I call upon the Minister to get this commission to set to work on the agricultural side. One thing I want to say also in this connection is how pleased I am to think that this fund is to be set up for helping secondary industries. This fund of £5,000,000 is going to give a tremendous impetus to industrial development in our land, and that of course, will help our farming community. I hope the industries we are going to set up in this country are going also to help consume the products of the farmer, and we are going to specialise in those industries that will consume those products. Generally speaking. Mr. Speaker, I should like to say before I sit down that I cannot take a gloomy view, as some of my hon. friends opposite do. It is quite true that we are spending a tremendous lot of money on the war, but they must admit that a great deal of this expenditure is because of our past neglect. A year ago the hon. member for Humansdorp (Mr. Sauer)—I do not know if he has” gone home to dinner yet — described our Defence Department as a whited sepulchre. He said that outside there were a lot of appearances, but inside it was rotten and putrid and everything it should not be. The extraordinary thing about that was that the then Minister of Defence got un in this House and agreed with the speech of the hon. member for Humansdorp. He said—

If hon. members are curious about the matter, I would ask them to read the speech made by the hon. member for Humansdorp, because no speech either before or since has given such a graphic description of the unpreparedness of our Defence Department, yet the late Minister of Defence says that he welcomed that speech. He went on to say—

I think we can make that appeal to hon. members opposite to-day, reminding them of our omissions in the sense that we have neglected our Defence Department. We have to spend millions of money to-day which should have been spent over the last ten years. This is not war expenditure, but Defence Force expenditure which we should have made years ago, and the bill to-day is high and heavy because in the past we have neglected doing our duty.

A few years ago a Bill was passed in this House which was in no way concerned with party politics. That Bill had only one object — namely to do the best thing possible for the people of the country; I am referring to the Marketing Act. I am convinced that if the Marketing Act had only been kept out of politics, and if an honest attempt had been made to give effect to the objects of that Act, and if the right class of persons had been appointed to the control boards, and those boards had been given the chance which they require, in the course of a few years the people as a whole would pick the fruits of this Act and they would realise the honest intentions of the Act. The consumer in particular is already able to realise, since certain sections of industry have been reorganised, what benefits there are to be obtained by him from this Act. Those benefits are already noticeable, and in this connection I particularly wish to mention cheese and butter. If we remember the variations in prices which we used to have in the past in regard to butter, which is an important foodstuff, we must appreciate what the position is; butter has gone up as high as 4s. and 5s. and every year it certainly has gone up to 2s. 6d. We find that last year, in spite of a scarcity of milk and cream, the price never went beyond 1s. 8d. and 1s. 6d. The producer has not yet had any benefit from the Marketing Act — he has not yet had the benefit which he expected and which was the object of the Act, and to which he was entitled. But I am convinced that if the people whose intentions in connection with the industry for which they are appointed, are honest, and if they are given a chance to carry on, the object of the Act will be achieved. I stated that this Act was intended as a nonpolitical Act; it was hoped that politics would be kept out. Yet what did we hear in this House a few days ago? When the War Measures were under discussion the hon. member for Durban (Umbilo) (Mr. Burnside) got up and declared that if ever the freedom of the people had been interfered with in a scandalous manner, it had been done by this Act, the Marketing Act, and he went on to show how the liberty and the rights of the consumer were being taken away by the Act, and in order to prove his contentions the hon. member for Rosettenville (Mr. Howarth) also got up and….

The hon. member must not reply to a debate which took place here on a previous occasion. I have allowed the hon. member to go so far but I cannot allow him to reply to a previous debate.

I am surely entitled to point out how prices went up during the 1914 war.

The hon. member is allowed to discuss that point, but he is doing so in the form of a reply to something that was said in another debate. He must not do so.

No. In that, case, I shall only mention the figures in order to show the way in which prices went up in those days. Take the question of our mealies. It has been pointed out that in 1914 the price of mealies was 12s. 3d. at a time which has been regarded as the only normal time so far as farming was concerned. Since that time farming has never been normal. In those days the price of mealies was 12s. 3d. The production costs which in those days were regarded as normal were 5s. 3d. per bag. Mealies, as hon. members have shewn here, went up to 18s. per bag in 1919, an increase of 33 per cent. I am pointing this out in order to show that the public outside are being brought under a wrong impression, that a further increase in the cost of living for the consumer may be expected. It has been pointed out that the increase in the price of mealies between 1914 and 1919 was 33 per cent., but this argument is lobsided because the hon. member who has referred to this failed to point out that production costs in that time also went up. Now I wish to mention six of the principal things required for the production of mealies, and I want to show the increase in respect of those requirements. In the first place I want to mention bags. Bags were 6d. in 1914, and in 1918 the price was 2s. 6d., an increase of 500 per cent. Ploughs, the double-furrow ploughs usually employed by mealie farmers, cost £10 in 1914, and in 1919 they cost £36, an increase of 360 per cent. Planters which in 1914 cost £10, went up to £45 in 1919. Good trek oxen used to cost on an average £7 in 1914, but in 1919 they cost £17 10s. 0d., an increase of 250 per cent. Threshing machines in 1914 used to be charged for at the rate of £1 for the threshing of 100 bags — that price in 1919 had gone up by 150 per cent. If one takes a general average, one will find an average increase of production costs to the mealie farmer of 296.4 per cent. The increase in the price of mealies amounted to 33 per cent., as against which the increase in production costs to the mealie farmer was 296.4 per cent. Now, if we take it that the price of 12s. 3d. per bag was the normal price, and the production costs were 5s. 3d., this meant a profit to the farmer of 7s. per bag, which the hon. member who has discussed this matter, regards as normal. At the end of the war we got 19s. per bag, and that being so, the hon. member wants the House to believe that the farmers were profiteering. If one studies the position it will be found that the farmer, as a result of the higher production costs in 1919, made a profit of only 3s. 4d. per bag. I would not have touched on this subject had it not been for the fact that those distorted representations have the effect of putting the consumer up against the producer, which makes it all the more difficult to get this matter solved. If hon. members had any conception of the position at all they would not have put such a distorted representation before the House as the hon. member has done who knows nothing whatever of mealies and the production of mealies. He gets up here and gives a totally distorted representation, with no object except to put up the consumer against the producer. Now I want to come to the position as it prevails to-day. I am sorry the Minister of Agriculture is not here, but the position of the mealie farmer to-day is such, as an hon. member stated here the other day, that we shall never be able to get back to normal. It is quite clear that the price of farmers’ requirements is still 100 per cent. higher than what it used to be, but the price which the farmer gets for his product is 100 per cent. lower than it was when it was considered to be normal. We have found in this House that the Government every year has to give some kind of assistance, and we know that millions have been spent in order to assist the farmers and, to save them from their precarious position — although they have not yet been saved. We know what has been done in latter years, and we know that the Government has to make a contribution in respect of last year’s crop, because the farmers are unable to come out on last year’s prices, but the position this year is much more precarious, and I want to know what the Minister is going to do to help us over this precarious position.

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

When business was suspended at 6 o’clock I had just said that the mealie position was even more parlous to-day than it was between the years 1914 and 1918. It is also worse than it was last year. The costs of production have gone up considerably, and with the assistance of the mealie board, the price of mealies is now only 7s. a bag. I say that if the mealie farmers are not assisted this year, and are not assisted considerably, then they will get into a very dangerous position. If we assume that last year’s harvest amounted to about 29,000,000 bags, then out of that the farmers themselves used approximately 10,000,000 bags, so that 19,000,000 bags became available for the trade. The position this year is quite different. The estimate certainly is not higher than 19,000,000 bags, and if 10,000,000 once more are used by the producers themselves, then it means that about 9,000,000 bags will come into the trade. That means that the quantity coming into the trade is 50 per cent. less than last year, and that will have to cover the increased costs of production. We know, in addition, that the large majority of the mealie producers are small farmers who only reap a little, and during a year like this when they have a bad harvest, they will have a very hard time. If indeed with last year’s harvest and with the prices of last year they were able to come out without the assistance of the Government, I say that there is little hope that they will manage this year with a 50 per cent. harvest. I want to give the Minister the assurance that if he does not try to stabilise the price of mealies at a minimum of 10s. a bag with the complementary assistance which is provided for the small farmers, then I assure him that thousands of people will go into the towns again this year, and will suffer from hunger, and if the Government does not want to assist those farmers on their farms, then it will be obliged to give them food and clothing in the villages. I therefore want to express the hope that the Minister will take this matter into serious consideration, and that he will see that the price of mealies is stabilised at at least 10s. a bag. I now want to come to the Minister of Labour. He said the other day in this House, when it was urged that higher wages and salaries ought to be paid, that the cost of living had not gone up so much, and that the price of the necessities of life had only risen by 0.8 per cent. I wonder how the Minister can reconcile that with what the Minister of Commerce and Industries said here a few days ago, to wit, that the price of certain articles which were a vital necessity, and especially those used in the homes every day by the wives, had risen by more than 120 per cent. In addition, he said that it was useless to run to the shops, because there were enough of those articles, and enough of them could still be obtained if we were only prepared to pay 100 per cent. more. They were linen goods, and that is the case with many other articles that are required in life. I assume that all the articles have not gone up so much, but there is not a single article, except mealies, which has not risen. The Minister of Labour had to make that statement, either because he was not well acquainted with things, and had not consuited the Minister of Commerce and Industries, in an attempt to get out of the corner he had been put into. That was the opportunity for the hon. member for Umbilo (Mr. Burnside) to justify the policy which he always preached here, and to try to provide for the people whom he makes out he has always wanted to defend, the under-dog. But since he has received promotion, and sits over there amongst the capitalists, he has forgotten the people whom he represents, and he has come to the conclusion that he had better attack the farmers and agriculturists to detract attention from this change that he has undergone. I want to ask a question of the Minister of the Interior. When a question was put to him about white girls who were working for Asiatics in shops, he said that there were no such girls working for Asiatics, except where they stood directly and exclusively under European direction. Now I would like to know from him whether he is certain that that is so, and then I want to refer him to a shop belonging to Dadabay in Vereeniging, where about 20 girls are working under the control of an Asiatic, and are every day working with Asiatic men behind the counter. They drink tea in company with those Asiatics, and behind that narrow counter they have to brush past the Asiatics. That also applies to Dadabay’s shop at Krugersdorp. I am surprised that the hon. member for Vereeniging (Lt.-Col. Rood) did not tell the Minister about it. If the Minister cannot go there himself, then I hope he will send someone whom he can trust, who can report to him what is going on in the shops of Asiatics. I hope that the Minister will take steps immediately, and that the next time he makes a statement he will make sure that the position of things is what he states them to be here.

The Minister when he introduced the Budget very rightly, and very courteously started by congratulating the hon. member for Fauresmith (Mr. Havenga) in respect of his past financial) policy, and the hon. member for Fauresmith reciprocated, not by congratulating the Minister on a very difficult task, very ably performed, but he reciprocated by congratulating him on the fact that South Africa was in a sound financial position. Even assuming that the soundness of our financial position was entirely or partly due to the hon. member for Fauresmith, I think, in that regard, I should remind the House and the country that but for the fortuitous circumstances into which he was forced by going off the gold standard, our financial position would not have been as sound as it is at present, and he himself would have been responsible for a very bad financial position so far as South Africa is concerned, especially if we remember what the position was in 1932. The Minister of Finance was faced with a difficult position, inasmuch as he had to deal with the war situation, as well as with the ordinary expenditure of the country. In regard to the defence of the hon. member for Gezina (Mr. Pirow) put up by the hon. member for Fauresmith (Mr. Havenga), to excuse his failing to spend the money for defence which had been voted, the hon. member for Fauresmith suggested that because’ over a period of nearly two years the member for Gezina spent £280,000, and the present Minister, over a period of six months, had only spent £500,000, that therefore there was nothing much to be said against the member for Gezina. But one has to remember two things in connection with that matter. In the first place we must remember that the member for Gezina when he was Minister of Defence, and when he budgeted for £6,000,000, based his figures on a peace situation. He made it perfectly clear to this House and the country that that £6,000,000 was the minimum amount that had to be spent in time of peace, in order to make this country safe. Then, having budgeted for £6,000,000, which was the minimum necessary, he promptly sabotaged his own policy by failing to spend the money. It is futile to compare his expenditure with the £500,000 spent by the present Minister of Defence when you remember that when the hon. member for Gezina was Minister he had every opportunity for placing his orders, and getting his orders executed, whereas the present Minister was faced with a special situation and difficult circumstances, difficulties in placing and getting orders executed, and difficulties as far as transport is concerned. Another point upon which I think the Budget deserves commendation is the fact that whilst we are spending £14,000,000 on war services the Government is not neglecting other aspects of our economic life. The Minister of Finance has shown that although we want this large sum, of money for defence, that in no way interferes with the policy of the Government in regard to the development of the country itself, and the necessary social services. In so far as the expenditure on social services is concerned, I would compare the policy of the present Minister of Finance with that of the hon. member for Fauresmith. The member for Fauresmith last year, when he had a big surplus, when the country was at peace, actually cut down the expenditure on social services by £47,000. The present Minister of Finance, in spite of this extraordinary expenditure with which he is faced, has shown his lively interest in social services —and after all the provision of social services is among the best methods by which you can help the poorer sections of the population—he has shown his lively interest in our social services by not only maintaining the position as it was before the war broke out, but actually expending £250,000, or rather providing £250,000 more for these services. That, I think, is evidence that the Minister is interested in the well-being of the poorer section of the population, and I want to express the hope that he will go further and at the earliest opportunity, consider the question raised in this House on previous occasions, of making provision through the provincial authorities for the giving of free meals to all school-children not only during school days, but also during the recess. In view of repeated reports by Dr. Cluver and the report of the nutritional survey, I feel that that is an expenditure which is not only necessary, but which will have the effect of giving these children greater opportunities of availing themselves of the advantages of free education than they have at present. Moreover, under such a policy some arrangements would be made to purchase the necessary foodstuffs in bulk through a central authority and this would prove a source of additional revenue for our farming population. I hope the Minister will take an early opportunity of calling together the Provincial, Educational and Social Service authorities, in order to see to what extent they can make the provisions I have indicated. As a further indication that the Government does not intend to allow its attention to be diverted from these matters by activities occasioned by the war, we have had the statement from the Minister of the Interior as to the additional sums to be provided for sub-economic and economic housing. I am sure that with the sympathetic Minister of Finance that we have at the present moment, there will be no question of curtailing expenditure which is necessary either for social services or national development. Then with regard to the Minister’s method of raising this additional taxation from the mining industry, I should like to point out that we depend very largely for our national development on the mining industry, which is not only contributing £17,000,000 in dividends to shareholders, but also according to the figures given by the Minister, some £21,000,000 in taxation. In addition, it is spending something like £17,000,000 in wages to Europeans, and £11,500,000 for its native labourers’ wage bill. Again, more than £30,000,000 was spent last year on the stores which the mines require, and I would remind the House that the bulk of that is spent in South Africa. When you take these figures into consideration, you can see that but for this mining industry about which our friends opposite very often speak disparagingly, South Africa would be in a very different position. In dealing with this taxation, it is very desirable that we should keep that fact in mind. I should say also that when our friends opposite mention the mine workers, I would remind them that the mine workers have secured advantages and benefits to the tune of £53 each per annum, in addition to the wages that they get. All these things count in the development of the country, and therefore when the Minister came to the conclusion which he did, a conclusion which I think he and I and others regretted, that it was necessary for him to change the method of raising that money by burying the policy adumbrated by the hon. member for Fauresmith, we must not assume, as some are inclined to assume, that that change was brought about under constant pressure from the mining industry, but rather assume, and I think that is the right assumption, that the Minister had regard to two essentials, first that he required this revenue, and secondly that nothing must be done to disturb the present economic position in this country. So far as revenue is concerned, the Minister can get a little more by the new method that he has adopted than he would have got by taking all above the 150s. Secondly, he has definitely obviated not only a general dislocation in the industry, but also a considerable amount of unemployment. We know that four mines which employ 2,500 Europeans and 20,000 natives would definitely have had to close down within the next 15 months but for the change in that policy. In addition to that he has not only satisfied the public, but the miners themselves who take a lively interest in the position, put forward the view to the Minister that he should pursue a policy of getting the money required by a taxation formula rather than by the method adumbrated by the hon. member for Fauresmith. I think, in the light of these facts, the Minister did a courageous thing in making the change and also did something which, for the time being, will provide the necessary funds. Probably this may be a short-range policy. I have felt that from the point of view of a long-range policy, the time must come when it will be necessary to consider whether it is desirable to go on lowering the grade of ore to a greater extent. This question should be considered not for the reasons given by the hon. member for Fauresmith, not because he wants to know how long we are going to depreciate our currency by having it linked with sterling, which is going down. On the contrary, as long as Great Britain is our best customer, and as long as we develop our country in the way we are doing, I think it would be suicidal on our part not to continue to have our currency associated with sterling. Nor would I consider the advisability of not further lowering the grade of ore to be worked for the reason given by the member for George (Mr. Werth), who spoke of the difference between 85s. per ounce and 168s. per ounce as a subsidy to the mining industry and criticised the so called subsidy, forgetting that but for that, the mining industry would have been back to the position when the price of gold was 85s. per annum, and would certainly not have been in a position to provide the employment and revenue which it has done since the price of gold rose. It may be that the time will come, and I am afraid that it is bound to come sooner or later, when the price of gold over which we have no control may come down. It will then be a very bad thing for us to be working a large quantity of ore of an unpayable grade, for the stoppage of this suddenly would cause a great deal of unemployment. Therefore I hope the Minister, in reviewing the position, will take into consideration whether from a national point of view it may not become desirable to divert the labour employed on such low grade ore to the agricultural and secondary industries, and it may be found that such diversion may prove more profitable. In the meantime, under the conditions as they exist to-day, I do feel that the Minister should not be bound to the policy laid down by his predecessor. Then, sir, if I may, I should like to refer to the other taxation that the Minister has imposed. The withdrawal of the income tax rebate is in my view reasonable. Although the amount which we are getting from income tax is a very substantial amount in relation to our national income it must be remembered that as far as income tax is concerned actually there are only 67,000 taxpayers in the country and they are in receipt of an income of £61,000,000. There are also some 1,600 companies in receipt of an income of another £60,000,000. Between them this handful of people have an income of £121,000,000, whilst in 1934-’35 the total national income was only £327.000,000. In the light of that, if you take 67,000 people out of 2.000 000 white people, or 9.000,000 people altogether, and find that the 67,000 are in receipt of £121,000.000 of the total national income of £327.000,000 it must be admitted that the additional burden on the income taxpayers is very moderate. I think the Minister will agree with me that he will soon have to consider other sources of revenues. I think he will have to consider the question, at any rate, of making the super-tax very much steeper than it is at the present moment, and he will also have to consider the possibility of differentiating between earned income and unearned income. There is another point in connection with taxation. I refer to excess profits. The excess profits tax is calculated to bring in about £800,000 per annum. That in itself implies that there will be a substantial amount of excess profits earned. As I have already indicated in this House some days ago, I feel that greater efforts should be made to prevent excess profits being made by people as the result of this war. The excess profits are passed on to the consumer and the consumer, naturally, to that extent, is placed in a worse position than he is at the present moment. In those circumstances, I hope the Minister will consider, in conjunction with the Minister of Commere and Industries, a suggestion I made the other day to make bulk purchases of certain commodities and distribute them through some Government authority. In addition to that he should consider that, as the profits become higher, there should be a graduated excess profit tax rather than a flat rate of 50 per cent. as provided for in the Budget. I suggest that because it will be a more effective method of keeping down excess profits and therefore of keeping down the cost of commodities. I feel that, before very long, the Minister will have to look for other avenues of raising revenue, and the method suggested by me will be more advantageous to the public as a whole than by taxing the poorer section of the people.

The hon. member for Kensington (Mr. Blackwell) said, in his argument, that public money was being used to maintain our neutrality. If that is so, then we have nothing against it. Bill instead of our neutrality being maintained, it is being used by the state for a direct attack against the neutrality of South Africa. The hon. member for Maitland (Mr. Mushet) made his contribution and expressed his view that we should make public money available as a sacrifice to seeing the war through as a member of the Commonwealth of Nations. I, for my part, say that I am only concerned with South Africa, and South Africa alone. I say that I know no British Commonwealth of Nations. South Africa is my nation and my country, and only South Africa’s interests prevail with me. I am prepared readily to admit the greatness of Great Britain. No one would deny it. She is a powerful country and possesses two-thirds of the world, and the sun never sets in the British Empire, and in very respect she is great and powerful. But at the same time I think that in her greatness she is great enough to see the war through without South Africa, and without the little money coming from South Africa. We may compare Great Britain with a big tree which sends its powerful roots out and causes the small trees in the neighbourhood to nine and be stunted. It is our experience that Great Britain sends its roots throughout the world to exploit the smaller nations, and when she gets into difficulties then the small nations have to pull the chestnuts out of the fire for her. That has to be done at the expense of South Africa, at the expense of our country’s interests, our country’s necessities and our country’s needs. If hon. members opposite are so anxious to give their share of the public Treasury to Great Britain then they can do so, but give our share to the public who are poor, to the sinking section of our people who are in need. I do not know whether I should congratulate the Minister of Finance on his appointment. I think that I should congratulate the Prime Minister in finding someone who was willing to confirm the policy, every jot and tittle, of the suggestions of the Prime Minister for the purpose of carrying out his bellicose desires. I can assure you that I listened with the greatest attention to his Budget, and understood it and followed it well. The whole tendency of his Budget speech was to see the war through, neither more nor less. The interests of the country were totally ignored. With him the war was the only thing and amounted to everything. We cannot associate ourselves with that policy. We will never do so. We definitely refuse to make our hard-earned public money, the public Treasury, the prey of another country overseas. We are standing here in our state of emergency and death, but I am not going to criticise or make any criticism because the experience in the past has been such that as soon as this side makes any sound, strong criticism then it is unwelcome. Then you always have that favourite topic of party politics, that old bogey which has already been ridden to death, because as soon as this side brings forward any sound criticism it is called party politics. That is nothing more than an exhibition of weakness on that side. We never make use of an argument like that when that side points to places causing friction on our side, by calling it party politics. We are always prepared to receive sound criticism if it is honestly intended. Therefore I do not feel inclined to criticise, but I only want to draw attention to the old proverb which says that love is blind. If you fall head over ears in love then you are nonplussed, stupid, in love with what has fascinated you — the fascinating power of the Empire. Then concrete facts amount to nothing. Your country and your people are nothing. Then you are so engrossed, so obsessed by the fascinating power beyond the sea that you see nothing here; you see everything that is on the other side. Your country, your people, amount to nothing, and Great Britain is your inspiration. She is everything. We understand that hon. members opposite look through the red imperialistic spectacles, and some of them have increased the strength of their red spectacles six-fold already, so that it is true that they see nothing else but red. They also regard us as red, but may I assure them that they are deceiving themselves. So far also as this side of the House is concerned, they will never make us red. This side consists of South African patriots, and nothing else. This blind Joyalty has already cost South Africa, dearly in the past. This blind loyalty of the imperialists has been nothing else but a disaster. Think of 1914, all the money that was wasted, all the valuable lives; think of what is going on now, of the increasing expenditure of the state. Is that not a disaster, and will it not be an irreparable disaster in the future? That was the very difference at the time between the Prime Minister and the Leader of the Opposition. The Leader of the Opposition a quarter of a century ago, reproached the Prime Minister with looking overseas, and viewing the interests of South Africa as too small, too insignificant. He sees the greatness of the Empire, but his own people and his own country are micioscopically small. He cannot see it, and he is still holding the same view to-day. And then the Leader of the Opposition said: The difference between us is this, you see the Empire and I see South Africa. Will the time never arrive when we in this House and in this country can work together for the best interests of South Africa, and can live together here? Will we not use the money and the finances of South Africa for the upbuilding of South Africa, and not waste it on the building up of the Empire, in which we have not in the past found any salvation, and will never find salvation? We have against our will been plunged into this war. We have broken our justifiable neutrality, and we to-day charge that side of the House with having been contributory to it. The Prime Minister has destroyed the justifiable neutrality of South Africa. We charge him with a breach of faith towards South Africa, and the Afrikaner people will in due course settle accounts with him, it will avenge the wrong being done to-day. I know that when we touch on sore points, then hon. members opposite are oversensitive, but if my hon. friends reproach themselves in that way for acts about which they even now have regrets, then we want to assure them that they will yet regret what they are doing here to-day, and, therefore, they may just as well be hurt. I want to issue a warning that South Africa will have to prepare itself for the future. This world conflagration we are in, is not a struggle of a few months, or even of a few years. I fear it is going to continue with its devastation for eight or ten years. We have not seen anything yet in our country, but it is a fact that the world has never vet experienced such a massacre as it will live to see in this war. Such a conflagration the world will never again see in a war. The very largest amount of human slaughter will take place in this war. It is not a trifle which we have blindly landed ourselves in. We must act carefully, and look facts in the face. We must save our forces and our war equipment for the future. We must not go and paralyse ourselves by expenditure and the wasting of public money. South Africa must defend itself, but not beyond its borders. I feel that the national border is the Zambesi. That is our strategic fort, and we take our borders as Lourenco Marques and the northern boundary of South-West Africa. Let us erect defence works. If that side were to spend public money on establishing defence works, we have no objection. We want to co-operate in the defence of South Africa, but we do not want to see our public money used for the preparation of an attack in Kenya on Abyssinia. That does not suit the strategy of South Africa. A small country like South Africa ought to dig itself in, and erect fortifications . Take our west coast. Here we have a west coast which is open to the enemy, with Hondeklip Bay, Port Nolloth and Alexander Bay as convenient landing places. If the enemy lands there, then we have no road facilities or a tarred road along the coast to transport our war material. We have no railway line to take our troops there. No, we are concerned about Abyssinia, but the coast line at our doors lies open to the enemy. We have no approved flying base along the west coast. Those trifles are lacking. If the west coast is attacked, we have only one railway line, via De Aar, and that is a line which is washed away at every flood. If the enemy attacks South-West, where then is the additional railway from Bitterfontein and Kalkfontein, by which the Cape Province will be brought 400 miles nearer to South-West, in case a possible invasion took place? All those things are neglected. We forget South Africa and the defence of our own country, and we are engaged in attacking and organising on behalf of the Empire; we are in this respect acting like ignorant people, who do not appreciate ourselves and our own country.

Fortunately we have the British fleet to protect that coast.

I now want to refer to another matter. We are doing precious little, as a state, and if we were only to use public money for what I have already mentioned, namely, the fortifying of our coast, on tarred roads and on our own flying bases, and were engaged in purchasing 1,000 bombers, then we would have nothing against it. But his object is to make an attack 3,000 and 4,000 miles away in those unhealthy regions, against Abyssinia, in Kenya, and that is why our money is being used for that purpose. If it were to be used to defend our own country, we would agree. I want to come to another point, namely, the development of our raw materials. What is being done by the state, for instance, to exploit the raw materials in Namapualand? We have mountains of copper ore, iron ore, asbestos and manganese there, and we also have oil and petrol there. If there is any oil in South Africa, then it is in Namaqualand, but public money is required for a drill which can drill to a depth of 2,000 feet. What a pity it is that the Government does not think of developing South Africa’s own possibilities. We and the whole of the world need oil, as well as the other raw materials we possess. If we exploit or mine for them, we will have plenty, so that we can also supply England. Let us use our public money to develop our own possibilities, and not shoot it all away by spending our money on shells for the Empire. That would be justifiable expenditure, the state would have an asset, and we should have value for our money. I think that the time has come when we should look after our own interests a bit and develop our own possibilities. There is a certain prospector in namaqualand. He has been doing prospecting work for the last seven years; he is a Mr. Leipoldt, and if the Government were to take him into their confidence, then they would be astonished at what that apparent desert right at our doors, would be able to yield us. Now in regard to our economic position on the countryside. Our countryside is over-populated, and we must solve that problem of over-population by means of the Treasury. And if the Minister of Finance would direct his thoughts in that direction in order to solve this problem, we will heartily welcome it. We know that there are many people leaving the countryside for the towns. I want to say there is such a steady transmigration taking place from the countryside to the towns because the countryside is over-populated, and because the people cannot make a living, and also because the mining magnates are buying up all the mineral land. In Namaqualand there are more than 400,000 morgen which have been bought up by the mining magnates as mining ground. The rural population is being driven away. It is a great problem, because we would like to keep the farmer on the countryside. The farmers are hardened to the work, and they are willing to work there. At the moment it is slavery to them. No one economises more than the farmer on the countryside. He has no pleasures or recreations. From his youth he has to live a hard life, and he has had to work. He has a passion for the farms, and for the land, and we must make it possible for the farmers to be able to live on their farms. He is at home there; he is very happy there, but as things are at present the farms are impossible, intolerable, and I shall in the future, if no change comes about, definitely go out as an apostle to tell the countryside, “Come to the towns; come and live in the towns: let us drive away and kick out the old Reds.” Give the young Afrikaners land. They have the land hunger. They have not a war hunger. Let the Minister of Finance satisfy that land hunger of the countryside people. How can he do so? By irrigation works. Our irrigation undertakings have, up to the present, been a very great success. Who can argue that away?

The Aspoort scheme.

I will welcome that very heartily if it is built, and I should be glad, but there is another scheme which is much larger and more important, and that is a barrage in the Orange River. The Orange River is the golden stream of South Africa. It is an asset to our country, and the small primary irrigation works on the Orange River cannot be a success if there is no big storage dam built in the Orange River, because in times of drought they contain no water, and when the flood water comes then everything washes away. One big gigantic barrage in the Orange River will control the floods so that no damage can be done to the primary undertakings along the Orange River, and in times of drought there will be plenty of water. But besides that, there will be an area of 100 miles wide, fountains will revive along the banks, and the water level which has dropped, will be raised again, and hundreds of fountains will live again, which the rainfall will improve and make the land inhabitable so that thousands of people could find a living there. If the Government will be magnanimous enough and take half of a year’s war expenses, £7,000,000, and tackle that undertaking and build a canal to Bushmanland, what will not that mean? Bushmanland to-day is uninhabitable. It is a flat country, but it is a desert at our very doors. There is deep and fruitful soil there, where now no one is living, 200 by 300 miles in area, not less than 50,000 square miles in surface area. What will that not mean if half of a year’s war costs were taken, and the great work commenced which will still the land hunger of some thousands? It will be a great asset to our fatherland, but this invaluable undertaking is neglected and left undone because we are blind to our own possibilities and future. We are busy looking across the sea. There are tried schemes, such as Kakamas, Hartebeestpoort, Boegoeberg, Loskop, the Vaal-Hartz scheme, and Olifants River. They were very successful, and paid. It would be a very nice and good investment to build The storage dam, and it would be an asset to the country, and the Government that undertook it would be famous. I heartily wish that the Government would prefer to get the praise of the people than to acquire the fame of Great Britain in the way they are now engaged in doing. But apart from that, we all realise our responsibility, and I, as a representative of that constituency, feel that I am the only one representing that constituency, the interests of the electors who sent me here for the purpose of looking after their interests. My constituency has been neglected and forgotten in a shameful way in the past. There is an emergency cry rising from the countryside, but there are never any funds. The countryside is commencing to sink into undesirable misery, hunger, want and anxiety, doomed to the beggar’s staff, the children underfed. Some hon. members in this House are more concerned about the native children than about our own rural children who are starving. Ever since 1914 we have been engaged in conducting hunger elections. Persons have been sent to this House to look after the interests of the countryside, to provide for the livelihood and the salvation of the people on the countryside. At every election fresh and bigger promises are made, but nothing is done. The countryside is sinking more and more, and the exploiters are engaged every year in doing their pernicious work faster, and nothing is done by the Government to prevent it. Political parties have come and gone, nice promises have been made and splendid programmes have been drawn. Persons have travelled and become great and rich, but the poor people have, with the passage of time, got into greater distress and deteriorated. The hon. member for Calvinia (Dr. Steenkamp), when he came to this House for the first time as an Independent, spoke with great enthusiasm and called out as if he was standing on the highest mountain summit. With a loud voice he called out and made an appeal to this House. He pleaded with all the earnestness of his soul, He was a voice calling in the wilderness. What was he calling? I can still hear him calling out with a prayerful voice: My people are passing away, my people are sinking, save Afrikanerdom, save them or I die—those were his words.

That is not true. Where were you?

I ask with all respect, is he still calling? No, he is silent, and is as silent as the grave. He is sitting by the side of the enemies of his people. He is rejoicing in his conceit that his people have been saved and assisted. In heaven’s name, in what way have the people been saved and assisted? If he said that he himself was saved and assisted I can believe it, but certainly not the people. Conditions are ten times worse than they were eight or nine years ago when he asked for assistance with that prayerful voice. I said it in my constituency that, dead or alive, I would not rest before the countryside was saved. Nor will I rest. I say that this section of the House is not going to rest until the shameful injustice which has been done to the countryside is rectified. Hon. members have referred to us and jeered at us because we promised that emergency loans under the Land Bank Act and relief loans would be written off. I want honestly to say that I promised that I would do my best to remove the pressing burdens from the countryside.

Writing off?

Yes, decidedly, because why is the countryside in distress? Because they have been stolen from and robbed by speculators, and the speculators are shielding themselves behind that side of the House and are doing their pernicious work under the protection of the Government. The farming industry has been systematically exploited with deliberate subversive organisations, with planned and tried systems. Our markets are controlled by monopolies and by cruel, criminal exploitation. Our farmers have retrogressed and have lost everything. We protest. [Time limit.]

I am one of the members who talk very little, because I believe in the old proverb: “Men of words and not of deeds are like a garden full of weeds.” I must, however, say that I am absolutely astonished to-night at the speech of the hon. member for Namaqualand (Lt.-Col. Booysen). He commenced by saying that the British Empire was so big that the sun never set over it. I am astonished, therefore, that some of its subjects lose their way in the light, because the hon. member is a subject, and he is wandering in the light although the sun is shining. Now he has said that we are so red that we also regard them as red. We have never had it on the brain, but it reminds me of the old coloured man who needed a few yards of red flannel, and then he just bought a roll for economy. According to the speech of the hon. member he is a man who would rather buy a roll than a few yards. We have heard a great deal from the hon. member for Namaqualand about the defence of our country. But he only remained in this part of the country. He wants to defend the coasts, he wants roads there, and he wants to have the Defence Force in Namaqualand, and only for Namaqualand. I notice that plans are now being made to train storm troops, and I hope that he will be an officer of those storm troops, and then they can storm the whole of the west coast, and then the others can defend the rest of the country. Now the hon. member says that the countrywide is so over-populated that the people have to run away to the towns, but then, on the other hand, he tells us how big Namaqualand is and how empty it is. But now he wants to come with his constituents to Cape Town, presumably to storm Simonstown.

You have probably never been to Namaqualand, and know nothing about it.

No, I have been there and can speak about it, but not about diamonds. He is one of those who congratulates the Minister of Finance that during the short time that he has been Minister of Finance he has put the finances in such a good state, that the hon. member for Fauresmith (Mr. Havenga) congratulated him on the good position. But I expect there is going to be great expenditure now that we are at war and I have always said: Keep the Defence Force ready, then it will not cost so much when the enemy comes, and when you cannot afford it. It is better to spend a few million pounds now on the Defence Force before the enemy is at our gates. Just look at the neutral countries in Europe which spend a great deal more than we do, and we are not neutral. But even if we were neutral then we would have to extend the Defence Force, because we do not know to what extent the war is still going to develop. I am glad that the Prime Minister said that he would only cross the boundaries with volunteers. During the Second War of Independence it was shown that when we went over the borders into the Cape Colony and Natal, and we did not wait for the enemy to come to us, we did not quibble about boundaries. We only thought about defending ourselves. But to-day there is quibbling going on about the boundaries. I think we should think less of where the boundaries are, and that we should think more of the defence of our boundaries. That would be very much better than what we are doing to-day. In the Republican days there were also people who were opposed to war, but when the war broke out they all went over the borders together and they did not say: Now we are going to dig ourselves in on the borders. We did the best fighting in the country of the enemy when we devastated it, and not our own country. I still always believe in fighting the enemy on his territory, and not on our own, because when we fought against the enemy beyond our borders our wives and children lived happily, but when the enemy came over our borders they had to fly from one place to the other. Therefore I shall be prepared to go with the volunteers over our boundaries, and to meet the enemy there, and I hope the storm troops, about which we have heard so much, will also be there. Then we have heard a great deal of late about the wool trade. I did not expect that the ex-Minister of Finance would also refer to that. He had the opportunity in 1937-’38 to enter into an agreement with Germany, and we had an agreement in which Germany undertook to buy our wool to the exent of about £8,000,000 worth. But what was the price of wool in those days? We asked the Minister of Finance to give another subsidy, and in 1938—39 we asked again for a subsidy, because the farmers could not come out on the wool prices. What is the position to-day? In my constituency the farmers who have sold are highly satisfied, and I get numbers of letters from people who say that they have sold their wool well. On the other hand, we hear that England is now buying up our wool, and that they are selling it at a profit. If we could do that we also would like to do so, but we cannot do it. Why then should we blame England for doing so? They surely have to see the war through, and they have to pay the cost. Do you then want them to go bankrupt?

But not at our expense.

I, as a farmer, can assure you that if I get the prices for my wool that I am getting to-day, then I will in future farm with nothing but sheep, and will give up everything else. Last year I got 11¾d. for my best class of wool, and this year I got 19d. I and other farmers do not look at what goes out of our pockets, but at what goes in, and we are trying to get the best market that we can, and we do not bother about the other man. I am sorry that the Government could not make the scheme for the duration of the war, and a year afterwards. By it we have an open market, and other countries can also buy, but now we have a price under which they will hot go. Then I want to say something to the Minister of Agriculture in connection with Section 11, where land was bought in the good times. There are many settlers to-day who are having a bad time because the land was bought above what was actually the real value of the land. Inasmuch as they are unable now, owing to various difficulties, to fulfil their obligations, their hire-purchase agreements are being cancelled. A man like that has put all his little savings for the last few years into that ground, and he has effected improvements, and now another will get that land if it is re-issued, and the benefit of it. Now I want to advocate that such a man should get a preference over that land, and that he should have another chance of getting it when the land is revalued. In my district there are many hard-working people who owing to illness and other troubles, are not in a position to-day to fulfil their obligations any longer, and I would like to see the Minister of Lands give such a man, who has fulfilled his obligations but has retrogressed in the difficult times, a privilege when the land is revalued, to get back on to it. They are people who are anxious to own their own piece of land, and I sympathise very much with them. But as I said, they have, owing to drought or hail or disease, got into arrears, and they cannot fulfil their obligations. Then we hear a great deal about another question, and that is the supply of labourers. I admit that there are great difficulties in connection with labour, but we have the Squatters Act and I think that it is not being administered properly. I know farms where a man has too much native labour, and then there is a man adjoining him who cannot get any natives. A man like that has to work to fulfil his obligations, and the other has natives who are doing nothing, and every six months the natives are given a pass to go to Johannesburg. I think that if the Squatters Act is properly carried out the position will be very greatly improved. I am prepared to admit that there are some people who will never keep a native. They do not know the natives and they do not possess the tact to work with them. There are many difficulties connected with it.

Then it is said that the farmers must get this and must get the other, but I do not desire subsidies, because they are a temporary thing, but I expect that the Government will do its very best to find markets for our farmers, so that the farmer who does his best will get a decent price for his produce. That is why I am so glad to see that the Minister is coming to the aid of the low grade mines, because if the mines that have been closed down were to start working again they would provide work for many of our people, and those people would have purchasing power. They must live on our produce, and therefore our market will improve in consequence. A great deal has been said about this year’s mealie harvest, but my information is that we will barely have an overproduction. There are areas which will have a very big production, but there are others who are already asking the Government to provide them with mealies because they have not enough to last them until next year. We may therefore expect to get a reasonable price for mealies.

What do you consider is a reasonable price?

It depends on what a man spends. One man cannot manage on 5s., and another can come out on 4s. It is difficult, and the cost of production of one man is greater than that of another. We have heard a great deal here of the price of machinery and plant having gone up, but I am a farmer myself, and you do not need new machinery every year. It may be repaired one year, or a year may be skipped with regard to the purchase of machinery, and that ought to be done now. But according to what is said here, a farmer would have to buy machinery every year. As I have said, necessity is the mother of invention, and the farmers can possibly repair some of the old machinery which they have discarded, and the man who has not sold his bags for 5d. or 6d. can use them again this year. But some farmers have, of course, never thought of such a thing! Then there is another thing on which I feel very strongly. We know that the Government is having more factories built, and we now have our chance, seeing that we cannot import so much from other countries. This is of great importance, especially seeing that we have factories which are working up our own produce here. I do not expect the Government will do it, but the Government must support the people who want to erect factories, because there are many people who are prepared to put up factories if they can only get assistance from the Government. In that way many of our poor whites will be able to get work, and in that way they will, in turn, have greater capacity for purchasing our produce. It is often said that the farmer should go back to the countryside, and I know that many of them will make a success of farming, but there are others who will not become successful farmers. We must provide for them so that they may go into the factories, and that their sons may be trained to fill appointments in the factories later on. That is the only way to save the poor population. Many will go on to farms and remain there, but never become farmers. Many of those who are not on farms would be fit to become farmers, and the difficulty is to find the right people at the right time and place. There is something else that I would like to bring to the notice of the Minister of Finance, and it has reference to the pensions of oudstryders. I had the sad case in my constituency of an old burgher who fought under me, and who was badly wounded. He died a little while ago—he had received a pension—in consequence of the pieces of steel of the bombs which were still in his body, and which had caused bad places again. His widow is left behind, and she is in a hopeless state. I would like to see that the wife of such a man, who sacrificed everything for his country, should not be left behind unprovided for. Therefore I would like to look forward to legislation being passed that when the husband dies, and his wife is left behind in needy circumstances, she will then be looked after according to the pension which her husband received.

It was not my intention to say anything about the speech of the hon. member for Frankfort (Brig.-Gen. Botha), but I would nevertheless like to reply on two little things. He has just said that the Boers, in the Second War of Independence went over the border, and they are again going over the border now, and they are not going to ask where the border is. He mentions it as an excuse for going across the boundary again now. We paid dearly for that act. He was an officer, and he knows that that was the greatest mistake, and that it had a long and injurious aftermath. And now the hon. member wants us to go over the border again, and have to pay again for our experience ourselves. That is a thing which astonishes us. Then he also made a remark in connection with the Squatters Act. That Act has long since been obsolete, and because it was unpractical, there was an amending Bill introduced which was passed into law in 1936. We are to-day asking that that Act should be put into operation. Those little things, that the hon. member said, really upset one a little, but I do not want to devote my time to that. I would like to bring a few things to the notice of the Minister of Finance, and I want to say at once that I should be very glad if the Minister would give me a reply in connection with them. It is a serious matter with me and I feel deeply about it without my having any arrière pensee, and I hope that the Minister will regard my remarks in that light. We have heard a great deal of late about a war cabinet and a war budget, and I ask the Minister, what about a war agricultural budget? I want especially to confine myself to agricultural matters, because we know what is going to happen to farming in these times. The agriculturists are the people who will be the first to suffer, and to suffer worse when the war really comes, and for that reason it is of the greatest importance for the Minister of Finance to give his attention to the matter, and for him to take precautionary measures, and to tell us what he intends to do if those things come to pass. I do not want to go into a lot of figures here. I took the trouble last year to prepare a summary which I brought before this House, to prove what the agricultural position was during 1929, and for the seven following years. The Agricultural Union took the matter up and they regarded it so seriously that they took those figures as a basis in order to make further representations on the matter, and the newspapers were full of it. It appeared from those figures that the valuation of the assets of the agriculturists in those years had diminished by £100,000,000 and more. That seems a large sum, but those figures were brought to the notice of the Minister, and he knows that that is so. Nevertheless I would just like, on this occasion, to mention a few figures to show the Minister why the position is so serious. The livelihood of the agriculturist is seriously threatened today. We see that, under the tenant farmer scheme, over £16,500,000 has been lent to the farmers, and we notice that 115,266 people have been assisted under that scheme. In my district over 3,000 people have been assisted by some advance or other. I mention this to allow the Minister to realise how serious the position is. I have figures before me of the arrears due to the Land Bank, and on farm mortgages, and they amount to over £18,000,000. That shows us how serious the position in regard to agriculture is. The industry is very sensitive. The slightest difficulty which comes along will have a remarkably injurious effect on the population. It is the duty of the Minister to bear that in mind, and if the difficulty does arise, it will be his work to know what he should do in those circumstances. The position is that the prospects of the farmers are very sombre, especially when we look at the overseas market for the produce of the farmer. We ask ourselves what is going to happen next year or the year after. We find that fruit export has been almost completely cut out, both deciduous fruits and dried fruits, we find that wool no longer has its overseas market. It is cut off, as it were, we do not know who is going to buy next year. Then there are mealies which have to be exported. We are saddled with millions of bags of mealies which we cannot export, and what is going to happen next year, if the people are forced to turn their mealies into money to be able to live? When we think of what is to happen to this class of person, then it is a very serious matter to us. There are three big occupations in the country, mining, trade and the farming industry. The farming industry is the one which suffers most. The other two are prosperous. The question immediately arises in our minds: Do we need those people or not? That is the very class without which we cannot get on. It is that class which separates itself from the rest of the world, and which provides our food and clothing for the inhabitants of the country. The state must take those people into account who are connected with such a difficult industry, and who can so easily become the prey of poverty. The Minister of Finance is in a position to be able to provide for those people, and we would very much like to warn him and ask him what he is prepared to do for them, and whether he has already made the necessary preparations. If there ever was a time when the agricultural industry was threatened by any great danger then to-day is that time. I think we cannot do anything else but ask the Minister of Finance to regard this question very seriously. All the branches and different ventures of agriculture are in difficulties. I would like to ask the Minister what he is going to do with this group of people who have bought land under Section 11, above its real value, and who are to-day saddled with that useless land; whether he realises that they are in a specially difficult position, and that if precautionary measures are not taken, and difficult days should come, and we are expecting them, then they will all be ruined, because they are living on land which is not worth the money they paid for it. We find, on the other hand, that our sons are all leaving the countryside. Most of them have gone to the mines. The reason given is that the agricultural industry no longer pays. There is another class which remains behind, that consists of the farmers who can do nothing else, who have no other occupation. Some of them are fairly old and they are poor. That class of man is having a very hard time. Then we come to the average class of farmer. He is just holding his head above water, he fulfils his obligations, but he gets no support, and he is suffering bitterly. His position is very parlous, and I would like the Minister to give his special attention to that class. Then we come to the prosperous farmers. But what assurance have we that if things go on as they are now that that man will be able to remain independent? If we include everybody, then we say that the agricultural industry is in such a position that it threatens to go to ruin. The difficulties are of such a kind that if a study of them is not made, we cannot realise in what a parlous position agriculture is. If things are like that in the good days of peace, what are we to expect when we are at war, and after the war? Accordingly, I say that it is worth while to give our attention to this matter, and, therefore, I ask the Minister of Finance to do so. Then there is another difficult matter in connection with which I wonder what the Minister of Finance is going to do, and that is to prevent the overproduction of farm produce by certain people, people who regard farming as a side line, as a hobby, as it is called in English. Those people play a great part in the country, and the Minister of Finance last year noticed the role that they were playing when a subsidy was given on the first 500 bags of mealies. It immediately appeared that the rich man who was not farming himself, got that money, but the poorer man, with the least land, or who was sowing in partnership with another, and who had reaped 1,000 bags, was eliminated, and an injustice was done to him. The rich man, because he only reaped 500 bags, has scored. Those are the kinds of things which I would very much like the Minister of Finance to give his attention to, so that there can be no repetition of them in the future. Let us take precautionary measures to rectify that kind of thing. Then we come to the marketing system. We found what the solution would be, namely, if we all marketed our goods on the co-operative system, but even there we entangled ourselves. Previous governments, one after the other, encouraged the marketing of produce on the co-operative basis, and the buying of necessaries on a co-operative basis, and we did it. What happened last year? I put a question to the Minister of Agriculture in connection with it, but received no reply. I now ask the Minister of Finance, and I hope that he will reply. I am thinking of the £66,000 which will be lost by way of damage by the mealie co-operative societies, in consequence of the action of the Government. What is the Minister going to do? Does he intend to give it back to the farmers? You will possibly say that there are also merchants who had mealies, and you will ask whether they ought not to be borne in mind if the Minister is going to come to the aid of the co-operative societies? There is a great difference between the speculator who buys mealies, and can deal with them as he likes, and whose own business it is when he loses, and the co-operative society, the directors of which are disposing of the produce of the mealie farmer, while the Government stood over the directors and said that the mealies should not be exported, notwithstanding the fact that permits have already been obtained to export them. The Government came along and said, after all the arrangements were made for the export, that the export could not take place. Subsequently again the Government came and said that they no longer needed the mealies. The result was that advances had already been paid, and then it appeared that there was a deficit of £66,000. Will the Minister take steps to cover the loss? I do hope that it will not be the policy of the Government to say that a part of the farmers’ produce may not be sold, because the Government need it for the public, while the Government subsequently come and say that they no longer have any need of the produce. In such a case the Government should take responsibility for the loss that they have caused, and it is the moral duty of the Government to pay the money back to the mealie farmers. It was due to the fault of the Government. None of the deputations that went to the Minister of Agriculture, not in a single case, got an affirmative answer, nor did they in a single case get a negative one. The deputations, however, were so sympathetically received that they went back, and being full of confidence, told the people that everything would come right. To come now and tell the mealie farmers that they would have to suffer the loss, will result in the agriculturists losing their confidence in the Government, and that is a dangerous principle to lay down. Just one word more about the rising cost of living. We have heard a great deal about it, and I want to ask the Minister of Finance whether he has thought about the people who are working on the canals and on the dams. Everything is more expensive to-day and the Minister should also think of those people. They have earned a slender wage on the relief works, and struggled through in a way, but to-day it is impossible. There are other things that one would like to raise, but if the Minister will make a concession in connection with things that I have mentioned, we shall be thankful.

Mr. Speaker, listening to the speeches which are being delivered in this House by rural representatives, one cannot help but conclude that there still seems to exist a big gulf between platteland and urban communities. A very wide divergence in outlook on our various national responsibilities is still apparent. There still exists an obvious disinclination on the part of the farming community to nay merited consideration to the other great national primary industry, that of mining. One need but recall the speeches which have been made on the Part Appropriation debate and listen to the speeches which are being made on the present debate, to obtain absolute confirmation for this belief. One might have honed that by this time it would have been universally recognised that the welfare of one section of the community is intimately related with and closely dependent upon the well-being of the other. Instead of that, we find that the old rivalry between agriculture and mining is undiminished. The veiled antagonism between town and country still fills the atmosphere. I desire to show that such an attitude is as unjustified as it is detrimental to our national well-being. This diversity of approach to our two great national industries is as unreasonable as it is erroneous. One cannot over-emphasise the fact that they are complementary to one another and that both are vital to the well-being of our entire body politic. If confirmation for these statements is required one need but study recently published statistics in connection both with our agricultural and mining industries. The trouble which such a study entails is amply compensated for by the great interest derived from it. These figures demonstrate the vast sums of money which have been devoted by the state, almost lavished in recent years, on our agricultural industry. They emphasise how vital is our other great primary industry—mining. They show, also, that our secondary industries are making an ever-increasing contribution to our national economy. I desire now, Mr. Speaker, to deal in some detail with each one of these matters. Hon. members may question my right or ability to do so. It may seem strange for a medical practitioner to be talking on farming and industry. In this connection I need only point out that a precedent has been created this session when my friend the hon. member for Hoopstad made a brilliant speech on constitutional law, although a farmer. As far as farming is concerned I would answer such possible criticism by stating that I may well lack the ability, but in all modesty I can claim the right to talk on that subject. In fact, after nine years of farming, it seems to me that the only thing I have to show on the credit side is this privilege to speak as a farmer on such occasion as this. Lest I be misunderstood by my fellow-farmers in this House, I desire to state at the very commencement that the Government’s agricultural policy has no greater supporter than myself. There are in fact few townsmen who are not most anxious to see agriculture helped out of its difficulties, many of which are the result of circumstances over which they have no control. What I do insist on, however, is that from time to time the enormous effort which the state is making on behalf of agriculture should be reviewed and the benefits which are being derived from such state assistance accurately assessed. Let me say a word to the townsmen—those who criticise the state expenditure of vast sums of money on the rehabilitation of agriculture. They are inclined to forget that this Government is not alone in such a policy. The post-war world depression which reached its greatest intensity some years after the conclusion of the war was a challenge to most governments to come to the assistance of their struggling farming communities. At first the crying need was for immediate measures of relief to individuals to alleviate distress. For that reason initially, such aid took the form of direct cash contributions. These were necessarily of a palliative nature and could only be regarded as a temporary expedient. To appreciate how hard hit the South African farming community was by those years of depression one need only state that during the three-year period 1927-’29 our exports of products derived from agriculture with an average annual value of £30,452,000 represented 32.8 per cent. of the total value of South Africa’s total exports, whereas in 1938 this value was £20,024,000 and equalled only 20.1 per cent. The catastrophic fall in prices called for financial measures which would temporarily improve such prices, hence the £10,233,000 which was paid out of Treasury funds towards export subsidies up to and including the year 1938-’39. The fall in prices of products was necessarily accompanied by a similar depreciation in the value of land. Farming properties on the new basis became over-capitalised and over-valued and interest payments, which at that time averaged over 6 per cent. on mortgage debts amounting to £60,000,000 became impossible of payment. Again the benevolent Government came forward with its scheme of interest subsidies whereby the maximum interest paid byfarmers was limited to 3½ per cent. This cost the state £4,000,000. Numerous other financial responsibilities were assumed by the Government in order to tide the farming community over the very hazardous times through which they were passing. £1,441,000 was spent in order to redeem export quota certificates for maize farmers. In order to facilitate the transport of stock from drought-stricken areas and other subsidies on railway rates, £1,550,000 was spent. £1,353,000 was spent in connection with assistance to farmers co-operative organisations. It is estimated that the total assistance to farmers under various heads for the years 1931-’32 to 1938-’39 amounted to £20,559,000, and of this amount it is estimated that £17,885,000 is not refundable by farmers. When one examines these measures more carefully it is gratifying to observe that as the years proceeded the Government’s policy in connection with its assistance changed. The initial efforts aimed at rendering temporary relief by neutralising individual farmers’ losses. These were necessarily of a negative nature. They were palliatives without hope of curing our economic ills. Gradually these were replaced by measures which aimed at the strengthening of the industry and safeguarding its security for the future. Briefly, these consisted of measures aiming at the protection of the carrying capacity and fertility of the farms; in the protection and the improvement of water supplies; in the improvement of livestock, and in the granting of rail and road transport facilities so as to enable farmers to bring their products to the market cheaply and expeditiously and also to receive their necessary commodities cheaply from the sourse of purchase. In addition to the sums already mentioned as having been spent by the state in connection with agricultural relief there is the even greater sum, namely £33,612,000, which has been applied since 1929-’30 by the Government in repayable loans and advances to farmers on conditions of interest which could not have been obtained anywhere else. Included in that amount are: (1) £4,481.000 for the purchase of land for settlers; (2) £4,000,000 for advances in terms of the Farmers’ Special Relief Act, 1931; (3) £13,389,000 for Land Bank advances in terms of Section 20 of Act 29 of 1923 (principally for the purpose of maintaining farmers on the land) and £7,923,000 for the Farm Debts Adjustment Scheme. Since 1936 the Government has applied itself to improving domestic marketing and has made a contribution of £100,000 known as the Marketing Fund in connection with the Marketing Act of 1937. Of the other efforts which have been made by the Government in recent years in order to help the farming community the following may be mentioned: (1) For 1939-’40 the Government provided £1,200,000 to defray further rebates on behalf of fruit growers and livestock and other farmers; (2) it has reduced rail costs, paid by farmers, when obtaining various kinds of commodities that he needs, i.e. fertilizer (including agricultural lime), bonemeal and licks, pest-control remedies, woolpacks and grain bags, boxwood; (3) considerable rebate also on road motor transport. All these efforts have as their main aim the safeguarding of the economic security of the farmer, an object which must commend itself wholeheartedly to every member of this community. Far from criticising these efforts or begrudging their outlay, I regard them as essential because they aim at safeguarding what must always be a primary industry in this country and a vital national asset. We must never forget that agricuture still provides a livelihood to approximately 35 per cent. of the Union’s total European population and in addition to millions of non-Europeans. But, Mr. Speaker, has not the time come when we must pause and ponder deeply and dispassionately on these weighty financial contributions? Has not the time arrived when we should devote ourselves to a most serious consideration and review of our agricultural policy? Such a review may well show that there appears to be a lack of equilibrium in many of our agricultural enterprises; that there is a tendency to over-concentration on any particular branch of farming; efforts to persevere with certain farming pursuits merely for sentimental reasons, which have repeatedly proved to be unsuccessful. We might well find that the efforts which the state is making is being dissipated by mistaken pursuits. It is for these reasons that I note with satisfaction in the last report by the Secretary for Agriculture and Forestry that his department has been actively engaged during the last two or three years with an agro-economic survey. It is hoped that this will ultimately embrace the entire Union. It has as its object the investigation of the various farming problems to which I have just referred. Certain farming operations in this country remind one of the story of the sentimental shopkeeper who, having inherited a shop that had been in the possession of the family for generations, insisted on keeping it open long after it had ceased to be a paying proposition.

Now if this shopkeeper had gone further and persisted in overstocking his shop with a particular commodity to an extent which was double the requirements of his immediate neighbours and then sent one half of the surplus away to be sold at a loss, and put up his price to his neighbours on the remainder so as to cover the loss, and then expected the Government to compel his neighbours to buy at the enhanced price, you then have a complete parallel with our maize industry in this country. In his Budget speech the hon. the Minister of Finance recognised the importance of the just distribution of assistance to various types of farming. He stated: “Secondly, I would refer to the provision made for assistance to farmers by way of a rebate on transportation costs. Perhaps the main feature of last year’s Budget was the institution of a new scheme on a generous scale for such rebates, at the cost of £800,000 per annum to the Treasury, and of £400,000 to the Railway Administration. There were then already in existence similar schemes costing the Treasury £275,000 per annum so that the total amount made available in this way was £1,075,000. My colleague, the Minister of Railways and Harbours, and I propose to continue to render assistance in this way to the same total extent. The amount of £1,075,000 has, therefore, again been provided on the estimates tabled by me. Agricultural authorities are constantly emphasising that this is a pastoral rather than an agricultural country; and that greater efforts should be concentrated on the conversion of more land to pastures. At the opening of the 84th Annual Show of the Royal Agricultural Society of Natal, the hon. the Prime Minister in discussing the growing of mealies said “that they are grown for sale in the world’s markets at prices that are not remunerative. In growing them we have destroyed the blessing of our grasses and pastures for a product that is a failure.” He went on to state that this was an animal country and not an agricultural one. He emphasised the point that if we could do less agriculture we would probably find a solution for our farming problems. The keynote of his speech was the encouragement of pastural instead of agricultural farming. A very valuable report, the first of its kind, has recently been issued by the Department of Agriculture on experiments carried out by farmers themselves, supplied with seed and fertilizer in the cultivation of grasses. “In most cases the results have been most gratifying.” It augures well for the future extension of pasture cultivation. Even after allowing for the natural enemies, namely drought, floods, irregular frosts, spasmodic outbreaks of disease, the contention still exists that there is a great deal of effort being lost by trying to extract crops from lands which by nature were not intended for crop growing. There is room for agricultural re-organisation in another direction, and that is to adapt our agriculture to our national nutritional needs. Recent surveys have disclosed the fact that our production of protective foods—dairy products, eggs, vegetables, fruit and meat is grossly inadequate for our requirements. In view of the enormous assistance which the State lavishes on agriculture it is not unreasonable to expect it to produce the materials essential for our national well-being. Most agricultural experts are agreed that some re-organisation of agricultural production is desirable and that a changed outlook on the whole agricultural question is called for. We may have to re-consider the scheme of subsidising exports and adopt one which will encourage and assist the consumption of certain essential foodstuffs internally. So much, Mr. Speaker, in connection with our great agricultural industry. Let me now turn to a brief review of our other great industry, and quote a few figures to show’ the important place which it occupies in our community. Let me begin by quoting a few figures from the 49th Annual Report by the Transvaal Chamber of Mines for the year 1938.

Gold Production.

The Transvaal gold output for 1938:

Labour

Average number of employees (Companies and Companies’ Contractors) during December, 1938:

Gold Mines, Transvaal:

Stores.

Stores consumed by the gold mines of the Transvaal, 1938:

Mining Revenue collected by Union Government:

Total revenue up to 31st March, 1939, from ground:

Salaries and wages to Europeans and coloured, 1938, for the Transvaal gold mines, £28,264,954.

The following figures will illustrate the enormous expansion which has taken place in the gold mining industry since this country went off the gold standard at the end of 1932:

To show the effect of the Government’s policy on the prolongation of the industry one need only quote the following figures: “Thus whereas in 1932 the average yield per ton treated from large gold mines was 6.469 pennyweights, the average yield for 1937 decreased to 4.446 pennyweights, and for the year under review was 4.323 pennyweights.” These figures reflect in a very convincing manner the constant expansion of our gold mines and their increasing economic importance to the country. Between 1935—1938 the total tons milled rose by 10 million tons and the yield advanced by 1,300,000 ounces. The number of producing mines along the Witwatersrand increased from 33 in 1935 to 40 in 1939. “Last year some 100,000 more men worked on the Transvaal gold mines than in 1933 and the money brought into circulation by the mines for wages, South African stores and manufactures, taxation and locally paid dividends amounted to no less than £54,500,000.” In other words since going off gold “we have brought immense tonnages of low-grade ore into the pay limit, the gold industry has expanded enormously employment of both European and Native has advanced to the incalculable benefit of the Union.” The contribution of the gold industry to the wealth of this country cannot be measured, however, only by way of money spent on wages, stores and dividends. It has played a great part in the cultural, educational and health aspects of our country. It has been responsible for the creation and maintenance of such world famous an institution as the South African Institute for Medical Research. This Institute has made contributions not only to the health and working conditions of the employees in the gold mines, but through its Research Department it has furnished discoveries which have been recognised as a blessing throughout the civilised world. It has enabled the creation and the expanding of our great Witwatersrand University with its doors open to receive the sons and daughters hailing from all over the country. It makes handsome contributions in connection with: A research scholarship; scholarship to students from the Witwatersrand Technical College; scholarshins for apprentices of the Government Mining Training School; and towards students’ mining tours.

From the beginning of 1927 to the end of 1938 nearly £100,000 was contributed by the gold-mining industry towards the Government Miners’ Training Schools. During that period no less than 4,478 apprentices completed their indentures as miners. It is partly responsible for the great expansion of the Johannesburg General Hospital with its 1,247 beds, which accommodated 30,297 inpatients; with its out-patient and other departments which have dealt with 336,758 out-patients during 1938; with its modern equipment, operating theatres where 12,439 surgical operations were performed. In its centre stands Johannesburg, the rateable value of which was estimated at the 30th June, 1938, to be £115,385,981, with a total population of 508,800 of which 271,800 were Europeans. Nor has mention been made of the numerous charitable and other organisations all aiming at social betterment which exist due to the fact that we have in our midst this great national industry. The best proof of the intimate relationship which exists between agriculture and industry is furnished by a brief reference to some facts dealing with the Rand which is as it were the meeting place of town and country, representing as it does the most important urban area in the Union. As a member representing an important Rand constituency and as an individual who has spent over 20 years in professional pursuits in Johannesburg, I consider it is my duty to draw particular attention to this matter. Permit me, Mr. Speaker, to give a few figures to demonstrate the truth of this contention. It is estimated that the Rand contributes annually about £140,000,000 in earning and spending power towards the economy of the Union. Salaries and wages including professional earnings and paid out annually are estimated to amount to £56,000,000. The influence of the Rand on the prosperity of the Union is felt in every port, in the remotest railheads and farms on the outskirts of the Union and even further afield. Industries, other than Mines, paid out £17.000000 in wages to 50.000 Europeans and 100,000 non-European workers. The Rand’s 7,000 shops employ 14,000 Europeans and 16,000 non-Europeans and paid out £5,000.000 in wages. The Johannesburg Municipality paid out £2,173,380 to 6.960 Europeans and £523,790 to 14,046 non-Europeans. The Municipality also bought stores to the value of £1,783,651 of which 65 per cent. was bought in the Union. In addition to the stores bought by the mines, to which reference has already been made, the various industries and shops on the Rand bought stores and equipment to the value of £24,000,000. It is of particular interest to point out the importance of the Rand to our farming community. (1) In 1938, 1,388,160 head of stock passed through Newtown Abattoirs; value £3,382,825. (2) Fruit and vegetables—£1,350,212 on market, £500,000 off market. (3) Millions of gallons of milk, tons of butter, tens of thousands of bags of maize, legumes, flour and other wheaten products. (4) Coal from Witbank and Natal for electricity. (5) The Rand was the biggest buyer ox clothes made from South African wool. (6) I shall have occasion, I hope, at a future date to indicate the enormous influence which the ever-increasing number of secondary industries are playing on the economy of the Rand. The Rand is the focal point of Union economics and its production of gold and other products must be regarded as the foundation of continued prosperity for the whole of the Union, providing as it does a stable demand for agricultural and manufactured goods. Let us never forget the importance of mining in South Africa as a branch of economic activity creating purchasing power and a valuable market for agricultural produce and other articles of consumption. It is the direct agent not only aiding agriculture but also the development of the necessary key industries. Conclusion: The object of my remarks will have been achieved if they serve to focus the attention of this House on the intimate relationship which must necessarily prevail between agriculture and industry. They were intended to emphasise that the urban communities are aware of and generally sympathetic to the troubles of the farming community. They are prepared to make contributions towards any effort which aims at safeguarding the security of agriculture. As consumers they are prepared if necessary to pay higher prices for farm products because they realise that agriculture is an essential and national industry. They appreciate the anatomical description which has so often been applied to agriculture, namely, that it is the backbone of the country. They must, however, not be criticised for hoping that the time may come when this backbone may be strong enough to support itself. For it to be able to support itself it must necessarily follow that each component part of it shall be healthy. That in any case is the general conception in dealing with the backbone or political column in the human being. If one of the links of the vertebrae is diseased the column must necessarily collapse or become deformed. If this analogy is applied to agriculture it must necessarily follow that for it to become self-supporting and strong its weak links must be eliminated and replaced for the benefit and the support of the whole. It is with reluctance that one must admit that this backbone is still a long way off supporting itself to say nothing of supporting the “head,” i.e., the state, which is primarily the function of a backbone. It still has to be reinforced by artificial supports. These supports are supplied by our other great industry—mining. One is therefore justified in appealing for sympathetic consideration for this “support”, instead of the scorn and criticism to which it is usually subjected. An appeal, therefore, is made to the farming community to form a better relationship with the town dwellers. It must never be forgotten in this country that the activities of one section must necessarily affect the community as a whole and that the guiding principle of all sections should be the promotion of the welfare of the entire nation. The position is much better put than I can hope to do by the Secretary for Agriculture and Forestry in his last annual report where he states—

Mr. Speaker, I listened with very great attention to the remarks which fell from the hon. member for Fauresmith (Mr. Havenga) this afternoon, I should like to congratulate the hon. member on having criticised the budget in this House for a matter of fifty minutes and never attempting on any occasion to say anything which would gain a political advantage for the cause for which he stands. It was a welcome change, Mr. Speaker, after what we have been through during the last five or six weeks, and I sincerely trust that other hon. members of this House, particularly those colleagues of his on the other side of the House, will take a cue from him and conduct the debate on this budget on the lines that he has set. I listened with great interest to the criticism that he delivered here on the question of mining taxation, particularly the criticism he had to offer on the change that this budget has brought about as compared with the system which he introduced on August 30th. In order to get an exact view of what this change is, I have found it necessary to go back to the budget of 1933. A system of mining taxation was introduced then that caused a very great hue and cry from the leaders of the mining industry. The main planks of their objections were that the system then in vogue prevented them mining ore of a lower grade. It was going to stultify the flow of capital for the development of new properties. The hon. member for Fauresmith, then the Minister of Finance, took up the point of view that he was not prepared to concede any of the Government’s revenue in assistance to those complaints, or in the alleviation of those complaints that those leaders of the industry had put forward. On August 30th, when an announcement appeared in the Press that the Government were going to take all the revenue over 150s. by forcing the producers to sell their gold to the Government at 150s., the same hue and cry came forward from the leaders of the mining industry. It was going once again to stultify the mining of ore of a low grade and it was going to prevent the flow of capital that was necessary for the opening up of new properties. I look upon those two stages in 1933 and 1939 as virtually the same, especially from the point of view of those who control the industry. In 1933 it became so obvious that the system was wrong that the then Minister of Finance, the hon. member for Fauresmith (Mr. Havenga), found it necessary to institute a departmental committee to report upon it. As the result of the report of that committee, the system of mining taxation was altered and a more equitable basis was arrived at. At the same time the Government did not yield any of its revenue whatsoever. But the objections of the mining houses were met. In 1940 we have a budget which, in the best of my opinion and to the best of my ability on analysing it, did exactly the same thing. It has merely altered the incidence of taxation to meet the objections of those people who are responsible for the carrying on of the industry. It has been clearly shown that the system that has come into vogue since the 1st January, as the result of the budget announcement, is going to enable them to mine low-grade ore, it is going to re-establish confidence from the point of view of the flowing of capital for whatever new ventures may occur. At the same time, this Government is not forfeiting any of its finance whatsoever as compared with the system introduced on the 30th August. Therefore I feel absolutely, entirely and in all fairness that the whole of the criticism of the hon. member for Fauresmith this afternoon—I feel that these two changes have been identical, they have achieved the same result, and the Government in neither case has given way as far as its revenue was concerned, and I was very disappointed indeed to find that the main plank for criticism this afternoon by so experienced a member of this House was that the Government was afraid that speculation would take place on the Stock Exchange. Am I to assume that they were out to prevent speculation on the Stock Exchange at the expense of meeting the request of the leaders of the mining industry? I am afraid that the hon. member for Fauresmith has found himself in a position of being unable to criticise from a really genuine standpoint. He found that the system introduced to-day was virtually the same as he was forced to agree to in 1936 by following the advice of his departmental committee. It is surprising that he has not admitted that, and that he did not find more genuine grounds for criticism of the system of mining taxation presented here last week. There is one item which appears on our revenue side of the budget, that was presented, that has caused me a lot of consternation, and that is this question of excess profits tax. I would like to inform the Minister that in principle I am not against this at all. I feel that it is an essential measure, especially in times like these, and it is to be hoped that it will have the desired effect of curtailing any attempt at profiteering at the expense of the country. But in supporting the principle, I feel it my duty to warn the Minister that it can have very grave consequences so far as existing secondary industries are concerned. He will remember as will most members of this House that in 1934, 1935, 1936 and 1937, there were many flotations both private and public, in this country, and many secondary industries were started. I can only mention such outstanding ones as the South African Paper and Pulp Industry, the first genuine one of its kind, the South African Torbanite and Refining Company, which produces Satmar petrol, and many others. None of them have to date declared any dividends, but the time is not far off when we hope to see them reach the dividend paying stage. There are many of them which have battled through lean periods, as most secondary industries do, when they start, and they may find themselves in a position, as a result of an unjust excess profits tax, of being unable to justify their existence. I want to ask the Minister in all sincerity, especially in view of the fact that we are about to consider a Bill here for the encouragement of the establishment of industries, and the provision of something in the neighbourhood of £5,000,000, to pay individual attention to the incidence of this excess profits tax. It can have a very serious influence on secondary industry that is still in the struggling stage. Some of them may even have just reached the dividend paying stage, but unless they are nursed by those who are in a position to help them and unless taxes are not imposed upon them which will make it more difficult for them to carry on, they will prove a great boon to this country and they will assist in the object which everyone of us has in view, and that is the establishment of secondary industries. As one who has a great interest in secondary industries, I would ask the Minister to take these industries under his wing. I would ask him not to stultify the establishment of secondary industries which have only recently been started, and which have not yet got on to their feet. Speaking on behalf of a constituency which consists in the main of what one commonly calls working men, I would like to congratulate the Minister on his Budget. I cannot after careful analysis find any portion of it which is laying an undue burden on the working man of this country and particularly on the working man of the Rand who is playing such a great part in keeping this country in the very solvent position in which it is. You can analyse it from any angle you like, until you get to the stage of men earning between £500 and £600 there is no burden whatever imposed on people in financing the terrific expenditure with which this country is faced.

Was there in the past?

No, but in extraordinary times like these when a country finds itself face to face with an expenditure of an extra £14,000,000, it is still possible—when we compare ourselves with other belligerent countries where men with salaries as low as £150 are helping to foot the bill, it is possible that there might have been some move in that direction, and I would congratulate the Minister on having seen his way to pilot this country through this financial year without imposing any burden on the working man of this country.

The burden is lower even than it is in the neutral countries.

That is so. I understand that there is no other country in the world, belligerent or neutral, where a man can reach a salary of £600 per year with as little taxation as in this country. It is an outstanding feature not only of this Budget, but of many Budgets in the past, and in congratulating the Minister, I feel one can also congratulate the hon. member for Fauresmith in having maintained that principle over the course of years, even though they were lean years.

What is going to happen in the future?

I have every confidence that there never will be an occasion to bleed the working man here. Of course, perhaps it is the wish of some hon. gentlemen over there that people in the urban areas who are supporting this Government should be so taxed as to force them to vote for what is to-day the Opposition. I can assure them that that will never happen.

Do not be too sure.

Before I resume my seat I want to say this: On several occasions during the last few debates I have heard remarks from the lips of hon. members over there, mostly by way of interjections, which may be classified as anti-Semitic. I deplore that that should happen in this House. I deplore that hon. members over there should indulge in what is commonly known as Jew baiting. It has happened too often on that side of the House to suit me. I do not quite understand, and I do not appreciate just to what extent the Opposition in this House to-day are united on this question of Jew baiting, because I have evidence not only before me, but in other ways, of many members on that side of the House having received both financial and moral support as far as their politics are concerned, from Jews. And there are many men over there who I am convinced dare not say one word against the Jews to-day.

Is that a challenge?

Yes. I would mention an experience I had about nine months or a year ago, when an Jewish individual on the Rand came into my office. He had a suggestion to make in connection with a certain land transaction near Barberton. I listened very patiently and I told him that I was not interested, and I asked him to leave my office. He said, “You need not be afraid, I have many friends in the Cabinet, and when it comes to deciding things, and your name and my name are associated with it, they will help us.” I said, “I do not like the idea and I do not want to have anything to do with it.” With that a letter was pulled out and placed in front of me, and I read it. A stronger recommendation could never have been given to any individual—it was like an open sesame to all Government departments.

When was this?

Not so very long ago. A more stronger recommendation could never have been given to any individual—yet this was a shady sort of an individual.

Do you suggest that he was a shady individual?

Yes, within my knowledge, definitely.

We are just interested.

That letter bore the signature of the then Minister of Lands, the hon. member for Wolmaransstad (Gen. Kemp), and I can assure you that as long as he was a Minister this letter was such a recommendation that it was an open sesame to any Government. It was a recommendation which would have taken that man anywhere.

How old was it?

I think it was dated 1925 or 1926. I said to this gentleman, “How do you of all people get a letter like that from a Minister of the Crown?” and he said, “Well, when the Nationalist Party were fighting their election campaign in 1924 they were very short of funds and I was up and down the Rand and collected approximately £2,000 from Jewish concession storekeepers on the Rand, and I paid it into the election funds of the Nationalist Party.”

Do you believe that from a man whom you yourself describe as a shady character?

Yes, and I believe it even more sincerely because only last week I saw the hon. member for Wolmaransstad and the same gentleman having dinner together at the Del Monica. I am not here to tell anything that is not true. That is not a habit of mine. I am just saying this, not to get any political advantage out of it….

Never let it be said.

No, I am simply saying this to put a stop to these anti-Semitic suggestions from the other side. Now we have our hon. friend from Namaqualand (Col. Booysen) here. That hon. member only tonight in speaking about the “armblanke” in his area mentioned the words “spekulante” and “diewe.” We all realise that when these expressions are used in the House they are meant for the Jews—whether the hon. member cares to admit it or not. Well, I have here a newspaper, which I do not know much about, but I am very interested in finding in this newspaper a letter of appreciation from the hon. member for Namaqualand thanking certain people for the support they gave him on the occasion of a certain provincial election.

When was that election?

Perhaps my hon. friend will remember the occasion if I give him the letter verbatim—there is a photographic copy of the letter in this newspaper. And this is how the letter reads—

The hon. member for Namaqualand is probably familiar with that address. The letter is addressed to Mr. N. Erlictman, Bokkraal, Nieuwe Rust, and it reads as follows—

I wish to be quite honest and I wish to be quite fair. I would like to make an appeal to the members on that side of the House to cut out anything pertaining to Jew-baiting, and if the majority of them are against it, to please get in touch with those who insist on doing it in this House and use their majority to stop that very heinous and dreadful practice.

There are two great dangers facing us, and I just want to mention them. One is the depreciation of the £ and that can become such a catastrophe that we are astonished that there is no reference to it in the Budget speech of the Minister of Finance, that he did not say anything at all as to what the policy of the Government was going to be in the future. I do not intend to enlarge on the matter. Questions have already been put about it today by the hon. member for Fauresmith (Mr. Havenga), which were of the utmost importance to South Africa, and of course, also to other countries where the same problems are going to arise. When the matter is referred to we mostly find that the opinions which are expressed are more or less whispered opinions. Generally, people are afraid to state the true position of things. We know that almost inevitably in the future such a depreciation will come in sterling, and it will increase from year to year, a depreciation in monetary matters which may become a catastrophe.

And there are actually members on your side of the House who are advocating another 25 per cent. devaluation.

I am not even speaking of 25 per cent. It may depreciate by 99 per cent. and also by 99.9 per cent. There is the danger which is facing the world, and especially South Africa also, because we chose to link up with those who have declared war.

The Parliament decided.

Yes, and because we decided to link up with those who look for war, the danger is too great for us. Now on the other hand, we hear the definite prophecy from American sources that the gold of the world will flow to such an extent to America that there is a great danger that there will ultimately no longer be any market for gold. That is the second danger which is of the utmost importance to South Africa. I have no solution for them. I just want to point out that these two matters may create problems for South Africa such as we have never yet had in our history—which is not too long a history. Never yet have such dangers within calculable time threatened us economically. What is now of importance? Of importance to South Africa, of greater importance than money and gold is the standard of your population. Of greater importance to South Africa is the kind of population that you have, and the intelligence of the population, if both the dangers to which I have referred are realised at all. Are we then in South Africa to throw up our hands and say that we can do nothing further? No, we must be prepared for that day, whether it comes in its most extreme form or merely to a lesser extent. We must be prepared to secure South Africa against such a catastrophe. We do not want, in South Africa, if our gold and sterling lose their value, that the important permanent section of our population should be lost. We shall have to see that that section of the population is so trained and prepared that they will be able to take their place amongst the nations of the world if our money is depreciated, and we have to carry on on lines of barter, so that we will not be able to get the things which we cannot do without, from other parts of the world, apart from gold and the value of your currency. What are we really doing in South Africa to see that we are training and educating the population to carry on our work when the catastrophe some day comes upon us. We have a population which almost to the extent of one-half lives in the towns. We have a rural population which lives in small towns and villages, and a rural population which lives on the farms. Besides that, we have about 900,000 people in the towns, while in the rest of the country there are about 1,300,000 souls. Now it is necessary for us to give the opportunity to the whole of the population in South Africa to get the kind of training and equipment for life which enable us in South Africa to be saved when the catastrophe overtakes us. But unfortunately, up to the present we only give that opportunity to 90 per cent. of those living in our densely-populated areas, in the necessary direction is, so far as vocational training and commercial training are concerned. We provide for commercial training in different parts of South Africa by means of technical colleges, the departmental commercial schools, private commercial schools, continuation classes and provincial high schools, in which two or more branches of commerce are taught. That is the provision which we make. Now let us enquire where the technical colleges are which give the commercial training, to keep to my first illustration, where are the schools which are doing the training in commercial matters? We have technical colleges in Cape Town, Port Elizabeth. East London, Durban. Pietermaritzburg. Johannesburg. Pretoria and Bloemfontein. We find that they commence by establishing certain branch institutions, for the most part on the Rand, and recently in the Cape a branch was also established at Stellenbosch. But they serve the section of the population of about 900.000 souls which is crowded into the big cities. For the other 1,300,000 of the population, there are three small provincial commercial schools coming under the Union Department of Education, and the three schools taken together can to-day only take 600 or 650 students. Those then are the opportunities for commercial training which we have created up to the present, and they only provide for the needs of one section of the population, and the other large section which is spread over the villages and small towns and over the countryside, has practically no opportunity of being educated in commerce. That is my first illustration, commerce. We have commercial schools at Paarl, Potchefstroom and Oudtshoorn. Provision is made in our legislation for the establishment of such schools. Let us see what the Secretary for Education says in this connection in his last report—

In addition, he goes on to speak about buildings, a subject I do not want to refer to, because I assume that further provision is being made for that. But I only refer to the fact that there is a large part of the country where provision is not made for that kind of training. What is the result? Simply that the permanent section of the people of South Africa have no opportunity at all of taking their legitimate place in the commercial world. It may be said that that section of the population should do something else, but then at least there ought to be an opportunity for doing so. It cannot be said that the initiative is lacking to such an extent amongst the people, because we find in other countries, especially in America, the rush to the towns is not limited to hundreds or thousands, but there are practically hundreds of thousands. They rush from the farms which have become uneconomic. Therefore, it has become necessary for us to extend the opportunities for such training, and that we should go to work in such a way that all sections of the population can share in it. How are the young people to be selected who are suitable to take part in commerce? We have only one test which we can put and the test ought to be put in all the schools in the country. Only the headmasters of schools, the teachers, not only in the towns but also on the countryside, can settle who the children are who are less privileged, and who show definite gifts in that direction. They ought then definitely to be given the opportunity of sharing in the training, and they ought to have the opportunity which exists at present for the more privileged section which lives in the towns. We have continuation classes, night schools, but unfortunately they have only established themselves in about twelve small towns in the Union. We hope that that number will increase, but for the purpose of really training professional commercial men we cannot, of course, look to the continuation classes. We have the provincial high schools where branches of commerce are taught, such as bookkeeping and commercial accounts, and in a few cases shorthand-writing and typing. Let us once more see what the Secretary for Education says in his report about the provincial schools, which have a course with a commercial leaning. He says that those courses may, as a matter of fact, arouse a desire to be trained for commerce, but that students who attend the classes have, at the same time, to take the full training in all the other departments at the institutions. In other words, the class is not sufficiently comprehensive really to enable the young people to take part in commerce. Let us further enquire the numbers of the population who are served by the technical colleges. We find that so far as technical colleges are concerned, there is absolutely no opportunity for the less privileged people on the countryside using them. I pointed out that amongst 800,000 of the population, provision was being made for about 10,000 students, but that for the other section of the population there is no provision made for even one, where technical education can be received. The 800,000 or 900,000 who are within reach of technical colleges live in the towns, and no provision is being made for the other section. We must give attention to the children in the other areas, so that those who show an attitude will, in fact, be given an opportunity of being trained, children who can be selected in order to develop in that direction. To-day the privilege is only provided for the children in the big cities. I want to put it in this way, if the 900,000 people who live in the densely populated areas can provide 10,000 students for the technical colleges, then we should demand that the other section of the population should also have the opportunity of sending 10,000 students to the technical colleges. If the technical colleges cannot be established in those areas, then we must enable them to go elsewhere for their training. We have a few commercial schools which I have referred to, and according to the report of the Secretary for Education, it is suggested that additional commercial schools should be established in the parts of the country where they are required. I ask, are these schools efficient? When we examine the reports that are available, then the few commercial schools that we have on the countryside were efficient, and according to the report, students from those schools are selected by employers to enter their service, and we see that applications from students for admission, are twice and three times as many as can be provided for. There is therefore a great need for those schools. Why do we want schools of that kind? Because if we remove the child from the countryside during those tender years to the towns, then it is not a very good thing in many cases, and sometimes it is dangerous to those children. They can get their training in towns of average size, which are better than the big towns. I think that that child should be trained at a place which is not very far from his home, where the child can be trained in his own language, where he can feel at home, and where he can accommodate himself to the local circumstances and to the methods of education, where he does not develop an inferiority complex, but feels that he really can achieve something. I have pointed out that where the commercial schools are efficient a large number of students will frequent them, and that will be the opportunity for them. I therefore think that I have made out a case that the population of the countryside should take part in the commerce of the country, so that we shall not constantly have to import people to conquer in that side of social life at the expense of those who are already in the country. Then we also wish that all the students in the commercial schools should be given a full course, that they will then get the certificate for a commercial course, and that is only possible if things are so arranged that all branches of commerce can be taught in that school. I cannot go too far into the matter, but it has already been dragging on a long time, and we have got behindhand in South Africa. The people of the country have not got their legitimate share of the commerce. Then it was a vocational training that is much more serious still, and much more difficult. We find in South Africa that the countryside population has practically been entirely eliminated so far as the appointment of apprentices is concerned. The building industry, the engineering industry, the printing industry take most of the apprentices in our country. The engineering and printing industries alone absorb 85 per cent. of our apprentices. Out of the apprentices in the country they get practically 100 per cent. from the towns where the industries are situated. It is quite natural that it should be so, but this is where the danger comes in, namely that the control of the apprentices is in the hands of the employers and the employees, and not in the hands of the state itself. It is a dangerous thing that there should be no opportunity for the other 1,300,000 of our population to get access to the apprenticeship ranks in South Africa. It is in the interests of the whole of the population, because we have so neglected it that we have come to a serious state of affairs. As soon as there is a depression the apprentices drop off, and when the depression is over and prosperous times return, then tradesmen are imported into our country by the thousand, people of 25 to 30 years of age, who remain in our country as tradesmen for years, for their lifetime. Why should they be imported? It is because it is not the state but the employer and the employee who have too much to say about the apprentices. In that way I do not think we shall make any progress unless the state has a say in this important matter, which will enable the people in the country to carry on its work. I do not want to go further into this, because I understand that others intend to speak about it. We realise that we have reached the stage where South Africa is sure that it can build up industries, and as it is uncertain whether we shall be able, in the future, to control the value of our currency and of our gold, I think that the present is the time to give the people the opportunity, by giving a chance to our young people by means of schools and continuation classes to do their share for the country and the people in the community we are living in.

At 10.55 p.m. the business under consideration was interrupted by Mr. Speaker in accordance with Standing Order No. 26 (1), and the debate was adjourned; to be resumed on 12th March.