I move, as an unopposed motion—

I second.

Agreed to.

I should like to say in regard to Clause 2 that in my Budget speech I forecast that at the close of the year there would be a surplus of approximately £522,000. It is obvious, however, that in view of the increasing expenditure of the Railways that estimate is going to prove to be unduly optimistic. We have had a series of monthly losses since the time of my Budget speech, in fact we have had monthly losses since December, right through till March, the total of which comes to £672,000. As a result of this the estimated surplus of £522,000 will now be a figure approximating £192,000. It still leaves a small surplus, but it is much less than I had anticipated. Hon. members will recollect that for the forthcoming year I am budgeting for a deficit, and it will be obvious from the trend of the present Railway figures that it will be necessary during the year to take steps to improve the revenue side of our Railways. The balance of £192,000 or whatever is the final balance, I propose to apply to the Rates Equalisation Fund which will then leave that fund at approximately £9,889,000.

The Minister now visualises future losses. I think the House and the country would like to know to what this sudden change is due. Hitherto we have been told, year after year, about the magnificent position of the Railways. The country’s economic position seems to be unchanged. What is the reason for this change? Is it the beginning of a new phase in our financial life—is this the start of deflation after the inflation we have had? If not, to what are these losses due?

I should like to make it clear that in my Budget speech I referred to the red light of danger on the matter of expenditure, to the dangerous position as far as surpluses were concerned, because of mounting expenditure. I pointed out that for July, August and September of last year expenditure had exceeded revenue so that it is not surprising now to find that expenditure is mounting and is gradually overtaking revenue. After September the balance went the other way, but as I have pointed out, from December to March again there have been losses …

Why is the expenditure increasing?

The reason is that we are paying cost of living allowances, higher wages, much higher costs for everything we buy and so forth. The expenditure of the Railways, as I have explained in my Budget speech and at other times has steadily mounted in the last 12 months. We are paying no less than £5,000,000 in cost of living alone and we are paying increased wages in quite a number of directions.

The Minister now gives that as his reason. After what the Minister of Finance told us earlier this Session, when he painted a rosy picture of our economic position, which he said was going to be exceptionally sound, it was most alarming to hear this statement made by the Minister of Railways. After the optimistic speech of the Minister of Finance, in which he excelled himself in his eloquence, I am sure the country will be very much alarmed at this statement by the Minister of Railways. In the past, Railway revenue has always been regarded as a sort of barometer of the country’s general economic position. It may perhaps be as well for us to have had this statement from the Minister of Railways. He is now warning the country that the red light has begun to show itself. He speaks of an increase in expenditure, but if we read the reports of his department we find that traffic continues to be very heavy, not only in respect of passengers but also in respect of goods, nor are only the Railways faced with increased costs and increased cost of living allowances, but other departments are in the same position. I want to reiterate that these remarks made by the Minister are giving us cause for serious alarm.

I am very glad that the facts will now bring home to the country and to this House something which apparently my statements cannot bring home to them and that is that expenditure is at present mounting over revenue. Let me emphasise that we have not done anything during the war to increase rates—we are still on the same revenue-earning basis from the point of view of charges as we were at the beginning of the war and it is inevitable that after 4½ years of war the expenditure should be rising. I have not raised Railway charges up to date.

Does that mean that we can anticipate a raising of rates in the future?

Not necessarily rates. I have various resources; I have a Rates Equalisation Fund and other resources. I do not want at this stage to make any general statement on future financial policy. I must therefore decline to answer the question which was so categorically put, but expenditure is mounting. I would however emphasise that our revenue is not falling—our revenue is still keeping up. The returns which you see every week in the papers are quite healthy. The revenue is keeping up, it is only that expenditure is overtaking it and therefore my surplus has been cut into.

If your losses continue at this tempo you will be obliged to put up your rates.

My charges will have to go up in one direction or another.

Clause put and agreed to.

On Clause 3,

When we discussed the second reading of this Bill yesterday we made it perfectly clear that we would not oppose the second reading but that there were certain clauses in this measure to which we objected and that we should deal specifically with our objections in committee. In this particular clause we are introducing a principle which disturbs the existing procedure. We have discussed this matter during the second reading. The State accepts responsibility for financing an industry which, in the opinion of many of us has been privileged for many years and which is quite able from its own earnings to improve wage conditions itself. On the second reading I dealt with the position of the mines as reflected in the findings of the Lansdowne Commission—I refer to page 40. We find there, that from-1911 to 1942 the position of the mines has been a very sound one and that even at this juncture it can be regarded as thoroughly sound. The State now goes out of its way to lay down the principle that it will bear part of the exploitation costs of the mining industry although the condition of that industry as a whole does not justify such a step. We seriously object to the principle, not only because the industry is able to put its own house in order, but also in view of the implications arising from such a step. The implications are twofold. The first implication is that the condition of the mining industry is such that a policy is being followed which is in conflict with the general conception of the duties of industries towards their employees. The mining industry takes up the attitude that its employees must be kept at such a low level of wages that the compensation for their work will not make it possible for them to develop. To cur minds such an industry cannot lay any claim to assistance by the taxpayer out of any fund whatsoever. I have repeatedly referred to the findings of the Lansdowne Commission. Reading these findings, they came to me as a shocking revelation. I make bold to ask whether the Minister of Finance himself has read the findings of the Lansdowne Commission. The Government now proposes to extend this assistance to the mines in respect of wages, but I ask myself whether the Minister has had the time to study the findings of the Commission in their entirety, because in those findings the attitude adopted by the mines is pictured as such that we feel constrained to object seriously to the policy which is being pursued by the mines. That policy has as its object to keep the wages down to a level on which it is impossible for people to live. In view of that fact one cannot understand how the Government can propose to supplement the wages of the employees out of State funds in order to meet the requirements of those employees. The Minister allows the mines to evade their responsibilities to provide for the needs of their employees. We must protest most emphatically against the Government’s proposal. The mines have deliberately followed a policy of keeping down wages and now the Government proposes to supplement the wages in spite of the fact that in our opinion the mines are well able to meet these obligations themselves. The mines are being presented with a subsidy out of the Exchequer and the policy followed by them is being approved. In the second place I want to point out that if the Government new decides to support an industry—a prosperous industry—to support it partly as far as wages are concerned it is creating a precedent the implications of which cannot be foreseen. Reasonable prosperity is prevailing today in many industries. It is improbable that a good case could be put up for a subsidy being granted to other industries. But the time will come when conditions will change. Bad times may be ahead of us. They may come just as they came after the last war in the great world depression. Will the Minister then be able to refuse to assist other industries if he assists the mining industry today by means of a subsidy. Is this not going to place an obligation on the Government in future to finance other industries also. There is no comparison between this and the protection of other industries by means of price fixation and customs duties. We on this side object on principle to the Government’s proposals and that being so we cannot possibly give our support to this proposal to help the industry out of State funds as far as the wages are concerned.

When one gives a Christmas box one usually gives it at Christmas time. It need not be exactly on the 25th but perhaps a week or two before that time. But we are only in June now, six months before Christmas and here the Minister introduces a provision in this Bill which means nothing less than giving the mining industry a magnificent Christmas box. I use that word deliberately because it is nothing but a Christmas box. In this instance the mines are being given a very fine present by the Government. The Minister can make all sorts of excuses but it simply amounts to this that the mining industry is being given a present free, gratis and for nothing. The Minister puts forward the reason that the money had been paid into Loan Funds. We don’t tell the Minister to pay the money into Loan Funds. It could have been paid into Revenue Funds. Another story we have been told is that an additional tax had been imposed on the mines in certain circumstances and that that tax is now being refunded to them. We have so often heard this story about poor mines. I assume that there are mines with a low ore content which are not as flourishing as other mines, but surely the Minister is not going to tell the country in all seriousness that the industry as a whole is in a precarious position. Earlier, the Minister of Transport painted a gloomy picture of the position in his Department as a result of increased costs. Only this week we saw the annual reports of mining companies published in the newspapers showing the profits and dividends of those companies and it is palpable that we are not dealing here with a whole lot of poor mines. That is the trouble in connection with this whole question. This concession is being applied not merely to certain mines which are finding it difficult to keep going but it is being applied to all mines, even to those making huge profits. I received a letter from the Department of Agriculture this morning. I had applied for certain farmers in my constituency who had suffered heavy losses as a result of the drought to be included in the scheme for the supply of seed wheat. As the Minister of Irrigation knows the Leeugamkadam has been dry for a whole year and the farmers in the area have not been able to sow any wheat. The reply I received was that his scheme would apply only to 13 farmers under the dam. I telephoned the Department and I asked them why there was a limit to the number, and the reply was that the magistrate had made an investigation and had found that only 13 farmers under the scheme were really in need of assistance. Now I should like to know why a similar rule has not been followed in regard to the mines. In principle I cannot approve of this subsidy to the mines. It is bad. But if the Minister had said that there are certain mines which are finding it really difficult to keep going; that they are no longer working at a profit, and that this additional burden of having to pay higher wages could not be faced by them, he would have a certain amount of ground for the repayment of this tax to the mines. But we now find that he is applying it to all the mines, rich or poor. The principle which is being laid down is thoroughly unsound; and we have to repeat the question which we have asked before, because it cannot be asked often enough: If this principle is to be applied to the mines, where is it going to end? If the Minister favours the mines in particular what about the factories and the industries which also have to bear additional expenses. The Minister of Transport told the Minister of Finance a short while ago what his difficulties were, and why he was getting less revenue. He explained that his running costs had gone up; but we have exactly the same increase in other industries and other concerns. Is the Minister going to tell us that this or that industry cannot bear these additional costs; that their expenditure has gone up by so much or so much and that they must therefore be compensated out of State funds to bear those costs during the war years? That is the principle laid down here. No, I’m afraid—one doesn’t like to look for motives—that we are compelled to look for motives here and to ask the question why the mines are being specially favoured in this instance. This side of the House has had to protest continually in the past against the special favouritism shown to the mines. The reason is to be found in the fact that the mining magnates are the Government’s very good friends. They are the people who when there is an election put their hands in their pockets to assist the Government with the necessary election funds. And then we also have this fact. We know that Mr. John Martin, the big boss of the mines.

And also of the Government.

… also travels with the Prime Minister, the only man who travels with him to London. Before the London Conference it was specially announced that on this occasion the Prime Minister was not accompanied by his ordinary advisers, who used to accompany him in the past, except the Secretary of his Department who of course had to go with him. But Mr. John Martin, the big boss of the mines did accompany him.

As guide, philosopher and friend.

One doesn’t like to look for unworthy motives but we can arrive at no other conclusion that here again a present— a Christmas box as I have called it—is being given to the mines, and that it is being done only because the mines are the Government’s special political friends and contribute to its election funds.

I do not think my hon. friends on the Opposition benches can accuse me of being a particular friend of the Chamber of Mines. Nevertheless I cannot agree with them in their objection in principle to this clause. The funds provided by this clause for the so-called subsidisation in respect of a small increase of unskilled wages on the mines are from the gold realisation charges. An impost which constitutes a direct tax on the product of the gold mines is in itself an unfair, an economically unsound tax. The remission thereof for this purpose does not seem to me to be a case supporting the general principle of subsidisation of wages. In any event, as I have pointed out before in this House, I believe that the State takes too large a share of the product of the gold mining industry, having regard to the remuneration of the workers in that industry. The State takes £28,000,000 worth of the product of the gold mining industry as against £12,750,000, which is the share in the form of wages of the 300,000 unskilled workers that are employed in the gold mining industry.

What are the dividends?

The dividends, I think, amount to about £13,750,000; £28,000,000 goes to the State, and £12,750,000 to the unskilled workers, while £20,500,000 goes to the European workers. That is a thoroughly unsound distribution of the product from every point of view, more particularly as to the large share taken by the State and distributed amongst the general public of the country in some form of services. Any extent to which that position is adjusted in favour of the workers in the industry, is sound. The criticism I have against this clause is as to why the Minister has limited this subsidy— I am not going to admit it is a subsidy, but I shall describe it as such for the moment— why he has limited it to this small increase. I know what the Minister will reply. He will say it was in terms of the Prime Minister’s statement earlier in the Session and that it was agreed upon between the Government and the gold mining industry. That raises the point whether that statement should have been made, as to whether this clause should not give effect to the full recommendations of the Mine Wages Commission. I know, Sir, I cannot discuss the Commission’s recommendations in detail on this clause, but it recommended an increase which it did not even pretend amounted to a living wage to the unskilled workers on the gold mines. It recommended an increase of 4d. and 5d. per shift in the pay of surface and underground unskilled workers respectively. It recommended overtime as dealt with in this clause. It recommended a cost of living allowance of 3d. a shift, and a boot allowance which would work out at 1d. a shift. If these full recommendations had been put into effect, the cost would have been about £2,600,000. According to the Prime Minister’s statement, this clause if put into effect, will mean an increase in wages amounting to about £1,800,000. According to the Mine Wages Commission the total of the gold realisation charges amounts to £2,200,000; in other words, the increase it is proposed to finance by this clause will be about £500,000 below the amount of the gold realisation charges. The Commision, in commenting on the financial capacity of the gold mining industry to pay the increase it recommended, said this—

I think the amount has fallen since then.

That was the 1941 figure.

The paragraph continues—

That is more particularly the case when the gold realisation charge is being handed back to this industry. I have explained that I am not objecting to the principle, but even accepting that principle I want to suggest that with the gold realisation charge amounting to £2,200,000, the whole of these increases recommended by the commission could have been met, and I will tell the Minister where the balance of £400,000 could have been found. That is the amount that is paid in pass fees. Those are charges in respect of the unskilled workers in the industry, for which there is no return; in fact, there is the opposite of a return. The remission of that amount received from pass fees plus the gold realisation charges would be sufficient to finance in full the recommendations of the Mine Wages Commission. I must express my amazement at the Government not having—more particularly in view of the financial facts I have mentioned—not having accepted these very modest increases recommended by the Mine Wages Commission. Through this clause they are proposing to finance increases which, according to the Prime Minister’s statement, will amount to £1,800,000 a year. That is £400,000 a year less than the amount of the gold realisation charges. We on these benches do not accept the reasonings of the commission, more particularly in regard to finance. We do not admit that any industry is entitled to base itself on a standard of unskilled wages which admittedly does not meet the bare needs of the worker and his family and relies on overburdened agriculture in the reserves to subsidise the wages paid. That is where the real subsidy comes from; that is what is subsidising the industry—the ruin of the agricultural industry in the reserves required, the continual taking away of the manpower required there to keep the lands cultivated. That is what is really subsidising the gold mining industry. The gold mining industry is subsidised by the whole native policy of this country at the cost of the future of the native people of this country. It is not subsidising so much in this particular form, by this paltry £1,800,000 being handed back to the mines. The subsidy which the native population of this country contributes to the gold mining industry cannot be estimated in terms of financial balance sheets; the price is the depletion of the manpower of the reserves, the neglect of agriculture in the reserves, and the erosion of the soil in the reserves. I do want to ask the hon. the Minister in view of those factors I have placed before him that at least the whole of the gold realisation charges should be devoted to the financing of these increses in the wages of the native unskilled labourers on the mines that have been recommended by the Mine Wages Commission. That would mean the payment of an additional half a million pounds for this purpose. [Time limit.]

This question has been discussed repeatedly and I have explained the matter several times from the Government’s point of view. But as I haven’t succeeded in the past in convincing my hon. friends I am afraid that I shall not be able to do so today. Nevertheless I propose repeating a few of my arguments. As a result of the Lansdowne Report the Government found itself faced with an immediate problem. There were of course certain very far-reaching aspects of that problem, but we were faced with this immediate problem and we availed ourselves of the means at our disposal for a temporary solution of the problem. The more far-reaching aspects of the question will of course require further consideration. Then we came to the question of where the money was to come from. It could be found in two ways. We could either have said that the mines had to pay it, which would have meant a reduction of profits. That would have meant in the first instance that about 70 per cent. of that money would have had to be found by the Government out of revenue; in other words 70 per cent. of that money would have to have been found out of that reduction of the Government’s taxes. But in the second instance it would have meant that there would have to have been a reduction of the pay limit, which would not only have had an effect on the low grade mines but also on the position of all the mines in regard to the working of low grade ore; in other words there would have been a large quantity of ore which couldn’t have been worked. That was one way. We thereupon decided not to follow that course. We decided to accept the alternative proposal that is, to use the money available in the Gold Realisation Fund. That was part of the money which they had to provide for production costs. That money had always remained part of the production costs although the Treasury for a time had the use of that money. It had no effect on their profits. The Government had had the benefit of that money for two or three years but it had always been part of the mines’ production costs. Now money is required for something else in connection with their actual production costs, that is for wages, and what we are doing here is to make this money which has always been regarded as part of their production costs available for that purpose. It makes no difference to their profits. It makes no difference to the amount of taxation which the State gets, and it seemed to us the right course to follow—the course which would involve the least number of complications.

†The hon. member for Cape Western (Mr. Molteno) complains because we have not gone further in the acceptance of the recommendation of the Lansdowne Commission. These recommendations would, if fully implemented, have cost about £2,750,000 instead of the £1,850,000 which will have to be paid. If I understood the hon. member correctly, he thinks that the gold realisation fund this year will have more money available than will be required to give effect to the recommendations in full.

I was going on the Commission’s figure.

Those were the figures of two years ago. My hon. friend has quoted the amount paid to shareholders and rightly referred to the fall in dividends of mining companies. There has, however, been a further fall of £2,000,000 since. That is largely due to the fall in gold production, and that fall in gold production is immediately reflected in the gold realisation charges, which are of course based on the actual production of gold.

What is the estimate for this year?

The estimate is £1,850,000. In other words, we are expecting to make available for these purposes the whole amount in that fund. My friend thinks we might go further by way of a remission of pass fees, but that is not our money. At the present moment it is a provincial source of revenue. Those pass fees also represent an item of working costs, and they are therefore on the same basis as the other working costs.

Why is it a working cost?

†The MINISTER OF FINANCE:: It is a payment by the mines in respect of pass fees for their native employees, and it is consequently a working cost. They have to pay the pass fees for the natives. That is why, I take it, the hon. member has linked up this item with his proposal. I do not think, however, that we can overlook the fact that if we had adopted the hon. member’s nroposal, and taken the revenue derived from pass fees, we would have been depriving the Provincial Council of a source of revenue.

Why don’t you do it by way of legislation?

That would not have been very popular.

I have heard the Minister speak on this subject on several occasions and I must say that I have never yet heard him less clear and have never seen him in such difficulties as those in which he landed himself today when speaking on this subject. I have nothing against the native representatives; I have nothing to say against the wages; I have no objection to the natives on the mines being paid those wages. But to argue that rich companies which pay millions more in dividends than the whole agricultural industry—to say that they shouldn’t pay, but the Government should pay those increases seems so ridiculous to me that I think the hon. the Minister should be ashamed of using that argument. That is why he says that he isn’t speaking on behalf of big capital. He doesn’t care where the money comes from as long as the natives get better wages. I can quite understand the hon. member’s point of view; all he is concerned about is the natives. I am concerned about the future, not about the natives only, and I repeat that it is a disgraceful thing for the Government to pay a subsidy to a profitable industry in the way it is proposing to do now. The Minister repeated his one argument today— that low grade ore would now be worked. This subsidy would assist in the working of the low grade ore. As far as the mines are concerned the position clearly is this. The mining companies have no soul—they are not national minded; all they look at is the money they can make; and to ask me to approve of a subsidy to an industry which is doing so well is asking too much. It reminds me of the poor who haven’t got food every day. They are so poor that they have to starve; they cannot afford to buy food because the little money they have has to be handed to the Government to pay the interest on the loan made to them. Whether it comes out of the Gold Realisation Fund or out of any other fund it is the Government’s money and whether the Minister takes it out of one of those funds or from Excise Duty it is one and the same thing. The Government is taking public money to subsidise the wages of the mine natives. This money doesn’t belong to the mines. I have a say over that money and every citizen in the country has a say over it. The Minister may as well say that he can use the taxes which are levied on the mines to pay the natives higher wages. The Minister is creating a precedent which is going to give us a lot of trouble in days to come. Tomorrow or the day after tomorrow the white labourers will also ask for a subsidy, and they will also ask for more pay. Is the Minister going to subsidise them too? And on what grounds can he say that he is not going to do so? If he does it for the natives he is compelled to do it for the Europeans as well. Whether it comes out of the Gold Realisation Fund or any other fund the money belongs to the Government. It doesn’t belong to those people. I don’t expect that type of argument from the Minister of Finance. He knows better than that. He is now going to pay out £1,850,000 for that purpose. He tells us that if the increase in wages amounts to more than that, they will be paid out pro rata. Pro rata what? The ore they work? The wages they pay? The natives they employ? What will be taken into account? I can see a case sticking out between the mining companies which will have to be settled. One will say that it has to be paid out pro rata the value of the gold. Another will say that it depends on the ore it works, and the next one will contend that it requires to be paid out according to the wages it pays. Doesn’t the Minister think that this clause should be amended? Isn’t it going to lead to a lot of trouble? I fail to see any justification for paying out a few million pounds to the mines for this particular purpose. I quite appreciate that they don’t pay their natives enough and I also realise that they pay their other workers too little. But now the Minister tells us that if we don’t pay this subsidy we shall not get the amount of taxation from the mines which we would get otherwise. In other words of this £1,850,000 I am still getting back £700,000 in the form of increased taxation, which means that he is now going to invest £1,850,000 and he is going to get a return of £700,000. That is one of the reasons he mentions for subsidising native wages out of public funds. I don’t think I need make any comment on that. The Minister cannot put up as a defence that by giving this subsidy he is going to get a little more in taxation. The mines are not individuals—they are not persons with souls. A mine is simply worked by a company which takes out of the bowels of the earth what it can, and if it can get no more out of the earth the hole is left there and we shall have to close it up, and the mining concern will put its employees on the streets. We have had experience of that sort of thing. During the last war, when the copper mines in Namaqualand were payable concerns, the companies got as much copper as they could out of the mines and when the war was over, and the price of copper dropped they put their employees out and didn’t care what became of them. The poor Cape Provincial Council had to make arrangements for sending these people away by train and for distributing them among the farmers. The gold mines will do the very same sort of thing. They do not care what becomes of the people who work for them. They have no soul. One cannot be sorry for them. They make huge profits. Some mines make almost 100 per cent. profit and they are going to be assisted by the State. Can you believe it?

They are all going to get this assistance whether they are payable propositions and make profits or not. The rich mine, making enormous profits, is going to get the same benefits pro rata as the mine that works low grade ore. Is that fair and just? One could perhaps put up an argument in favour of the mines working low grade ore. One might say that they are doing a service to the country by making profits, by putting money into circulation. But these mines are not concerned with the country and the people. All they are concerned about is their own pockets. They take all they can get out of the mines. When the mines are worked out we are left with the holes in the ground. They are not even going to fill up those holes. What right has the Government to take £1,850,000 of the country’s money and hand it over to the mines. I have never heard of anything more scandalous. The Government subsidises the labour of rich companies, but if a poor farmer who for years had no decent income wants to borrow money for seed, he can get no help. [Time limit.]

There are a few other aspects with which I want to deal before the representative of big capital, the hon. member for Houghton (Mr. Bell) regales us once again with one of his interesting speeches. The first point I want to make is this: One of the reasons put up in connection with this matter is that if this assistance is not given the mines will stop working low-grade ore, which they are doing at present. This question of working low-grade ore, or rather lower grade ore is becoming a sort of bogy. Our whole policy aims at getting the mines to work a lower grade ore than they did before. We have actually reached the position that we are giving subsidies for the working of uneconomic ore. It is a vicious circle in which more and more assistance has to be given for more and more unpayable ore to be worked. At some time or other we shall have to decide that the gold mines must work payable ore in connection with which no assistance from the State will be necessary to keep an unpayable business going; when that is done they will be able to build up reserves for the future. I know that the Government is as frigtened of a precedent as a hare is of a load of buckshot, but the Government is actually creating a precedent now, and that is to pay a subsidy to a certain industry in which the employees are not getting high enough wages—irrespective of the question as to whether that industry is a profitable one or not. Where will it lead to? One of these days we are going to be faced with bad times and a number of industries will approach the Government and tell it that if they do not get a subsidy to pay their employees their employees will no longer be able to earn a decent living. The Government is creating a precedent here. It is perfectly true that the Government is wrapping this precedent up in cottonwool, or rather that it is covering it up with a lot of sophistry, but the fact remains that the principle of the subsidising of labour is being laid down, no matter how one puts it. Other industries will put up a very much better case than the mining industry. They will be unprofitable industries. And what is the Government going to do then? Is it going to subsidise one industry after another in respect of wages. But there is a further point, and that is that apart from all this sophistry behind which it has been trying to hide the true position, we are dealing with mines that have made enormous profits and are still making enormous profits. The mines are making huge profits and yet the State has to see to it that the employees get a decent living. If they were working at a loss, one might be able to say a word in support of this step taken by the Government, but that is not the position. Let us cast aside this sophistry. What we are doing here is paying the mines a subsidy with public money. The Minister has selected the one industry which generally speaking is a very payable one. Let me mention some of the dividends paid by those mines, and these are the mines which are going to get a subsidy in respect of the labour of their labourers. All day long we are told of the enormous taxes from the mines. The hon. member for Houghton is ready with another of his Jeremiahs. But let us look at the profits they make even after the deduction of the taxes. That is the test. Is there any reason to help this industry. I have taken the figures of a few of those companies to see what dividends they pay, and to see if the lack of dividends is such as to warrant State help to pay their natives a decent wage I take the figures for last year—

Those are the poor people who have to be helped. These are not profits on capital but actual dividends after the deduction on taxation and they are to get this £1,850,000 which the Minister wants to give them.

How many years ago were those companies floated?

That doesn’t matter.

Apply it to all companies.

My contention is that companies which are able to pay such dividends should not get a subsidy from the Government to cover the wages of their employees. The hon. member asked how many years ago those companies were floated. As many years ago as the hon. member still had common sense.

Buy those shares and see how much you get in dividends.

The point I want to make is that tomorrow or the day after other industries will be asking for subsidies and those industries will not be making profits like the mining industry. They will ask for a subsidy for their employees—and the industries will be industries which are not making a profit— they may even be working at a loss. And what will the Minister do then, after having created this precedent to subsidise the mines? Will he be able to refuse them? The mines are alleged to be unable to pay decent wages yet they aie paying 30 per cent. to 90 per cent. in dividends, and they are going to be paid this £1,850,000 subsidy. The Minister will then have to pay other companies which are working at a loss 100 per cent. subsidy. The Government is afraid of precedents but it is now creating a dangerous precedent for the future. As a result of this measure we are going to have a confusion which will have disastrous results.

The hon. member for Humansdorp (Mr. Sauer) seems to think that I just exist in this House to represent big capital.

You said so.

I did not say so and I have never said it and I don’t know where he got it from. I made no such statement and I do not represent big capital any more than he does. I am interested in the maintenance of private enterprise with all the benefits it stands for, just as much as he probably is. I was very interested to hear the hon. member for Cape Western (Mr. Molteno) criticising the gold realisation charge and describing it as an unsound economic principle. I have criticised it for some time and I have held for some time that it never was justifiable for the product or the gold mining industry to be taxed in this way. It was nothing but highway robbery when it was done. It was a blatant tax on the product. I do not like the principle which is embodied in this clause. The only thing that can be said for it is this that it is a temporary measure, it is purely an expedient, because when the Prime Minister made his statement to this House, he made two points clear; he made it clear that the gold realisation charge which has been in force for some years and has totalled many millions, should be made available to meet this extra charge for wages, and he made it clear that these wages would not be met to an extent exceeding the amount of the money accruing from the gold realisation charge. He made it clear further that it was in respect of the financial year 1944-45 that it was intended to pay it. My concern is this, that this subsidy—if such it may be called—to the mines to meet this increased cost in wages does not in any shape or form alleviate the difficulty of those mines, which were making a loss before the increase in wages took effect this year. I was hoping that the Minister was going to make available the gold realisation charge to all the mines, that he would give them full price for their product so that those mines which were in difficulty would be able to use it to meet working costs. Those mines which have been described by the hon. member for Humansdorp are mines which he has picked out—they are mines which are making a good profit, and those mines because of the profits they are making, will be refunding to the State three-quarters, 75 per cent. of that realisation charge. It would come back to the State. And those mines which were not making profits, which were working on a loss basis, would have that amount towards making up their losses, but this scheme now involves the absorption of the whole gold realisation charge for compensating the increase in wages.

Do you agree that there should be an increase in wages? And if you do where should it come from?

Yes, I think it fair and it should come from an adjustment of the taxation. The hon. member for Cape Western made out quite a good case. The share which the Government is taking from the mines is big. But the hon. member for Cape Western only referred to direct taxation; he made no reference to indirect taxation, which is very heavy, running into several shillings per ton. It has been computed that indirect taxation may run to 5s. per ton. I think the Government should help to put the mines in a better position, and the time is approaching, and approaching fast, when we shall have to formulate a sound future policy as far as the mines are concerned. This arrangement is a palliative; it is a temporary measure; it is made clear that it is for a year, and for that reason I wont criticise it, but I think we have to get down to it and I think the Minister should take steps to formulate a sound policy for the future. We have to remember that as soon as the gold mines increase the native wages it will have repercussions throughout the country.

That will make the Government sit up.

Exactly. The Lansdowne Commission comments on the subject and says that it is of opinion that any increase of wages on the Rand will have repercussions outside the Rand. It refers to the Barberton district as a good example of an outside district. Well, it must have that effect. It will go further than that—it will also affect the coal mines. But the difference between coal mines and gold mines is this, that if the working costs of the coal mines increase they can put up the price of coal by 1d. or 2d. but in the case of the gold mines they cannot do that. The price of gold is fixed. Now I want to ask the Minister this. I take it that the recovery of the extra cost of wages will be available to all gold mines irrespective of whether they are on the Rand or not.

This clause is quite general.

Yes, I read it that way. How is it intended to pay? Once a year or in instalments?

That is a matter for the Mines Department.

I raise this aspect because many of the smaller mines, which are called upon to pay extra wages, will be embarrassed if they have to pay out each month and then have to wait a year or more before they can recover anything.

I think that is exaggerated.

I don’t think so. I know something about the small mines.

I know more than you do.

The hon. member may, but the Lansdowne Commission make specific reference to the fact that the increase in wages in the outside districts may even lead to the closing of some mines. I hope the Minister will see his way to work this out on a pro rata basis, say once a quarter or once every half-year.

I want to object most emphatically to this amount of £1,850,000 being given to the mines as a subsidy for increased wages to the natives. As far as the hon. member for Houghton (Mr. Bell) is concerned, he is known as the handyman of the Chamber of Mines. The proposal to grant this amount of money contains an unsound principle; it is a discrimination which must lead to conflict and discord. Why cannot a similar amount be given to the farmers or to the industrialists as well? I also object to this subsidy because it is being given to the wealthiest section of the country. I want to associate myself with what the hon. member for Humansdorp (Mr. Sauer) has said, and I would like to add that there is no section of the community making as large profits as the mining interests. Those people don’t care what becomes of South Africa. All they think of is profits and bigger profits. They never think of rendering services to the country, and I contend that the Government should grant this assistance to a community which renders service to the country—a community such as the farmers and the industrialists. I want to point out that some mines have paid out as much as £150 for every £1 invested and yet they are now to be subsidised. I have a third objection. This money is not provided for love of the natives, it is not being given to the mines because the Government feels sympathetically disposed towards the natives—but it is paying out the money because it feels sorry for the Chamber of Commerce. It is there where the agitation started for higher wages for the mine natives with the object of increasing the purchasing power of the native. I say definitely that the people who are going to get the benefit of this £1,850,000 are not the natives but the commercial community, and nest the Chamber of Mines. We know the native; he uses the money he requires for his needs and the rest he spends on luxury articles. I make bold to say that at leaest 80 per cent. or 90 per cent. of this £1,850,000 will be spent for the benefit of the commercial community. It will flow into the coffers of the commercial community and the Chamber of Mines by means of its chain stores. I therefore contend that the principle of this provision is unjust to the country and I raise the strongest objection to the Government’s policy.

This is a particularly important matter because my view is that in the light of this small increase the position cannot be left as it is. I feel that I should make it clear to the Minister that we on these benches cannot accept the Government’s explanation as a satisfactory one as to why this clause limits the assistance to a less extent than the Mine Wages Commission recommends. The Minister said quite rightly that the amount of the gold realisation charges referred to by the Commission was a figure for two years ago but that that figure is not the same today. Nothing that I said was intended to admit that the increase in native mine wages should be limited to those figures. What I did suggest was that it was the duty of the Government to see that the industries of this country, particularly the mining industry pay, a living wage to their workers. According to the Lansdowne Commission, the amount of the gold realisation charges was £2,200,000. The Minister has pointed out that the figure is not so large today but that doesn’t detract from my argument. I also pointed out that the Lansdowne Commission increase did no establish a living wage. All the Lansdowne Commission suggested was a small step in that direction, and the very least the Government should have done was to give effect to these recommendations. I did suggest further that increases in unskilled wages of workers on the mines should be financed— could be reasonably financed—by a remission of taxation, because the mining industry has to pay the State £28,000,000 and it only pays its unskilled workers £12„750,000— an entirely unjust balance as between their contribution to the State and to their own workers. It seems to me therefore sound that a remission of taxation should be resorted to. And it should not necessarily be limited to the proceeds of this particular fund. Now hon. members on the Opposition benches have referred to this as a subsidy. In a way, through the machinery set up by this clause, it does look like a subsidy. I have made the submission that a remission of taxation for these purposes is reasonable. Although this looks like a subsidy I submit that it is really a remission of taxation, but it would not be any use just remitting taxation in the way referred to by the hon. member for Houghton (Mr. Bell) because that would not meet the case of the lower grade mines. The wages are based on what the lowest grade of mine can pay. If we simply remit taxation it will leave the principle unimpaired. If, however, the proceeds of taxes are taken and then distributed over the mining industry in relation to the wages they pay, although in effect it may be a subsidy it means a remission of taxation and a spreading of the costs involved by increased wages. That is sound, and I do not think it can be done in any other way as for instance by a single a remission of taxation. I do not, however, believe that the limits of the gold realisation charges should be regarded as the limit to which we should go in putting into effect the recommendations of the Commission. The hon. the Minister stated that I was suggesting utilising the proceeds from pass fees which were at present a source of Provincial revenue. That was not my contention. What I did say was that the pass laws should be abolished, and then automatically the fees would be swept away; and that would be well within the powers of the Government. I want to put this to the hon. members on the Opposition benenes. There are only two sources out of which these increases in pay can be financed, either through the remission of taxation—and I suggest that in effect that is what this is rather than a subsidy—or out of dividends. I quite agree—I do believe—that the profits of the mines should be made to bear some proportion of the increase; but how is that to be done in a manner which falls within the power of the Minister of Finance? There is only one way that can be done, and that is to make a Wage Board determination for the gold mines. That is the only way in which they can be forced to pay any proportion of these increases out of profits. I have often asked in this House why the gold mining industry is not made to submit to the Wage Act. The Wage Board is never requested to investigate wage conditions as far as the gold mining industry is concerned. I do ask the hon. members on the Opposite benches if in future they will support me when I ask the Government to apply the Wage Act to the mining industry. So long as the Government is not prepared to order a Wage Board investigation into the gold mining industry, then the only way it can secure an increase in wages is by machinery such as this they are setting up here. I felt myself it was a thoroughly unsound procedure to set up a Commission without any statutory powers at all for a matter of this kind. The question of native wages should have been investigated by the proper body, namely, the Wage Board. The Government would not do that. In spite of demands made on it for a Wage Board enquiry, it insisted on appointing a Commission, and therefore this is the only way in which they can secure lawfully an increase of wages for the unskilled workers on the mines. They are doing it by a remission of taxation. I am not saying for a moment that all the increases should come out of dividends, but what I do say is this, some of them should come out of dividends, but the Government has itself to thank in having to finance these increases by taxation remission because it refused to apply the machinery of the Wage Board to the gold mines. Not having done so, its only alternative is a remission of taxation. In respect of the actual increases the Government has not gone nearly far enough, not even as far as its own Commision recommends. Under the Wage Act they would have had to have a Wage Board recommendation, and then they would have had to accept it or turn it down; there would have been no alternative. This is a curious procedure, but having appointed the Commission the Government now has no choice but to finance all the increases themselves. I hope that in future when I make demands on the Government, that the mining industry should be subject to the discipline of and conform with the industrial laws of the country; hon. members on the Opposition benches will support me.

The hon. Minister has not yet replied to the most important point, and that is that this money is being taken out of the loan fund. He began by asking how it had come into the loan fund. That is not the point we are making from a public finance point of view. The fact is that that money is in the loan fund, and it is now being taken out of the loan fund in order to subsidise the wages of a particular industry. That is the point. It does not matter whether it was part of the production costs or whether it was highway robbery originally. If we condemn it from a public finance point of view, it is because, whatever happened in the past, that money is at present in the loan fund, and it is being taken out of the loan fund in order to subsidise a particular industry. It is of no avail to ask under what circumstances it was deposited into the loan fund. Because in that case the Minister condemns himself, since he is responsible for the fact that that money was deposited into the loan fund. It is not something that he inherited from his predecessor. The other point in regard to which we feel that no satisfactory reply has been given, is that by means of this subsidy and the manner in which it is being given, a distinction is being drawn between the rich mine and the poor mine, between the mines earning large profits and the mines whose profits are dwindling. No distinction is being drawn between the mine which is working low-grade ore, and the mine working high-grade ore. We say that if it is the intention to help the mines which need assistance, and if it is the intention to encourage the mines to work lowgrade ore, it can, if necessary, be given in that way by means of a subsidy, but in that case rich mines and poor mines should not be treated on the same basis. That is the other objection we have; and the third objection is this. If any assistance has to be given why is it not given on a sound basis? If the production costs have become very high, cannot those production costs be reduced without making a raid on loan funds? The other day I mentioned the case of the railway tariff in respect of coal from Witbank which goes to the mining companies in Johannesburg, a distance of 100 miles, and it is more than 6s. per ton. We know that the pit head prices at the coal mines are of the lowest in the world. I notice in the report of the Low-Grade Ore Commission that the following statement is made—[Translation.]

The average pit head price of coal which was sold to the gold mines during the year ending 30th June, 1931, was 5s. 7.9d. per ton, but as a result of railage the average price on delivery was 12s. 2.6d. The administrative costs of the association is less than ¾d. per ton sold.

That difference of more than 6s. is almost entirely due to the railage. Taking the 1930 figures of coal which was used by the mines, more than £500,000 was expended on railage alone for the conveyance of coal from Witbank to Johannesburg. I want to know whether the mines cannot be assisted in that way if they really need assistance?

An indirect method.

It is a sound business method. In comparison with the tariff for exporting coal, it seems to me to be an entirely excessive tariff, and this would be a sound method of reducing production costs. The State bears 70 per cent. of the increased production costs in any case. It would therefore, if there are decreased production costs, get 70 per cent. benefit. Of this £500,000 therefore, if it could be reduced, the State would get a great portion; it would get 70 per cent. of the reduction. The mines would benefit to a certain extent, and the rest of the benefit would go to the State. I merely mention this as one method which could be used to lower production costs in a sound financial manner. I do not want to say that it is the only method. There are quite possibly other methods. But it is not the correct method to make a raid on loan funds. Our fourth objection is the dangerous precedent which is being created here. Here we have an industry which contributes more than £100,000,000 to the national income, an industry whose percentage of the national income amounts to 22 per cent. That industry employs approximately 20,000 Europeans and approximately 200,000 non-Europeans. That is a rough estimate. I think the hon. member for Houghton (Mr. Bell) can correct me there.

It is approximately 40,000 Europeans.

Let us take it at 40,000 Europeans.

And 300,000 natives.

Let us take it at that. Those 40,000 Europeans and 300,000 nonEuropeans account for 22 per cent. of the national income; and then we have the agricultural industry. We have the following figures in respect of the agricultural industry: They account for 12 per cent. of the national income, and that is earned by 35 per cent. of the European population of South Africa and 77 per cent. of the nonEuropean population of South Africa; in other words, it is earned by 696,000 Europeans and 6,000,000 non-Europeans, as against the figures of 40,000 and 300,000 respectively in the case of mining. Assuming that the farmers—the agriculturalists also complain about increased production costs—assuming that the farmers came to the Government and said: “Our production costs have increased; we want the Government to give us a subsidy in order to meet the increased costs of production.” What would the position be then? They would say: “You did so in the case of the mines; why can’t you do it in our case?”

What sort of argument is that?

We say therefore that this is a dangerous precedent, and we must guard against placing ourselves in a difficult position. Languishing industries may then ask for similar assistance. If it is the general policy to subsidise every industry in order to keep its production costs low, one could understand it, but there should not be discrimination as there is in this case. Then I just want to say a few words in regard to the arguments which the Minister advanced in connection with production costs. He said that this had always been regarded as part of the production costs. If I understand his arguments correctly it means that in the past the gold realisation costs formed part of the production costs. Today it is still part of the production costs. So as far as that is concerned there has been no increase in the production costs. The fact that the Government took it does not make any difference. Their production costs have remained the same. The Minister nodded his head when I said that they still had to nay the production costs. They paid the gold realisation costs before 1940 as nart of their production costs, and they are still paying it today. As a result of the arrangement which was made in 1940, that portion of the realisation costs which they expended at that time and still expend today, was got back from the people who sell our gold overseas and they are now paving 168s. for our gold in South Africa instead of overseaes. That is the contract which was made by the Government. It did not involve the gold mines in any extra expenses. The only difference is that we introduced this very sound principle that we are now getting this price for our gold in South Africa and not overseas. I hope the Minister of Finance will see to it that this princinle is also maintained after the war. [Time limit.]

I just want to explain this point again. The mines have always paid the costs in connection with the realisation of gold. Those costs rose when the war broke out. Formerly it amounted to something like 3s. per ounce. It was part of the production costs. The Government was then placed in a position of being able to sell all our gold to the Bank of England and to receive the full price for it. The arrangement therefore amounted to this: The mines then disposed of the gold to the Government, and the Government then arranged for the realisation proceedings to take place without any expense. The Government was therefore in the position of effecting the realisation without any costs, and it therefore made a profit on the realisation.

Did the mines suffer any loss?

No, they received the same as they did previously, namely, 165s., but the Government was in a position to sell the gold without itself incurring any costs. That represented profit which was made by the Government, and because that was obtained by way of a windfall, we deposited it into the loan account.

Why in the loan funds?

It was a windfall, something of a temporary nature. It would have unbalanced the Budget at the time, and we then placed it on loan account, but it did not represent ordinary loan receipts. We made this profit, and the mines have always paid us for the realisation of gold, but our costs have disappeared. It was always part of their production costs. The hon. member now asks why we did not give subsidy to every mine separately. I think that would have created a very dangerous precedent.

You do that in the event of drought or floods.

We are dealing here with something which is part of their costs of production, and we feel that in the circumstances we followed the best course by allowing them to use this amount in respect of production costs.

†May I say to the hon. member for Houghton (Mr. Bell) that it is proposed by the Department of Mines to make monthly payments in respect of this fund; such payments will of course have to be subject to adjustment at the end of the year.

The Minister has referred to some aspects of the points made by hon. members opposite about the Government robbing loan funds, and I should like to deal with that. This is not a fair accusation to make. I submit that if the Government had looked on the gold realisation charges in the first instance, as legitimate revenue, this money would have been paid into revenue account. In fact, however, they look upon it as a windfall. I go further and say that they looked upon it to a certain extent as if the money did not really belong to them. I do not think that the money did belong to the Government. In the ordinary way of business one would have put this money into a suspense account. As we have no suspense account what else was there for the Government to do? They did not want to use the money as they would revenue; they felt that later there would have to be some adjustment concerning this money. The Treasury have only the two accounts revenue and loan. They paid it into Loan Account. At the same time coming to the pay-out of this money not only many hon. members in the House but the country generally does not like this arrangement. They agree that faced with a crisis the Government were acting under compulsion; they were compelled to do something and they had recourse to what was the readiest means that came to hand for helping them in the situation that had arisen. But that can only be looked upon as something temporary, even as a makeshift, and the aspect of the matter with which the country is concerned is that though this has been done they feel that it provides no solution. They appreciate that it is only a makeshift, but they are asking what is going to happen afterwards? It would appear that no principle has been laid down at all in handing over this money. The mining industry, as such, over a period realised a certain amount of gold and these funds accrued from the realisation on that, and the whole amount for that period has been handed over to the mining industry as such. If that is so, if that is why the Government has acted that is because it belongs to the mining industry. I submit they shoulr hand over all the money standing today in loan account under this head to the mining industry. But I do not think that this is the reason why the Government has handed over this money; they refuse to admit any ethical obligation. The Government felt that the mining industry was in a hole, and that they could help out the industry by resorting to this temporary expedient. I submit that when this step was taken some basis should have been laid down. The Government should have said: We are helping you over a difficulty now by handing you over this money—there is no reason for the whole lot being handed over—because you are only in a difficulty in regard to these low grade mines, only in regard to the mines that are making no profit or very little profit. Why then should we not confine our help to these mines only; why should we hand over the whole sum, giving the rich mines and the poor mines, and the mines that are even worse than “poor”, a pro rata equal share? There I think is where a mistake has been made, and we can realise how the Government made that mistake. But I would submit that since this is only a temporary measure, we have to think of the future, and that the Government will have to get down to some principle as a basis for their contribution, haying first agreed in principle that they are going to use this money say in the same way as it is proposed to use excess profits. The Government has admitted that very large taxes have been taken from private industry during the war, but they have made provision that in the event of losses the contributors to that excess profits tax shall be reimbursed to the extent of their losses. There is the principle laid down, and I should like to see that principle applied to the case of the mines. I think it would produce a great deal more satisfaction throughout the country than exists over the present arrangement, and I rise principally to make that point, that since the Government is handing over this money—it is not they say conscience money, if it was they would give the whole lot—as a contribution to meet an emergency, that emergency can only exist in the case of low grade mines, or the mines not making a profit, because we have to bear in mind that today all the mines are working quantities of low grade ore. But the big mine should not be able to come along and say: We are working only low grade ore, and we are therefore entitled to share in this benefit. We are speaking about the bona fide mine that has all the trouble in the world to keep its head above water and to keep going. But there is no justification for a rich mine which is paying large dividends drawing a penny of this money from the gold realisation charges. That brings me back to the point that we are not making a contribution from this fund on any ground of principle or the ethical sanction, but merely on the grounds of expediency to assist the mining industry in this emergency.

I am sorry that once again I have to say a few words in regard to the alluvial diggers. The Government is making a very big mistake in subsidising the mines to the extent of £1,850,000. I feel that if the gold mines are subsidised in this way, the alluvial diggers are equally entitled to a subsidy. I have pointed out ad nauseam what the position of the diggers is. I pointed out that they were a great asset to the country and that they can be a great asset in the future, but it seems to me that it is felt that the diggers are disappearing from the scene, and that they may just as well disappear. I think that is very wrong. Today there are still twelve constituencies where there are large numbers of diggers, and they are as much entitled to support from the Government in respect of their non-European labour, as the gold mines.

The hon. member is out of order. He cannot discuss that.

Then I just want to make a few observations in regard to the effect of this subsidy to the mines. There is a great scarcity of non-European labour on the farms, as well as on the diggings. By giving this subsidy to the gold mines, the non-European labourers are given a greater incentive to leave the farms and the diggings. The mines are able to pay good wages. Now the State comes along and helps them to increase their wages, and that must necessarily attract even more non-European labourers to the mines. The farmer and the digger will be prejudiced. They will be unable to obtain non-European labour. I cannot but strongly protest against this subsidy to the mines.

I should like to take this opportunity to refer to the bankrupt and narrow economic policy of certain members of the Opposition in their criticism of this payment.

It is the mines that seem to be bankrupt.

I refer particularly to the hon. member for Swellendam (Mr. S. E. Warren), the “know-all” of his party, and who took the opportunity of attacking this industry as a whole. There appears to he a growing tendency to assert that any undertaking which would deserve every praise if conducted by that indeterminate entity, the State—which incidentally can always charge its losses, its expenses and its muddles and extravagances against the public—if carried out by the State, automatically acquires all manner of evil characteristics when it is conducted by private enterprise, which pays for its mistakes with its own money and also contributes out of its own pocket to the public purse. I am quite confident that the economic policy of the Opposition on this industry will only spell ruin to the future of this country. In addition this particular industry has a very particular significance. 70 per cent. of its profits go to the Government. The Government which has no capital outlay in this undertaking, which has no capital risk, benefits directly to the extent of 70 per cent., and yet we hear criticisms from the hon. member for Swellendam (Mr. S. E. Warren) that the mining industry will dig holes and leave him as an “Unie burger” to fill them up. I can quite imagine that he would fill them up if hot air would fill them.

You are now becoming offensive.

Hon. members forget that increases of cost on the mines take place in the same way as they do in agriculture, and hon. members opposite are very prone to talk about those increases. We appreciate that economic factor—we appreciate the fact that the farmer has to meet increasing costs and wages, and we also appreciate that the mines have increasing costs to meet and in this instance increasing wages. But in the case of agriculture we meet these increasing costs by increasing the price of the product, but with the gold mining industry the price of the product is fixed. This is obviously the way of approaching this increase in the cost of production and for hon. members to resort to the type of criticisms which we have been listening to is quite unjustified. I do not remember any suggestion in this House that the rich farmer should bear the subsidy on the increased cost of production of the small farmer. It has never been suggested. When the price of wheat was fixed at 36s. the rich and the poor benefited alike. Therefore I feel that this House and particularly the farming community should realise that this industry is a national industry, and that we must tackle it in a national way and not in a narrow bickering spirit.

The hon. member for Orange Grove (Mr. Waring) tells us that the mines are paying 70 per cent. of their profits to the Government. Up to 1933 the mines never paid more than £9,250,000 per annum by way of dividends. The average was approximately £8,000,000. After we left the gold standard, the price of gold was increased from 85s. to 168s., and the dividends rose to £22,000,000 per annum, with an average of £17,750,000. Can the hon. member explain that to us? Can he explain why, if a subsidy was not required for increased wages before 1933, it is necessary today when the mines are paying so much more by way of dividends.

What about the increaesed cost of living?

I am not talking of globular profits, but of dividends which are paid out after taking into account all the increased costs. Take the position of the farmers. In the year 1931-’32, the price of wool fell to 2d. a lb., sheep to 5s. and 6s., and cattle to a few pounds per head. The price of gold remained at 85s. As against that the mines bought their products more cheaply. The depression was in their favour. After we departed from the gold standard, the price of gold to the mines was doubled,

What is the income per ton?

That does not matter. I am pointing out that much higher dividends are being paid in comparison with the pre1933 period. We can only come to one conclusion, and that is that the mines are today making a much higher nett profit. I agree with the hon. member for Vasco (Mr. Mushet) that the Government is not justified at all in paying this subsidy to the rich mines in respect of native labour. If the Minister thinks that he ought to assist the low-grade ore mines to enable them to make higher profits, we can still understand it. But what justification is there for paying it to the rich mines as well? The hon. member for Vasco is quite correct in saying that here a precedent is being created which will in the future have to be followed in other cases as well. Investigations are being made in connection with low-grade ore mines, and it is therefore possible for the Minister to determine which mines need this assistance in order to be able to continue. Let him give the subsidy to those mines. I repeat that there is no justification for giving this subsidy to the rich mines as well.

The hon. member for Orange Grove (Mr. Waring) said that the hon. member for Swellendam (Mr. S. E. Warren) is the “know-all” of this party.

You, too.

According to his speech I can only say that the hon. member is the “no-blow-all” of his party. He says that no distinction is drawn between the big farmers and the small farmers. Does he not know that a distinction is drawn between the big farmers and the small farmers as far as the price of mealies is concerned.

The difference is only 6d. per bag.

But, comparatively speaking, a big difference is made.

What about wheat?

Do not try to run away now. That distinction is also drawn in the case of transfer dues because if the farmer buys a bigger farm, transfer dues are payable on a higher scale. A distinction is drawn therefore in the case of farmers. The argument of the hon. member for Vasco (Mr. Mushet) cannot be answered by the Minister. It is an absolutely sound argument that if it is the intention of the Government to assist the mines, one can make out a case—I do not say that I would be in favour of it—to assist those mines which need assistance. Reference has been made to the enormous profits which are made by some mines, and the argument of the hon. member that we should not pay the subsidy to those mines is quite correct. There are many other institutions, bodies and businesses which also suffer a great deal as a result of the war circumstances which have brought about increased wages. I refer, for example, to the school hostels which are required to pay the cost of living allowance. In my constituency there is a small school hostel which has to pay £130 per annum in the form of war allowances. Comparatively speaking, that is an enormous amount for such an institution, and it cannot afford it unless it is paid at the expense of the children. They are compelled to pay this allowance and yet they do not receive any subsidy, while this enormous sum is being paid to the rich mines. I want to tell the Minister again that this clause is causing an enormous amount of dissatisfaction, and since the leader of the financial group on his own side of the House has advanced this argument, I hope the Minister will pay attention to it.

As a member representing a gold mining constituency I would like to invite hon. members opposite to give us their policy on the taxation on mining, and their considered policy as regards gold mining industry on the Witwaterstand. I invite the hon. member for Fauresmith (Dr. Dönges) to speak on behalf of his party. He is pretending not to listen. I invite the hon. member for Winburg (Mr. Swart) who is pseudo-economist—he really knows little about economics—to get up and tell us what he and his party wants. As a matter of fact he got up here the other day and said that the policy of the Nationalist Party was State mining. When we go back to Johannesburg we would like to know if that is the considered policy of the Nationalist Party. I seriously invite these hon. members to give us their policy. Are they in favour of State mining? And if they were in the Government today—they tell us they will be there tomorrow—what would they do in regard to native wages on the Rand? Because these wages may go up again. Now I would ask this alternate Government what they would do about native wages on the Rand. Would they say to the gold mines: “Put up the wages, and do not work the lower grade ore”? If the gold mines did that there would, of course, be less money for any Government; they would not be able to pay the taxes they pay today; and less money for the Government means less money for the farmers, less subsidy, because let me tell hon. members this, that the subsidy on the price of mealies over the economic level comes out of the gold mines. All the low tariffs on the railways, below the economic level, come from the gold mines. All the big irrigation schemes, which we run below the economic level, are paid for out of the gold mines. In fact South Africa is based on gold and the harder you make it for the gold mines, the more difficult you make it for the farmer. Let my hon. members consult the experts of the Treasury. We don’t know what their political opinions are and we don’t care, but ask them whether the policy which the Government is bringing forward is the correct policy, or not. Now the hon. member for Humansdorp (Mr. Sauer), who has no knowledge whatsoever of the gold mines and the gold mining industry, based his whole argument on the fact that there are certain dividends paid. He mentioned a number of mines and I pointed out to him that some of these mines were over 45 years old. He says that didn’t matter. Well let me put the position to him in a different way. I know of farms which used to be sold at 4s. and 5s. per morgen which, today, you wouldn’t get for £20 per morgen. Who has caused the price of the land to go up? Is it the farmer? No; railways have been built in certain parts; roads have been constructed; buildings have been put up nearby and there has been an unearned increment in land. We all know that. I am not blaming the landowner—it is the system in South Africa. We have never taxed unimproved land values and I am not suggesting that we should. You take land near a town which you could buy at one time for £2 per morgen. Today you have to pay £100 and more for it. And what is it all based on? The gold mines of the Rand. The hon. member for Drakensburg (Mr. Abrahamson) and myself, lived in the same little village 63 years ago. There were no gold mines in those days, and what was our position. We had very little to eat and very little to wear.

Oh, no.

Oh, yes. That was the position before the Kimberley diamond fields were discovered. The republics were using “blue-backs” with nothing behind them —no reserve behind them. The farmers could sell nothing because there was nothing to sell. I remember farmers coming from Rustenburg and other parts with oranges and skins and exchanging them with my friend’s father, who had a shop, for clothing and groceries. There was no money. Do we want to go back to those days again? I say that my hon. friends opposite are most irresponsible on the question of the gold mines. Let them tell us what their policy is. But what are we doing. We are basing our economy on the low native wage on the gold mines and the higher the native wage on the gold mines goes, the more difficult it will be for the gold mines to carry on, and if the gold mines cannot carry on to the extent they are doing today, the harder it will be for any Treasurer, no matter which party he may belong to, to find the wherewithal to run the country. That is a fact. We cannot get away from that. We in South Africa live on gold. Yes, on the Rand we may live at a little higher standard than others do but we all live on gold. Yet fools rush in where angels fear to tred. There are a large number of economists who would not dare say what these so-called economists here have been saying against this slight remission of taxation. I say the Minister should never have taken these gold realisation charges. It was sheer highway robbery. And now he is giving something back and we have all this shouting. My hon. friend over there forgets that when he buys gold mining shares and he gets a dividend—part of that dividend is amortisation. He gets a small part of his capital back, because it is a wasting asset all the time. Let him go and buy Langlaagtes and see what he gets out of it. Let him put his Parliamentary earnings into Modder Deeps. Let my Nationalist friends put their money into the old gold mines and see what they get, and if they want to be clever let them start a big gold mining company in the district of the hon. member for Winburg—where Western Holdings are—let them start a big gold mine, put in a few million pounds and leave their money there for a large number of years without any interest at all. They may not get back anything at all. But they rush in and make statements here. Fools rush in … I say to the Minister that he will be the first Minister to realise that the whole of our economy is based on the black man’s back and if you lose that black man you’ll have no gold mines and no prosperity, and then you’ll have no Nationalist Party, and God knows we don’t want to lose the Nationalist Party; because if we did not have a Nationalist Party the Government would fall in a week. Our Ministers dig a grave for themselves or that Nationalists Party always rushes to fill in the grave.

The hon. member for Orange Grove (Mr. Waring) made a statement here with which I fully agree, and that is that the big difference between agriculture and the mining industry is that the mining industry has a stable price. He then goes on to say that it is in favour of the agricultural industry that they have not got a fixed price. One of the great difficulties in agriculture, in fact, is that they have not got a fixed price. It is to their deteriment. Let me give you the position in respect of the price of agricultural products. If you take the basis of the period 1923-1924 to 1928-1929, and compare it with the period 1935-1936 to 19391940, it will be seen that the scope of the total agricultural production increased from 100 to 141. The scope therefore increased by 41 per cent., but the value over the same period only increased from 100 to 121. Although there was an increase of 41 per cent. in the scope, there was an increase of only 21 per cent. in the value. If one could give the agricultural industry stable prices one would render the agricultural industry a very great service. I agree with the hon. member for Orange Grove, but his conclusion is wrong. I want to come back to the question of the gold realisation costs as forming part of the production costs. We have this position, that the Government is still paying the same amount for the gold of the mines that it paid previously. The mines are paying no more in respect of their production costs than they did previously. That gold is now being sold to the Reserve Bank. It is now the Reserve Bank’s gold, and the bank receives more advantageous terms in reselling the gold. It still gets 168s., but insteaed of receiving 168s. delivered in London, that is the price delivered in Cape Town. Who made that contract? Who ought to get the benefits which flow from the contract? It must surely be the Government, which was the owner of the gold at that time. It sells the gold and enters into a contract advantageous to itself and as a result of that advantageous contract, the Government is now getting what the Minister described as a windfall. It takes that money, and quite correctly puts it into the loan fund. The Minister says that we could not do anything else, because it would have thrown our whole budget out of gear. But in 1941 he again put it into the loan fund. In 1942 he again deposited it into the loan fund, and in 1943 did so again. He did not say: “Even though it is a windfall, I know that I am going to get it this year; I am going to put it into revenue account, and I shall therefore be able to levy less taxation. It is not necessary now to levy all those taxes, because I obtained this income as a result of the contract into which I entered.”

The proof is that the Minister did this from year to year. Having regard to the fact that the Government is able to sell gold in this country today at the same price which it previously obtained for deliveries in London, it is important that we should retain that after the war, but then we must not say that it is something which is due to the mines if we are able to sell it in South Africa. We are a very big gold-producing country. The gold production has fallen in all parts of the world. In this country, too, the production has fallen somewhat, but not to the same extent. We are therefore in a particularly fortunate position in comparison with other countries. We have our gold here and we have the Reserve Bank which makes provision for it in its safes which are specially constructed. We can keep all the gold here. It is not necessary to incur any realisation charges, if we can arrange that with the other countries. If gold has to be shipped from England to America, it could remain in South Africa physically, and it would only be necessary to make a book entry to the effect that the gold which is in this country in the name of England, is now transferred to the credit of America. All the realisation charges could then be eliminated. I think that is the ideal for which we should strive. We received this advantage in the war circumstances, and we should retain it; but then we should not say later on: “The Government acted wisely in eliminating the realisation charges, and we must now give the mines the benefit of those realisation charges as a moral right which is due to them.” It is no moral right. It is due to the sagacity of the Government that 168s. is being paid for gold in South Africa instead of in London, and the only one who has any right to it is the Government, the peoeple of South Africa. The mines are getting the price which the Government undertook to pay them. Their production costs have not risen by a single penny, and this amount therefore legitimately belongs to the peoeple of South Africa, to the Government of South Africa; and we say therefore that this is nothing but a subsidy. It is being taken out of loan funds and handed over in that way. I hope that this elimination of the realisation charges will be perpetuated in the distant future, but then the attitude should not be adopted that it will be placed into a sort of suspense account, and that the mines, if they are in difficulties at any time, will be able to ask for a subsidy out of that account. I do not want to take this matter any further. I think we have now put all our points. In principle we are bitterly opposed to this act on the part of the Government, this raid on loan funds. We have given our reasons and will now abide by the nation’s judgment in regard to our attitude as opposed to the attitude adopted by the Government.

Clause put and the Committee divided:

Ayes—56 :

Abrahamson, H.

Alexander, M.

Allen, F. B.

Barlow, A. G.

Bawden, W.

Bell, R. E.

Bodenstein, H. A. S.

Bosman, J. C.

Bowen, R. W.

Bumside, D. C.

Butters, W. R.

Christopher, R. M.

Cilliers, S. A.

Clark, C. W.

Connan, J. M.

Davis, A.

De Kock, P. H.

Derbyshire, J. G.

De Wet, P. J.

Du Toit, R. J.

Faure, J. C.

Fawcett, R. M.

Gluckman, H.

Gray, T. P.

Hare, W. D.

Hofmeyr, J. H.

Hopf, F.

Johnson, H. A.

Lawrence, H. G.

McLean, J.

Maré, F. J.

Molteno, D. B.

Morris, J. W. H.

Neate, C.

Payne, A. C.

Pieterse, E. P.

Prinsloo, W. B. J.

Raubenheimer, L. J.

Robertson, R. B.

Shearer, O. L.

Shearer, V. L.

Sonnenberg, M.

Stallard, C. F.

Steenkamp, L. S.

Sturrock, F. C.

Tighy, S. J.

Ueckermann, K.

Van Niekerk, H. J. L.

Van Onselen, W. S.

Visser, H. J.

Wanless, A. T.

Waring, F. W.

Warren, C. M.

Wolmarans, J. B.

Tellers: J. W. Higgerty and W. B. Humphreys.

Noes—25.

Bremer, K.

Brink, W. D.

Conradie, J. H.

Dönges, T. E.

Erasmus, H. S.

Grobler, D. C. S.

Haywood, J. J.

Klopper, H. J.

Le Roux, J. N.

Louw, E. H.

Ludiek, A. I.

Luttig, P. J. H.

Malan, D. F.

Nel, M. D. C. de W.

Potgieter, J. E.

Serfontein, J. J.

Stals, A. J.

Steyn, A.

Swanepoel, S. J.

Swart, C. R.

Van Niekerk, J. G. W.

Van Nierop, P. J.

Warren, S. E.

Tellers: J. F. T. Naudé and P. O. Sauer.

Clause accordingly agreed to.

On Clause 6,

An amount of £54,587 5s. 5d. is being written off here, which is of course welcomed by this side. It seems that this amount which is being written off is in connection with vines which were planted, and which did not grow as well as was expected, or which bore very poorly, and the result was that the Government was compelled to write off. But what we object to is that this unlimited power will be given to the Minister of Lands. There is a provision in line 56 which states that the purchase price will be reduced by an amount which the Minister of Lands deems reasonable in any particular case. What we should like to know is whether the Minister of Lands has any scheme which he can submit to us, or has his department got any scheme governing the manner in which debt is to be written off, because we feel that as this clause stands it is too wide. The Minister may benefit certain people and not others, and we feel that he should take the House into his confidence and tell us what basis he proposes to adopt.

The amounts which are being written off here fall under three heads. In the first place, we are dealing with the reduction of the value of the vines, in the second place with the valuation which was placed on citrus trees, and thirdly, the valuation in connection with peach trees. The position was as follows: When the settlers were tenant farmers the Administration decided at the time that two out of every seven or eight morgen which they got, should be set aside for the planting of vines. When they passed out as tenant farmers, the price to them was worked out not according to what it cost the State, but the tenant farmers were charged according to the value of the vines—what was regarded as the value—at the stage when they had developed to their full bearing capacity. The tenant farmers themselves developed the vineyards but the valuation placed on them was based on the value of the vines in full bearing. A portion of them did not bear. In any event the position is that a value of £47,500 was placed on the vines, over and above the cost to the department. The people agitated against it. In the second place, I come to citrus trees. In that case too the Administration told the plotholders that they had to put so much land under citrus. It appeared after four or five years that citrus was not a success in that area, that the frost was to severe, and all the trees had to be uprooted. The value of the citrus trees, which was added to the price of the holdings, was £4,023 11s. In order to protect the citrus trees against frost and cold, the department instructed them to plant peach hedges in between the citrus trees. They did not plant a type of peach which finds a ready market, but trees which did not bear at all. When they took out the citrus trees, the people found that they were left with peach trees which did not bear. The amount with which they were burdened in respect of peach trees was £3,053 18s. That is what the department had contributed in respect of the peach trees. How did we arrive at the valuation and the amount to be writen off? First of all the Land Board went into the matter, and a special commission was then appointed to make a valuation and to see where the people had paid too much. They then reported that when these people passed out the department required them to pay for the value of the vines in full bearing, and it was recommended to write that off. The same applies in connection with the citrus trees which were uprooted, and when it was later found that the peach trees did not bear, it was recommended in that case as well that a certain amount should be written off. Of course, these people also lost the use of the land during those years when the trees were there. It was a total loss. A survey was made under these three heads, and the department acted on this report.

May I put a question to the Minister? Was the same amount granted to those who had to take out the vines because they did not answer the purpose, as to the others? Was everyone treated on the same basis? In the second place, did these people pay interest on the money throughout the whole period, or is that included in the amount which was written off?

I am not quite certain on that point. This writing off is taking place a few years after they passed out. I think the interest was also written off.

Clause put and agreed to.

Clause 13 put and negatived.

On New Clause to follow Clause 12,

I move—

13. Section four of the Registration of Business Act, 1909, of the Transvaal, is hereby repealed.

Agreed to.

Business suspended at 1.0 p.m. and resumed at 2.20 p.m.

Afternoon Sitting.

On Clause 27

I should like to move an amendment to this clause in connection with the point which I raised at the second reading, namely, that the registrar should not be given an unlimited discretion. The reasons are self-evident. Every company would like to know where it stands, so that it can arrange its affairs accordingly. If it depends on the arbitrary judgment of an official, the company does not know where it stands and it is necessary therefore to limit the discretion to a certain extent. The Minister may say that there will be cases where it will be impossible to lay down a hard and fast rule in the Act. I am prepared to take that into account, and to give the registrar a limited discretion, but not the right which he has at present of declaring the company to be a closed company or otherwise, whether its transactions with nonmembers amount to 1 per cent. or 99 per cent. My amendment reads as follows—

1. (i) not more than 45 per cent. of its total transactions, shall be deemed to be a closed society or company;
2. (ii) more than 55 per cent. of its total transactions, shall not be deemed to be such a society or company.

The effect of it will be that where the transactions of the company with non-members do not amount to more than 45 per cent. of the total transactions, it will be a closed society, and, on the other hand, where it is more than 55 per cent. it will be regarded as an open society. If it is between 45 per cent. and 55 per cent. it will be left to the discretion of the registrar to decide whether the society is a closed or open society. There is a margin of 10 per cent. To that extent the discretion of the registrar is limited by this amendment. If the Minister is inclined to accept this amendment and if he thinks that a margin of 10 per cent. is too small, we will be prepared to increase the percentage to some extent. If this amendment is accepted, the company will know that if its transactions with non-members do not amount to more than 45 per cent. of its total transactions, it will be entitled to the privileges of a closed society. Then there will be no question of the registrar being able to deprive them of those benefits. On the other hand, if the transactions with non-members amount to more than 55 per cent. of its total transactions, the company will know that it will be subjected to the disadvantages connected with an open trading company. It is only when the figure is between 45 per cent. and 55 per cent. that the registrar will be able to use his discretion. I move accordingly.

The hon. member for Fauresmith (Dr. Dönges) mentioned this matter yesterday during the second reading, and he was also good enough to approach me in that connection. I have had an opportunity of further considering this matter. To a great extent I share his desire to limit the administrative discretion, but I do not know whether we ought to apply that restriction in this case. May I just say in passing that the person who will have this discretion will not be an official in my department. It will be the Registrar of Co-operative Societies, who already has very great discretionary power in connection with the registration of co-operative societies, for example. He is a reliable official, and an official who has no interest in the matter from the point of view of the tax collector. But that is only in passing. What we are aiming at is to grant certain taxation privileges to closed co-operative societies which we do not grant to the open co-operative societies. What is our object in making those concessions? Our object is to encourage the co-operative principle, more particularly by favouring trade with members of the co-operative societies; but of course, we have the position that the co-operative societies which were called into being mainly for the purpose of trading with members, have necessarily to enter into transactions with non-members to a certain extent. One cannot therefore limit it in such a way that those privileges will only be given to co-operative societies which trade exclusively with members; one must make it possible for them to trade with non-members as well, in so far as that is necessary to achieve the objects of the co-operative societies. In the second reading debate I gave a definition of a closed co-operative society. A closed co-operative society is one which trades with members in the first instance, and also with nonmembers, but only in so far as that is necessary in order to achieve its purposes. The application of that description of the trade of closed co-operative societies with non-members will undoubtedly have to vary according to circumstances. It will depend to a large extent on the circumstances of the business of the particular co-operative society to what extent it is necessary for that co-operative society to trade with nonmembers, and for that reason I feel that we should give these wide discretionary powers to the registrar. If it is laid down that any co-operative society which transacts 45 per cent. of its business with members will be regarded as a closed co-operative society, one would practically encourage those cooperative societies which transact very little business with non-members today, to extend their business with non-members; one would say to them in effect: “You will now be at liberty to extend your business with non-members, and you will still be entitled to these taxation benefits.” That would conflict with our object. Our object is only to grant favoured treatment in so far as trading with non-members is linked up with the question of trading with members, and I hope therefore that the hon. member for Fauresmith (Dr. Dönges) will be prepared to withdraw his amendment. Then I have certain amendments of which I gave notice and which appear on the Order Paper. The object is, as far as the K.W.V. transactions with non-members are concerned, to regard it in the same light as transactions with members, and that is being done on the strength of the fact that those transactions with non-members are such that non-members receive the same benefits as members. It is therefore a fair amendment; and I move the amendment as printed—

I should like to support the amendment of the hon. member for Fauresmith (Dr. Dönges). I tried to indicate yesterday in what way this would affect a company. We are quite prepared, and all the companies are prepared, to pay taxes on that portion of the turnover and of the profit which they make in trading with non-members. But our difficulty is this, that this provision, as it now reads, will under the Co-operative Societies Act hit those people who are members of the company, and subject them to the provisions of that Act. Those people will now be required to pay. In their case it is no exception. They do their business with their co-operative societies. One does not encroach here on the territory of commerce or trade. It does not make any difference what commerce is going to do; but those members who become members and buy shares, will trade with their own companies. In other words, they trade with themselves. Where people group themselves together under the Act to do business with themselves, I feel it is unreasonable to subject that portion of the business to taxation. The Act does give the right to trade with non-members, and we do not object to paying taxes on that portion of the turnover and the profits, but as I said yesterday, I do not believe this provision will answer its purpose. We know that the commercial people feel that the co-operative societies are taking business away from them. Here it will make no difference to the turnover of the business; and for that reason I strongly support the amendment of the hon. member for Fauresmith that a provision should be inserted in this Bill which will clearly lay down that if the co-operative societies transact more business with non-members than a certain percentage, they will have to pay taxation on that portion of the business. I feel that the Minister ought to widen the margin of discretion to some extent, but I am strongly opposed to imposing a tax on people who do business with themselves. They are not prepared or inclined to do business outside the co-operative societies, and the Minister now comes along and says: “Because you do business with people who are non-members, you are going to be taxed on your whole turnover.”

I feel called upon to say a few words in regard to this matter. For many years we have supported the principle of co-operative trade. We would like to encourage it, and I am glad to know that the Government is following the same policy. We suggested certain proposals in order to amend the Bill in such a way that, in our opinion, it will continue to encourage the co-operative societies. But apparently the Minister does not want to accept our amendment. We are trying to perpetuate this policy. But if the Minister’s proposals are to become law, will the Minister give instructions that they are to be applied with as much discretion as possible in order to encourage the principle of co-operative trade? A point which the Minister possibly knows, but which I nevertheless want to mention, is this. In our co-operative business we transact our business on a cash basis—or at any rate we do not give more than six weeks’ credit— which practically amounts to a cash basis; and he will agree that it is a praiseworthy object to combat the evil of credit. But we are now handicapped by certain difficulties. One of the problems is the poverty of the customers. Until such time as the co-operative societies have their customers on a cash basis, their poorer customers find it difficult to switch over from their present places of business to a co-operative society. The poorer people find it difficult to become shareholders in a co-operative society. But we are still willing to assist the poor man to become a member of the co-operative society, even though we have to give him a share in the business as a present. But there is a further factor. Not only are there poor whites who want to trade with us in order to get the benefit of our co-operative business, but there are also non-Europeans. They cannot become shareholders. If we exclude them, they lose this benefit, and we are reluctant to do that. We did not establish the co-operative society for their benefit, but since they are able to benefit, why should we not allow them to get the benefit of this co-operative trade? If the Minister regards the matter in this light and if he accordingly instructs the officials who have to give effect to the provisions of the Act, it will be of very great assistance. But there are certain hitches. The Minister can expect us next year, or perhaps even during the recess, to come to him and ask for the removal of these hitches.

Amendments proposed by the Minister of Finance put and agreed to and the amendment proposed by Dr. Dönges put and negatived.

Clause, as amended, put and agreed to.

On Clause 28,

I move—

1. (3) The provisions of Sub-section (5) of Section Ninety-seven shall mutatis mutandis apply for the purposes of paragraph (a) of Sub-section (2) of this section.

Agreed to.

Clause, as amended, put and agreed to.

On the Title,

I move—

Agreed to.

Title, as amended, put and agreed to.

HOUSE RESUMED :

The CHAIRMAN reported the Bill with amendments and specially amendments in the Title.

Amendments to be considered on 2nd June.

I move as an amendment to this amendment—

I second.

“Administrator” in this case mean “Executive Committee”?

If that is so, I hope the Minister will accept it. It is not always the same.

I shall accept it.

Agreed to.

Amendment, as amended, put and agreed to.

Remaining amendments in Clause 3, the amendments in Clauses 4, 5, 8, 9 (Afrikaans), 10, 12, 18, 19, 20, 21 and 22, put and agreed to, and the Bill, as amended, adopted.

Bill read a third time.

I shall not say much on this Bill. I do not want to discuss the question of housing as comprehensively as the Minister did. The Minister explained what had been done and what still remains to be done. I feel that whatever steps are taken by the Government in order to improve housing, and especially to improve the lot of the poor man, will always be welcomed by this side of the House. The Minister quoted a large number of figures which were given to him by the management of the municipal association, and on the basis of those figures he arrived at the conclusion that it will still be to their advantage. The Minister says that if they accept the one to two ratio of loss, it will still be more advantageous to them than the plan which they themselves suggested. The Minister only spoke of the big cities, however, and did not say what the effect would be on the platteland towns.

More favourable.

Assuming that the Minister’s figures are correct and that all the details which he gave are correct. If we want the housing scheme to be a success every conceivable obstruction should be removed. The Minister is keen to have a success made of this legislation in the interests of the people. Why were the housing schemes in the past not as successful as they should have been? We are bearing in mind the fact that there is a war on, as a result of which the housing schemes may not have progressed as rapidly as they should have progressed. I personally was a member of a municipal council, and I do not think our council was any exception to the rule. The main reason why we did not undertake more housing schemes was that we were afraid of the financial consequences. When one imposes taxes in a town, one becomes unpopular, and every member of the council tries to keep the taxes as low as possible and to conduct the affairs of the village as well as possible, and the result is that they are not anxious to put money into housing schemes, because they are afraid that for some reason or other it may not be a success, and that it will involve the council in financial losses. To a great extent I am in agreement with what the Minister said, but if the Municipal Congress decided that the Minister should regard this from a national point of view, I think it is the duty of the Government not only to work out the figures, but to consider the matter seriously. If a success is to be made of the Government’s plans not only in theory but also in practice, the Minister should have the co-operation of the various municipalities. If they are not sympathetic, and if they do not support the Minister 100 per cent., the Bill may be perfect, but it still cannot be a success on the platteland. I received a telegram which indicates that the executive committee of the Municipal Association is not very favourably disposed towards this matter, and I think the Minister ought to go into this. Perhaps the Minister does not regard it sufficiently from a national point of view, but too much from the point of view of £.s.d., and in a matter of this kind he should rather forget that and try to obtain full co-operation, especially of those who have to carry out the scheme. The telegram which I received is from Mr. Scholtz, chairman of the United Municipal Executive. His telegram reads—

That is not correct.

They go on to say that the Minister’s proposal that the loss should be borne by the State and the municipality in the ratio of two to one, is not acceptable to the local authorities. That is what the chairman of the Municipal Congress wired. There are two aspects of this case therefore. I am not going into the sums of money which the Minister mentioned, and the taxes which the municipalities will gain or lose. I admit that, but if the peoeple who have to carry out the schemes are not satisfied, it will not be of much avail. This Bill can be as perfect as possible, but if the Minister does not obtain the co-operation of those people, not even to mention the fact that they object, as is shown by this telegram, the Minister can take it for granted that his good intentions will not materialise in practice. I hope, therefore, that when the Minister decides in regard to the portion of the loss to be borne by the municipalities, he will meet them as suggested by the governing body of the municipal association, and that he will give effect to their request to limit the responsibility of the local authorities to 1¼ per cent.

It is clear that this Bill is going to be acceptable to the House and to the country. The reason for that is that it is obviously a step in the direction of the extended recognition of the responsibility of the Government for housing that large majority of the people who cannot maintain a roof over their heads by their own efforts. That, Sir, has been the general rule in all countries in recent years, that is to impose the responsibility for housing the poorer people on the central government, which is responsible for maintaing a standard of public health and public decency. I am not going to say that the recognition of that principle is long overdue in this country; but it has needed extension and it is now getting that extension here. One of the problems of this country is that such a large proportion of our population is entirely incapable of meeting the cost of reasonable housing, and a special obligation lies on the Government here to provide, in increasing quantities, the amount of money that is necessary to maintain a reasonable standard of living in a country where the earnings of people who build houses are so very much out of proportion to the earnings of the vast majority of the people who have to live in those houses. That circumstance imposes a special obligation on the Government, but it is a circumstance that will tax to the uttermost the resources and the imagination of the people who are going to run this Planning Council which the Minister is establshing under this Bill. I have no doubt they will be equal to the task if they are chosen with care, but there is one gap in the composition of the Council as it is defined in the Bill and adumbrated by the Minister, to which I would like to draw the Minister’s attention in the hope of his assurance that it will somehow or another be filled. The large proportion of the population which it is sought to house under the provisions of this Act is a section which is governed and controlled by all sorts of laws and conditions which are not commonly known to the ordinary citizen. I refer, of course, to the native population. The native population will be one of the major responsibilities of this Planning Commission. A large part of the problem facing the Commission will be to provide housing for our native population, especially the urban native population, and I suggest that if it is going to meet that demand, it is imperative, not simply that there should be a representative of these interests either on the Advisory Council which the Minister proposes to set up by this Bill, or even on a sub-committee to advise the Planning Commission. I feel very strongly that it is absolutely imperative that there should be somebody with specialised knowledge of native problems on the Planning Commission itself. There are special reasons for this, not because the native population is in fact any different from other sections of the poor population, but because of the differential laws which control and interfere with the movement of the native towards fields of employment. In every movement of the native population towards fields of employment he is circumscribed by conditions which do not apply to other sections of the population. This results in the creation of a very specialised field of knowledge and experience, and it is a field which also demands, for its effective treatment, a considerable diversity of knowledge of economic and social factors. Without this knowledge I do not believe this Commission can function adequately. I may mention only one or two of the problems which arise in regard to the housing of the native population. Apart altogether from the essential poverty of the native population and the inadequacy of its earnings to meet the ordinary cost of housing in this country, a difficulty which has increased considerably since the outbreak of the war, there is this problem of the right of movement of the natives towards the towns which has been debated at intervals in this House in the course of this Session. The movement of the native population towards centres of employment is a controlled movement, and that control is sought by the Government on the grounds that there is no housing available for these people, but when we demand that housing should be provided, we have been met with the argument that it is impossible to provide housing for a population, the number and stability of which cannot be guaranteed. It is said that it is impossible to provide housing for a population when you do not know the extent to which the development of industry is going to make or maintain demand for that population. Now, Sir, that is the sort of problem which cannot be left in the air in the way in which it has been left in the air in the past. If we are going to plan to meet this problem we must have some reasonable basis on which to plan and we must have the sort of people in control who understand all the factors. In other words, it is absolutely imperative if we are going to plan for this large section of the population. That we must plan in terms of the prospects of industrial expansion or contraction, and that can only be done by people who’ understand the problem. Another aspect of the situation is related to and derived from the policy of segregation; the acceptance by this country of residential segregation. This has created a problem of transport for native workers which is increasingly engaging the attention of the responsible people. It is true that problems of transport have arisen in other countries, and among other groups of the population, but never to the extent to which they rave arisen, and continue to arise, in a country like this with its insistence on residential segregation. The distance of such housing as is contemplated from the centres of employment will have to be considered by a Council of this kind. This is a problem which must be seen in its wider aspects, both economic and social, with a view to the provision of subsidies of transport. There is a limit to the distance of a man’s home from his work beyond which it becomes both economically and socially unsound; and this matter will have to be kept steadily in view, particularly in regard to the housing of native workers. Consideration will have to be given to the danger of excessive distance, considering not only the financial stability of the worker but his ability to give effective service to his employer. The former danger will have to be met by subsidies for transport but if this is to be the accepted line of policy, the latter danger will remain. Now I want to draw the Minister’s attention to another aspect of this question so that it may be passed on to the Planning Council on its inception. There is a movement at the present time to solve the problem of squatters on European farms in the Border districts which I represent here by setting up large townships of natives on the outskirts of European cities, far enough away from the city to satisfy the aspirations of the European population for separation and to save the European urban ratepayers from the burden on its rates which inclusion in the city would involve. If this scheme is carried out it will make it impossible for the workers for whom the scheme is devised to go home to their families at night. In other words, Sir, if this proposition is allowed to get under way it is going to mean the establishment of housing schemes so far away from the centre of employment that the workmen will have, in fact, to pay two rents, and maintain two establishments for that is what it will come to. That is the sort of situation with all its economic and sociological problems which tends to arise out of the traditional attitude of South Africans to the problem of native urbanisation and native housing, and I suggest it is the sort of problem which does require very special knowledge and very special handling by a Commission of this kind. Here is another aspect of the case which I feel ought to be faced from the beginning and must be put in the forefront of any planning for native housing. In the towns, under the present law, there have been two types of housing possible for African, one provided by the local authority and one by the native himself on a plot rented from the Municipality. All along the latter scheme has been much the more popular with the native population for reasons which are obvious to those who know anything of the conditions under which the native population has to struggle and strive for any sort of social advancement. It is a fact that on the whole, the housing provided by the Municipal authority is superior to that provided by the native himself, but the native clings to the house that he has been allowed to build for himself on a rented site, because for the bulk of them it is the only investment an urban native can make since the Native Laws Amendment Act of 1937 which finally took away from the native the right to buy property in urban areas. I have found in my experience that the native population will cling to this type of location, the location of the Bloemfontein type, even though it doesn’t achieve anything like the standard of Bloemfontein housing, in preference to low rents and attractive housing facilities, such as are provided for instance at Port Elizabeth. I see the conflict in close proximity, as between Port Elizabeth and a place like Uitenhage where the individual builds his own house. Here he clings to his right to do this, because first of all it saves him rent and in the second place it gives him the chance to leave a little property, the only sort of fixed property he can leave, to those coming after him. In recent years, with the progressive attempt to improve native housing, the municipal housing scheme has more and more taken the place of the native-built home with, admittedly, an improvement in standard of housing but with progressive opposition from the native population and it has not been possible to counter that opposition for the reason I have just given, linked with the fact that, in the past, the sub-economic housing schemes have not permitted of the alienation of the houses built under them to individuals. Now in this Bill a house can be alienated to a tenant under certain conditions. I think myself that it is an excellent provision, because I feel that the whole compass and plan of sub-economic housing schemes should be steadily to raise the stability as well as the standard of living of the family; and stability under the capitalist system does depend on the property basis, therefore I support wholeheartedly this proposition in the Bill. I do want to urge on the Minister, that he will impress on his Director of Housing and on his Commission that this principle should be applied to native housing as well as to European housing, and that from the beginning the native population should be encouraged to realise that with thrift and careful management they will also become owners of their own homes. By that means, I think we can get some of that personal pride and stability into their lives which the location system with its public housing and general instability has failed to develop, has indeed destroyed where it has existed. Finally, I want to say this. I do realise that what I am asking for is a lot. I am asking in fact that on this Commission there should be someone who has got a special knowledge of the conditions of native life. I am also asking for someone who has the training and experience to evaluate the economic forces at work in our society, and the sociological conditions which govern our lives and the lives of the native population. Now the Commission is limited in number, and I notice therefore it is difficult to get all these qualifications separately represented on it. I do believe, however, that it is possible to get all these qualifications in one person, because I know that people who apply themselves to the problems of the conditions of native living have to learn a good deal about the economic and sociological conditions surrounding that living. Or let me put it this way. The people who do apply their minds to the problems of native living are usually people who have begun by realising the way in which their conditions have cut across the lines of healthy economic and social organisation and advance. So it would be possible to get these qualifications in one person and I believe it would be of the greatest advantage to the Commission in all its work to have such a person capable of applying this sort of experience to its work. On the Minister’s own statement it would appear that he has already filled up all the seats on the Planning Commission. I had hoped he would allocate one of the two undefined seats for this purpose. He has, however, told us that he has decided to give one of the seats to the Deputy-Controller of Building Materials and one to a representative of the Department of Economic Development. I quite appreciate the desirability of having both these people on but I do feel still that without the sort of person I am suggesting here, the whole of this Commission is going to be seriously handicapped in the work it is to undertake. For the rest, the personnel of the Commission consists of professional people with admittedly extremely important professional qualifications, but those professional qualifications are not enough. It is absolutely essential in my opinion to have someone with the sort of experience and background I have suggested that will integrate this experience of all these professional persons into the social pattern which is essential to the effective administration of the purposes for which the Planning Commission is being established. Unless the whole of our housing development in South Africa can be inspired by imagination, by vision and by courage it is going to take us a long time to get up on the accumulated demands which are going to meet a Commission of this kind. It is going to need all the courage and imagination possible to meet those demands, and that is why I feel that someone with that sociological experience is necessary to help in the elaboration of these plans. Now let me make one point quite clear, it is one I was very anxious to make clear. I do not think that the addition I have adumbrated as essential to the personnel of this Commission can be satisfied by the appointment of a civil servant from the Native Affairs Department. I am absolutely emphatic that what we want and need in the matter of planning on this Commission cannot be done by a member of this Department. Not that I wish to cast any reflection on the ability of members of your Department—I have said all I feel about that on this occasion this Session and I shall not repeat it now—I merely want to put my contention on this basis, now that in the nature of the case the Department of Native Affairs must, or at least considers it must, carry out the policy of this Government as it sees it. My contention always has been that that policy is contrary to, cuts across the lines of economic development in this country. Now I have not found the Native Affairs Department ready to tell the Government in explicit terms where it finds the policy impossible. Instead it tries to apply a policy which will not work. That is why I feel it is absolutely imperative that we should have someone on this Commission in the capacity I have foreshadowed who is not hidebound by past policies, who does not feel impelled to implement a policy unless he is certain that it does square with the needs of the country and can be put into operation. Of course, I have always felt that policy-making on bodies such as this Commission cannot be done by our civil servants, not because they are not in themselves capable of such work but because they are not trained for it and their obligations to their own job make it impossible for them to take up fully the responsibility that would be involved. Now, finally, it is a fact, as the Minister has said, that the mere provision of housing is not going to solve our social problem, that housing is only one aspect, a most profoundly important aspect, but one aspect only of our social problem which can have dangers as great as its possible advantages as he himself has shown. He instanced how, in England, slum clearance schemes had actually resulted in an increased death rate. This matter was also taken up by the hon. member for Stellenbosch (Dr. Bremer). Experience indeed has shown that people generally try to respond to the provision of better conditions of life, to match their standard of life to these conditions, and often their earnings are inadequate to the demands which this entails. In other words people, if they are given better housing, will try to put a better face on life generally even at the expense of underfeeding themselves. Now to meet this danger, the Minister has suggested that in all these housing schemes there must be linked social services which will ensure that the people will be properly fed as well as properly housed. There is another aspect of this matter I wish to put to him. It is this. I am talking now particularly from my experience of native families. Wherever I have seen such people move into decent houses their first instinct for better living leads them into the clutches of the hire purchase furniture seller. Furniture is as great a problem in the lives of the people you are uplifting as food. They will spend their money on furniture to try to live up to the frame in which you put their lives, at the expense of every other necessity. I know that that is going to be a very difficult problem to meet, but I do want to make this suggestion to the Minister. This Planning Council in any case is going to be faced with the urgent problem of getting down building costs —one of the major social problems of this country is the cost of building and the consequent high level of rents. The Commission will be faced with the business of investigating new methods of building. I want to suggest that, from the beginning they should apply their minds to the possibility of putting in these houses as much built-in furniture, as much fixed furniture, as possible. This is not an impossible demand. I have heard of a variety of schemes which have planned for this. Of course the furniture dealers will not like it. There will be strong opposition from them just as there will be strong opposition from the building industry to the reduction of building costs. But the cost of housing and rehabilitating our poor population will be an enormous national responsibility which will break us if we don’t tackle it effectively, and we cannot afford to be held to ransom by big business interests which will happen if we do not take proper steps to cope with the position. The provision of furniture in the houses is a very important matter. It is a matter for this research branch of the Planning Council to be set up under the Act, to go into very carefully. It should go into this question of having fixed furniture in these houses that will reduce the capacity of these houses for accumulating dirt, and will reduce the possibility of control by the hire purchase furniture dealer over the prospective tenant. On those lines I feel that there are possibilities of making an enormous advance under this Housing Act. I must come back, in conclusion, to what is a fundamental factor in the whole position, that is that the real problem of South Africa is to raise the earning capacity of the population so that we cease to be faced with this enormous problem of social services on a poor relief basis, which is really what we are attempting to face here. I trust that sooner or later this country will face that fact, and if anything can make it face that fact, the rising cost of this housing scheme should make them do it. I believe the Commission will do its best to wake up South Africa to that responsibility; I hope it will and that it will apply its enquiries to the need of narrowing the gap between the earning capacity of the population, and the cost of the necessaries of life, including housing.

May I first congratulate the Minister on introducing this Housing Bill; although people have complained about it being rather late in the session, nevertheless anyone who has been closely acquainted with the Minister during the last few months, cannot help saying that no other man in the country has worked harder to bring this scheme to fruition. I have been asked by Port Elizabeth, the leading municipality in the country so far as housing is concerned, to suggest to the Minister the addition of an addendum to Clause 13 in regard to differential rating. We have tried it out in Port Elizabeth and it does not work. The psychology of the people concerned is that they do not appreciate the reasons why a neighbour occupying the same type of house should pay a lower rent than he does himself. Take this case in point. There are two houses, (A) and (B), of exactly the same type alongside each other. Both houses cost the same, and there are two tenants in these houses. “A” earns £5 a month and he pays one-fifth of his wages in rent, namely, £1 a month; “B” earns £1 10s. in wages and he pays 18s. a month in rent. “A” has five of a family and is a good colonist. “B” has no family; the lady of the house will not assume motherly responsibilities. May I ask the Minister, which of these two people should get the support of the Government first? Think again of the difficulties when temporary sickness occurs in the family, and the wage-earner originally receiving £5 a week in wages has this reduced to £4 10s. He ought to have his rent reduced, but who is going to believe him unless he gets a medical certificate which costs as much as the relief he will receive. The system breaks down there. Then again we take no cognisance of lodgers in the house. You will require a large municipal staff to deal with sickness, lodgers and casual labourers, etc. A casual labourer who makes sufficient money and no more to be in one of these houses, has been known to reuse even to work a litle overtime, for the purpose of remaining in this house. Yes, Mr. Speaker, the difficulties are great in regard to differential rating. We have been told that differential rating works in Britain; there are many things you can do in Britain that you cannot carry out here. Although Cape Town has said they are going to experiment in this respect, they will find out by and by when you are dealing with some of the people who will occupy these houses, that they are a different type to what you would have in Britain. We are told also that this principle will work out quite well in the platteland. If the platteland people are as contentious as their representatives here in this House are, I doubt whether it will work. I want even at this late hour to bring forward another matter. I was compelled to raise it during a previous debate. It is the complex which exists in the minds of certain important members of this house which favours the three larger municipalities of the Union to the exclusion of other municipalities of supposedly lesser importance. When Bills are passed in this House concessions are sometimes given to one or other of these municipalities, and when they are given the Minister will say that it is for convenience sake, or that they are experiments. The success of these experiments cannot always be gauged by the needs of the district to which these concessions are given. They are applied more often than not because there are a greater number of people living in the districts concerned. I wish to mention the latest so-called experiment which has been conferred on Natal in respect of this national housing scheme. We have been told by the Minister that Natal is to be allowed to appoint its own Provincial Housing Board. I understand that that has been done on the personal representations of the Administrator of Natal, and the Minister is prepared to allow Durban to go ahead with its own scheme. When I say Durban I mean the Natal Provincial Council, because the Natal Provincial Council is Durban and Durban is the Natal Provincial Council. Durban therefore is to be allowed to experiment with this National Housing Bill to that extent. The Minister believes that this experiment—and he is quite genuine—may produce some useful information for his future guidance, but has the Minister realised what has happened as the result of his concession to the people of Natal? Natal has become jubilant about it. Natal says that it has won another round in its bout with the Central Government. The Central Government is often accused of poaching on Natal’s provincial preserves, and the cause of its jubilation is the appointment of a Provincial Housing Board for Natal. Why the Minister wants two boards I do not know; they are expensive too. Durban is also joyful about certain other concessions they have gained. They were irritated by what they called “Minister Lawrence’s blustering attempt to browbeat and cajole the authorities” into an acceptance of the provisions of the Bill.

Do I look like a dictator?

The Minister thought the new board would simplify the organisation, and this is the result. The tit-bit of their comments however was that Durban Corporation “with its knowledge of local conditions can advance money to local authorities on easy borrowing terms out of its own revenue.” That is after it has made two attempts to get money from their ratepayers by getting a Savings Bill through the House last session, and a Housing Department Private Bill through this year which they said were required for the purpose of obtaining funds for housing. No other representatives have had more to say about social security than the members from Natal, and I would suggest to them that they should practise what they preach. I want to tell you exactly what Natal has done in regard to housing, and when I say Natal I again mean Durban. Mr. Speaker, Durban is more than twice the size of Port Elizabeth. Port Elizabeth has spent £1,500,000 on housing. Durban has spent just a little over £500,000. Durban has had, since 1920, the opportunity of getting money at ¾ per cent. and a loss of 1¼ per cent. and what have they done ? What I have said is the extent of their efforts and yet they come along now and want special treatment under his National Housing Bill. I warn the Minister that Natal is trying to legislate itself out of this Bill because they only talk about Social Security and do practically nothing about supplying their people with housee.

They recognise that Natal is part of Madagascar.

I want to get back to the first question of differential rents. For instance, I like the way the Minister dresses, and I want to go to his tailor.

What has that to do with this Bill?

I want to ask his tailor whether he agrees with the Minister on the principle of differential payment. If he says yes, and I say to him since the Minister’s suit cost him £18 18s., and as I only get a third of the salary he gets I want a suit for £6 6s. Now, what would his tailor say to that suggestion? I hope the Minister will withdraw this concession he has given to Natal, and I hope, in the interest of the whole country, that Natal will not be allowed to get out of this National Housing Scheme. They have failed in the past and ought to be compelled in the future to institute a housing scheme for their poorer inhabitants. I will finish up by congratulating the Minister on the Bill, But I want, in conclusion to say a word about the soldier. The soldiers’ Parliamentary representative said in regard to demobilisation that soldiers were not considering pensions so much as they were a roof over their heads when they are demobilised. I was never more impressed in my life than I was by what that soldier said. I am hoping that we will get ahead with this demobilisation scheme as quickly as possible because I believe it will be to the great advantage of this country and to our returning soldiers.

There is not the slightest doubt that there is a particularly great shortage of houses in this country, and any effort to make up the shortage is therefore welcomed by us and by the country. It is proposed here to abolish the old Housing Board, and to appoint in its place a national housing commission. The hon. member for Cape Eastern (Mrs. Ballinger) spoke of the great things she expected of that commission. When I look at the powers of the commission and find that it can only exercise those powers under the control of the Minister concerned, I do not share those great expectations. I want to come to another important matter. The present Minister repeatedly said in this House that his Government was opposed to Europeans and non-Europeans living together in the same areas. He added, however, that the Government did not want to force’ the people. We ought therefore to get a clear statement from the Minister. We want to know from him whether, when these schemes are carried out, it will be the policy of the Government to allow these people to live together, or whether he is going to insist on separate residential areas. This is an important matter, and we must have a clear statement from the Minister. One of the native representatives made a proposal which would have the effect of doing away with the segregation of natives. Her idea is that when housing is provided to the natives in a specified area, the Europeans should be prohibited from buying in that area. We cannot have segregation and then still allow the natives to have their residential areas in the midst of European residential areas. She bases her attack on the fact that if the natives are removed from the European residential areas, it will not be economical. I should like to tell the Minister that this side does not care whether it is economical or uneconomical; but we want to remain Europeans. We stand for the maintenance of the European civilisation in South Africa, and we cannot therefore allow Europeans and non-Europeans to live together. It will be of no avail to make this scheme economical or to make money, if it leads to a hybrid population. We want to know from the Minister, therefore, as far as the natives and the coloured people are concerned, whether it will be his policy to carry out the principle of segregation. Then I should like to hear this from the Minister. Clause 9 of the Bill makes provision for town councils to have the right of expropriation. That is also laid down in the existing Act, under which the housing schemes are carried out. It is now stated that the Minister proposes to withdraw that clause in the Committee stage, and we are also told that he is doing so at the insistence of the Indians in Natal, because they are afraid that the municipalities will expropriate their properties in Durban and in other places. We do not know whether that is the case or not. It is openly said, however, and I want to give the Minister an opportunity of replying to this in plain terms. If it is the policy of the Government to have separate residential areas for the various races, it will not be in a position to carry out that policy if this clause is withdrawn. If it is the intention of the Minister, and that is also our intention, to have separate European residential areas, he should strengthen this power instead of withdrawing it. Then I want to come to another matter in connection with the building of houses. We feel that the man of average means can afford to have a house built. If he has not got the money, he can borrow it from a building society or even from private people. The very poor people are provided for under the national scheme. I want to ask what the position is of a man in a platteland town who gets from £15 to £20. He is not in a position to pay a high rent or to buy a house for himself. Many of our municipalities have poor ratepayers who find it difficult to pay the rates, the municipalities are unable to buy houses for these people. We understood that the municipality has to guarantee the loan. At the moment labour and material are expensive items, and that will also be the position after the war; and consequently the houses which are constructed will be expensive. The municipality stands surety; a depression arrives; the houses stand empty, and the responsibility rests on the shoulders of the municipality. That has happened in the past. Before the war I was at Smithfield. There the municipality advanced money to teachers for the building of houses. The teachers left, and the houses stood empty. I made enquiries. These were fairly nice houses, and I asked why they were empty. I was then told that money had been made available to teachers to build these houses and that they subsequently left. The teachers have now gone to a different place, and the municipality is left with these houses. We all know that although there is a great shortage of houses at the moment throughout the whole country, there are times when those houses stand empty.

Who built those houses?

The teachers built these houses by means of loans which they obtained from the municipality, and the municipality, in turn, got it from the Provincial Council and the Provincial Council got it from the Government.

Did they take transfer?

Yes, I suppose they obtained transfer. They took bonds.

Why are the houses empty?

Because there are no people to rent them.

It is better to have too many houses rather than too few.

Ten years ago the position was quite different. These people move from one part to another. There may be a certain industry in the area; tomorrow that industry disappears; the people move on, and the houses stand empty. Even the Minister is old enough to know that although one cannot get houses in Cape Town today, there were plenty of houses ten years ago. If the houses are built at a time when there is a scarcity of labour and when wages are high and material is expensive, they cannot afford to have houses built. If those houses are built, they will eventually stand empty because the people will not be able to afford the rent. It is not right on the part of the Government to require the municipalities to provide houses for their residents. That is the Government’s duty. These people are citizens of the country. They are supporters of the Government. The person who usually borrows money from a building society is a man of moderate means, but I am now referring to the very poor man and the man of average means. The municipality is not able to borrow money from the Provincial Council because it cannot afford to take the risk There are many poor ratepayers in the towns. Many of them own houses on which they borrowed almost the entire purchase price. Those people live from hand to mouth, and if the taxes are increased, they cannot afford to pay them. The State should admit that that is the position.

Are you suggesting that we should subsidise these people to enable them to buy their own houses?

We saw this morning that the Government was prepared to subsidise the gold mines. Let me suggest a plan to the Minister. The Government should lend money to the man concerned, and exclude the municipality. The Government should take the responsibility. The Government represents the whole country. The towns have only got the taxpayers who live in the town itself. It is the duty of the State to do this work which it now expects the Commission to do. I want to suggest that the Minister should investigate this matter.

That is a different matter.

It could be arranged through the Commission. There is a section of the population whose income is so low that they cannot buy houses, but they are not so poor that they can come in under the sub-economic housing scheme, and I should like provision to be made to enable those people to obtain houses. Then there is another matter to which I want to refer, and it is this. The municipalities buy a piece of land in the town, or perhaps just outside the town, on which they put up a housing scheme. They may build twenty or thirty houses on it. It is true that these houses are very much more comfortable today than they were previously. The plans seem to be better and the material also seems to be better. But where one has 30 or 40 houses in a small community where the poorest of the poor live, the place eventually becomes a white location. It is much better to buy a plot here and there, and to put up separate houses, because in that way the people are not humiliated. They can then educate their children to become independent, and these children can be of value to the community. I want to tell the Minister that I am surprised that the Afrikaners have managed to retain their nobility of character, bearing in mind the circumstances in which some of those people have to live. I personally have seen families live in stables in the platteland. Provision should be made for those people, and we should try to save their children if we cannot save them, so that they can become useful citizens to the country. It is important to make proper provision for those people. I should like to say a few words with regard to this differentiation; in other words, that the rent will depend on the man’s earnings. I do not know what the position is in the cities, but I can assure the Minister that it will cause dissatisfaction if there are ten or twenty houses together and the one man pays £1 and the other 10s. or 5s. The man who is required to pay more will say: “Why should I pay £1 for this house while my neighbour only pays 5s.”? It will be very difficult to carry out this scheme in the platteland. The last speaker said that it was not possible in the cities, but he expressed the opinion that the people in the platteland would be satisfied with it. I can assure the Minister that it will create a very difficult position. My experience of these people is that the Government will not succeed. The question arises whether it will not encourage the people to be idle. It is quite true that one should only pay a certain portion of one’s income in respect of rent. If any difficulty arises, the Government should bear the responsibility.

Should the Government be the owner of these houses?

Yes, the Government can take transfer if they build the houses. It is the Government’s money. There may be some of these people who will be able to put aside money to pay for the houses, but where a block of houses is built, where a number of houses are built, it will lead to difficulties if any of the houses in that block are subsequently sold. The people who have slightly more means should be enabled to become the owners of the houses. Those people are anxious to own their houses. We should try to improve the existing avenues of employment in such a way that these people will be able to put aside something. It is no use merely creating the machinery for the building of houses. The houses should be built, and the people should be afforded an opportunity of becoming the owners of those houses. Every Afrikaans-speaking Afrikaner is anxious to possess his own house. If a poor man is the owner of a house, it gives him a sense of independence. The children who live in a rented house grow up in poor circumstances. The tenant is in an uncertain position and the children in the house are also worried; and we should do everything in our power to enable these people to become the owners of the houses. Then there is one matter which the Minister ought to take into consideration under this Bill. There was formerly a scheme under which the Government gave £50 for the building of bywoners’ houses, provided the bywoner occupied the house for five years. That scheme was abolished and legislation was even introduced to write off the arrear debt. I should like the Minister to give the farm occupiers in the platteland an opportunity of building decent houses, if they are poor, and also to build houses on their land for the Europeans who are in their employ. But the most important of all is housing for the coloured people on the farm. There the Government ought to step in. The coloured people are usually given a small house on the farm, but it is often so uncomfortable that they cannot live in it. If the authorities build sub-economic houses in the cities for that type of person, they should also do it on the farms. The farms should have the same privileges in this respect as the platteland towns or the cities. According to statistics in our possession, the greater portion of these millions of pounds was expended on housing for coloured people. I think in 1941-’42 they provided approximately 5,000 European families with houses, while 40,000 coloured families were provided with houses. When a small municipality builds houses, they usually make provision for both sections of the population, but since the money will not be sufficient to meet the needs of all the municipalities, the money ought to be divided equally where the coloured population and the European population are the same. Then I feel that although the Government builds these houses, even if the municipalities are prepared to assist them by taking the administration upon themselves, the municipalities are not in a position to bear the risk; but the municipalities will be prepared to undertake the administrative work in that connection. It will not involve very great costs. It will be easier for the municipalities to undertake the administration than it will be for the Government, and I think they would be prepared to undertake that with the greatest willingness.

I would like to ask the Minister to give consideration to the lay-out of new townships which will be one of the principle difficulties local authorities will encounter in the carrying out of housing schemes. The matter of the lay-out of a township both within urban and rural areas is vested in the Provincial Councils, who have appointed Township Boards to advise the Administrator. In so far as the Transvaal is concerned, there is an obligation on the Board in submitting its recommendations to furnish the Administrator with a report upon the following matters in so far as they are applicable: (1) The need or desirability of establishing the township; (2) the suitability of the site with regard to area, position, water supply, grade of streets, etc.; (3) the existence of servitudes or encumbrances which may affect the prosperity of the township; (4) the conditions which should be imposed; (5) the regulation of buildings with particular reference to the maximum number which may be built on each erf. The foregoing will appear to cover any contingency which might arise in connection with the lay-out of land either within or outside local authorities. A glance at a plan of the environs of Johannesburg will show that in the northern area, and within a radius of about five miles from its existing boundary, the greatest proportion of land has been laid out in townships which will depreciate surrounding areas and may develop into second Alexandra Townships. Notwithstanding the fact that there are thousands of vacant stands within the municipal area, this is going on. Why is this permitted? In the Transvaal an attempt has recently been made under a Provincial Ordinance to bring these areas under control. But I am safe in prophesying that owing to the niggardly financial provisions made in the Ordinance the scheme for setting up authorities outside large urban areas will be doomed to failure, and the large local authorities will be forced to extend their boundaries. The question of the lay-out of Indian and coloured townships in the vicinity of European areas is also causing a lot of difficulty. We have recently had in Johannesburg an application from the Townships Board to lay out an Indian township in an area that is absolutely surrounded by European communities. This is looking for trouble. The city of Johannesburg has opposed the idea because it will not benefit the Indians to have a township on that particular site. Uncontrolled townships on any local authority’s border are always a menace to the health and amenities of the inhabitants of a neighbouring local authority. The Minister has stated that he intends establishing a Planning and Housing Commission primarily to control the erection of national housing. The building of houses is closely connected with the lay-out of land; and it is strongly urged that the duties at present carried out by the Provincial Townships Boards be undertaken by that commission, and so ensure that the lay-out of our land becomes a national matter and have for its general purpose a co-ordinated and harmonious development of South Africa.

I regret that the Minister intends to withdraw the amendment No. 9 altering Clause 11 of the Act. In Clause 11 of the Housing Act the authority to expropriate is given if no other suitable land is available. Who is going to decide the suitability of the land?

The Act specifically imposes that duty on the Minister.

The Minister is setting up a store of trouble for himself. Line 65 of the amendment which is going to be withdrawn, gives power to expropriate for a housing scheme in such a manner that would have left no argument, and the Minister would have no difficulty in deciding; but where is he going to decide under the old Act? He is going to meet with a lot of difficulties. He is is going to ruin at least one big lay-out of the scheme in Johannesburg. There approximately 2,000 acres has been laid out, and in that area there are one or two small plots which we have failed to secure and for which exorbitant prices are demanded. As anyone who is a local authority councillor knows, as soon as a hint goes round that the authority intends to buy land in a specified area, some of the owners will hold out for three or four times the value of the land, which it is desired to expropriate.

Has the Johannesburg Municipality ever tried to expropriate up to now?

The council’s experience has been a very sad one in regard to the expropriation of land and arbitration concerning the purchase of land. We fail to see why we should have to spend thousands of pounds on this when the amendment which is now being withdrawn would have eliminated the difficulty.

You should apply under the Act.

We will apply, but I should very much like to see this amendment kept in. The hon. member for Port Elizabeth (South) (Mr. McLean) has declared against preferential rents. I think it is one of the best features of the Act. We have had in Johannesburg experience of men having had to leave a sub-economic township on obtaining promotion which would increase his income above the limit for sub-economic tenancy, or else declining the promotion so that they could stay on in their homes. If they accepted the promotion it meant that they would have to leave their home, to leave a nice house and a little bit of garden that they had carefully tended, and again go back into a house in what is practically a slum. One man may decide to leave, and obtain a house situable for his family, and the other will decide to stay on. There is more than one difficulty; if a man is improving at his work it is likely that his employer will give him further promotion, but if he declines the first promotion he is forgotten. There is another thing in the Act for which I am sorry no provision has been made as far as I can see. What I consider a serious deficiency in this Act is that no provision is made for a gradual conversion from a sub-economic to an economic basis and it would be better to have a limit to the income on which help should be given. Might I suggest to the Minister that he gives consideration to such a scheme as would enable a tenant who finds himself able to pay a little more than the basic rental, to be allowed to pay an additional sum towards the purchase of his house, the money so contributed to be placed to the credit of a special fund so that should circumstances arise which prevent the tenant from continuing his payments the additional sum contributed might be withdrawn, plus interest. Half the capital required for post-war development by the municipalities will be required for housing, and will be provided by the Government, but the balance will have to be provided by the local authorities themselves, which will have to be borrowed. This will mean that the local authorities will have to go into the money market in opposition to the Government. Might I suggest that the Government lends the local authorities the money they will need and charge a fraction more than they pay the Government to raise all the loans, thereby obviating competition. The whole idea of this housing scheme is to give a dwelling to our very poor, and we do have very very poor people. I should like to have seen the Minister make a total grant to the local authorities enabling them to build and allot these houses at a nominal rent to people who are possibly not able to qualify under this scheme. We have, as I have said before in this House, a number of our population who do not know how to keep a house, and it costs the local authorities quite a lot to teach them. It has been known during a cold night for them to take a brazier and place it in the middle of a room. Then we know of a case where the door was smashed up for firewood. In our sub economic scheme in Johannesburg we have educated many of this type of tenant how to keep a house and take a pride in it and so instead of being a liability to the municipality and to the nation they have become an asset to Johannesburg and a credit to the country. That type of man and woman has first to be given a house to make a start, and where he can be taught and will have to pay only a nominal rent. The next point I wish to make is that I am in agreement with the hon. member for Swellendam (Mr. S. E. Warren) when he points out that there is no provision here for the farm labourer. If we are going to build these houses round about our towns, what is going to happen to the farm labourers? They will not stay on the farms, they will move to the locality where they can get a house. I suggest that the Minister should make provision to enable the farmers to build houses for their labourers. Unless that is done, I can foresee a difficulty about the farmer keeping labourers on his farm.

I took the opportunity on an earlier occasion to discuss at some length the question of home ownership of houses which we have been defining as sub-economic houses, and as I fully expected, that request submitted by myself was adopted, not only by the Municipality of Durban but municipalities throughout the whole of South Africa through the United Municipal Executive Committee, and I think the hon. Minister will concede that it almost became a clash between that Executive vis-a-vis the determination on the Minister’s part to pursue the principle of differential renting. It looked at one time as if the scheme propounded by the Minister was going to fall by the way in face of the demand by the Municipal Executive for the establishment of the principle of home ownership of sub-economic houses. Fortunately, in the dialectical process, the best of both schemes was by common consent made part of the housing policy. While the scheme of the hon. Minister for differential renting is embodied in this Bill in Clause 13, the other and very important principle of home ownership of what has been defined as sub-economic housing is absent from the Bill. It is true that it can be argued that this Bill merely sets up the machinery for the carrying out of the Government’s housing policy, and the deteails of any home ownership scheme can be filled in by the Commission. I want to deal, however, with the various aspects of two essentially different proposals. I would like at this stage to take the opportunity of answering the points which were raised by the Minister of Finance when I put forward the proposal for home ownership for sub-economic houses at an earlier period. The Minister asked whether I had considered the principle involved of allowing the sub-economic householder to sell his house at some subsequent date which would, in fact, be the selling of the subsidy on the house. Although the Minister of Finance did not specifically say so, what he said carried the inference that he was against any such home owner reselling the subsidy which had been given to him on the house purchased by him. I saw it in an entirely different way, I saw in the subsidising of a house a means of supplementing the wages of a person whose wages are so low that he cannot live in the form of habitation which the country expects from a public health point of view. Such being the case it is merely incidental that the subsidy on his wages is on the house. I question whether the Minister of Finance or anybody else in the House would be justified in standing up and saying that a person is not entitled to do what he pleases with the results of his thrift and saving, whether it take the form of home ownership or an increase of wages. It is quite clear, in my opinion, that if a person enjoys home ownership through a sub-economic housing scheme, he may justifiably be considered to regard that as part of his earnings and become his own exclusive property and he should have the right to sell at any future date. I would like an assurance from the Minister that there is the intention to accept the principle of home ownership by persons who purchase houses in some subsidised form. I think this is a very excellent scheme, but I have yet to be convinced that any of the major municipalities in South Africa, who have been prepared to put it into effect, will be prepared to accept the principle of differential renting. If my assumption is correct it will be very much to my regret, because I consider the principle a just one which the Government should pursue and which I hope in the course of time the municipalities should adopt, even though it does mean a certain difficulty in administration. I hope they will accept that because it is the best form of subsidy. In establishing the differential renting it must be carried to its logical conclusion. The hon. member for Cape Eastern (Mrs. Ballinger) has pointed out the difficulties of persons who live in subsidised homes by reason of the fact that they live at such distance from their places of employment. If differential renting is to be carried to its logical conclusion then it is necessary to take into consideration this question of distance from employment. Furthermore, the point raised by the member for Port Elizabeth when he put the hypothetical cases of one man with a large family and another with no family at all, must be taken into consideration. That will necessitate a system of rents based upon family allowances. Most of the people holding or occupying such houses are confined to unskilled work, and are subject to periods of unemployment, so that the question of continuity of work must also be taken into consideration. In regard to the Bill itself I find what are to my mind certain technical flaws. First, I regret to find that the Minister has readily agreed, by public statement, to withdraw Clause 9 and the very important principle embodied in that clause which lays down that expropriation should be based upon 1939 land values. In any scheme of sub-economic housing it is essential that the land should be acquired at the lowest possible price. The Minister’s first proposal to take 1939 as the basis of land value was a good one and I am sorry the Minister has seen fit to recede from that. In Clause 11 (3) (c) we find provision made on the commission for the appointment of an attorney. Now, I cannot see any possible good purpose which can be served by having an attorney on the commission. The Government has plenty of law advisers and all the legal advice which the commission would require can easily be furnised, and an attorney cannot possibly serve any useful purpose on a commission which is essentially technical and has to deal with the highly technical question of building houses. I would just like to support the contention of the hon. member for Cape Eastern. I had intended to say that rather than have an attorney I would ask for the appointment of a representative from the Trades and Labour Council, because such a representative would probably be drawn from the building industry and would have some knowledge of the technical requirements, and be in touch with the mass of the population whom this Bill is intended to serve. But I am prepared to support the suggestion of the hon. member for Cape Eastern (Mrs. Ballinger) and would ask the Minister to consider such an appointment of such a person as suggested by her. In Clause 6 which establishes the commission as a corporate body, there is power to acquire buildings. It seems to me there is an important omission there, because if the commission is to build houses, the first essential is to have land upon which the house can be built. It seems to me that that Clause should have a provision enabling the commission to buy land. In Clause 16 in which it is proposed to establish regional planning branches, the powers of such branches are not defined. I think the Bill should have these powers defined, because such a planning branch would have to be under centralised control. I content myself with these few points and when, at a later stage, Clause 9 is discussed, I propose to ask that the Bill shall fix the value of expropriated land in accordance with the original proposal.

I hope the Minister will not regard my remarks as an attempt to pour cold water on his great plan of making a contribution—which will probably constitute a monument to himself—towards the solution of the serious problem facing us. I wish to mention a few considerations, however, which have led me to the conclusion—with regard to the particular time at which these proposals have been introduced and the undue haste on our part in tackling the solution of this problem—that it is doubtful whether this is the right time of the Session to introduce such a tremendously important Bill. All members of this House have for a long time been looking forward to a well thought out proposal to bring about relief in the great need prevailing in South Africa in regard to housing. In our best towns, in our villages and on the platteland with its large open spaces, the conditions, as far as housing is concerned, are bad. The country as a whole is crying out for relief as far as this problem is concerned, and in view of the new measures which we are all looking forward to, it must be the responsibility of the State to assist in the realisation of these ideals for proper housing. This Bill, however, contains a number of far-reaching principles. We have now reached the final stages of a long Session, a Session of practically 100 days. In view of the important issues at stake and the far-reaching principles involved, I want to ask, with all due respect to the Minister, whether he cannot, without harming the scheme, allow this Bill to stand over until the next Session. We all feel that such important principles are involved that it is essential to give this Bill further consideration. If ever we have had a Bill before this House which could have been referred to a Select Committee to the benefit of all concerned, it is this one. Every member will contribute his modest share to assist the Minister in making this Bill a success. But it is not possible now for us to give this measure the attention which we want to give it. Everyone of us would like to contribute his share. It would be interesting to know how many members had the time to make a proper study of the Bill. I admit that with the best will in the world I have not had the opportunity of giving this Bill the attention I would have liked to have given to it. Perhaps all of us feel just as strongly as the Minister that this Bill is intended to provide for a serious emergency. Housing conditions in the towns today are deplorable. Even in the most up-to-date towns there is over-population and overcrowding. In the best towns one finds slum conditions. I know of families in the heart of Pretoria living in one small room. In other towns, conditions have developed to such an extent that serious physical deterioration is developing, not to mention the moral deterioration which is going to result from these very bad housing conditions. That is why we are all in agreement that this Bill deserves most serious consideration, most careful study and most thorough analysis. In those circumstances I ask, in all modesty, whether the Minister in consultation with this colleagues, cannot see his way to allow the Bill to stand over till next Session. In view of the delay which has taken place in the past, judging by the Minister’s statements last night, I assume that he feels very much concerned about the gaps, the failure to carry out this plan, which has been in existence for twenty years, and I quite realise his anxiety to make an immediate start with his scheme. In the circumstances prevailing today I think the Minister will agree that it will be impossible to do very much during the next six or nine months—except that there is a possibility of a lot of mistakes being made, some of which may be irrevocable. I want to make an appeal to the Minister, not for lack of sympathy, but because great questions of principle are involved, and I want to emphasise a few of these principles. Great principles are involved. A practically new department would to all intents and purposes have to be established. In the machinery which the Minister proposes there is room for improvement. I think he will agree that one of the bodies he proposes to establish, namely, the Housing Board, will by itself not be able to do much if it is constituted as is now proposed. I am of opinion that delay of from six to nine months is not going to do any harm to this cause. I want to tell the Minister what to my mind are the important question of principle either mentioned in this Bill or contained in it by implication. The first question which the House will have to consider is with whom the responsibility for housing will eventually lie. In the past the State has accepted the financial responsibility, but actually the local authority is responsible for dealing with housing scarcity in this country. Whatever may have been the cause, the Minister expressed his disappointment last night at the fact that so little had been done compared with the high expectations which had been cherised, and he said that everybody was disappointed at the little progress that had been made during the last twenty years. There must be a cause for it, but the first question which has to be settled is who is responsible for providing relief in respect of the housing scarcity and the concomitant factors of public health and morale. There is a possibility that under State supervision the Province may be expected to attend to these matters, or in the third place the local authority, but in addition to that there is a fourth possibility, namely, that the State as a whole may expect the industrialists to spend part of their income on the provision of proper housing for their employees. The Minister is conversant with certain schemes which have developed very satisfactorily in Europe, schemes under which the private employer has done a great deal in respect of housing conditions for his employees.

The same thing is done under this Bill to a certain extent.

The State may hold the employer responsiblie in one or two ways. I do not want to go too deeply into that aspect of the question just now, but I have seen some outstanding examples where the industrialist has contributed a great deal by accepting responsibility for housing his employees. These are questions of principle which we have to settle—whether the State or the Province or the local authority or perhaps the industry concerned is to take the responsibility. The second point is to make effective provision with a view to a longterm policy. The question of future industrial development is a very important one. The concomitant problem in connection with industrial development, the problem of social enterprises in connection with housing is deserving of special attention. The Minister referred to it last night, but there is, more particularly, the question of migration, the migration of the native to the town, the migration of the white employee from the one area to the other area to improve his conditions or to look for work. These are very far-reaching principles in regard to a long-term policy. The third important principle is the fixing of the borderline between the economic and sub-economic ability of the occupant of a house. I listened with pleasure last night to the remarks of the hon. member for Stellenbosch (Dr. Bremer) when he said that we must not deduce from this Bill that the sub-economic part of the scheme was going to mean a subsidy to the employee. His attitude was that it was a subsidy to the employer. But it is a very far-reaching principle to determine the borderline between the economic and the sub-economic ability of the eventual occupant of the house. There is a fourth principle I want to mention in passing and that is the possible balancing of the rural and urban populations according to social and economic means. The next principle involved is the question of occupants of houses obtaining property rights. The Minister last night held out the prospect that the occupants of sub-economic houses could eventually become the owners of those houses. That principle should undoubtedly be encouraged. Every individualist agrees that we do not believe Communism to be a good means of encouraging self-respect. Every individual wants his own house; it bolsters up his pride and his feeling of independence. The question of transfer is another matter which has to be carefully considered. And now I come to the final principle which I find in the Bill, namely, the determination of effective discrimination for the various population groups of the people in accordance with the nature and the character of the group. If we start from the point of view that every group of the population must have the same type of house to make it happy, we shall undoubtedly get on to the wrong track as far as the motive is concerned, and we shall be straying further away owing to the fact that we shall be spending a lot of unnecessary money. I think we should make sure of the type of dwelling best suited to ensure the happiness of the population, the type of home which will enable them to be independent and to make the best of their lives. But if we take it for granted that one and the same type of house is required for the Europeans, the Indian, the native and the coloured person, then we are on the wrong track. This is a particularly important aspect of the matter. I should like to express a few ideas in regard to certain implications and more particularly on the question of the migration of natives, the drifting of natives from the platteland to the towns. I said earlier that I believed that a little delay in passing this measure might be advantageous to all concerned. We are faced with a problem on which this House has been engaged for days, the problem which we discussed only a few weeks ago, namely, that of the migration of natives to the towns, how to stabilise the relationship between European areas and non-European areas on a permanent basis. In that national problem housing will play an important part. We cannot look with indifference on the possibility of the migration of the native to European areas eventually having to be allowed to take place freely. My conclusion is that the Government is in agreement that the natives can go to European areas if there is work for them and not otherwise, and with the information which we have before this House, we know that in many centres of the Western Province there are a great many natives who find it impossible to make a proper economic living, simply because there are too many of them there. If the cry of one section of the population for housing is listened to, if the demand for housing in their particular area is complied with, it may just be a waste of money, and in addition to that it will make the eventual provision of separate residential areas for Europeans and non-Europeans impossible, or at any rate, it will make it much more difficult for the future. The first thing that is essential is to have a clear policy laid down by the State in regard to its plans for the setting up of native residential areas. I believe that everybody. European or non-European, irrespective of the colour of his skin, requires a good house. I believe in that, and I feel therefore that the Government should first of all lay down a definite policy regarding the setting up of European and non-European areas. Once the policy has been clearly laid down the question of housing must be tackled. The subject of migration, therefore, is a very important factor in this connection—it is a very important factor in the relationship between Europeans and nonEuropeans. The next aspect is in regard to the coloured population. Previous speakers, and the hon. member for Swellendam (Mr. S. E. Warren) in particular, referred to the effect, the advantages and the disadvantages connected with the lack of housing on the platteland. There is a crying need on the part of a large section of the white bywoners on the platteland for better housing. Only recently I saw a large number of houses which were not fit for occupation by bywoners on the platteland, and what applies to Europeans also applies to coloured people, but unless the Government has a very clear-cut policy in regard to industrial development and the need of industries for workers on the platteland, in towns and in the villages, housing will create a lot of difficulties, and if we continue to neglect the platteland as far as housing is concerned the result is going to be that we are going to draw even more people away from the farms to the towns and the villages. For social and economic reasons a clear-cut policy must be laid down. Only after that can provision be made. A third question which I think deserves our attention is this: The building of houses or the policy of building houses in towns or near towns, or in future development centres; there is today a great need in the towns, but the future of the development of our industries is fundamental to a long-term policy. The Government cannot just go on building houses wherever land can be found for the purpose. Houses have to be built in accordance with the needs of our industrial development. The hon. the Minister of Economic Development recently gave instructions to the Board of Commerce and Industry to enquire into the possibilities of industrial development in various parts of the country. The Minister will perhaps be able to tell us how far this enquiry has progressed, although I believe it was only started recently. Until we have a clear statement of policy about the potentialities of industrial development, it will be impossible for the Minister to lay down a definite and comprehensive policy as to where attention has to be concentrated in regard to housing. As I have said, it is no use just building houses. They have to be built where economic development is taking place, and where development is favoured by other circumstances. Before the Government, therefore, is clear on the subject of the potentialities of industrial development, it will only be able to carry out part of its programme. The Minister will say that we can proceed to carry out that part of the programme. That is so but a complete programme requires a long-term plan and that is only possible if the industrial potentialities of the country are properly surveyed. I spoke about the social and economic measures which have to be taken in connection with housing. Now I want to give expression to one other point. When I hear the Minister and other members speak about economic and sub-economic housing I feel that by implication we are doing injustice to certain citizens of the country, to certain occupants of houses, namely, those who live in what are known as sub-economic houses.

When is the ability to pay, when is the purchasing power of an employee sub-economic? His purchasing power to my mind is sub-economic when he is not able, out of his own income, to meet the needs of his standard of living. I think that is a reasonable definition. That means that the employee is not earning enough. Sometimes he is engaged in an occupation which is not able to pay him more, but in many instances he is engaged in an industry which pays him too little for the work he does. I therefore feel that it is a matter of supreme importance that, before we stamp certain people as sub-economic, and before we consider that they should be sub-economically housed, we should work out a plan to go into the question as to whether the man can earn more for the services he renders. I assume it is not possible for every industry to pay all its workers such wages as will enable them to live in luxurious houses. Wage is part of the cost of production, and cost of production is an important factor in the competitive ability of your product. That being so, not every industry can pay adequate wages to the people in its service. The question then arises—and it is a question of national importance—when has the State to contribute to the proper maintenance of the individual and when must it not do so? But I want to emphasise particularly that before the Minister classifies certain employees as sub-economic, and as being entitled to sub-economic housing, he must first investigate the question whether the industry cannot pay its employees more. He will find that I myself and others will keep on insisting on his doing so.

Are you not putting the cart in front of the horse? Should we not build houses first?

I want a clear-cut policy to be laid down. If we can lay it down we can carry on with housing. Before we compel anyone to live in a sub-economic house, or before we make it possible for anyone to live in a sub-economic house, the Wage Board, or whatever body has to do so, must investigate whether the individual is getting the wages to which he is entitled. I welcome the Minister’s efforts and I believe in his good intentions, but I do feel at the same time that the subject requires a great deal more study. It is impossible to declare a long-term policy today, simply because the matter has not been studied adequately. The Minister may possibly say in reply that he and his Department and others have considered the matter for months but I want him to consider that the eventual responsibility for the biggest scheme we have in view does not rest with him, but with the representatives of the people. We, as responsible members of Parliament, are anxious to contribute, but the first thing we require is a definite policy.

I hope the Minister will take into consideration the malarious areas of the country and ensure that special provision is made for them for housing. I wish to point out to the Minister that those of us who engage labour in those areas suffer heavily, because we cannot get the maximum amount of work from them as they are continually down with malaria. I would anneal to the Minister that everything should be done to re-instate the old scheme for the farms, not with a grant of £50 but with a larger sum so that farmers who are willing to provide the necessary facilities for their workmen on the farm should receive this assistance from the Government, not only in respect of European workers but also for natives. The farmer is a sufferer when he cannot get the due amount of work from the native he employs. If we had these houses on the farms it would be one sten towards building up the native population. Similarly, in respect of the mines. One finds just a collection of small houses, and I think that these mining people when they start with a new mine should be assisted considerably so that their employees could be properly housed. But I maintain that once you lay down a policy to build houses in certain areas, you should always bear specially in mind the malarious areas. No house should be built in such areas unless it is mosquito proof, because houses built in the same way as in other parts of the country would be of no use to people occupying them in malarious areas. I also wish to point out that where we have made experiments today we are getting the maximum amount of efficiency as the result of the workers being housed properly. There are areas in my district where there is good land and a fine water supply, but in the absence of good housing with the consequent illness from malaria, that ground is not worth what it should be. I hope the Minister will go as far as he can in assisting the Minister of Lands when he does sell any land under Section 11, so that the man who buys land under Section 11 will receive the maximum grant to enable him to build a decent house on his property. It is no good settling people on that land unless proper provision is made for housing. If you do that they will be an asset to the country; if you do not house them properly they will only be a liability to the State, not only from a farming point of view but from a medical point of view. I make this special appeal to the Minister to do everything he possibly can to assist these people, especially in malarious areas, and to take a further step towards cleaning up the country and making it not only habitable for the people there at present, but for the soldiers who may want to go there after the war. Every precaution should be taken so that they will not go there with their families unless we have proper accommodation for them.

I want to associate myself with what the hon. members for Swellendam (Mr. S. E. Warren) and Ceres (Dr. Stals) have said, and I also want to make an appeal to the Minister, if at all possible, to leave this Bill over until next Session so that we may tackle this subject in a comprehensive manner. If there is one subject which should be dealt with comprehensively, it is that of housing. It is a well-known fact that few things have had a more deleterious effect on the health and the life of our people during the last few years than the poor housing conditions prevailing in this country. It is a subject which has to be tackled on a large scale and we welcome the fact that the Minister has undertaken it. We want to give him our support to carry out his project on a big scale, and we want to express the hope that in regard to this matter he will display the same zeal as he is displaying in regard to the war effort. He should take up this question with the same enthusiasm. There is an even more important reason. The hon. member for Ceres (Dr. Stals) said that a clear-cut policy should be laid down. I am particularly thinking of the question of separate residential areas. The time has arrived for this matter to be laid down by means of legislative Acts. We have an instance at Hercules, near Pretoria, where people have built houses in a certain area and after they have spent their money there, a coloured man bought land in the midst of that part where they had put their houses, with the result that a number of those people have already sold their houses at heavy losses simply because they wanted to get away from the place. That sort of thing should not be allowed. We know that in Johannesburg housing schemes have been undertaken close to locations which has led to an unsound condition of affairs. In connection with this matter we should keep our population figures in mind. I am not one of those who attaches great value to the idea of wholesale immigration after the war. Most of the countries from which we can get immigrants who would be useful to this country are not faced with a growing population. Take a country like England; we know that an expert has expressed the very definite view that the population of England is going down to such an extent, that by the year 2,000 there will only be 19 million people in England. We have the phenomenon that the population of England is on the decrease, and we cannot attach much value to the potentialities of large-scale white immigration. We have to build up our own white population here, and if we want to do that, we have to see to it that we have separate residential areas. We must have good housing and separate residential areas, and only then can we expect an increase in population. In South Africa we are fortunate in the fact that our population is still increasing. We must encourage this. We are dependent on the stream of national increase which we create ourselves and which will not be wiped out by co our. The Minister must be very definite. He must not be content with making statements, but this whole matter must be laid down annd fixed by legislation.

Mr. Speaker, this Act is another instalment of Social Security, and one of the most important instalments of that great code, and one hopes that as such it will be a great success in this country. We, of course, do not blame the Minister for any delay in a big matter like this, a national matter. It was necessary for him to consult the various local authorities and others in connection with the scheme and a certain amount of delay was unavoidable, but we should now, I think, express the hope that when this Bill is passed by both Houses, no long time will elapse before a start is made. One realises that Government machinery always moves slowly and that proper organisation must be built up under this Bill, but while I know that, I want also to express the hope that there will be no undue delay in making a start. Speaking for Johannesburg, let me say there is urgent need, at once, for 10,000 houses. That is according to a survey made in 1941. I will go further and say that in order to grant any considerable relief 20,000 houses are required, and our information is that the whole country needs 250,000 houses. When we consider these figures we realise that there must be no undue delay and that we will get on with the job. In Johannesburg we are ready to start. Plans are already prepared for an extensive building programme. They are ready to start with houses on a very large scale, and the Minister apparently is only waiting for the machinery to be established to get on with the job. It is difficult for me to see the distinction between sub-economic and national houses, and my submission is that we should not lay emphasis on sub-economic housing. Sub-economic houses should only be a temporary measure to tide the man over a comparatively poor time, and allow him to save up to acquire his own home. That is what sub-economic housing should be. It is only called sub-economic housing becauses it takes the man a longer time to pay off the capital and interest, where, with the other type of housing the interest and capital is paid immediately. My submission is that a man should not be made to live in a sub-economic house for ever but be transferred over to a nouse which he can acquire as his own property. Let me give you an experience we had in Johannesburg. In the Jan Hofmeyr Township people were very poor when they moved in there, but after a while, 18 months or two years, we found that these people were buying refrigerators, motor cars and such like comforts. Then the story went round that these people were rich and should not be allowed to live there. But, Sir, it was because they saved in rent that they had the opportunity of acquiring comforts. I think the hon. member for Ceres (Dr. Stals) mentioned the construction of these houses and pointed out that we should avoid monotony. Sir, that is a very important aspect of this matter. In the past we have built too much on one plan—in the Jan Hofmeyr Township, the Morris Freedman Township and one or tow others. Here in Cape Town you have the Epping Garden Township, and others that I have not seen. One of the things that strikes the visitor to these townships is the monotony of design, the houses are all the same and constructed in the same way, of the same dimensions and the same appearance. To my mind it makes a place like that look like a location and that is not the impression we want to create. We don’t want to encourage or create an inferiority complex. One of the most important ideas connected with housing is the rehabilitation of poor people, and anything likely to create an inferiority complex must be discouraged at all costs. Townships must be planned in such a way that you cannot distinguish between an ordinary township and a national housing township; you cannot distinguish between an ordinary township built by private enterprise and one of these Government townships. The casual tourist or vistor must not be in a position to notice the difference when he moves from one to the other. One must not be like a capitalist township and the other like a poor white township. This is the mistake we have made in the past. Take a young girl whose parents happen to be poor —they are no less respectable because they are poor and in the labour market—that girl meets some nice, young and well-established man and she is scared to take that young man to her home because of the fact that the township looks like a location. These townships must not look like locations. There must be differentiation in construction, in painting, etc. Now the hon. member for Cape Eastern (Mrs. Ballinger) said that we must abolish locations. Well, locations are becoming a thing of the past. We are getting townships. Another point which has not been mentioned by any previous speaker —and I am only mentioning points which previous speakers have not mentioned—is the question of the relation between building and demolition. It has happened in the past and it will happen again that a new township is established under Government or local authority subsidy, but nothing is done to demolish the existing slum with the result that as fast as people move into their new houses others move into the slums. That is wrong. My submission is that if a family is taken out of a slum property, whether it is a minor or major slum property that slum property should be demolished. If the owner of that property cannot afford to reconstruct, assist him to do so, to rebuild it, but do not allow the slum property to continue to exist. Unless rebuilding is accompanied by demolition of existing slum properties national housing in South Africa is doomed to failure. Now I want to touch briefly on the question of non-European housing. This is an important factor in our big cities. Whether we like it or not, the largest percentage of our non-European population live under slum conditions. It is a pity, but it is nevertheless a fact that the money which is locked up in these slum properties is not the money of non-Europeans.

The property belongs to European people who are not ashamed to make money out of the poorest of the poor, to enrich themselves. That is the position today in places like Sophiatown, Martindale, etc. The natives are only the nominal owners of the property. A man buys a place; tomorrow he cannot pay the instalment, and out he goes, and the next owner comes in, and these properties have paid for themselves over and over again. I want to make a suggestion which will prove a solution. We have heard a lot about segregation. When the native Bills were passed segregation was the ideal as far as rural areas were concerned, but no provision was made for the urban areas and you cannot apply segregation as such to the urban areas. May I suggest something better in its place—the parallel development in separate areas. You take any of these slum native townships in Johannesburg.

What is the use of building another township, taking the natives out, putting them there and not destroying the existing township? I submit that the Minister should see to it that townships are built for the non-Europeans and the existing ones removed.

What about the Slums Act?

It is not done today. No non-European housing scheme will be a success while it is in the midst of European townships. These are a few suggestions I want to make and I once more want to reiterate the necessity of an early start being made.

I want to congratulate the Minister on the very able statement he made in introducing this Bill. But there is one aspect of the situation about which I am very much concerned. I am not going to give the Minister any instructions about the type of houses and the details of those houses—because he has had that drummed into him very effectively for several hours this afternoon. I want to deal with the matter from the point of view of the scarcity of building material. The Minister made a statement yesterday that during the next year £8,000,000 worth of building could be carried out. I am surprised to hear that there is that amount of building material in the country. I want the Minister to tell us whether that is so or not. When a private person makes an application for a room to be added to a building, the application in most cases is turned down “owing to the scarcity of material.” I know what I am talking about because I have been engaged in the building industry for forty years. If a private person wants to get a pane of glass to put in a window it takes days to get a permit. Let me tell the Minister of an experience I recently had in Johannesburg. I wanted to get an electric switch. I went to a shop and I was told I couldn’t get one because all electric materials were frozen. The man I went to said: “I have 25,000 in the store but you cannot get one.” Now, if there is sufficient building material in the country to spend £8,000,000 in the next 12 months, why should the public be penalised in the way they are? No one can build a house or a room on account of the scarcity of building material, yet the Minister comes here and tells us that it is possible to carry out £8,000,000 worth of work in the next 12 months. I am glad that there is sufficient material to undertake such colossal schemes in the next 12 months. But if it is so then the Government should stop this permit system and stop persecuting people and no longer prevent them from carrying out repairs which are very necessary.

Do you think they’ll have enough cement?

I want to tell the Minister that I agree wholeheartedly with this building scheme and I support every clause.

I shall have something to say in Committee on Clause 9. I hope the Minister will leave no stone unturned to force the local authorities to get on with these building schemes because they are long overdue and many people cannot get a house to live in. Owing to the fact that the Government has met the local authorities in a very generous way I see no necessity for holding up the scheme any longer.

My only regret in connection with this Bill is that it was not put on the Statute Book at the beginning of the Session instead of at the end. I am not blaming the Minister for the delay because I appreciate the long negotiations which had to take place with local authorities. In regard to the lengthy debates which we have heard in this House today I want to say that whoever holds up the building of homes any longer will be doing the greatest possible disservice to the poor people of South Africa. They are crying out to us for help and help them we must immediately. When one reads in the “Cape Argus” of the 26th May about the conditions prevailing—when one reads the headlines: “Nine Living in a Bathroom,” one realises the seriousness of the situation. Here was the case of a whole family staying in a bathroom and other people in the house having to make use of that bathroom. There are many matter of detail in this Bill which we have to leave to the good judgment of the Minister. And let me add this, that no matter what we say here this afternoon, it is the local authorities particularly in the urban areas who have to work out the destiny of the people in their towns and all they are concerned about is to get the money to be able to meet the cost and to get the material to build the houses. The main objection on the part of the local authorities seems to be that they want the Minister to guarantee that their losses will not exceed 1¼ per cent. plus the ¾ per cent. loan. In this connection I have been told that the local authorities were very moderate in their demands and that the Minister was prepared to meet them. In view of the very fine provisions that have been made enabling individuals to purchase their homes, it seems that they will not be a liability to the local authorities, while the differential rents will help considerably to keep the losses of the local authorities down to 2 per cent. or somewhere around that figure. Taking the Bill all in all, I feel it is up to the local authorities to get on with the scheme once the Bill is placed on the Statute Book. There is one point I would like to ask the Minister. I am putting it as a theoretical proposition; the local authorities are afraid that they will lose more than 2 per cent.; if in practice it is proved that the loss to the local authority is more than 2 per cent., is there any machinery by which the position may be reviewed? I feel that this question should be reviewed if necessary; in any case it is for this House, without further discussion, to see the Bill passed in all its stages.

I am going to be very brief. I wish to associate myself with what the hon. member for Ceres (Dr. Stals) has said about housing schemes in the towns and on the platteland. A Municipal Congress was held at Stellenbosch recently, and the question of housing was discussed there very earnestly. It appeared that the municipalities were building houses under sub-economic schemes, but the influx from the native areas is such that the municipalities find it impossible to supply sufficient houses. The biggest mistake one can make is to build new houses as fast as people drift into a town. The result of such a policy is to attract more and more people from the platteland to the town. Now I want to put a few question to the Minister on which I would like some information. I want to know whether farmers who are desirous of putting up houses for their labourers will be able, under this scheme, to get loans at 3¼ per cent. I admit that housing conditions on the farms in many cases are unsatisfactory. You cannot keep your labourers unless you provide them with decent houses. We don’t want a large amount of money—we want from £150 to £200 to build houses for our labourers, and we want to know whether we can make application for a loan at 3¼ per cent.

Do you mean whether the farmers themselves can make application?

Yes, the farmers. We are not asking for a subsidy for labourers, like rich industries are doing, we are only asking for assistance to build houses for our labourers, and we should like to know where we can make application and within how many years the amount of the loan has to be repaid. It will help to remove some of the difficulties on the platteland as far as labour is concerned. We cannot solve the housing problem by making provisions for the towns only. We have to tackle the question as a whole, and you have to provide for the platteland as well.

I am grateful to the House for the welcome it has given to the introduction of this Bill, and for the constructive suggestions that have fallen from members on all sides of the House. The hon. member for Ceres (Dr. Stals) has suggested that I might hold over the passage of this Bill to enable the House, at the next Session of Parliament, to appoint a Select Committee to examine its provisions more carefully. I quite agree with him that it is desirable, on matters of major policy, to give members of the House opportunities such as that to help in forming and moulding policy in South Africa. But, Sir, I feel that the public outside this House would not forgive us if we were to hold up the Bill at this stage.

They would hang you.

If I am correct in judging public opinion, I am afraid my hon. friend is right. They would certainly take a very poor view of this House if, at this stage, it did not proceed with the Bill. The Bill, after all, merely provides the machinery for our new plans. I said, in introducing the second reading, the Bill itself does not build houses. It provides certain machinery which, after careful examination of the reports and advice that were presented, the Government considered necessary for launching this new national campaign for housing. Everything will depend on what use the machinery is put to, the manner in which the Housing Commission formulates its policy, the manner in which the local authorities respond to the fresh appeal made by the Government to co-operate with us in providing houses for the people. The success or failure of the new national housing plan depends on a number of factors, economic factors, human factors and other factors. It may very well be, In the light of the experience to be gained this year, that the House may next year feel it desirable to appoint a Select Committee to examine the whole of the workings of the Housing Act, as amended, and in the light of the experience of the new Housing Commission.

Would you accept that?

If in the opinion of the Government it is necessary to have that Select Committee, I am prepared to accept that next year. It may be that the House itself may express such a wish, and I shall always be glad to meet the wishes of the House in this connection. I am sorry the hon. member for Pretoria (West) (Mr. Hopf) felt regret that the Bill could not have been introduced earlier in the Session. I, also, would like to have seen it brought in earlier, but may I remind the hon. member that the report of the Van Eck Committee was received only at the end of February. There was no delay on the part of members of the committee. But I hope my hon. friend and the House will bear in mind that, in the course of the last four or five months, the Government, as a whole, has been concentrating not merely on one or two matters of policy, but on a number of items of major policy which will affect the country for many years ahead.

In the future you must work a little quicker.

My hon. friend may remember the injunction: “More haste less speed!” We are planning for the future. We are planning for demobilisation, we are planning for housing, we are planning for war materials disposal, we are planning for a national health system, we are planning for other aspects of social security. We are planning for social insurance; and we have made a great deal of headway during the Session.

You have done particularly well.

Members on all sides of the House, and I certainly know members on this side of the House, have been particularly concentrating their minds on a number of these important factors, and I think the House and the country in fairness will agree that, while there is a natural impatience to get results, there must in the nature of things, when we are planning on so vast a scale, be a little lapse of time while the machinery gets working. The hon. member for Stellenbosch (Dr. Bremer) said he hoped that we would not allow research matters to cloud the issue and to deflect us from getting on with the job. I hope not. We have to establish these various sections in the housing organisation, but the primary purpose of establishing the new machinery is to try to make a new start—to make a new start and to make that new start with the co-operation of our local authorities. The hon. member for Stellenbosch has said that he did not quite appreciate the exact functions of the Housing and Planning Commission. His question is somewhat related to that put to me by the hon. member for Port Elizabeth (South) (Mr. McLean), who complained this afternoon that Natal had contracted itself out of this Bill, and that Natal was going to receive preferential treatment. I may remind the House of what the hon. member for Port Elizabeth (South) suggested. He said that I am making an “experiment” in respect of Natal and making a “concession” to the people of Natal, and that they are “jubilant” over it. I think the hon. member for Port Elizabeth (South), who I know has a great deal of experience in housing matters, has misconceived the position in regard to Natal. There is nothing in this Bill which contracts the Province of Natal out of the provisions of the Housing Act. The existing Housing Act prescribes that housing loans are made by the Administrator of the province concerned. It is the Administrator who decides whether to give a loan to a local authority or not. It is the Administrator who decides on what terms to give a loan. Actually a practice has grown up in the course of the years under which, when an Administrator receives an application for a loan from a local authority, he submits that application to the Central Housing Board, which goes carefully into the application, into the suitability of the scheme, into the financial obligations and so on, and then it advises the Administrator whether to approve the scheme or not. That has been the practice. The Province of Natal has decided that it wishes now to run its own affairs, as it is entitled to do under the Housing Act. The Administrator wishes to form his own Housing Board and to deal direct with the local authorities. He is permitted to do so under the existing Housing Act, and there is nothing in the Bill which alters that. The only difference between the old position and the new position is this, that we are now creating a Central Housing and Planning Commission whose duty it will be to take cognisance of the whole housing position throughout the Union. That commission will, I imagine work direct with all local authorities, except in Natal, if the Administrators of the other three provinces ask for that. In the case of in Natal, if the Administrators of the other the Administrator and his executive and will hold them responsible if housing does not proceed satisfactorily in Natal. The position in Natal is simply this, that the Administrator of Natal and the Provincial Executive will be the agent of the National Housing and Planning Commission in furthering the cause of housing in Natal. The Administrator and his Executive will deal with the local authorities direct. But the Housing Commission will examine the position in Natal from time to time. If it feels that a particular section of the community is being neglected, or that particular geographical parts of the community are being neglected, it will draw the attention of the Administrator to these defects; and in the ultimate event, if the commission is not satisfied that the Provincial Administration is adequately carrying out the task of rehousing the people of Natal, it will be entitled to step in. By agreement between the Government and the Administrator, for the next twelve months the Administrator will pursue the policy of running his own housing in Natal, subject to the new position that the Government has accepted housing as a national responsibility and that the Government can step in if necessary. So, Sir, I think my hon. friend from Port Elizabeth need not have any fears that Natal is contracting out. The hon. member for Roodepoort (Mr. Allen) asked whose will be the ultimate responsibility for housing under this scheme. Sir, it is a joint responsibility. The State acceps that housing is a national responsibility but, as I attempted to show yesterday afternoon, the Government also feels that local authorities cannot divest themselves of their inherent responsibility for looking after the housing needs of their own people. Do not let us forget this, that under this scheme the local authorities will ultimately own the houses which will have a residual value. Well, Sir, if the local authority is going to own the houses with some residual value, if it is going to have the benefits of rates, if it is going to have contented citizens who will be living under happy conditions, and by their work helping to swell the financial resources of that local authority, then I think it only right and equitable that the local authority should bear some portion of the cost of this scheme.

Why do you say benefit of rates?

Under the national housing scheme the local authorities will be entitled to charge rates against the housing scheme. So the responsibility is a joint responsibility, but under the two to one ratio proposal, which the Government has made, the financial burden of the local authority will be greatly relieved in respect of past schemes—and immediate relief of 40 per cent. of annual losses. That is going very far indeed. In the case of Cape Town it has been pointed out by the City Treasurer that, if the two to one ratio is observed and the charges against a scheme are limited to a formula to be drawn up, Cape Town, with differential renting, will be able to house its citizens earning £1 a week or more and, at the same time, limit its losses to 1¼ per cent. That is a great advance. There is, apparently, some misconception regarding the new financial arrangements. There is apparently the idea that the financial proposals made by the Government to local authorities are included in the Bill. There are no financial provisions in the Bill, just as there are no financial provisions in the existing Housing Act regarding sub-economic housing. That Act provides that loans may be made on certain terms and conditions, which terms and conditions are dealt with administratively. So hon. members will find nothing in this Bill about the two to one ratio. I have been urged to make provision in the Bill for entering into contracts with local authorities in regard to specific schemes. I have also been urged to put into the Bill specific provisions relating to financial assistance. But I think it is wiser to leave out those legislative provisions. First of all, it is not necessary to incorporate a provision in a Bill to the effect that the Government may enter into a contract with a local authority. What is the need for that? The Government at any time has the right to enter into a contract with any local authority. That is a common law right held by anyone There is no need for legislative sanction for such an action. Then, secondly, if we were to tie ourselves down to a particular basis of financial assistance in this Bill, it would mean that the Commission would forthwith have to proceed on the basis of that statutory provision. If in three or four months we found that there were difficulties, and that we would like to modify our financial proposals, we should not be in a position to do so. It is much better to leave these things elastic and not hedge ourselves round with legislative enactments. For that reason I have left open the question of the lowest paid workers. If the City Treasurer of Cape Town is correct, then under our new national housing scheme Cape Town will be able to house 50 per cent. of those who are in need of houses, an increase of 100 per cent. over what is being done at the present time. But, says the City Treasurer, there will still remain another 50 per cent. in Cape Town who are below the £1 per week level. They cannot be housed under the conditions put forward by the Government, and at the same time allow Cape Town to limit its loss to 1¼ per cent. I agree that we cannot suggest that we are properly dealing with the housing problem if we ignore this lowest income group. I said I hope that that is a transient group; there should be no people in South Africa earning less than £1 per week.

But there are.

Of course there are, and we have to deal with them. But there should be no such persons.

Give every worker an adequate wage.

My hon. friend must address that matter to the Minister of Labour. I am dealing with the question of housing. I have given an undertaking to the United Municipal Executive that I am prepared to discuss that particular aspect of the question during the recess. An experiment has been carried out in Cape Town by a utility company with funds made available by the Department of Social Welfare. We have provided funds to this utility company to enable it to subsidise the rents of certain European families in Cape Town who cannot even afford to pay a sub-economic rent. It may be that we can expand that principle. I cannot bind the Government, but it is a matter for consideration whether we shall not have to provide a rent subsidy, not to be charged against the housing scheme itself but to be paid out of the funds of the Social Welfare Department. That is a line which might very well be followed up. Then the hon. members for Roodepoort (Mr. Allen), Swellendam (Mr. S. E. Warren) and Kensington (Mr. Gray) have asked me about Clause 9 of the Bill. The hon. member for Kensington went as far to say that, if I withdraw Clause 9, it will ruin big schemes in Johannesburg. Clause 9 purports to amend Section 11 of the existing Housing Act, and Section 11 of that Act deals with the question of expropriating land for housing purposes. It lays down that a local authority, with the consent in writing of the Minister, may expropriate land for housing schemes subject to three conditions, three safeguards which are inserted in that Clause 11.

They are not in this Act.

I am dealing with the existing Housing Act. The safeguards are (a) that the Minister must be satisfied that the ground cannot be purchased on reasonable terms; (b) that no other suitable land is available, and (c) that no other suitable land can be purchased on reasonable terms. Now, Sir, the Province of Natal, or rather the City Council of Durban, wished me to amend the provisions of Section 11 so as to enable local authorities to purchase land, not for building on that land, but for re-planning and re-laying out and then selling to the public. It was alleged that that power was necessary for certain schemes of re-laying out and replanning. On going into the matter, Sir, I was advised that the Province of the Transvaal has by Ordinance taken such powers to itself; and, in view of the fact that Natal has now asked to run its own housing affairs in terms of the Housing Act, it seemed to me that if it wanted to take that specific power for re-laying out and re-planning, it could also do so by Ordinance. It was suggested to me by representatives of the Indian Community of Durban that this was a sinister attempt to obtain Indian property. Well, Sir, I want to make it perfectly clear that I am not prepared to allow a Housing Bill to be used for dealing with the Indian problem or any other problem. A Housing Bill should deal with housing on its merits, and should not be used as a vehicle for dealing with other problems. That is the attitude that I take as Minister of Welfare, and so I was not prepared to insert that amendment in the Bill. Then it was proposed that I should cut out two of the three safeguards in the existing Clause 11 of the Act, and so Clause 9, it will be seen, provides that a local authority may expropriate land, and the only safeguard there is is that the Administrator, and subsequently the Minister, must be satisfied that the land cannot be purchased at a suitable price. The hon. member for Kensington is afraid about what may happen in Johannesburg. He has told me that Johannesburg has bought a composite area of land for a housing scheme and that it owns all that land barring three spots. The hon. gentleman says that the City Council of Johannesburg has failed to purchase these three spots on suitable terms, and he goes on to say that, unless I amend Section 11 of the Housing Act in the manner provided by the terms of Section 9 of this Bill, the City Council will not be able to expropriate because the owners of these three spots will always be able to say that there is other suitable land available for housing. Now, Sir, it is true that outside the area referred to there may be ground which is suitable for building houses. But it cannot reasonably be argued that these areas outside can be said to be areas “suitable for the scheme.” This is clearly a matter for the Minister’s discretion and the Act lays that down. Now hon. members know this, that so long as a Minister of the Crown exercises a statutory discretion bona fide, no court of law will interfere with that discretion. My hon. friend from Kensington seems to fear that the courts may upset a decision which is bona fide. But the courts do not do that; a court of law can interfere only if the Minister has not observed the principles of natural justice, or has gone outside the four corners of the statute, or has not acted bona fide. He must have acted so blatantly unreasonably that he may be said to have acted mala fide, before a court will interfere. I can assure the hon. member for Kensington that local authorities have nothing to fear on this point. Finally, a number of hon. members have raised the question of the platteland position, and the former £50 scheme on the platteland, and they ask whether farmers will be able to take advantage of this scheme. May I say that all these suggestions and queries will be matters which will have to be placed before the commission and the staff of the Director of Housing. There are a number of matters which will have to be thought out and dealt with as matters of policy. I am grateful to hon. members for putting these questions to me and suggesting lines of thought which will be followed up. The Act has been specifically drafted to enable the commission to deal with rural as well as with urban housing conditions, and there is no doubt that not only the commission, but also the Director of Housing and his technical experts, will have to devote a great deal of their attention to the question of rural conditions. It has also been suggested by the hon. member for Kensington that there is no provision in the Bill for ownership. He said it is a pity that the Bill does not make provision for home ownership. It is a cardinal feature of our National Housing Plan that national houses shall be capable, not only of being leased to citizens, but also of being sold to them on terms if their economic position qualifies them to buy. And the provisions of Section 5 (b) of this Bill make that clear. The original Act enables the local authority to sell or let houses built under an approved scheme, and in terms of Section 5 (b) of this Bill, the local authority may—

Various details will have to be worked out. The Bill does not deal with all the niceties of a legal contract. But it enables local authorities to sell, to embark on a homeownership scheme, and it lays down that the conditions will have to be arranged by the local authority. The machinery is there. Finally, the hon. member for Port Elizabeth (South) (Mr. McLean) still doubts the wisdom of differential renting. I shall just quote one passage from Sir E. D. Simon’s book on the anti-slum campaign, in which he says—

If we have a system of differential rents, that does not necessarily mean that the rents themselves will differ. A uniform rent may be laid down for a fixed type of house, but there will be subsidies, or rent rebates, for individual types of tenants. While I thoroughly agree that, to some extent, the granting of a rent rebate, the giving of assistance to lowly paid people, is a subsidy to the employer, the administration of such a system will necessarily require careful investigation by the local authority, and that will lead, in many cases, one hopes, to further action by the Department of Labour and the Wage Board. In other words, we shall be able to relate our differential renting system with a fair wage system, and in that way relate it to the great problem of social security, The hon. member for Langlaagte (Mr. Bawden) has asked me what the position is in regard to building material. The Director of Housing has consulted the Deputy-Controller of Building Material. As hon. members know, a certain amount of building material has had to be frozen in this country for essential needs. There are the needs of Defence and other departments, and, while I sympathise with my hon. friend who may have had difficulty in securing permits for certain items, he will appreciate the primary necessity for control over materials as a whole. The Deputy-Building Controller, after consultation with the Director of Housing, has come to the conclusion that our building capacity will enable an £8,000,000 national housing programme to be carried out in the next 12 months. Certain sums have also been reserved for certain national essentials and a certain amount has also been reserved for private work. These are the figures which the Deputy-Controller of Building Material has given, and we are notifying the local authorities in order that that they may submit their requirements.

What about this question of European segregation?

The hon. member for Swellendam has sought to extract from me a declaration of policy in regard to the segregation of the races in this country. This Bill provides for housing. Local authorities will, in terms of the Bill, be empowered to submit housing schemes. Local authorities know their own conditions, and the onus will be on the local authorities to submit to the Commission such schemes as are requisite to meet their needs. As far as the Government is concerned, we have repeatedly said that, while we are anxious to do all we can to encourage the various racial groups to live in their own townships, we are not in any way committed, nor shall we be committed to any policy of compulsory segregation, either in relation to Indians or to coloureds. Here in the Cape Peninsula we have found that such schemes as “Q” Town have attracted large numbers of members of the coloured community, but they have not been forced to go there. That is a policy which I hope will be followed, under which there will be voluntary separation in the interests of all sections. I think I have now dealt with all the main points and, once again, I want to express my appreciation to hon. members for the constructive suggestions they have made.

Motion put and agreed to.

Bill read a second time; House to go into Committee on the Bill on 2nd June.

I think it will meet hon. members convenience if I move that Clauses 2 to 9 stand over until the rest of the Bill has been disposed of. I am doing so because these clauses may possibly give rise to a fairly lengthy discussion, and we do not intend asking the House to sit this evening. I think we can leave those clauses over until tomorrow. I therefore move—

Agreed to.

On Clause 16, On the motion of the Minister of Finance an amendment was made in the Afrikaans version which did not occur in the English version.

Clause, as amended, put and agreed to.

On Clause 31, *Mr. NAUDÉ: I shall be glad if the Minister would explain to the Committee what the effect of this clause will be.

The effect will be that the allowance per child will be increased from £6 per year to £8 per year; that is in respect of the child of a native volunteer who has been killed. At the moment the allowance is £6 per year per child and now it will be £8 per year per child.

Let me say at once that we object to this increase. As I understand the Minister, this is a permanent increase. We have from time to time in this House put forward strong pleas for increases of other pensions. These cases were not affected by a temporary increase in the cost of living but the Minister took up the attitude in regard to those other pensions that he was making provision for increased cost of living. Among other things he also provided for a one-third increase to Oudstryders, and when I asked that that one-third should again be made applicable, the Minister’s reply was that the allowance was only a temporary one. It was granted temporarily in 1943, and the attitude adopted by the Minister today is that actually that grant no longer exists. The temporary grant of £6 per year as an addition to the old age pensions, which the Minister has announced, but which is not given to the Oudstrvders, is also a temporary grant. The Minister now asks the Committee in this instance to agree to a permanent increase of £2 per year for native children. I want to point out that the natives who are affected by this have been getting money during war time, and grants such as they have never been accustomed to in all their lives. There are instances of native women who do not know what to do with their money, and now, without giving any reasons, the Minister proposes to increase these allowances from £6 to £8 per child. In view of his refusal in other cases we are not prepared to grant him this increase.

May I point out to the hon. member that we are also proposing to increase the allowances for European children from £30 to £36. On the question of the increase of £6 in respect of old age pensions, our intention is to leave the amount of the old age pension at £5 per month as recommended by the Social Security Committee. I feel therefore that this may be regarded as permanent. As we are increasing the allowances to the white child we feel that we must do the same thing in regard to the native child.

May I be allowed to point out that this principle has been passed in connection with other legislation, but we, who are familiar with conditions on the platteland—and the Minister knows them too—know what actually goes on. The native has been killed. His family is left behind. There is a woman and three or four children. Now the tribe takes them over. That is the custom. Nobody is left uncared for.

These people are an asset to the kraal. They are looked after in the kraal and the eldest brother of the native who has been killed takes over the whole kraal; he gets the woman with her stock and children, and we also know that the custom is for the young girls through the lobola system to be married off again. They are an asset. Consequently there is no need whatsoever for this increase. Even now they are in receipt of something to which they cannot lay claim. Why then have this increase of 33⅓ per cent., which is more than the white child gets? I think it is totally wrong. The native male has unfortunately been killed, but his family is looked after just as well as it was before. There might be some argument in favour of something of the kind being done in respect of native children in the towns, but certainly not in respect of natives on the platteland, in the kraals. The native doesn’t look upon it as a burden if he takes over a woman and her children. They have to work for him and they are an asset. And now, if the woman has four children, we are going to grant this additional allowance of £32 per year. I want to warn the Minister. How is he going to control it? What happens if the woman marries again? There is no proper system of registration, so what is going to happen? Is this allowance to be given until the child has reached the age of 18 years, or for how long?

I should like to point out that the percentage increase in the case of the native child is more than it is in the case of the white child. I assume the Minister will say that the increase is proposed in view of the increased cost of living.

No, it is proposed because we consider it fair.

But why is not the increase on an equal percentage basis?

The request was made to me in regard to European children and we felt we could not refuse. It was not based on increased cost of living.

Did you also get a request from the native?

No; I would like to add that the request came from soldiers’ organisations, but they made a request on behalf of Europeans and nonEuropeans.

I, too, would like to object to this clause. Hon. members have already drawn attention to the fact that it is having a disintegrating effect on the life of the natives. The native woman, generally speaking, is well cared for. But I can see a further danger. This clause is going to have a demoralising effect on the native family life and is going to promote immorality on a serious scale. The women will not be able to marry but they will simply live with the men. This is the sort of thing we are going to get among the natives, and this proposal is going to encourage it.

I want to ask the Minister in all fairness to tell us clearly what his reply is to the question of the hon. member for Pietersburg (Mr. Naudé)—what is the position going to be if the native woman marries again? The arguments put forward by this side of the House is that the Minister cannot control the matter. He can do his best but he cannot control it.

The child’s allowance does not lapse if the woman marries again.

Then it means that the allowance continues—until what age?

14 years.

So the increased allowance is now given to native children until they are 14 years of age, and it is not reduced.

Unless Parliament decides to reduce it.

I think the best thing Parliament can do is to vote against it. The Minister knows that we are opposed to natives being used for the war, especially as armed soldiers. Some of the natives have been killed. But if you want to grant allowances, the existing allowances are adequate and there is no reason to increase them. It appears that no request for an increase has come from the natives, but it has come from an organisation of Europeans. It is true that they have put up a plea on behalf of the natives as well, but the Minister is now giving the natives a higher percentage increase than he is giving the Europeans.

May we ask the Minister what the position is if a native has more than one wife?

It makes no difference as far as the allowance to the children are concerned.

Even if he has 15 or 20 or 30 children?

The allowance is given in respecct of each child. But we are only dealing here with the question of increasing the allowance.

But that is appalling. What about the natives who were recruited in Ovamboland and Pondoland and other native territories and who were taken up in the Union forces?

Those who are in the Union forces ….

Then they will get more money than they have ever had or ever will see again. It is a profitable business for them. The effect of this increase is appalling. I hope the Minister is not unwilling to reconsider the matter. We are familiar with the native territories. The hon. member for Kingwilliamstown (Mr. C. M. Warren) can corroborate that. There are natives who do not live with one wife but with several wives. And by each wife they have their quota of children. What is the financial result going to be if each child gets £8 per year? And the Minister is even more liberal in respect of the native’s child than the European child. I want to ask the Minister not to make a party matter out of this, but without prejudice to allow his supporters to vote according to their convictions. Take the native from Ovamboland, where a great number has been recruited for our army. The young native from Ovamboland, when he is 17, is taken into service on contract at 10s. per month. Now the child, the small native girl who sits at home, will receive more than 10s. per month. The natives were never used to so much money. They do not know the meaning of much money. Let the Minister leave it to the free vote of the House.

I also want to raise my voice in protest. We who are familiar with the natives, know the state of immorality amongst the natives today. Immorality is rife and most young native girls usually give birth to children long before they are married, and then according to native custom, the grandfather takes the children. Often he also takes the eldest child of his children. Such a grandfather is usually still young, and if he falls on the battlefield and he has adopted children in that way, how is the Minister going to control who are really his children? Because according to tribal custom they are his children. Consequently later on allowances will be given to children who are not the children of the fallen man. We cannot let this matter go through like that. We feel that the allowances are already so high that in any case they must not be increased. That is why I feel positively that I must raise my voice against this proposal.

I want to ask the Minister whether he is going to demand a marriage certificate to find out if such a native was actually married?

The allowance is for the children.

But how is the Minister going to determine that they are the children of that native? We know that they do not get married, and simply take each other.

The Commissioner of Pensions must satisfy himself that it is actually the child or children of the fallen volunteer.

Is that determined by the Commissioner of Pensions or by the Department of Native Affairs?

No, in this case by the Commissioner of Pensions.

I wish to point out that the native has already originally been privileged against the European. According to his customs, the native takes more than one wife, and he can obtain pension for the children of all those wives, and now the Minister still comes and makes the percentage increase higher in the case of the native as in the case of the Europeans.

It is the child who is assisted by us, and not the native.

But I wish to point out that the native may have had five wives, and he receives the allowance for the five, ten or more children from all the wives, while the European has only one wife. There the native already has an advantage as far as this pension is concerned, and yet the percentage increase is higher in his case than in the case of Europeans.

May I just ask the Minister if, in the drafting of this Bill, the aspect of the matter which has now been mentioned by hon. members, viz., that a native may have four or five wives, and twenty children, was thoroughly taken into consideration; and if not, is the Minister then prepared to let this clause stand over?

No, that was taken into consideration.

We protest against this increased allowance to the native children, and for the sake of clarity, I move the following amendment—

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

Upon which the Committee divided:

Ayes—53 :

Abrahamson, H.

Alexander, M.

Allen, F. B.

Ballinger, V. M. L.

Barlow, A. G.

Bell, R. E.

Bodenstein, H. A. S.

Bosman, J. C.

Bosman, L. P.

Bowker, T. B.

Christopher. R. M.

Cilliers, S. A.

Clark, C. W.

Connan, J. M.

Davis, A.

De Kock P. H.

De Wet, H. C.

Du Toit, A. C.

Du Toit, R. J.

Fawcett, R. M.

Gray, T. P.

Hare, W. D.

Henny, G. E. J.

Hofmeyr, J. H.

Hopf, F.

Lawrence, H. G.

Maré, F. J.

Miles-Cadman, C. F.

Molteno D. B.

Morris, J. W. H.

Neate, C.

Payne, A. C.

Prinsloo, W. B. J.

Robertson, R. B.

Russell, J. H.

Shearer, O. L.

Shearer, V. L.

Sonnenberg, M.

Stallard. C. F.

Steenkamp, L. S.

Steyn, C. F.

Strauss, J. G. N.

Sturrock, F. C.

Tighy, S. J.

Van der Byl, P.

Van der Merwe, H.

Van Niekerk, H. J. L.

Van Onselen, W. S.

Visser, H. J.

Waring, F. W.

Warren, C. M.

Tellers: J. W. Higgerty and W. B. Humphreys.

Noes—24 :

Bremer, K.

Conradie, J. H.

Dönges, T. E.

Erasmus, H. S.

Grobler, D. C. S.

Haywood, J. J.

Klopper, H. J.

Le Roux, J. N.

Louw, E. H.

Ludick, A. I.

Luttig, P. J. H.

Malan, D. F.

Nel, M. D. C. de W.

Potgieter, J. E.

Serfontein, J. J. Stals, A. J.

Steyn, A.

Swanepoel, S. J.

Swart, C. R.

Van Niekerk, J. G. W.

Van Nierop, P. J.

Warren, S. E.

Tellers: J. F. T. Naudé and P. O. Sauer.

Question accordingly affirmed and the amendment negatived.

Clause, as printed, put and agreed to.

Clause 39 put and agreed to.

I move—

Agreed to.

HOUSE RESUMED :

The CHAIRMAN reported progress and asked leave to sit again; House to resume in Committee on 2nd June.