announced that the Committee on Standing Rules and Orders had appointed the following members to serve on the Select Committee on the Irrigation Commission Bill, viz., the Minister of Justice, Mr. Hugo, Colonel D. Reitz, Messrs. Struben. G. C. van Heerden, I. P. van Heerden and Waterston ; had discharged Major G. B. van Zyl from service on the Select Committee on the University Schools Transfer Bill, and appointed Mr. Papenfus in his stead; and had also discharged Colonel D. Reitz from service on the Select Committee on the Subject of the Prevention of Disorders Bill and appointed Mr. Deane in his stead.

When we adjourned last evening I was dealing with the question of the supposed increase in the tariff on flour. I think I proved that with the total imports on the basis of 2s. 11d. per 100lbs. on Canadian flour and 2s. 11d. on Australian flour plus 7d. dumping duty we are reducing the tariff this year to the extent of 2d. ped 100lbs. I realize it is a very difficult matter to deal with certain taxes so as to decrease in any way the import duty on commodities which are for the consumption of the ordinary person. In principle I think that a system of assisting an industry or the growing of wheat by means of a bounty would be more beneficial, but if the Government, which is a coalition Government, does not see its way clear to assist by bounties I am willing to support it in its present policy. For this reason. Wheat is the staple food of the people of this country. We know full well that in years of plenty in Australia and America they would export wheat to this country and sell it at a lower price than in their own country, and unless we protect the wheat growing industry it would result in no farmers in South Africa sowing wheat We know that in some years there js a possibility of a scarcity of wheat, and what would the result be? Those countries would pass legislation prohibiting the export of wheat. What would happen in South Africa? You would have no farmers growing wheat and you would have no wheat being imported into the country. Therefore, although it may be a wrong principle to tax the foodstuffs of the people, in this particular instance—and I deny there has been an increase—even if there was an increase, if it was to safeguard the people of this country I would be prepared to vote for it and support it. We know full well that with the interchange of commodities which is taking place at the present time no country is safe from having dumped on its shores the surplus of other countries, I am pleased to say that we have in our Minister of Finance a very capable man, who, I believe, will look after the welfare of the people in general. I do not mean by that that I agree with everything the Minister does, but I do say that the Minister as a Minister in a coalition ministry is the best man, and I believe that he will not only look to the interests of the party, but he will look from the view of the interests of the greater majority of the people of this country. We have also had charges made that the policy of this Government is such that there would be an increase in the price of sugar. There again, I agree with the Minister. I believe with him in legislation to prohibit the dumping of the produce of any country on our shores. If it was a commodity of which there was a surplus for all time it would be reasonable. Are we going to allow the dumping of sugar in South Africa just because at present there is a surplus? No. I believe that there would be no increase in the price of bread and no increase in the price of sugar. I believe this Government in assisting an industry or any section of the farmers will expect in return that that section will play the game to the consumers of the country. I am certain that the sugar planters in Zululand will play the game to the consumers of South Africa in this particular instance. There will be no increase in the price of sugar. Some play has been made also of the Economic Commission’s report. I do not agree with the so-called majority report. I have a book here with which Professor Clay had something to do. It is called “The Rise of Modern Industry.” It proposes quite a different policy from what you have in the majority report. It is true he did not write that book, but in the preface they thank him for his assistance and advice. There quite a different outlook is taken and quite different suggestions are put forward for the development of industries in respective countries. My main objection to the report is that we brought men from other countries to advise us on the economic conditions in this country. In other countries they are quite correct in looking at everything from the point of view of the cheaper production of the different commodities, for the benefit of the majority of the consumers in those countries. That is quite a logical argument, but in this country, if you put that into operation, it would mean that you would have the natives producing commodities who would not use these commodities, and that is the reason why I object to the majority report and the views so ably expressed by the front benches on the opposite side of the House. I am not in a position to say that that is wrong for other countries. I believe it is quite correct that the cheaper production of commodities and the more effective using of the workers from the standpoint whereby you can get commodities produced cheaply which will ultimately mean that the consumers reap the advantage. This does not happen in this country ; the persons who were producing the commodities would not use the very commodities which they produced. I hope and trust that neither this Government, nor any future Government, will import men to advise us on the conditions in this country—we are altogether different from every other country. Fancy bringing a man from Australia, where they have the white labour policy ? We have a convert to high wages for high efficiency in the hon. member for Cape Town (Central) (Mr. Jagger). I was surprised when he told us so. In this country we have no great development in the use of machinery, but a great development in the exploiting of a standard of civilizations which are living on a lower ecconomic scale. If we analyse this matter much further (I am very pleased to find that the Government has, to a certain extent) brought down the barrier which we call the dignity of labour —under the South African party regime you had a small section of our boys and girls, who were intellectually blessed and had talent, encouraged and had the talents developed, we were producing a very fine type of South African, which, however, was very small in numbers compared with the large number of boys and girls who did not have great talent or possessed intellect, and who were allowed to drift to the lower level of civilization. We erected barriers, and certain work was classed as native. I am glad that the Government has broken down that barrier, and white boys who have passed the Junior Certificate or the Matric are doing labourers’ work until there is an opportunity for them in other spheres. I am glad that is happening. Sooner or later a civilization which is not using its creative faculties must die. The poor whites, especially in the country districts, are the product of European civilisation, not using their abilities in the way of producing, but just overseeing and exploiting a lower civilization. I would like once again to ask the Government to consider this matter of representation at the Geneva conference and the League of Nations. I am in sympathy with the Government having representation there, but I have no sympathy with the Government sending representatives who believe in the policy of not treating as equals the persons who live in their own country. We say that the Indians are a menace to the European population—all well and good if that is so—but why send representatives to sit with them on the League of Nations and treat them as equals in other spheres ? Personally I would like a League of Nations which are living on the higher scale of civilization, South Africa represented at a conference where different parts of the British Empire and the United States and any other country living on our economic level can sit and consider matters of great, worldwide interest with nations which are living on the lower civilization, and who, to a certain extent, cannot assimilate the ideas which we in South Africa have. To come to a hardy annual, and to deal with the income tax, I am sorry that the Minister of Finance has agreed to raise the exemption from £300 to £400 instead of an increase in exemptions for children. I believe that it should be left at £300 and an exemption of £100 for each child should have been granted. I believe that we should, to a great extent in this country, especially when we are crying out for European population, assist and play the game with those who are struggling to rear large families. For instance, on farms right away from the railway there are people who have to send their children away from home at an early age to schools and universities, and it is a tremendous burden on these parents. On the other hand, a large number of married men have no children at all, and therefore have little expense in keeping their homes together. I hope and trust that next year the Minister will consider the advisability of reverting to the £300 exemption, and giving £100 exemption for each child, irrespective of whether a man is a working man, a business man or a farmer. I listened very attentively to the speech of the hon. member for East London (North) (Brig.-Gen. Byron), who was advocating a better and more up-to-date defence force. In this country the cost of the defence force is 14.6 per cent, of the total income from taxation. In Australia it is practically less than 9 per cent. If hon. members want a more efficient defence force they should suggest some scheme whereby the money can be better spent than it has been in the past. I believe this country cannot stand any further taxation for this purpose. I would also like to congratulate the Minister on his advance in giving assistance to technical education. In the past we have had a tremendous output of B.A.’s and M.A.’s. and while I wish I had had the opportunity for such an education, after all, that is not of the same advantage to the community as technical knowledge, and therefore I look forward to the time when the technical institutions of this country will produce—and I believe they can do it—boys who can compete with boys educated in any other country. In 1923 only 27 per cent, of the mechanics in the South African Railway workshops were trained in South Africa, whereas in Australia you have over 80 per cent, of the mechanics trained in Australia, showing that we are a long way behind in the training of boys to fit them for the arts, crafts and sciences in South Africa. There has been a great amount of chipping across the floor in regard to a certain cold storage scheme. I would like to explain. I could have wished that the criticism had been from men who did it for the public benefit, but I believe the hon. member for Cape Town (Gardens) (Mr. Coulter) is legal adviser to the Imperial Cold Storage Company, and I think it was he who criticized this cold storage more than anyone else. I would like to explain I was on the Price of Produce Committee in 1923, when we found that the producer only received 23 per cent, of the price paid by the consumer for the commodity ; already a believer in the co-operative principle, I was more and more convinced, and decided to do what little I could towards furthering the co-operative ideal. A large number of Socialists have advocated that we should leave trusts alone ; believing, that by allowing the trusts to get more powerful than they are and to get control of practically all the raw commodities of South Africa, the intellectual class would come round to the idea that a new system of society was needed. Personally, I believe in altering conditions gradually, also that the only way to fight trusts is by co-operation. In pursuance of that principle, I visited certain parts of this country, and certain farmers proved to me that the reason why co-operation had not been successful was because they had to deal with the Imperial Cold Storage. How they managed it I do not know. Later on I visited a farm owned and controlled by a Mr. King outside Kimberley who has a large number of cattle. He had over 500 calves at the time of my visit.

Which of the kings was it ?

I cannot enlighten the hon. member for Three Rivers, but it was not King George. The farm is about 20 or 30 miles from Kimberley. He proved to me that by crossing an Afrikander bull with a shorthorn cow the cattle would develop, and at the age of 25 to 30 months would be fit for slaughter and could then be exported, not in cold storages, but could be chilled and sent to the British market and command a big price, but they were debarred from doing this owing to the fact that the Imperial Cold Storage control the cold storage of this country. I believe the farmers are as good experts in cattle breeding as lawyers are; the farmers told me that if they got the assistance of the Government or a private cold storage, they could cold storage or chill the meat. There was a possibility of a great development in trade between South Africa and Great Britain. I went with others and interviewed the advisory board of the Agricultural Union in Pretoria. I believe it was initiated by the late Minister of Agriculture and that the present Minister of Agriculture had approved of that board, which is doing useful work. We laid the scheme before them, and a very large number of them were in sympathy with it. We found that under the Co-operative Act, co-operative organizations cannot successfully finance cold storage undertakings, they are debarred from trading with people who are not members of co-operative societies. It was thought that by having a subsidiary company financed by private individuals and those egg and fish merchants who were debarred from storing with the Imperial Cold Storage Company, there would be enough revenue to pay a dividend to the private investors, while the control would remain under the co-operative society. The charges which it was believed would ensure the making of a good profit, were those of the Johannesburg Municipal Cold Storage, and it was thought that this would leave a tremendous profit to the co-operative organization. It is only by such methods that, to a great extent, the Imperial Cold Storage Company can be brought to book. I was very sorry indeed that the hon. member for Newlands (Mr. Stuttaford) should read into the prospectus something that was never in it. The Board of Trade never saw the prosuectus. I read the report of the board, and the principles as embodied in that report were the principles which were embodied in the prospectus of the Co-operative Meat Export Company. I believe there has been a misunderstanding by the hon. member. At any rate the Board of Trade had nothing to do with it, but the board does recommend the principles which I have tried to enunciate from this seat. I have tried to prove that this co-operative organization is the only method by which you can challenge the Imperial Cold Storage Company’s monopoly.

Did the Board of Trade give the seal of their approval?

The Board of Trade practically say word for word, in their recommendation, what we say our company will stand for. The hon. member for Illovo (Mr. Marwick), I think, has shares in a subsidiary company of the Imperial Cold Storage Company.

The statement is on a par with many other statements the hon. member has uttered. I do not hold a single share in any meat company, and never have, or in any other industrial company at the present moment.

I accept the explanation if the hon. member states he has no shares in a subsidiary company. I happen to have a list of the names of a large number of influential men who have shares, directly or indirectly, in the Imperial Cold Storage Company. In travelling around the country people told me the difficulty there would be in having anything to do with a company of this nature on account of the tentacles of the Imperial Cold Storage Company.

Was the name of the hon. member for Illovo on your list ?

The hon. member's name is on a list of a company which is controlled by the Imperial Cold Storage Company, but as the hon. member has denied it I have withdrawn.

I challenge the hon. member to produce any share list or any document to show that I have ever held a single share in the Imperial or any other meat company.

Don’t cry about it.

I accept his statement, but it is quite different to the one I made.

Tell us something about your company ?

Our prospectus was printed two months after the report of the Board of Trade was laid on the table. The board’s report was practically on a par with the principles laid down in the Cold Storage Company’s prospectus. I am not tied down to that, and if the hon. member for Cradock (Mr. G. C. van Heerden) and other gentlemen, think of forming a co-operative meat export company I shall be only too pleased to join them. I will be a humble musket bearer in the ranks, but I believe the time is coming when gentlemen who sit on that side of the House will realize the tremendous power of the Imperial Cold Storage Company.

18½ per cent, dividend.

I have dealt with that previously, but some hon. members are very difficult of comprehension. I may mention that the 18½ per cent, was based on the tariff charged at the present time by the Johannesburg Municipal Cold Storage. The co-operative farmers’ organization by having 60 per cent, of the representation on the board would be able to control, and I think it is very good of private individuals to invest their money in any company and give the control to a co-operative organization.

Is 18½ per cent, a fair percentage to rob the consumer of ?

I like these interjections, for they show the simplicity of these gentlemen. I have been asked whether 18½ per cent, is sufficient. The unfortunate curse of this country is that 18½ per cent, is not sufficient for the gentlemen who sit over there on the Opposition side, and that is the reason why South Africa is suffering at the present time. I have honestly tried to do something for the producer in South Africa, and I think there is no man in Parliament here who could have taken an interest in what was laid before the prices of produce committee without coming to the conclusion that something must be done for the producer and Consumer in South Africa.

You were to get £2,000 out of it.

As regards the £2,000 that goes in options, I have never received a halfpenny. The fact is I acted as promoter for a company that is not in existence, but one that is going to be in existence, a very powerful company, the Co-operative Meat Farmers’ Export Company. I claim that I have initiated an idea, that I have done something to compel others to co-operate and to bring home the fact that the Co-operative Act must be altered, and I hope and trust that the hon. member for Cradock (Mr. G. C. van Heerden) with the long life that is before him will in his district try and bring about the co-operative spirit so that at some future time we shall have the producer and the consumer getting the fruits that rightfully belong to them.

Not the company promoters.

Well, sir, as regards company promoters, hon. members on the Opposition side understand that very well, have a lot to learn, but I do not wish to attend that particular school. I realize that there are hon. members on that side who are past masters in the art of company promoting. If they would take up the co-operative principle for the benefit of the producer in the same way that they have taken up company promoting, South Africa would be a better country than it is today. I hope and trust that my efforts on behalf of the co-operative principle, in fact I know will not be in vain, I believe that much abler men will carry on the battle. For hon. members opposite to accuse me as they have done is ridiculous in the extreme, if it were not such a serious matter. It was suggested that I dealt with the Egg Commission's report, but owing to the fact that I am connected with another company, I shall refrain from doing what the hon. member for Newlands (Mr. Stuttaford) and other hon. members on that side of the House have done, and that is to attack another company in defence of the financial interests which they have in certain companies.

I would like the hon. member to withdraw that. He has made a similar charge against me to the one that he made against the hon. member for Illovo (Mr. Marwick). He suggested that I have an interest in the Imperial Cold Storage Company. Is that the hon. member's suggestion?

No.

We have listened with intense interest and, I may say, a considerable amount of hilarity to the extraordinary views of the hon. member for Liesbeek (Mr. Pearce) on the subject of finance, cattle breeding (his mysterious references to the Afrikander bulls seemed to puzzle a good many of the farmer members of the House), the League of Nations and company promoting. To the ordinary plain man it strikes one as uncommonly curious that people who Vaunt their high principles, and attack company promoters and make political capital of the most tainted kind out of that kind of thing, should come here with such an explanation as the hon. member for Liesbeek has given this afternoon in regard to the remarkable transactions that he has been connected with. As to his views on politics and on finance, I am sure the Minister of Finance has learnt a lot this afternoon from that particular quarter. In regard to his approval of what the Minister of Finance has done, it has been said by some of my hon. friends here that the hon. gentleman executed a very skilful dance, even if it were a tainted egg dance. Before I go further I would like to ask one question of the Minister of Finance, and that is whether the report of the Police Commission which was laid on the Table of the House this afternoon, is the same as the report which was published in “Die Burger” this morning, and, if so, how it is that a report which was only placed on the Table of this House at two o’clock this afternoon could appear in a particular newspaper in the city this morning. I would like the Minister to give the House an explanation, and say whether the Rules of the House have not been flagrantly broken.

made an interjection.

If the hon. member (Mr. I. P. Van Heerden) will allow me, I am not asking him the question. He is not yet a Minister. I am informed that this is the second occasion on which a similar thing has happened. The same circumstance attended the report of the Economic Commission, which was published in “Forward,” which represents another branch of the Pact, and I do ask that the Minister will make one of those full and frank statements that I know he will make as to the circumstances attending this breach of the privileges of the House. I would like at this stage to make a protest about the position of this House last night. We had a debate which has only taken two-and a-half days on a matter involving £54,000,000 of expenditure of public money. For the greater part of the evening, with the exception of the two Ministers in charge of the budgets, we had hardly a single Minister in the House.

The old story.

Yes, that’s the pity of it. It is the old story and it is a sad story that members of the Ministry should take so little interest in the affairs of the country that during the most important debate of the session when £54,000,000 of public money is involved, we should only see two Ministers and a few solitary members sitting on the other side. Members opposite have evidently been muzzled. It obviously is very inconvenient that We should have this diversity of utterances on the part of Government members of the House and that we should have these attacks, made so effectively, like that of the hon. member for Troyeviile (Mr. Kentridge). It is, no doubt, extremely awkward and inconvenient to have these attacks and these different things going on the Government side of the House. For instance, we had the hon. member for Vrededorp (Dr. Visser) letting two or three full-sized cats out of the bag, as usual. I would just like to touch upon the doctrine of collective Cabinet responsibility and the question of how far that doctrine is observed by the members of the Government. We have had, for instance, the untameable extremist from Benoni, who came into the Cabinet with a loud flourish of trumpets. He was not going to be tamed ; he was not going to be shackled by the responsibilities of office. He has been letting himself go at various places outside this House, and once or twice inside, and I ask the Prime Minister what is the position of the Cabinet when we have speeches such as this made at Somerset West, in which he suggests confiscation and the repudiation of liability for interest on national indebtedness. We have his speech at Port Elizabeth in which he lays it down that public servants are to give evidence such as the Minister may dictate. He has laid it down that he is going to keep a watchful eye on public servants. We have, beside that, the utterances of the gentleman elsewhere described as “the Lion of the North.” What has the Minister of Justice been doing? He has recently been making statements at Stellenbosch ; he has also made statements about the Public Service Commission, about the natives, and the native and coloured policy of the Cabinet, and about the Asiatic Bill policy, statements which either were extremely dangerous at the time, or were diametrically in conflict with the statements made by the Prime Minister not long before. I ask the Prime Minister whether this country is to expect that this form of individual irresponsibility is to go on unchecked. People outside, and people outside the Union, have still the old-fashioned notion of Cabinet responsibility, and they will take, it, when a Minister speaks in public, that he is speaking with the consent and foreknowledge of the Cabinet. Under these dircumstances I put it that the theory of Cabinet responsibility involves that if a Minister makes a statement not approved of by the Cabinet on matters of great public moment, the duty of the Prime Minister is to take the first opportunity of putting the Cabinet right with the public by explaining how such statements came to be made, or, at all events, to what extent those opinions are the views of the Cabinet. I submit that is of the most vital importance. We come to the Budget. One appreciated with much interest the general Bugdet speech made by the Minister of Finance, and the appeal he made at the end for the people to realize that this country could not go on with extravagant expenditure and that it was the duty of all to support the Government in curtailing expenditure of that kind. The Minister knows perfectly well that he has had a couple of slices of luck during the last two years, and he knows that he has to make provision for a rainy day. What is the effect on hon. members down mere? the first thing is the speech by the hon.member for Troyeville (Mr. Rentridge), who says the Minister continues to be influenced by conservatism of officials and high finance. Pray heaven, he will be so influenced for many years to come if he is still in that position and that he will be guided not only by conservatism from the officials, and certainly by the rules of high finance, but also by what the Auditor-General says, and by what such highly qualified bodies as the Economic Commission have to say! As an answer to all this we have a sneer from the hon. member for Troyeville and other members of the Labour party at high finance and the economic laws. One could not help imagining, say, the hon. member for Durban (Umbilo) (Mr. Reyburn) or the hon. member for Troyeville sitting at the bottom of a precipice with a huge rock tumbling over and sneering at the law of gravity and Sir Isaac Newton. They are rather awkward things, these laws of economics. May I ask the House to bear with me while I give the criticism of one who in financial matters is much greater than I am. I have here some interesting remarks made by a gentleman, in this House apparently, who says the Budget is a perfectly good, sound Budget ; in fact, it is quite irreproachable. It is so eminently sane in its outlook that it is hardly worth a damn to the working class. That is a highly interesting criticism.

Who did it come from?

It is the hon. member for Durban (Umbilo). He goes on to say—

I must point out that the hon.member is not allowed to refer to a newspaper.

I am reading a criticism. It is only referring to the Budget, I submit I am entitled to quote from it. He is speaking as a journalist, writing his views on the Budget.

No, the hon. member is not entitled to read that.

I have not the rule before me and I do not wish to challenge your ruling. I do not know whether I should be in order in asking under what rule you think I should not read these passages.

It is Rule 61 (1) and (2).

This only refers to the Budget itself. However, I am only sorry we are debarred from presenting the House with some of these plums. The difficulty I am in is this. The hon. member makes his criticisms not from where he sits in the House, as a member of Parliament should, but he writes and publishes them somewhere else, and we have not the opportunity of meeting him unless we have the opportunity of reading aloud to the House what he says in print. I should like to deal with the matter of the Navy contribution. On Vote 19 we have £71,684 for the South African naval service. That represents and is in lieu of the old vote of £85,000 that has figured on the Budget ever since Parliament has existed. It took over two old votes from the Cape and the Natal Parliament. Three or four years ago a substitution was made in the form of keeping up ships like the minesweepers instead of giving a direct grant. We who supported that did it on the ground that it was desirable that men should be trained locally and that we should have the nucleus of a fleet. That was the position then, but we never for a moment considered that was anything but the beginning of a different state of affairs, and we thought that a grant more commensurate with our position in the world, with our enhanced status, and with the benefits we get from the navy, would be made. The Imperial Conference is coming on in October, and I hope the Prime Minister will either formulate a scheme of his own, or be ready to support some scheme which will be in our best interests and at the same time, one of which we can be proud. This enhanced status implies not only an enhanced position but enhanced obligations. We come to the main proposals of the Minister. Here we are handicapped because we have been informed there are various other matters which have to be taken into account in the way of withdrawals before we can fully appreciate ways and means proposals. In my lay way I have been extremely puzzled, like other members, to find the basis of the principle on which the Government has gone in framing this amendment of the tariff. From the report of the Board of Trade and Industries, I have taken out something like 12 or 14 items which seem to me alterations granted at the request of individuals. I exclude the things where the alteration is made at the request of representative associations such as the wine farmers’ or the motor traders’ associations. What is the basis and the method on which the board goes in these matters ? Is a full opportunity for enquiry given and evidence taken from people qualified to know, who are able to put the other side of the case, e.g., the people interested in buying an article, because unless we have such information the Board of Trade report becomes a mere travesty. Looking at the extraordinary curious items brought up in this list, the impression seems to be growing that the alterations are made in favour of the man who thumps hardest on the knocker, and does so most early and vigorously. That is a very bad impression to get abroad, and I hope that the Minister will dispel it. It certainly looks as if there is some justification for believing that that is the method by which this is done. Tariffs are to develop an industry, and not to protect a business. But the impression is growing that people need only ask: “Give us protection, and see what we can do.” That is wholly unwarranted. In these alterations there is still more than a suggestion of tenderness towards the United States, and a whittling away of the small preference left on the statute book to Britain. I say that preference is in our interests, knowing, as we do, that statesmen from all parts of our empire, including the late Mr. Jan Hofmeyr, have laid down as their opinion and given their reasons why they held that preference is of benefit to every member of the partnership. We had an illuminating telegram only the other day from Mr. Eric Louw, who has gone over to Canada, and has evidently been convinced by the hard logic of facts, that he can do better in Canada than in the U.S.A. I would like to know to what extent the alteration of tariffs and the sending of an ambassador of commerce to the U.S.A. have altered the growth of trade and benefited us ?

You do not object to the growth of trade with the U.S.A.?

I do not object to the growth of that trade, but I want to know what has happened. The Minister has not put a fair question. I want to know whether we are getting benefits from the countries to which we are giving preference. There is one point I ask the Minister very earnestly to reconsider, and that is the item to which the hon. member for Cape Town (Central) (Mr. Jagger) drew attention. A protective tariff is being imposed discriminating against fishing gear and items for trawlers. After all, we have in every country, and particularly in our own, three great primary industries, which are agriculture, manufacturing and fishing ; and fishing has been the Cinderella of these. I have been pleading in this House for years for better treatment with regard to the fishing-industry. A move has been made during the last three years, and we hope it will have the effect of developing one of our biggest potential assets. It is not our biggest asset, because we have not developed it in the way we should have done. Raising the tariff on these articles, I submit, is a move in the wrong direction. I am not going to enter into a debate on free trade and protection, because I quite agree with the hon. member for Newlands (Mr. Stuttaford) that that question, under our peculiar conditions in this country, is largely an academic one. We have always had largely to depend for our revenue on our customs tariff. The question as to how you apply your customs tariff is one of degree really, and the method of application can be detrimental to the growth of industry in the country. There is not a man in the country who can dream of having an absolutely free customs list, whether it is the hon. member for Cape Town (Central) or anybody else. But I do say that when you are drawing up your tariff, which is both a revenue tariff and may be used as a protective agent, you are only justified in doing it on the lines laid down in the House during the last few years—to develop really sound, true and legitimate industries which can be made into something really practical, and not bastard industries or industries which depend largely on the importation of raw material. We have had it over and over again that “civilized labour policy” is a gross misrepresentation. It is not a civilized labour policy, because it does not give equal treatment to all civilized men. It is a policy of doles, as the hon. member for Vrededorp (Dr. Visser) artlessly admitted yesterday afternoon. We are all in favour of keeping a white South Africa, in the best and truest sense. A man whose life work has been amongst the natives and has the greatest affection for them and a tender regard for their rights, said the other day, in my hearing: “We want to keep this a white man’s country, and in the best sense, by the white man always being able to lead the natives in the right paths—the paths of courage and truth, honesty and work.” We need a high standard in the white race, and we do not get that if we do, or suggest, anything that is unfair or unjust to the other races. I would like to draw the Prime Minister’s attention to this: that we have protested against unjust discrimination, and certain results are going to follow. No matter how civilized a native may be, he is not going to get employment in the largest department of labour in the country, and in the mines is not going to get the opportunity of rising in the scale under the colour bar Bill. What is left to the native but to get employment of a minor character at the hands of the private employer ? I think the Prime Minister should bear in mind the recommendations first in paragraph 5 of the report of the Economic Commission—that the Government should undertake a complete survey of the economic position of the native people. Without that it would be impossible to deal satisfactorily with the native question. Another recommendation is that a considerable addition to the present reserves should be made ; again, this is needed for any solution of the native question. The native has been prevented from rising in the scale or from getting work at all on the railway, in the post office, public works, the mines and in other respects, and, seeing that they are restricted in the great employment departments of work in this country, we have to find some other scope for the native. On this point the Ministry has been studiously silent during the session. We know that the native Bills are coming forward soon, and every attention will be given to them by us, as we promised ; but side by side with that the Government must make adequate provision for these two main recommendations as to natives, for these are vital as far as the native question is concerned. I am not going at any great length into the question of a State bank, but it astonished me yesterday afternoon when the hon. member for Bezuidenhout (Mr. Blackwell) raised the point of the necessity of starting a State bank. One wants to know, what does any hon. member who raises the point mean by a State bank ? Does he mean a bank that uses the credit of the State for its note issue, because that is what the hon. member for Troyeville (Mr. Kentridge) means.

I did not agree with it. I said there was a case for enquiry.

Well, I should like to have the terms of the enquiry defined. The Currency Committee in 1920 turned down the question of a State bank in favour of the present Reserve Bank.

I want a State bank on the lines of the Commonwealth Bank of Australia.

Well, the objection that most of us have to a State bank is that it creates a new department for the public service. The public service is much too big, or at all events big enough, and will not bear extension. A State bank, moreover, on the lines of the hon. members down there also leads to an inflated note issue, because if the Treasurer is able to use the credit of the country to issue an unlimited supply of bank notes, the Lord help him if he does not do it when we have demands from socialists, and other demands from various people. Think of the millions of notes that would have to be issued for State mining, for instance.

Did they do that in Australia ?

That would increase the cost of living all round, as it did before 1920 during the inflation period. It has been tried by Austria, Germany and France, who are pretty well ruined through having an inflated note issue. Again, there was America with the greenbacks after the civil war. The Orange Free State had its bluebacks trouble with its unlimited supply of paper issued at one time. This talk about using the credit of the State to issue paper money is only another word for inflation.

No.

Inflation means high prices, high cost of living, and a subsequent crash. It has meant that in every country where it has been applied. Before Austria came back to sane paths under the guidance of Sir Henry Strakosch, who helped us to pass an Act in 1920, which saved us from the biggest crash we have known here.

How did he do it?

By first restricting the paper-inflated issue. We put the paper issue on such a basis that you had full and proper security behind it, and it made for a steady return to the gold standard. If we had had the way of the Minister of Defence the crash would have come.

It came to the assistance of the National Bank with its guarantee.

That is the point. Through the existence of the Reserve Bank the National Bank was saved from the crash. The Reserve Bank performed the function it was established for. It was able to give credit, but credit backed by good security.

And also pledged the credit of the State.

No doubt it pledged the credit of the State through the bank by giving full security. I might pledge my credit to someone on my personal security, but that does not make notes issued by me equal to face value. I went into the question of the Common, wealth Bank of Australia, and there is an excellent book in the library with regard to it. In a foreword the Acting Governor says, for the information, of readers outside Australia, that the bank, though State-aided, is in no sense a political institution, and that the bank has thus been able to proceed with its work on the broadest national basis. That bank differs from ours, in that it does a certain amount of ordinary banking business, but when you look at the balance sheets published, at the end of this book, you will find that the great bulk of the money used in the bank is savings bank deposits. Out of a total figure of one hundred and thirty-four million odd, fifty-two millions is the note issue, leaving eighty-two millions. The Savings Bank Department provides forty millions of the business of that bank. We have our savings bank here, which does what is practically more than half the work of the Commonwealth Savings Bank in Australia.

What were the profits of that bank for the people ?

They are not-referred to here. I will send the book down to the hon. member.

I got this book and gave it to the library.

Hon. members here deal with the matter as if the Bank of Australia was to fulfil the functions which they suggest, and which were really suggested in a motion by the Minister of Defence in the 1920 committee, for the creation of a State bank for the purpose of ousting the private banks. That is not the policy of the Australian Bank. There it is friendly co-operation with the ordinary banks. So far from being in competition with the ordinary banks, it gives ½ per cent, less on deposits than the ordinary banks, in order to avoid competition. I am quite sure that the Prime Minister, in the manifesto referred to by the hon. member for Troyeville, never contemplated setting up the kind of State bank that hon. members down below want. That is, one giving unlimited note issues not backed by proper security.

Who asked for that?

And one that enters into competition with other banks to oust them and is controlled by the Government. The hon. member for Wonderboom (Mr. B. J. Pienaar) said that the Government was concentrating on agricultural development, but that is nothing new. That is what our Government did for ten years or more, and more successfully too, and built up the agricultural development of this country on lines which have been carried on by this Government, except that in one or two cases they have changed it for the worse. Their policy was one of co-operation, and developing fruit and other export through cooperation in such a way that the people on the other side might know what they are getting and be willing to pay high prices for it. The present Government is taking all the credit for the good it has achieved by following on the lines of the late Government and is giving no credit at all for the great work done by its predecessors in office. As a aide line the Government is “delivering the goods,” but a little bit shop-soiled and with the pawnbroker’s pledge ticket very visible on them. The late Government followed a sound financial policy, but it was faced with the biggest financial crisis the world has ever known. It went in for a policy of balancing income and expenditure, and it did its best to reduce taxation and lower expenditure. But what support dit it get from the late Opposition ? Every measure that it took to decrease expenditure was met with a volume of abuse, and the most violent party capital was made out of it. The present Government came into office with a large number of pledges. ‘We know about the eight-hours’ day pledge and the promise to increase the pay of public servants, but we do not know what promises were made and what pledges given when the Pact’ was formed. The Government has been accused by its own supporters of not having redeemed those promises and earned out those pledges. The late Minister of Posts and Telegraphs (Mr. Boydell) promised that certain things should be restored to the telegraph learners, but when the motion to give effect to that was brought before the House, his reply was that the late Government had done it and the present Government could not alter it. Notwithstanding the violent attacks which were made on the late Government when it was doing its duty valiantly and bravely, when the members of the present Government —who indulged in those attacks—are asked to put these things right, their excuse is that the finance of the country will not permit of these requests being complied with. So far as the present Government has been going on sound lines, whether legislative or financial, it has simply followed the lines laid down by its predeoessor. There was an election charge of extravagance in administration and particularly charges were made of our enlarging the public debt. It was no use our pointing out that the debt was increased by war expenses and by the expenditure on public works of a remunerative character. But as soon as the Pact Government came into power, there was the same recognition of the necessity of developing a growing country by means of loans—the very think they had attacked the late Government for doing ; and the public debt has gone on increasing as before. We kept our pledges —has the Government kept its pledges to the electors? We stand before the country with a clean sheet ; we did our duty and kept our promises. What we want to know it how far is the Government going in its policy of socialism and of yielding to the demands of the extremists in the Cabinet and on the cross-benches, and we want to know when and how the next instalment of blood-money is going to be paid.

The hon. member for Ronde bosch (Mr. Close) waxed indignant because the report of the Police Commission appeared in "Die Burger” before it was laid on the Table. I am sorry that he did not draw attention when a forecast of the Economic Commission’s report was published in the “Argus” before it was laid on the Table. The hon. member for Cape Town (Central) (Mr. Jagger) is willing for the Government to accept the majority report of the Economic and Wage Commission, but I have been listening in vain for any other member of the Opposition to repeat that request. Doubtless the hon. member for Gape Town (Central), as the only free trader on that side of the House, has asked the Government to accept the free trade report. He is probably the new leader of the party, no doubt to the chagrin of the hon. member for Bezuidenhout (Mr. Blackwell) or the hon. member for Port Elizabeth (Central) (Col. Reitz) who, however, has Been ruled out by the “Sunday Times.” The hon. member for Cape Town (Central) calls the report of Mr. Mills, Professor Clay and Mr. Martin, the majority report. It is nothing of the kind. I was taught that three was equal to three, but evidently the hon. member was taught that three in one sense is bigger than three in another. The report signed by Professor Clay was not signed by the chairman on some very important aspects, so three minus one is two. I would call it the overseas report.

Which is the majority report ?

There is no majority report, but if there is it is the one signed by Mr. Lucas, Mr. Andrews and myself.

Mr. Andrews objects to the whole thing.

No. Mr. Andrews’ reservation does-not affect the report, as the reservation of Mr. Mills does to the Clay report. Why ask the Government to accept a report signed by only two gentlemen—why ask the Government to change its policy because of that report ? If you are so keen on the Government accepting Mr. Mills’ report are you prepared to accept his reservation regarding, say, the importation of native labour? I do not think it would be fair perhaps in detail to describe what happened in committee when we were asked to deal with that report. The position was simply this that we were no sooner finished with our evidence and had arrived back in Pretoria, when Professor Clay had to leave, and on the Monday he simply placed his memorandum before us and said—

We had no possible opportunity of discussing Professor Clay’s memorandum, which has now been adopted as-that report, in any way. You cannot discuss a thing like that in three days. It was certainly a most regrettable thing, and though, personalty, I would say nothing against the knowledge of a man like Professor Clay, it certainly shows the disadvantage of getting men from abroad to come here and enquire into our concerns. I have never posed, and I do not now pose as an economist, but I presume I was appointed on that commission to protect certain agricultural interests, of which, I flatter myself, I do know a little. I hope it Will be a lesson to this Government, and to any other Government in future, not to import economists or anybody else from abroad, but to take your local men.

We must be a law unto ourselves, I suppose.

There is one other point that the hon. member for Cape Town (Central) (Mr. Jagger) dealt with, He stated that the farmers were drifting to the towns because of the increase of duty on their farming requirements. That may be a reason in some few minor instances, but the real reason why farmers have drifted into the towns is because of the difference in the wage rates between town and country. Many of the smaller farmers have drifted to the towns because, owing to the low wages that many of the workers receive in the towns, they have been unable to find an outlet for their produce. I have heard nothing in the way of an attack from any member of the Opposition on what they would be pleased to call the “minority” report.

We have not seen the report yet.

You have seen the general recommendations which were laid on the Table of the House. I have purposely not used my own copy of that report, but only the copy as published in the “Social and Industrial Review” of March. If the Government is going to accept a report, I sincerely hope they will accept the report signed by Mr. Lucas, Mr. Andrews and myself. Apart from that report, there are many points on which the members of the commission Were agreed, and on which the Government could take some action.

Since this debate began it has been evident that nothing has been Said on either side of the House to remove the feeling of anxiety which a good many of us have as to the growth of expenditure in the country. The tables which were presented the other day show that, excluding railway expenditure and provincial council subsidies, the expenditure of the country has grown from a little over £14,000,000 in 1915-16 to nearly £31,000,000 in 1925-’26, and the estimates for this year, which we have before us, involving a proposed Union expenditure of £26,951,000, shows that that rate of expenditure is in no way coming down. The question is whether that expenditure is justified. Has there been, since the years 1915-16, any such increase in the population of the country as to justify this increase of expenditure ? I am quite aware that revenue has increased also, but revenue has been increased largely by The ingenuity of successive Ministers of Finance in finding out new sources of taxation. I maintain that, considering the population of the country, the taxation which we have to bear to-day, both direct and indirect, is excessively high, and that taxation is undoubtedly hindering the development of the country. The Minister of Finance candidly said, towards the conclusion of his speech, that he was rather nervous as to what might happen in case there were lean years ahead of us. We know that in South Africa there are always ups and downs, and that, for one reason or another, it is very seldom indeed that we get more than two or three years of uninterrupted prosperity. The Minister has said that he has done what he could to economise. I agree that it is extremely difficult for a Minister of Finance to economise. He is beset always by every head of department who says that it is absolutely essential for his department to have some expenditure on some particular thing or another. He has to satisfy a number of people on his own benches and a number of people on the cross-benches. The people on the cross-benches are never satisfied. The result is we have got up to this enormous expenditure and we have an enormous number of people employed as government officials. I do not say that as a rule they get excessive salaries, but I do say that if many of the departments were conducted by private enterprise fewer of them would be employed. There are matters in which It is perfectly obvious money can be saved. It could be saved for example by appointing fewer commissions. The country has been flooded with commissions, and some of them have been a pure waste of money. Some of them have been so manifestly biased that they surely did the Government a great deal more harm than good. We have the Government appointing a commission to deal with its economic policy and inviting experts from overseas, and when we get these people reporting in a sense opposed to the wishes of supporters of the Government then we hear that we do not want people coming from overseas. That is a direction in which money could be saved. It could be saved in various ways, partly by not embarking on expenditure and partly by seeing that when expenditure is embarked upon it is properly controlled. This year I am glad to see there is not going to be much expenditure in connection with locusts Last year it is notorious that in many parts of the country enormous amounts were spent in the destruction of locusts which with better organization could have been saved. I say without fear of contradiction that in some of these cases money was grossly wasted. I quite agree that it is difficult for any Minister, especially when he finds himself, largely owing to the exertions of his predecessor, in possession of a comfortable surplus, to turn a deaf ear to all demands made upon him, but he must bear in mind that not only will there be lean years but we have got to look ahead to the time when the great industry which is now the largest employer of labour in the country is to all appearances going to yield considerably less revenue. I suppose it is with that in view that the Government have embarked upon their present economic policy. They are hoping, I suppose, before that time arrives they will have built up a system of manufactures which will take the place of that industry by degrees so far as providing employment is concerned and so far as providing revenue is concerned also. I think this is a very real danger which has got to be faced. We have got into the habit of thinking that these mines can go on for ever yielding revenue, but in time there will be a want of the revenue the mines produce and the employment they offer. What is the policy of the Government? It is so far as it can to encourage farming. We all want to see that done. We all approve of money being spent to encourage scientific farming, to encourage production, and to find markets overseas. When it comes to the question of industries we find that the Government, with insufficient forethought, I think, have embarked on a policy fraught with very great dangers. The policy of the Government tends to prevent legitimate use being made of native labour. The Minister himself said that he was short of revenue from the gold mines because of the restriction of native labour.

Not our own labour. It was foreign labour.

Quite so. That is perfectly consistent with the legislation of the Government in regard to the natives of the country. The tendency of legislation has undoubtedly been to restrict the use of native labour in its most economical way. It can hardly be denied that the policy of the Government is to put European wages up to a very high level. We have had the agrument by hon. members on the cross-benches that if you put wages up to a very high level you increase purchasing power and, therefore, give the industries of the country a better chance. That is all very well up to a point. We have been told that is bound to be the right policy, because that is the policy of America, but it is by no means certain that even in America that policy is going to be permanently successful, because there must come a time when people arrive at the conclusion that what is behind the high wages must be production. In the end you come back to what you can produce, and what you can sell to other people. It is not merely a process of taking in your own washing ; you must send your products overseas or over your borders. In our case we must send our products overseas. We are putting up wages, it seems to me, before we have made certain of our markets overseas. Of course it is obvious that high cost of production hits our primary industries. I am not saying that certain industries are not deserving of encouragement even if it entails some loss to our primary industries. We cannot be doctrinaire about free trade; there is bound to be an element of protection. At the same time we have got to see that we do not, in order to build up industries, which at present do not exist, cripple industries on which the country depends. We have to face the fact that in this country we are not in the position of America. We have not got a large home market. We have not got that population—that is our great difficulty. We have doubled our expenditure— have we doubled our white population ? Of course not! Nothing like it! What have we done to get new people into the country, or what are we doing to-day to get new people? Practically nothing. People are going into Rhodesia in such numbers that the Government finds difficulty in dealing with them ; but who is coming into this country, except a few aliens? If we encourage industries now, we shall find, first of all, that unless goods are turned out in very large quantities they are unsaleable, and when we come into competition with goods of the same kind produced by people who have more experience probably than we have—with workmen engaged in the same occupation for generations, and those who have much more intelligence in marketing their produce, I think we have to be very careful how far we carry this policy. The Government went slapdash into this policy last session on the recommendation of the Board of Trade and Industry—on the opinion of three young men who were entirely inexperienced and had no business knowledge of any kind, and were strongly suspected of having obtained their posts or, at any rate, it contributed to their getting them, that they had delivered themselves of anti-British sentiments. They presented a report last year which received universal condemnation amongst business men, because it was so partial. It is quite true that the Minister has told us that there are certain remissions of taxation which he is going to announce, which will help the primary industries. I hope that is so, and that the Minister will bear in mind that if the remissions of taxation are not made, all he will be doing is to put up the cost of production to such an extent as to accelerate the end of the mines, instead of prolonging their lives—and there is nothing to take their place. It is perfectly easy, in dealing with mines, to give figures. Everybody knows that if you reduce the working costs by so much, so many more million tons of rock are put into operation, but it is not so easy to do so as it affects the farming industry. It is always amazing to me that gentlemen on the other side who represent, or say they represent, farming interests, are so pleased with this policy. It is beyond my comprehension why they are I can only see one thing in which this policy helps them at all, and that is the duty on wheat, because the consumption of wheat is greater than its production ; but how it is going to help them to find markets for their maize and cattle—the difficulty of which was very clearly shown by my hon. friend behind me (Mr. Deane)—is beyond my comprehension. It is perfectly obvious that if it costs anybody a shilling a bag more to produce maize, he is not going to get a shilling a bag more when he sells it overseas, the prices being fixed there under conditions over which we have no control at all. This policy calls for the greatest vigilance on the part of the Government that they do not carry it too far. We pointed it out last year, and nobody paid any attention—nobody pays attention this year—but the time will come when people will have to pay attention, because the results will begin to be seen. The commission which was appointed by the Government, which comprised two experts, one front England and one from Australia, has amply confirmed our criticism. Now we are told by some hon. members that the people from overseas are not worth considering. I should have thought that the hon. member for Brakpan (Mr. Waterston), who is always talking about the good example set by Australia, would have been quite pleased by the opinion expressed by the gentleman who came from Australia. Not a bit of it—he agrees, no doubt, with the hon. member for Barberton (Mr. Rood) that the opinion of the gentleman from Australia is only as good as the opinion of the gentleman from England. The hon. member for Troyeville (Mr. Kentridge) said that everybody knew that the opinion of the commission would be against the Government. I doubt that. If the Minister of Defence had thought that there was at least a fair chance of these experts not backing his opinion, would he have brought them out and put them on that commission? The commission, I feel sure, had the matter been put to it, would also have been against the proposals put forward for a State bank, and been equally condemnatory. A certain amount has been said about the Commonwealth Bank of Australia, and the hon. member for Pretoria (West) (Mr. Hay) asked, rather noisily just now, about the profits that bank made. The hon. member for Troyeville told us it started with a capital of £10,000, and made £4,000,000 profits. According to the original Act, the capital of the bank was to be provided by the issue of debentures of one million and, by the Act passed in 1914, this was increased to ten millions. As a matter of fact, no debentures were issued at all. Funds were placed with the bank by the Government, and no interest was paid on them. The actual profits made under these favourable circumstances, of having the use of Government money for nothing, were nothing at all in the first two-and-a-half years ; for the three years ending 1917 an average of £252,000 ; during the following three years an average of £763,000 ; thereafter, until June 30th, 1923, an average of £493,000; and from June, 1923, to June, 1925, an average of £146,310. The Act provided that half the annual profits should be used towards redemption of the Commonwealth and State public debt. But not a penny of the profits was devoted to that purpose until Decernber, 1923, when the first instalment of £61,000 odd was paid over. Since that date half the profits have been paid by the bank to the National Debt Commission. We were told by the hon. member for Troyeville (Mr. Kentridge) that banks in this country accumulate the money of the people and lend it out for their profit, although at the same time they do not give the facilities which the public require. I take this Commonwealth Bank. At 30th June, 1925, the total assets of the bank were £87,000,000, and only £14,000,000 had been lent out to customers, that is, 16 percent. During the same time I find that Lloyd’s Bank in England made advances to the extent of 55 per cent. ; the Westminster Bank 53 per cent. ; the Union Bank of Australia, which is a private bank competing, so to speak, with the Commonwealth Bank, 56 per cent, and the Commercial Bank of Australia also 56 per cent. Therefore, it follows that this wonderful bank, which hon. members are talking about, has not made advances to the extent of the ordinary commercial banks.

It kept down the rate of interest.

I do not think it did. The best proof that it was not very attractive lies in the fact that the Australian Government have proceeded to alter it. In 1924 they brought in a Bill to bring the State bank on to practically the same lines as our Reserve Bank in this country and the Commonwealth Treasurer stated that, on the whole, it would be recognized that the Commonwealth Bank had not been a serious competitor with the other banks ; that it was understood that the policy of the management was not to enter into active rivalry with the trading banks and that such a policy had been fortunate, because it had made the conversion of the Commonwealth bank into a central bank easier. I do not think that gives much encouragement to the hon.member for Troyeville and the other hon. members over there, and it shows that a State bank would not do all the wonderful things they thought it would. If I may say so, there are degrees of iniquity in the views of these hon.members. Some want a State bank to have unlimited power ; some of them, like the hon. member for Troyeville, say you must simply increase the purchasing power of the country in order to increase production later on. That is all very well, but it is not in dispute that that tends to promote inflation, and the ultimate result of that must be disaster. Nobody put that more clearly than Dr. Page, the Australian Treasurer, when introducing the Commonwealth Bank Bill in June, 1924. It would take too long to read extracts—

Page is a Conservative.

You opposed the Land Bank, didn’t you ?

What has that got to do with it ?

I do not think it necessary to labour that point. The hon. member for Bezuidenhout said he was, to a certain extent, a qualified supporter of the view, because there was not sufficient competition in the country as it is. It has been found, not only here, but in other countries where there has been a multiplicity of banking institutions, that serious disaster has occurred through competition Most of us were young when these disasters occurred ; but they occurred in Australia, here and elsewhere, and it is practically accepted that banking should be in strong hands, and the stronger the hands in which the banks are, the more opportunity there is for legitimate competition. It is when one bank is weak and another strong that competition becomes impossible. And there is this to be said in connection with competition. In banking business, as in many others, the same view is taken by different banks as to what is legitimate business ; as to what kind of advances it is legitimate to make and what rate of interest it is legitimate to charge. What appeals to one manager is likely to appeal to another manager acting quite independently. The people who want advances without security are the people who find difficulty and are apt to complain. The Minister may say it is all very well to criticize our policy, but what would you have done? Up to a limited extent, I would have encouraged industry, but first of all, before embarking on an economic policy upon the advice of people of insufficient experience, I would have appointed my commission, and only committed myself, after I had seen the report. What the Government did was to announce their policy and then appoint the commission. They hoped the commission would bless them, but it didn’t! And now they have said that the commission was no use; or, as in the case of the hon. member for Troyeville, that everybody knew from the start that the commission would be against them.

The commission was most useful.

There is one thing I suggest might be done I am not speaking about the existing mines. They are, of course, the largest employers of labour and the largest source of revenue to the country, and if we could find and develop more mines, that would obviously be for the good of everyone. I would like to ask what is being done in connection with the report by the very capable departmental committee which was appointed in 1924 to report on the means of stimulating the development of the mineral resources of the Union. That commission knew a good deal about mining and gave very useful advice. Their very interesting report was published in the Journal of Industries, which, I think, is now called something else. So far as I can see, only one out of a long list of practical recommendations has been carried out by the Government. They have brought in a Reserved Minerals Development Bill. Every year the amount spent on agriculture and kindred departments grows. We do not grudge that money so long as it is clear that it is wisely spent. Economies might have been made in the management of some departments which might have rendered it possible to spend money in carrying out some of the recommendations of the commission. Last year the Minister said he was considering the matter, but so far we have heard nothing further about it. If steps can be taken leading to fresh discoveries of minerals on a large scale, nothing will add more to the prosperity of the country by bringing in fresh population and increasing our revenue. Discoveries of that kind would do a vast deal more to assist the Union finances, and to fill the gap when the Rand mines begin to fail, than the starting of a number of minor industries, the success of which must be extremely doubtful. I do not wish to take a despondent view of the future at all ; we all have plenty of confidence in the natural resources of the country, but I am sure the Minister recognizes that we must look out for lean years, and we must insist upon reasonable economies being effected so as not seriously to hurt the primary industries on which the progress of the country depends.

We on these benches are immensely flattered by the attention given to us by the Opposition. Whatever we may be accused of in regard to this “infamous and iniquitous Pact,” we certainly cannot be accused of not advocating a progressive programme, and it is not altogether a disadvantage to have an advanced party with some vision of the future. This party, at all events, is not breaking up, but the leader of the Opposition is looking anxiously at the benches at his back to see how many of his present followers are preparing themselves to follow the example of Sir Abe Bailey, a former stalwart of the S.A. party.

Speak seriously!

Yes, I am; there are more than are generally supposed on that side of the House who are quite ready also to prove the cowardice of their convictions as soon as opportunity may arise. Already the right hon. member for Standerton (Gen. Smuts) has offered to support the Nationalists if they will only get rid of us, for he said at Douglas that the South African party would give the Government all the support necessary ; and that it would have been better to have formed the Government without the help of Labour. Unless the right hon. gentleman moves quickly, he will probably find that the bulk of his party has crossed over before him. I am perfectly certain that there are many, like Sir Abe Bailey, who are not willing to back a loser. I do not know whether the senior partners of the Pact, however, will think that after all we are worse partners to have with them than those who have deservedly lost the trust of the country, both as a government and ns an opposition. But, in spite of our being somewhat troublesome partners, all the chances are in favour of our not joining the Opposition in their march through the wilderness. We hear rumours that they are seeking another Moses to lead them, having lost confidence in the discredited political prophet who at present directs their pilgrimage. During this debate we have heard from the other side a great deal about the “awful” growth of expenditure and our “terrible” debt, and comparisons are made between the figures of 1910 and 1925. Some members opposite apparently think that a growing expenditure is going to lead the country to ruin, as it might have done under their administration. We, however, have a confident belief in South Africa, and feel that it is worth backing to win, and, instead of cutting down expenditure, we should welcome expenditure which leads to expansion, for that is the only possible way of dealing with a country which inevitably has greater and greater responsibilities. After all, why should we be fearful of growing? The hon. member for Cape Town (Central) (Mr. Jagger) talks as if we were going downwards when expenditure is ascending, but I have no doubt he looks with pride on the immense expenditure in his own business compared with what it was 10 years ago. We should all be greatly interested to see him trying to get into the litle knickerbockers his mother made for him to go to school in. Why should we complain of growing out of the clothes provided for us in the past, or be fearful of realizing that we shall want still larger and larger expenditure as the years pass on ? One would like to look forward to doubling our expenditure as quickly as possible, so long as we are building up live assets in the country. I want to compliment the hon. gentleman (Mr. Jagger) on having become a convert to the doctrine of the high wage.

Yes, and I want the output.

But we were told year in and year out that the big output came with the low wage.

No.

Well, give a man pay that is worth working for, and you will get the output all right. We have had a great deal of advice given to us, and, therefore, I would like to reciprocate and to read the advice given to the S.A.P. by one whom they thoroughly respect. He is the chairman of the S.A.P. in the Transvaal, and controls this particular medium through which his voice is heard. On April 11 we find the organ which he directs saying, in regard to the S.A.P.—

Remember, this is from Sir Julius Jeppe’s organ, and the article goes on—

Then this friendly adviser continues—

Yes! the South African party have indeed wrecked themselves as a government and as an opposition. It is “going on as before,” and the country has no time for them in any way whatever. Let them listen to the press voice of Sir Julius! We on this side serve no overseas interest, we serve South Africa first, and therefore have no need to be alarmed even over this “awful debt,” 33 per cent, of which is unproductive. We know where the guilt lies in that regard. The cost of that portion of our debt is £2,800,000 per annum in interest. Unfortunately, £7,000,000 of that money we never got at all. We pay interest on money that we never had. It cost £7,000,000 to borrow our debt of £204,000,000. That is the institutional process in regard to loans. What is it that we advocate in regard to discharging this load of debt ? It is that we should develop our assets in the country, and for every million of unproductive debt we should incur at least two millions of productive debt. In regard to the State bank question, I may mention that our banking charges to-day in London cost £47,000 a year, which we pay for our business being done there. What is the position as regards this dreadful proposal to have our own bank ? Our account is placed in a bank like the Standard Bank, which is a foreign bank, managed in London, and Barclay’s Bank, to which the National Bank shareholders have been handed over ; and we start by finding £100,000 for the Standard Bank continuously to credit and a similar globular sum for the National Bank. That is, we have to find £200,000 to start with, which we are bound to keep there. That is the minimum balance we are compelled to keep in these private banks. It is very nice for them, and I can quite understand their opposing anything like a State bank, but the moment we want money we have to issue Treasury bills, which they discount, and for which we have to pay interest and commission. No wonder the hon. member for South Peninsula (Sir Drummond Chaplin) makes an appeal for these private banks, so largely in the hands of his friends the financiers. The fetters of foreign finance are being rivetted on us. This so-called Reserve Bank has simply strengthened the chains, the Reserve Bank being attached firmly to the Bank of England. It has been of no assistance whatever to the commerce of this country. That bank is a shareholders’ bank. It has just declared a 10 per cent, dividend, and the £100 shares stand at £175 each. That fact tells its own story. I think I remember what fell front the hon. member for South Peninsula in the Transvaal Parliament when we urged the formation of the Land Bank. We heard the same argument, only rather worse. Farmers would be ruined, because they would come continuously for loans, and so would get into debt. It was he, or one of his colleagues, who said that it was better that farmers should pay a high rate of interest to the private moneylender, because that would prevent them from borrowing. Let him stand up and say honestly what he thinks of the Land Bank now, which is purely a State bank. It has saved the farmers of the country; it has been an immense boon to the Transvaal. But for the Land Bank, which his party fruitlessly opposed, his financial associates would now be possessed of half the farms held safely by individual farmers, in addition to the vast tracts they hold out of use for speculative profit beyond the Vaal river. That is our answer to his attack on a State Bank. I was not surprised, either, at the misuse by the hon. member for Rondebosch (Mr. Close) of the figures he also gave in regard to the Commonwealth Bank of Australia. You find from the actual accounts that the reserve fund and the redemption fund at 1922 exceeded four millions, and the profit is now over five million, belonging to the people, as it has no shareholders ; it has been done merely on the credit of the people, and they have made this enormous sum of money. In regard to the floatation cost on ten loans, the total expense saved the Australians five millions. The loans were raised at a rate of 5s. 7d. per cent, against the £3 which it used to cost. The net result of that bank in Australia is that the people there have been saved an average of two per cent, in their transactions. No, we have nothing to take back, in regard to a State bank. When the criticism was passed that they are trying now to turn the Commonwealth into a Reserve Bank, it is perfectly true. The attempt is being made by financiers to get control of this successful bank under their own representatives as directors. As soon as the Labour party come on top again in Australia they will see that this control is wiped out and that once more it is the people’s bank. We must always be prepared that the moment we make a success of public owned utility big financiers try to get hold of it. It has been so with the highly successful cold storage plant and abattoir at Johannesburg, by the Imperial Cold Storage Coy, of “bad egg” fame. It would occur to-day if financiers could possibly get hold of our Land Bank. I was glad to note that the Minister of Finance referred to the balance of trade. I have always hoped that some day we would raise a financier, one connected with the Government, who would pay particular attention to that interesting question. He drew attention to the fact that the balance of trade in our favour last year—showing our prosperity—was twenty-two and three-quarter millions. If you take invisible charges, which has been given to me by Government at 8 per cent., you get twenty millions capital abstracted from this country, and never coming back. If the Minister goes into the question he will find that in six years a hundred millions has been taken from the country in this way. I would like to ask him to tell us how it is that £5,871,000 has been transferred in addition—by the Reserve Bank, I take it— in coin, to London. One of the great financiers in this country told me recently that six millions, which we should have retained in this country, has been sent to London. This is in actual coin, minted in our own Mint. Nobody is going to deny that this country would be better off for the circulation of that six millions here on this side of the sea. I hope we shall get some further explanation of this expert from the Minister, who is a defender of the Reserve Bank system, and opposed to a State bank using the credit of the people for the people. We look for his conversion in due time when he more closely studies the question. In regard to the Budget itself, while congratulations are being showered on the Minister of Finance, he will have to listen from these benches to criticism rather than admiration. He has such a circle of admirers in the ranks of our political opponents that I need not add to their number. The day may come when he will regret the admiration that came from that side of the House. While we have good reason to be satisfied with a great deal of what has been done, we have nothing but regret for the slow progress made. There is no reason whatever why a far more advanced programme should not have been entered upon, but we know that no Ministry can he stronger than its Minister of Finance. A Minister of Finance is like the slowest ship of a fighting fleet; to its reluctant pace the whole fleet has to slow down. There are Ministers who desire a more vigorously expansive programme, but the Minister of Finance is breaking their hearts by saying that he cannot find the money for their requirements. The Labour party is accused of driving the Government along. Would it were really so. We regret exceedingly the limited influence we possess. Were it otherwise movement would be quicker. The hon. gentleman was patting himself on the back about the advancement and increase in our industries. Last year I ventured to criticize his two-line maximum and minimum customs tariff, pointing out that his partial protective measures would fail in effect, and unless there was absolute security for industrial capital, there could be no stability—a man could not tell whether his manufactures were to be protected or not. The Minister told us 343 new factories have been established, a “factory” according to the Act, consisting of three or more employees. The actual labour increase, white and black, was only 4 per cent. If we were in the place of the Government we would say it with sorrow. In this country, waiting for expansion, it is indeed pitiful that the Minister should be proud of 343 more factories and a 4 per cent, increase in the sphere of labour! It is a success that desires sackcloth and ashes for expression! I am glad indeed that an increased duty is to be put on ready-made imported clothing. The hon. member for Bezuidenhout (Mr. Blackwell) expresses sorrow that people will have to pay more for such clothing. Of course, it does not appeal to the hon. member that there are poor tailors not members of any club he frequents or of any of the profitable professions. But they deserve to be considered, and we shall now have more work for them. It means that there will be more money kept in the country. The value of tailoring added to the material is probably at least 70 per cent.

And the poor man pays more for his clothes.

Yes, and secures work for the still poorer worker. I am sorry the Minister has not seen his way to stop the introduction of second-hand clothing. Why importation has been permitted to go on I do not know. There is the danger in regard to disease. Such clothing is not required, and it would be better to stop its introduction. What we really want is less timidity on the part of the Minister of Finance. We want him to be confident of the country’s progress ; that it will catch up to anything he does ; that whatever expenditure is sanctioned, in time, and in a very short time, the country will catch up. I regret sincerely that the hon. gentleman has not been able to visit other young countries. If he and others had gone to Canada or Australia they would have returned to this country with wider vision, would back it confidently, and see it go ahead by leaps and bounds. If he does not cramp his colleagues but advance as they want to advance, he will never regret it. In the estimates of revenue there seems to be an omission to put in what the people are entitled to know—the actual share they have in the profit of gold mines. Our share in diamond mines is separately shown, but the partnership in gold mines appears to be included in income tax, whereas the hon. gentleman got from one mine alone £1,100,000, our share of profits.

It goes to Loan Account.

You need a ready reckoner.

I welcome the correction. That fact should be constantly brought to the front, because the better we develop the plan of partnership, the better it will be. I think, when the hon. gentleman put up the duty on whisky, he should have increased the excise by a similar amount. America shows what people are prepared to pay for that luxury, though I am not in favour of pressing prohibition. I ask him to go into the question of the evasion of the excise which should be paid on spirits used for the fortification of the sweet wines. That has escaped the net as it was never intended to escape, and it only requires a little attention to add a considerable amount to the revenue from that legitimate source. I am anxious that he should get the very greatest possible revenue, to devote to the needs of this country, which would respond by expansion. I also ask why he should have given that £180,000 to the mines mentioned by the hon. member for Troyeville (Mr. Kentridge). We had last year to complain of that sum being robbed from the Transvaal. I know the Minister throws the responsibility for that on the Administrator of the Transvaal ; but the province really had to make it up through local taxation. It was certainly not a square deal! This year it is to be given to those who have, and from those who have not it is to be taken away. A hundred and eighty thousand pounds more to the mining industry, which has never been more prosperous than it is to-day. Profits are higher, dividends greater, and costs lower, and the Minister has put us in the humiliating position of being jeered at by the right hon.the member for Standerton (Gen. Smuts), who says: You in the Pact said you were going to tax the mining industry more for the people, and you have given them £180,000! Unfortunately, he is right. We should demand the highest possible exaction from the mining industry, to develop other resources of the Union. It is a vanishing asset, and must be so. Much of our debt is due to requirements of the mining industry. The hon. member for Bezuidenhout (Mr. Blackwell) offers an interjection that I did not catch, but if it was that the asset would vanish more quickly if the lawyers got hold of it, I dare say he is right. We should see that it is used to a far greater extent to reduce the public debt of the country. There is another item which Government could have increased easily without injuring anybody and that is the taxation of diamonds exported. I want to draw the Minister’s attention to the fact that while we only got £860,000 last year from diamond export duty, all told, and while he budgets for £900,000 this year, America obtained in revenue from diamonds £2,117,000—pounds, not dollars—mostly our diamonds, although the hon. member for Kimberley (Sir Ernest Oppenheimer) may, and probably will, affirm they were Russian crown jewels! Year in and year out America always made a revenue twice as much as we have out of our own diamonds, and I challenge the hon. member for Beaconsfield (Col. Sir David Harris), champion defender of that industry, to deny it. The United States get 10 per cent, on uncut diamonds, and 20 per cent, on cut diamonds, and here are we, the producers of the luxury, allowing them to go out, and the people who benefit most out of it are raw Basutos who work on the mines. If the Minister had had the courage not to listen to the soft blandishments of the gentlemen who are so pleased with his methods of finance, but rather to those who are thinking of South Africa first, he could easily have doubled his income from this source, and at the same time established more employment in this country. America would take its requirements if diamonds were twice the price—indeed, that would make them only the more desirable to rich women of the States. The items I have mentioned would have given him at least £2,000;000 a year more with which to assist his colleagues in developing this backward country. I am afraid, however, I am speaking to deaf ears, for already big finance has made its influence felt in the Government. The Minister, indeed, seems to be making an effort to set up a record for being the most economical Minister ever chosen for the post, but unfortunately it is, in the sense that the hon. member for Cape Town (Central) (Mr. Jagger) uses it, the most restricted sense of all, that of pounds, shillings and pence. National economy is more than merely money saving. In regard to the increased abatement to £400 in the income tax, the Labour party pressed for £500, and the hon. Minister could have given it if he had increased his revenue in the way suggested ; and it would have been to the benefit not only of the 10,000 whom the hon. member for Bezuidenhout says we have wasted it on, those middle-class clerks, who, he says, do not really need any reduction. But it will not be lost Much of the saving will find its way into the pockets of the hon. member for Cape Town (Central) in purchase of trade goods. In fact, be will come back probably a convert next year, and an advocate of further reduction, as well as higher pay. We might have income tax based on a much better plan. I would ask the Minister to study the new American tariff of present and proposed income taxes. In America the £600 and £700 man will pay nothing ; in fact, payment does not begin until the income reaches £1,000 a year, and then he pays £3 7s. 10d., and after that comes a steeper grading. The £10,000 man will pay £1,071. Why should we not have a much steeper grade? I find from the revenue official blue book that at the present time there is one fortunate person who gets £31,000 a year income, and is unmarried. He or she pays, I see, £3,400.

What nonsense you talk!

It must have been £10,000.

I will look up the actual figures, but it does not alter the argument that such an unmarried person can afford to pay £10,000 a year.

He pays seven shillings in the £.

I cannot see why we should not take half of the £31,000 for the State. We, on these benches, exceedingly regret the increased duties on wheat, for we do not like the idea of necessary foodstuffs being made any dearer. It would have been better if the dumping duty placed on wheat by the South African party men in opposition had been wisely used as bonus inducements to extend the area under wheat in this country. We are not going to stand, many of us, for any system by which the bread of the people is made dearer.

Move an amendment that the duty be taken off.

If you or any member of the Opposition will move for a substituted revenue, I will vote for it and guarantee considerable support from this part of the House. Will the member for Bezuidenhout so move ?

Are you so paralysed by the Pact that you are afraid to move it yourself ?

The hon. gentleman represents a constituency of natives who mostly eat mealies, not wheat, so he will, perhaps, accept my challenge? No? Well, we now see the utter hollowness of the whole thing. Why are they so nervously afraid ? I will tell these leaders why they are so fear-stricken as to avoid my challenge. In their back rows are sitting a number of wheat and wine growers, who are already straddling the political fence, with a longest leg towards the National party. My challenge cannot be taken up for fear of there being several more “independent” Abe Baileys in their fast diminishing ranks. However, the offer still stands open. The hon. member for Cape Town (Central) (Mr. Jagger) tells us that sugar consumption in Australia is 138 lbs. per head per annum, but in South Africa only 45 lbs. There is our answer to all the arguments he has ever used. The lower the rate of pay the lower the rate of consumption.

Business suspended at 6 p.m. and resumed at 8.7 p.m.

When the House adjourned I was about to conclude, and an apology is almost due to the House for my having inflicted myself upon it so long. There are one or two points I would like to emphasize and, as I see the hon. member for Bezuidenhout (Mr. Black-well) in his place, I would allude to one or two things which attracted my attention in his speech. There was, first of all, his dissatisfaction at the amount which is being provided for the redemption of debt. I am glad to see that he-is so anxious it should be put right. If his anxiety had been as great during the regime of his Government, perhaps a different order of things might have been revealed than the deficits which occurred year after year. If the late Government had taxed properly, there would have been no such deficits, but they preferred to borrow money and to add to our debt in order to meet the recurring deficits. That is absolutely unpardonable finance. There is another point I would refer to The hon. member for Bezuidenhout always expresses himself as shocked at the employers tax in the Transvaal. He is so easily shocked! I have not defended it as one of the best of taxes ; on the contrary, I thought it one of the worst. We put on that tax because, after the courts had awarded us, under the South Africa Act, the right to tax gold mines, that right was taken from us, and the only way in which we could get something out of the mines for the education of the children of employees working on the mines was by an employers tax. Let me ask the hon. member why he does not attack as viciously the existing employers tax in the Transvaal, called the native pass fees. As a matter of fact, it is an employers tax of twenty-four shillings a year in labour areas, and half that in outside districts, paid entirely by employers. Is that a fair or unfair tax ?

The only virtue that tax has is that it is about twenty years old.

It may be old, but why doesn’t the hon.gentleman, in his anxiety for purity of direct taxation, attack that ? It is on exactly the same lines as the now defunct employers tax. With regard to the State bank question, I have in my hand the balance sheet of the Commonwealth Bank of Australia up to 1922, which shows an amount on the profit and loss account of £4,198,000 in addition to a similar amount carried to reserve. Since then this profit has been very largely added to. Why should we be denied the prosperity which attends such a bank simply because of gentlemen who are interested in private enterprise, which is frequently breaking down, as it has done in the National Bank going under to Barclay’s of London, Egypt and the East. It is not in the interests of the people, but only in the interests of those who are rich enough to be shareholders in private banking monopolies. In reference to the sugar industry, the consumption in Australia is 138 lbs. per head of the population. Contrast that with our figure—45 lbs. per head, inclusive of natives and coloured persons. That is just one of the proofs that if you give the people a change of having luxuries, you can increase production as well as consumption. I want to make an appeal, finally, to the Minister of Finance. He has round him colleagues whom one might envy, men of enterprise, bold enough to experiment in a country which would well respond to experiments ; and I ask him to remember that it is within his power either to cramp their movements orto second them by making provision which can be made, as I pointed out, with the greatest ease, by adding £2,000,000 a year to his revenue. One point I urge particularly upon him, and that is that one source of revenue which I have recommended him to get from diamonds, would be paid entirely and absolutely by Americans outside this country, who are wealthy enough to pay. He can take another million in export tax on diamonds, and the Americans will pay it with the utmost ease. Past Governments have listened to the blandishments of those interested in getting all the profits of that trade, irrespective of what the country of production gets, and we have lost that opportunity of years gone by. The pity of it! I would make a special plea for the fisheries which it would be possible to establish on our coast. We little know the wealth that is in the sea which we can have for the taking, and if the Minister would put aside, not immediately, but from time to time, half-a-million of money, to develop a great fishing industry, it would repay itself 100 per cent, every year. It is possible to have fine seagoing fishing boats on the co-operative plan, of which the crews could become owners by purchase on monthly instalments. The boats could be insured, so there need be no loss. The Minister would be amazed (if he got out Scotch fishermen and developed that industry) at the harvest of the sea which could be gathered, and which has for years and years been lying at our feet undeveloped. I was rather struck by a remark of the hon. member for Port Elizabeth (South) (Sir William Macintosh), whom I want to congratulate, not on the happy event which we were delighted to hear of, but on the fact that, as a free trader, he has been kicked into protection by the boots made at Port Elizabeth. The hon. gentleman used an illustration which appeals to me. It should sink into the minds of members. He said the healthiest chickens were those that had to scratch for themselves. Nothing could be truer. When we have learned in South Africa that our chickens have to scratch for themselves, and no longer for old hens on the other side of the water, we will be on the high road to success.

The House in indebted to the hon. member for Pretoria (West) (Mr. Hay) for his counsel of perfection relating to length of speeches. This side of the House is deeply indebted for his financial dissertation on the present condition of the country! He spoke much in praise of the Pact. Some of us are wary of this adulation of the Pact. There is one aspect of this policy of protection that ought to be brought to the notice of the House. There were placed in my hands some time ago certain documents from a commercial man in my constituency. He had bought ruled printed pads from England at a cost of £49 13s. 4d. The customs due was £50. That is protection gone mad. I draw attention to the fact as illustrating what protection means in the estimation of hon. members opposite, and particularly in the estimation of the Minister of Finance.

Are you against it ?

I am against mad protection. Once again I ask why so heavy an imposition of customs on a consignment of that sort. In whose interest is it? I have heard of a firm in the Cape Peninsula that has something like a monopoly in that kind of product. I have heard of a similar firm in Durban ; but why should the public be burdened ? It seems to me rash finance. I want now to ask—I am almost afraid to put the question to the Minister of Railways and Harbours—about a matter I have dwelt on and which I shall perist in dwelling on until some sort of satisfaction won, and that is the position of men getting on in years who, for twelve years or more, have been pensioned under the old system, and to-day their pensions are pitifully inadequate to their needs in times of greatly enhanced cost of living. I do hope it will be possible for the Minister to bring in next session some Bill that will ameliorate their condition. I want to draw attention to the position of coloured employees of long service who get no privileges, and, as far as I can see, have no prospect of a suit able pension. Why should not these stand within the purview of the Minister ? I also want to draw the attention of the House to that most remarkable census recently conducted by the Johannesburg “Star.” It presented a questionnaire to some 1,100 or 1,200 schoolboys of the leaving age, and asked them what they intended to be, and why their preference. Of the 1,000 replies that passed scrutiny, 264 boys expressed their intention of going in for agriculture in one of its many forms, 260 want to take up engineering in one of its many forms. It is a very healthy sign that half the boys who replied expressed a preference for farming or engineering. We know they are sometimes mistaken in their outlook about farming, but it might be possible—why should it not be possible with these vast irrigation schemes now being put forward to provide for these lads’ careers. As concerns engineering, when one thinks of what has been done in forty years past in South Africa, it is scarcely credible to think what advances will be made in forty years to come. Surely, with all this lavish expenditure of public funds, some assignment could be made for the training of our lads in this profession, even at the public cost. I must, as a matter of duty, speak out at this eleventh hour about the infallible tendency of present-day legislation in this House in regard to the native mind and the native outlook. I am not an alarmist, but I fear for the future if this repressive policy is persisted in. For 100 years past we have been trying to teach these people to raise themselves. Many have done so. The repressive legislation to be forced through at the joint sitting will have the effect of terrorizing these men. I am a sufficient student of human nature and human history to be afraid of that policy directed against those people. I want to express the hope that the Government, in such wisdom as it has, in the recess, if not now, will give all possible encouragement to a scientific, sane, and most merciful system of old age pensions. There are old people who sadly need help. Through circumstance over which they have no control, they are poor and suffering in their declining years, and this Parliament ought to follow the lead of other countries and make provision for its indigent poor. I commend that policy to the consideration of the Government.

I wish to deal briefly with some matters that have arisen during the recess, chiefly concerning native matters. I wish first to quote from a speech made in this House by the Prime Minister last session. He stated, among other things—

He continued—

I do not wish at this stage to discuss the segregation policy of the Prime Minister—that will come up later—but I wish to discuss the point he raised in regard to the development of native land. He laid down a distinct policy that we not only tell the native how to develop, but that it is our duty to make full provision therefor. In view of that statement, and in view of the promises he made to the natives on his visit to the territories that he intended to do his utmost to help them in every way to develop the land, one would have expected that in the estimates for this year at least we would have seen increased expenditure on the Native Affairs Vote, instead of which it is one of the few Votes that is actually decreased. I have before me the agenda of the Native General Council, or Bhunga, from which I note that almost every district asks for additional agricultural demonstrators. Yet I find there is an amount of barely £1,700 to be spent by this Parliament on such demonstrators. The natives, when they heard the Prime Minister speak, were fully convinced that he intended assisting them in that particular development. He showed sympathy ; he showed he realized that the future of the natives lies upon the land. We feel that the native is largely tempted into the towns by conditions not suited to his development ; and it is our duty, as a Parliament and as the guardians of the natives, to try to help them to develop on the land, and to encourage him to remain there. In view of these promises and the statement made in the House, I think it is fair to expect he would have shown that these promises are to be translated into action. I would like to point out to this House what the Bhunga is doing. We have three native agricultural institutions, in which over 100 native students are to-day being educated, all developed under the council system. These institutions have cost a large sum of money and are very commodious. The Bhunga has several plantations and has developed a network of divisional roads. It has built sheep and cattle tanks right through the Transkeian territories—constructed dams and irrigation schemes, provided largely for education, and carried on an experimental cotton farm. Provision is also being made for capital for a cooperative credit society for native farmers—all from current revenue. The position to-day is that the authorities find that they cannot cope with the demand, and the natives are unanimous in asking for greater facilities for dam making, irrigation works, fencing and all works that tend to greater development. We find the Government introducing a new native taxation act, which I supported, because I believed it to be in the interests of the natives, and made provision for a certain amount of development ; but I ask The Prime Minister and the Minister of Finance, are the natives going to develop entirely from revenue? Are they not entitled to a certain modicum of treatment of the same nature as is given to European farmers who have a land bank and are granted loans for fencing purposes or irrigation, windmills, and so forth. I think the Prime Minister realized that in the Transkei we have a large number of natives who desire to help themselves. If, we look at the legislation of the present Government with regard to the natives, we find, first the native taxation act, to which, as I stated before, I have no great objection.

We have the civilized labour policy of the Minister of Railways, who considers that the natives should not come to this part of the country to earn money, and that they should be kept apart from the coloured people. He has caused a large number of natives to leave Gape Town. Personally, I have no quarrel with that. Our natives come here and mix with a low substratum of coloured people. They contract diseases and are brought into contact with the lowest classes, and acquire the drinking habit. They intermix and intermarry with the coloureds. A native told me that there were over 500 natives married to coloured women, and none of these natives dare take their wives home—they would be turned out of the kraal. No, I will say very deliberately that if the native wishes to retain his racial purity he should keep away from Cape Town and the Western Province. Then we have this colour bar legislation which the Prime Minister and every hon. member knows is creating an atmosphere of suspicion and unrest in the minds of the natives. We have the cotton blanket tax. If all the Government is going to do is to pass such legislation, both burdensome and repressive, and not assist the native in internal development and the development of his land, it is not to be expected that the Prime Minister’s proposals, when they are brought forward, will be acceptable to the native. We have raised suspicion in the native mind—either that we fear him, and are trying to push him under, or that we are using him to raise revenue for our own development. I feel that whatever Government is in power it is necessary to try to help the native to develop. Last night the hon. member for East London (North) (Brig.-Gen. Byron) hinted at there being 120,000,000 natives in the hinterland of Africa, who might fall upon us if we are unprepared. Let me say straight out that I do not like speeches of that kind, and deprecate them. When statements of that nature are made by important members, it puts ideas into the heads of the natives which they themselves would never have thought of. It is not right to disseminate such ideas. I am satisfied that if we were threatened by natives from the north, the natives here would rally to our banner. It is their country as much as ours and they have not yet forgotten the days of Tshaka. They realize that in this country we must stand together and help each other. In the Bhunga last week, which I attended, there was a motion that the Government should deport all coloured men from the native territories. The mover, an educated native, said that the Government had taken up the attitude that it did not want natives down here, and so they should retaliate by asking that the coloureds he expelled from native territory. An old greybeard of the old veteran type said—

Practically only the mover and the seconder supported the motion, and the whole council was apparently against it. That shows the feelings of the natives. As the guardians of the public peace of this country, it is our duty to try to maintain that feeling which exists among the better class of natives. I appeal to the Prime Minister to consider my words. I do say that if the only use we are going to make of our power here is to impose taxation and repressive legislation, the native will feel he has not got any friends in this country. If we want to carry the natives with us, we must show a little more interest in their affairs, and try to help them to develop along correct lines —and in the first instance that is on the land. At Lady Frere I think the Prime minister saw a large dam being constructed, for which the natives themselves paid. A large number of other natives wish to follow that example, and there is real and urgent call for financial assistance. The Prime Minister from the experience gained on his recent tour must realize that it is practically impossible for a native to grow any other crop than maize. Winter crops are impracticable as the lands are unfenced. His cattle have to pasture on the lands at night and when they trespass we have stabbing cases and friction results. The native must he encouraged to fence, but he cannot afford it, especially with his small holding. It cost £80 000 to survey a certain district, and the money would have been more beneficially spent on fencing. The Prime Minister should try to establish some development fund, which will help the natives to develop in their own area. We have been talking high politics and high finance for several days, but I feel that the native question has been very largely ignored in this House, and we ought to feel that it is the great question facing this country. We are apt to lose sight of the fact in the party squabbles—I do not know whether it is Parliamentary to call them “party squabbles” that there is a big issue facing us every day, and I do appeal to the authorities in power to consider this question very carefully, and to realize that, if we are to continue to hold the respect of the natives, and to occupy the position we have occupied in the past, we can do so only by dealing sympathetically with the natives. It may be necessary—from the Government point of view—to introduce legislation such as the Government has introduced, hut it is necessary to show real sympathy with their demands for development.

The hon. member for Riversdale (Mr. Badenhorst) referred in glowing terms last night to the great benefits his district has received at the hands of the present Government. I wish to congratulate him. It is a good omen. As his neighbour I may also get something. He also referred to the visit of the hon. member for Paarl (Dr. de Jager) and myself to his town. I am very pleased that our visit has had the desired effect and given him cause for reflection. I am in entire sympathy with the attacks made on him, especially by the fishermen and others who were called upon to pay the increased burdens placed on them by taxation. If I am correctly informed, he has generously assisted to pay that so as to pacify them. My hon. friend emphatically stated that he would resign in the event of the Nationalists joining with the Labour party. I am sure he is not going to deny this, and he stated that if any of the Labour party were taken into the Cabinet he would immediately place his resignation in the hands of his electors. May I remind my hon. friend that his electors are still waiting for him to carry out his promise. When the hon. member was asked whether he would vote for an increased parliamentary allowance I will give him this credit that at a public meeting at Swellendam he definitely stated—

But when the matter came to a division my hon. friend conveniently left the House, evidently not wishing to hurt the feelings of his “boeties” on the cross benches. The hilarity displayed last night when the hon. member was speaking reminds me of a circus which I attended when a boy. Two clowns appeared in the arena one depicting ignorance and the other slimness. I would not for the world suggest to which class the hon. gentleman may belong. I am sorry that I cannot view the position of the country with the same optimism as the hon. Ministers have done. I do not want to be unduly pessimistic but I cannot realize that the immediate future is as promising as it would appear to be. We are faced with a comparatively small harvest of maize and there is absolutely no sale for mohair at present. The wool market is not as buoyant as it was a few years ago, and the tendency is for lower prices. I believe when I speak on these matters I can speak with some authority. I subscribe every time to the dictum that the farmers are the backbone of the country and they are not so flourishing as some of the members over there appear to be. I feel that in my humble way I must give a warning. My ears still ring with the cry of economy during the last election, but I have yet to learn that the Government is going to practise what they have preached. On the contrary the annual expenditure is increasing and the public debt is accumulating to an enormous extent. I am profoundly disappointed that the Minister of Railways has made no further provision for a reduction of rates. The country is calling out for this. Last year the hon. members for Malmesbury and Piquetberg (Messrs. Bergh and de Waal) hurriedly proceeded to Pretoria in connection with the dumping duty. We find now this duty is about to be removed, but as a representative of a wheat-producing district let me say that the additional 5d. per 100 lb, in protection is not going to help the farmer in the least. The price of South African wheat is dependent on the price of flour from Australia. The result will be that Australia will send unlimited quantities of flour and the price of wheat will be considerably lowered. The tendency is now to lower prices for wheat. However much I should like to see the poor while labour problem solved, I cannot believe that the means employed of getting them on the railways is most desirable. What I fear is that these people are going to learn some of the vices of the towns and particularly socialistic ideals which, if introduced on the platteland, will have most calamitous effects. I think the only way the question can be solved is by putting them on the land, and any reasonable expenditure in doing so will have my heartiest support. I would draw the attention of the Minister of Railways to the parlous state of the stations and sidings on the New Cape Central railway and the manner in which the trains are run. We are greatly indebted to him for having so judiciously taken over the railway. I feel confident that the result of last year’s work is going to be an eye-opener to him and to be a great success, but I would invite his attention to the disability the inhabitants are suffering with a view to coming to their assistance. Since the line was taken over by the Government, the train is generally two or three hours, and I am reminded, even five hours late. I am sure with the good feeling which the Minister has to myself and my neighbours that he is going to assist the district in connection with this complaint.

The acclamation with which the Minister’s statement that he was closing the year with a surplus was received on the benches opposite showed that they had closed their eyes to the fact that it had been taken out of the pockets of the taxpayers. The revenue from taxation in 1923-’24—the last year Mr. Burton prepared the Estimates—was £16,853,095. In the first year of the Pact Government it was £18,365,707, or an increase of over £1,500,000. So there is nothing to be very jubilant about, because it is quite easy for the Minister to have a surplus when he has the monopoly of taxation. The amount received in 1923-’24 from customs duties, included in the amount I have referred to, was £8,616,594, including excise. The estimate for this year is £9,512,000 from the same source, an increase of nearly £900,000. So I hope my friends on the other side are satisfied. They were warned of this when the preference was taken off that the Minister was expected to take £400,000 out of the pockets of the consumers and here we have the evidence of it, although it was received with a certain amount of dissent on the other side. I want to deal with the reply to the question I put to the Minister of Finance with regard to the restoration of the 10 per cent, cut in 1923. It is quite true that the Minister said that there was no reduction in pay, but the cut was in the grade or scale, so that the man who possibly would have reached £500 was finally placed; at £460, and the public services feel to-day that in view of the prosperity of the country they have been specially singled out for this special taxation. I think the records of the interviews between the late Government and members of the public service and also the railway service would show that there was a sort of implied promise that this cut would be restored when times had improved. The Minister smiles, but I am almost sure that if the late Prime Minister is able to get up and support me in this he will say that the idea was that once this financial stringency was removed, the public service would again be considered. I must say that the lower paid men feel this cut very much because it also affects their pension. I would also like to draw the attention of the Minister of Railways to the position of the third grade clerks in the railway service. The Minister knows from discussions that took place in select committee last year that the barrier in grade three has an effect on the salaries of these men ; that having arrived at this barrier they have very little chance of promotion and are in many instances performing the duties of the higher grades at the lower salaries. The majority of these officers belong to the mechanical and stations sections. The actual figures showing the proportion of third grade to higher grades are as follows:—

Some of these men have been in grade three for the past nine years, and there is very little hope of their getting the benefit of a higher salary. The maximum salary in grade three has been reduced to £310 a year, and as many of the men are married and have families they have very great difficulty in paying their way. The hulk of the clerical staff experience difficulty in passing out of grade three. The time has arrived to enquire into this. The Minister should either appoint a committee or refer the matter to the conciliation board. Now there is the old question of renewals. The Minister in his budget speech stated that a committee was enquiring into it. I hope that the committee’s report will be in the hands of members before the session is over and that it will follow the lines indicated by the select committee, and that it will not be possible to use a million pounds of this fund for the purchase of say new electric engines, which should come out of loan funds. I hope that any future vote from the renewal fund will not be taken without the consent of the House. There is still a loss of about £300,000 a year on branch railways. This is a distinct charge on the users of the railway. I should like to know what amount is credited to the branch lines for the traffic they are the means of obtaining for the main lines. The great majority on this side of the House feel that the Minister is doing the correct thing in trying to find work for our civilized youths.

Oh!

But what we disagree about is that the extra expenditure incurred through the employment of civilized labour as against uncivilized, should be charged to one section of the community only. If it is the settled policy of the Government to extend the field of white labour, the cost should be charged against the Consolidated Revenue Fund, so that the users of the railway should not be made to pay for it. Seventy-five per cent, of the branch railways are in the Cape, and the losses on their working constitute a charge on the main line and on the Reef line. The hon. member for Cape Town (Central) (Mr. Jagger) has referred to the Conciliation Act as a distinct blot on our legislation. As a matter of fact, the result of that Act has been to keep down the cost of building, for the men have been shown that if they ask for too high a rate of wages it will result in less building. The men have seen the wisdom of that, and have agreed to a rate of wages which, while paying them, will not injure the public. Recently the men demanded an increase of 3d. an hour, but the masters were able to show them that the stagnation in the building trade was such that any increase would prevent a good deal of building, and the men saw the reasonableness of this argument. This shows that the Conciliation Act is in the interests of the public as well as in the interests of the men.

As a farmer, I wish to say a few words regarding taxation. It is remarkable how the taxpayers are always ready to pay for whatever is imported, regardless of the amount of indirect taxation their purchases impose on them, but as soon as you touch their pockets directly there is a plea for consideration. It is remarkable how farmers in particular are so ready to accept any amount of indirect taxation, even when they are protective measures against themselves. People do not seem to realize how these protective duties become a great burden on their own living. There has been a considerable amount of jubilation over the raising of the exemption of income tax payments from £300 to £400. The taxpayer seems to think that he will have more money to spend as a result, but he will find that he will have to pay more than he has saved in income tax on the purchase of those necessaries of life which have been protected.

What are they ?

Is it necessary to mention all the articles which have been taxed—boots and clothing ?

I thought we were discussing this budget.

Butter, eggs and sugar. It is quite clear that, under the proposed duties, the small man will pay a heavier tax than he did under the old system of the higher income tax exemption. There is no direct taxation on the native, except the poll tax. While the European is to be exempt up to the amount of £400, the native with an income of only £30 or £40 a year will have to pay £1. This is creating a considerable amount of indignation in European areas. A great number of farmers are complaining about it, for they will have to pay it. In many cases the farmer pays it directly, so as not to have trouble, and those who do not pay it directly are told by the natives that, as a result of the poll tax, they must have higher wages.

You want me to repeal the poll tax ?

Yes. I consider the natives are the most poverty-stricken people we can find in the dominions. They live on the border line of starvation and poverty. I do not blame anyone in particular for that, but that is the position. The native has nothing to spare even for the ordinary necessaries of life. The stamina of the natives throughout the Union, is steadily going down, because of their poverty. We saw that during the influenza epidemic, when thousands of natives died simply from starvation. They had practically no food and no fuel, and were too weak to go to look for either. I am surprised that farmers are in favour of protective duties, and I support most heartily the argument used by the hon. member for Cape Town (Central) (Mr. Jagger) in regard to those duties, for they are a hindrance to the development of the country. I hold that the farming industry is the worst paid industry in the Union. There is no question that, taking the average salaries and wages paid by the farmers and the returns made by them from capital, farming is the worst paid industry in this country. Therefore, if you lay duties on many articles which will raise the cost of living and the cost of labour you are going to make the cost of production to the farmer in this country such that the only result will be to lessen his profits. After all, the real stern necessity of the conditions under which the farmer carries on his industry is such that he ought to be able to use all his requisite productive powers at as low a cost as possible to make any return. We shall have to produce at the lowest possible cost if we are to compete, as we must, in the markets of the world. On top of the contests that the farmer has to wage against, drought and hail and all the climatic conditions, when he goes to rest he will have to sleep in a suit of pyjamas which cost him more than it ought to have done owing to the protective duties and, at last, when his life is ended, he will be placed in a coffin which has cost more than it ought to have done because of these duties. The agricultural products of the Union have been estimated at a value of from £70,000,000 to £80,000,000 a year and if, as a result of this protectionist policy, the costs of production are to be increased 5 or 10 per cent., it will make a very considerable difference to the incomes of the farmers of this country. I will say a few words in regard to our railways, and what they mean to South Africa. By having railway communications throughout the country we are able to have that contact with each other which will undoubtedly raise the standard of living. Stagnation of trade, antiquated methods of farming, low standards of living, retrogression, are always seen in the backveld, far from our railways, the result of the lack of railway communication. If we are anxious to see a white South Africa, the first thing we have to think of is that the transportation services shall be improved to the greatest possible extent. I will appeal to the Minister to think for a moment of the conditions under which thousands of our farmers in the backveld are living, owing to the lack of railway communication. What is the insistent cry every session, but for railways and still more railways. I feel that there is nothing that requires the constant and careful attention of the House and the Government in particular more than the question of improving the transportation services in this country. That is one picture which I wish to impress upon the farming members of this House. The other picture I want to refer to is the picture of unemployment. Unemployment is a matter that wants our careful and most judicious attention, but in facing that question do not let us handicap the development of the railway service in this country by adding to the cost of the transportation services the cost of work that we want to do in regard to saving the unemployed from the disastrous consequences of the lack of unemployment. Increasing lines of railways will give increasing work in the higher spheres of the development of those railways, and we can leave the more unskilled work to the raw native labour of this country. By having a system in which we see no tendency to run our railways on anything except a proper financial basis, we shall be able to go into the market at any time and get more and more capital for the extension of our railway lines. The Minister of Railways has pointed to his supporters as in favour of his policy of white labour on the railways. I would like to appeal to those members, as representing the farmers of this Union. I would say to them: What is your insistent cry in regard to South Africa—

To that I say I agree ten times over. As a man born in this country, I want to see a white South Africa, I want to see South Africa a nation. I am confident that the one hope for the civilization of this country is to have a white race here. What are my conservative friends, the farmers of this country, doing in regard to this policy of white labour ? They are encouraging the drift of the white man from the land, they are enticing him away from the land to the towns. My conservative friends, my farming friends and those who represent the farmers, are proud of their race. Let that pride continue and be justified. Your race has been evolved and raised from the land. That type has been moulded by the influence of old mother earth and dame nature in the centuries of the past—

And the stability and security of your country depends on the man on the land. This policy of encouraging men to go into work on the railways and in the towns is going to kill your race. The more they drift to the towns the sooner we shall see the word “Ichabod” written across the pages of history ; that their glory has departed.

Why do they go?

The policy of putting them in the towns or on the railways is the wrong one. I realize that something must be done for the poor whites. We all realize it, but do we all realize our responsibility ? I would ask our farmer friends what are they doing for the poor whites? We have 100,000 farmers in this country, and surely amongst them we can find a sufficient number who are prepared to do a big bit towards the solution of this serious problem. Do not let us hamper the development of our railways, because on them depends the happiness, progress and prosperity of this our land, and our people. Do not let us put our sons in a sphere where, perhaps, a few may make good. Do not let us put them into blind alleys. Do not let them go to work for pay that is degrading to their sense of self-respect. For there is not one who does not realize that they are being paid at a rate not justified by the work they are doing. They know it ought to be done by unskilled native labour. When I think of the efforts we ought to make in regard to putting men on the land, I also think of the question of immigration, and I can see nothing cone in the proposals laid down in this budget, Yet I think we must all realize what an important matter immigration is for the future and development of this country. Other dominions are not hesitating in this respect. They are welcoming and encouraging these men, and giving them every opportunity to go to these different countries. It is the duty of our Government to do very much more than is being done at the present time, even by private effort. Our future depends on the occupation of the land, and unless we adopt a big, bold policy of occupation of the land, and its development, then I fear very much for this country, and I realize our progress will be slow, and we shall not make that development that I am sure every member in this House is anxious to see.

This debate was introduced by the Minister of Finance in very militant terms. He told us he had cleared his decks for action, and was prepared to receive the attack of the enemy in mass formation. Now there are several ways of clearing the decks for action. One is to load your guns and have the men standing ready at their war stations, ready for whatever may happen. Another way is to send the crew below, and tell them to go to bed and keep quiet, and on no account to show up while anything is happening, while the captain goes to sleep on deck. Looking round this House, and at the rows of empty benches opposite, I think that it was the latter method the Minister meant to adopt, so far as this debate is concerned. One would imagine that this debate was a matter of the slightest importance. Here, indeed, is an exhibition of the Pact as we see it at work to-day: ten altogether in their seats, including the two most industrious Ministers in the Cabinet. I think it is as well that the country should understand how its business is being conducted by the Pact. This exhibition needs to be thoroughly advertised. Where the members of the Pact are, I do not know.

They are on commissions.

Not all, however, are so dilatory as those conspicuous by their absence. We have had one or two most enlightening speeches. Notably, that one this afternoon from the hon.member for Liesbeek (Mr. Pearce), who to-night is taking a well-earned rest. I think, if any man ever deserved a good, long and substantial rest, it is the hon. member for Liesbeek. He indeed enlightened us on many things, including the crossing or, as he called it, grafting of an Afrikander bull with a short-horn bull, the results of which we were given to understand he had seen, and which were so convincing and apparently boundless in possibilities, that he not only saw big money in it, but an opportunity of bringing the Imperial Cold Storage Company to its knees. He accordingly appears to have rushed back to town and started right in to promote a company for the export of the progeny of these two remarkable animals. Incidentally, the company was to pay the promoters a big fee, and it was hoped might return the shareholders some dividend. It seems to be almost in the nature of a disaster and a tremendous loss to science that this company was strangled at its birth. But if an alliance between an Afrikander bull and a shorthorn bull can produce such amazing results, what may we not expect from a marriage between the Nationalists and the Socialists ? But, speaking seriously, it is difficult at this stage to discuss the policy of the Government in respect to many matters of first-class importance. Take their native policy, for instance, which is still in embryo ; but this we do know, that there is a situation which is existing in the country to-day which those of us who are acquainted with the native people and live amongst them cannot possibly ignore. And I want to support a good deal of what has fallen from the hon. member for Tembuland (Mr. Payn), although I do not agree with him when he takes exception to the frank expression of the situation placed before us by the hon. member for East London (North) (Brig.-Gen. Byron). It is absurd to think that by our not talking publicly about the relationships which exist between the white races and the natives that the natives are not conscious of it. A change has come over the attitude of the coloured to the white peoples during the last twelve months.

Two years.

My hon. friend says two years, but during the last twelve months the change which has come about has not been exceeded for the past twenty years, and to a great extent we are responsible for that. We may dissociate ourselves from everything done in this House by the Government side, but, so far as the native population is concerned, they hold the white men collectively responsible for what is done in Parliament, and it is folly to deny that they have grave grounds for complaint. There is the poll tax, increases in duties on everything the natives buy, wage Rills which they know are aimed at them to drive them out of work, and colour bars ; and at the same time every form of legislation devised to increase their expenditure and yet make it more and more difficult for them to live. If South Africa is going to follow that line of action and deliberately adopt that policy towards the native people, who outnumber us by seven to one, and give them to understand that fair play and justice are things of the past, you may be sure that the white man will have to pay for it. We owe a great debt to the natives. Except for the hon. member for Tembuland (Mr. Payn) and the right hon. member for Standerton (Gen. Smuts), how seldom do we hear a member of this House get up and speak a word on behalf of the natives, who have no direct parliamentary representation, and are practically inarticulate as regards their own affairs. And yet they are our sacred responsibility ; let us never forget that. They have been loyal to the white man in the past, and have trusted and served him faithfully, and the whole of this country has been to a very large extent built up by their industry. They have developed our mines and our farms and industries, built our railways and our roads, and they were our railways and our only means of conveyance before there were roads and railways in this country, for they carried our produce from one end of South Africa to the other. I am speaking from the depth of my heart on this matter. When I say that to-day it is soaking into the minds of the natives, and preached by their leaders, that their future in this country is hopeless, a deplorable state of affairs, we have to get back again to the turning point, and that implies the regaining of the confidence of these people. While we are busy alienating the coloured people, what are we doing to keep the white peoples together ? Everything in future depends upon the co-operation of the English and the Dutch people of South Africa, and yet we have a Minister who preaches, in season and out of season, secession from the Empire, knowing perfectly well that every time he makes those speeches he wounds the feelings of half the white population of South Africa, and is keeping them bitterly apart. We are sick of those speeches ; and they have got to come to an end. They may have their party advantages, but they are of lasting harm to the future peace and prosperity of South Africa.

The Minister of Finance is being congratulated on all sides about his budget, especially by members of his own party. I feel also that it is pleasant to be able to show a surplus, but nevertheless if we look into the budget now before us we see again what we saw during recent years, viz., a continuous increase in expenditure. Now we must not forget that an increase of current expenditure is not always a sign of progress but may also mean that too much is being spent on administration. If we analyse the budget we find that almost half the expenditure is on officials’ salaries and officials’ pensions. The Minister mentioned that the surplus of £500,000 will be applied to writing off the deficits which accrued to certain pension funds under the previous Government. The question arises whether it is desirable to use annual surpluses to pay old debts. I think it is not right. The Act provides that surpluses should go to the Com missioners for investment, but now they an being employed to supplement old funds. In my opinion a fund which has got into arrears should be assisted out of current expenditure so that the people should know what they are being taxed for, and the surpluses should be used for other purposes.

Where do the surpluses come from ?

From taxes paid by the people. But if we go on in this way and continually increase taxation, I do not know where we shall end. Again this year there is to be further taxation, as, e.g., the tax on men’s ready-made imported suits. It is the poor man who cannot go to a tailor to have a suit fitted, and it is the poor man who will be hit by this tax.

The poor man’s wife can make suits for him.

Then she has to pay a licence.

In my young days it often happened that wives made suits for their husbands, but in these days there are few wives who can do that. We should try to meet the poor man. The blanket tax also hits the poor man, and we should allow the cheap cotton blankets in without this high import duty. The Labour members are very quiet, and do not protest against the tax on ready-made clothes. I am one of those who buy readymade suits because they are cheaper, and now I shall have to pay more. If the supporters of the Labour party can buy tailor-mades, they are better off than I am.

Why don’t you go to a tailor ?

The worst tailor-made suits cost £6 or £7, and one can buy good imported ready-made suits for £4 or £5. I am also in favour of protection, but when things cannot be produced here we should not impose a duty. Take petrol. The Government gets 3s. on every case, and we cannot make petrol in this country. Who uses petrol? The farmers, and they have to pay. The Government also places an import duty on wheat and Hour, and I am not opposed to it. I am in favour of a duty on things which can be produced in our country, but the benefit of this duty does not go to the farmers. We get our death blow from the millers. An import duty of 3s. 8d. per 100 lbs. is levied on flour, but it is not the farmer who benefits but the miller, because he does not pay a higher price to the farmers for the grain. If the Minister wants to do something to assist the farmers, he must make us more independent of the millers who control the whole wheat trade and do as they like. We cannot sell any wheat to-day to the miller, because he gives practically nothing for it, but imports it and uses that. If the duty is raised he will still import because he knows that he alone is the one who sells wheat to the bakers and the public. The hon. member for Waterberg (Mr. van Niekerk) spoke about our immigration laws. It is necessary that the laws should be amended, but the Government do not intend to do so. There is no doubt that we get a certain class of people in the country that is not desirable. Encouragement should be given to people who can accommodate themselves to their surroundings outside of the towns and villages. The people who come in to-day mostly go into the towns and struggle along there until they earn something. I agree with the hon. member that if we adopt the system applied in the United States we shall attract desirable immigrants from certain European countries. We must do this if we are to have a larger population to consume the overproduction. There is no doubt that the difficulty we have to-day in regard to production is the fact that we have not enough markets. We have, indeed, the European market, but often there is not sufficient demand, and in our own country the population is not large enough to consume all we produce. Consequently it is necessary to have more people. There is another question which comes under the Minister of the Interior, but which is not now before the House, viz., the introduction of natives from Portuguese territory. I mentioned the same question last year, but it seems as if the Government has continued its policy. On account of the limitation of imported native labour from Portuguese territory, the Treasury received £96,000 less, because the restrictive policy caused shortage of native labour on the mines. What does that prove ? Not only that the shortage of labour is felt on the mines, but that we, as a farming population, have still more felt the shortage, because the result of the policy of the Government is, that although some years ago we could get as much native labour on the farms as we wanted, the position to-day is entirely different. The workpeople who went about looking for work on the farms now go to the mines, so that the farmers are without labour, so that both the Government and the farmers are suffering. That fact cannot be argued away. Farmers are assisted by the introduction of native labour from Portuguese territory and the Government should give attention to the matter so that they can get labour. The Government further has a policy of civilized labour on the railways of which I approve. What happens, however, in my own district? At least twenty-five young men have left the farms to get work on the railways, and as a result their parents remain without labour. This shows that if the white lads are attracted from the farm their parents have no labour. The Government ought to take further steps to assist the farmers. The chief reason why the people leave them is that they have no labour. It is impossible for anyone to do the work on a farm alone. The Minister of Lands will agree, because he is trying to provide labour for the farmers on the settlements. I do not, however, agree with the kind of work which is being given to these people, because it is so expensive that the people must work themselves to death just to pay wages. The Minister and the officials provide the labour, but the people must pay for it. The system of providing white labour will never be a success.

They are young lads who get 2s. a day.

I agree, but I was there myself at threshing time when a party of them arrived. The water was not too far from the machine, and after two loads of water had been transported the water carriers could rest for a bit, but they got 3s. 6d. per day. That kind of labour is not paying the farmers, and they cannot stand it. If the system is continued, some of the settlements will go under. The result of the system is that farmers will get nothing for their work. I do not wish to go into the matter further, because I shall be able to discuss it with the Minister later. Labour is the great difficulty to-day on the farm, and the more Government stops its introduction from beyond the Union, the greater will the difficulty be. At harvest time the difficulty is particularly great. I went to Basutoland myself to get natives, but one cannot get them any more. The more natives introduced the greater the demand for mealies, and the farmers will be benefited thereby. I now want to say a few wards to the Minister of Agriculture. I have received letters intimating that people are still being prosecuted under the locust regulations. I should like the Minister to go into the matter. I know of a case where inspectors came on a farm and were gone again in half an hour, and the farmer had to pay from £30 to £40 for the destruction of locusts. In connection with help which the Government gave to the farmers last year, I want to ask that the farmers should not be pressed too much. They Had years of drought and they find it difficult to make a living and so must be given a little time. The hon. member for Riversdale (Mr. Badenhorst) praised the Nationalist Government to the skies and said it had given £500,000 to the provinces for roads. But where does the amount come from ? He does not know, but says that the Government gives it. That is not so. The £3,000,000 which the Minister took, and from which the £500,000 comes, is the money which came from the Custodian of Enemy Property. The money was intended for other purposes, for redemption of debt and development of the country. Not everything is so fine as it seems. With reference to the abolition of the medicine tax, I heard to-day from someone that he would rather pay the duty than the licence. He makes less profit on patent medicines than the licence costs, the consequence being that the small shops in the villages are not now able to stock patent medicines. The hon. member should make himself acquainted with things before he speaks about them here. The Government itself feels that the excessive praise which he gives them is undesired and does more harm than good. I should like the expenditure to be cut down as much as possible. Last year it was £2,000,000 more, and this year it will again exceed the estiates by £700,000. Later, when difficult years come, the increase of the current debt will result in retrenchment right to left, and then the difficulties of the people will come.

Wait till they come.

We must not wait until we are in the mud, but should make provision beforehand.

Of course money must be spent every year for the development of the country. Last year we raised a loan of £10,000,000 and perhaps we shall have to raise another this year, but what I always insist upon is that expenditure on current administration should be kept as low as possible.

I desire to draw the attention of the Minister to the serious position into which the farming industry is drifting, especially in so far as that industry is dependent upon cattle raising. May I mention incidentally the remarkable speech which we had this afternoon from the hon. member for Liesbeek (Mr. Pearce) who came before us with the white sheet of penitence to explain his connection with a meat company which he has been instrumental in launching upon the consideration of the public of South Africa? The hon. member made a remarkable speech ; I believe one of his colleagues, the hon. member for Roodepoort (Mr. Mullineux), said that he had “enlightened the public.” I am sure the public will be enlightened to know the truth about this matter at long last, because for some considerable time the hon. member (Mr. Pearce) has been invited from various sources to explain how it comes about that he has issued a prospectus containing statements tantamount to a declaration that his company has the approval of the Board of Trade, though the Minister of Finance has given a denial to there being any truth in that declaration. He endeavoured this afternoon to make out that there was nothing in the prospectus which would lead one to infer that, but I should like to invite attention for one moment to the statement appearing in the hon. member’s prospectus. It reads—

Then without an intervening word the prospectus proceeds in block type to make this extraordinary statement—

Now, what can anyone who understands the meaning of plain English infer from this statement ? It means that an investigation into the proposals and schemes of the company was made by the Board of Trade, and that as a result of that investigation, the seal of approval of that Board was set upon this company. I faced the hon. gentleman with the enquiry as to whether the Board gave him the seal of its approval. He, forsooth, replied that I was not a competent person to ask such a question, because I was a shareholder in the Imperial Cold Storage, or one of its subsidiary companies. I denied that at the time, and I wish to say with all the emphasis at my command that there is not a vestige of truth in it ; no statement has ever been made in this House more empty of truth. The hon. member repeated that statement on a second occasion. One lacks words in which to describe the conduct of a member who takes refuge behind the rules of this House to make statements which he knows himself to be untrue. The hon. member has said he is a promoter of the company, and the prospectus states what the promoters are to receive! I should like to say that this hon. gentleman, whom one can only describe, after his performance this afternoon as a financial freak, is a man whose passion for his fellow-men is expressed in money terms by the fact that he and his fellow promoters propose to take from the shareholders £2,000 only in cash, and an additional £8,000 in shares. For what reason ? For this reason, and this reason only. His claim to be entitled to take a share of the £10,000 rests upon the cession to the shareholders of an option which he and his brother promoters hold, an option consisting of the right to buy assets amounting to £45,000. It is almost like adding insult to injury to take £10,000 from the shareholders for the priceless privilege of buying a property utterly unvouched for, which is put in at the mild figure of £45,000—a tannery to be used as a cold storage! It is almost as incngruous as the hon. member himself in this House. We are asked to believe that when this scheme was introduced to an admiring public that the hon. member considered he was doing a service to what he calls “co-operativism,” to the farmers of the country, and to the meat industry of South Africa. I venture to say that if any person in South Africa, upon the representations subscribed to by the hon. member for Liesbeek (Mr. Pearce) in this prospectus and printed here in large type, were fool enough to take shares in this company, that he could demand his money back on the ground of misrepresentation and, in such an event, I should not be surprised if the hon. member found himself obliged to face a very serious charge. The statements contained in this document spell nothing but misrepresentation of the most mischievous kind, and the hon. member has had the face to stand up in this House and endeavour to justify it. He has said that the hon. member for Newlands (Mr. Stuttaford) is in some way connected with a cold storage company and, therefore, unable to give an unbiassed opinion on this matter. I have the statement of the hon. member for Newlands that he does not hold a single share in the Imperial Cold Storage Company or any other meat company, and yet the hon. member for Liesbeek. Who has fathered a scheme of this sort, has the ineffable effrontery to come forward and abuse members of this House with statements that have not a vestige of truth in them. I can only hope that the hon. member will realize that there is some responsibility attaching to a member of Parliament, and will try in future to conform to that standard. That brings me to the question of the dairying industry in South Africa. The dairying industry of this country is suffering from severe depression. I am glad to see the Minister of Agriculture present, because I wish to put to him the desirability of having some different method of making use of the two very important divisions of his department, the dairying division and the Department of Economics and Markets. The one division—to my mind the more important—that is the dairying division— has a personnel of only seventeen, and an annual expenditure of only £11,000. The newer division has a personnel of 39 with an annual expenditure of £17,000. In that personnel we have eight economists, one senior economist, eleven inspectors, and three market officers. If these gentlemen were assisting in a practical way to improve the marketing of farm produce, I should not complain with regard to the disparity between the one division and the other, but from one’s experience of this division up to now, one would say the officials confine themselves largely to the preparation and issue of reports discussing the obvious and emphasizing the commonplace—things that we all know, and know to our cost, such as labour difficulties and the farmers’ inability to command a supply of labour at the right time, which are matters that have their origin and remedy in political action—matters of policy which should be dealt with by the Ministerial head of a department. The young men employed are doubtless very able, but they are employed in theoretical rather than practical matters. We have difficulties in our markets which have to do with the forming of rings, which call for the attention of men of experience and drive, determined to get to grips with the problem, and endeavour to work out a remedy. But, instead of this, we have this important department employed, to my mind, in ornamental high-brow work. I should like to invite the Minister’s attention to a pamphlet I have describing the remarkable progress of the dairy industry in New Zealand, which is headed “The Empire’s Dairy Farm.” “31,000 tons of dairy produce.” Let me cite one or two statements printed in block type—for a very different reason than that adopted by the hon. member for Liesbeek (Mr. Pearce)—

The story of the remarkable dairy expansion in New Zealand owes its origin to the enterprise and courage of one man. It is stated—

With the equipment at the disposal of the Minister, and with the determination which I am sure he has, this achievement should not be outside the Minister’s capacity. If only he would undertake to focus the energies of The divisions of his department in the right direction, and introduce one or two capable, experienced men from New Zealand, we should have most remarkable results. This development has taken place within an area in New Zealand of 150 miles in length by 60 miles in width, and we have suitable areas of equal productivity in South Africa which, if handled in a similar manner, would yield similar results. I agree with the hon. member for Umvoti (Mr. Deane) in regard to the inferior grade of cattle we have in this country and if the Minister of Agriculture would himself, or by deputy, visit every part of the country and do yeoman service in getting rid of the scrub bull, he would earn the gratitude of the progressive people, and be handed down to posterity as something of a hero, and certainly a very great benefactor to South Africa. The admiration which a certain quite numerous section of the community have for the Minister would extend to a much more numerous section, and for a different reason, and one that would reflect on the Minister very much more than the reason for which he is admired to-day by a section of the population. The Minister should endeavour to harness every kind of help to his aid. The consumption of milk in South Africa to-day is very much below what it should be, considering the population in the larger towns of the Union, and considerably below what good hygienic conditions require, and it is only by means of some kind of propaganda like that adopted in regard to fruit that the demand will increase. The slogan—

which we see endorsed on letters passing through the post should be adapted to milk, and one would like to see the young people in the schools and universities instructed and encouraged in every way to promote the slogan—

This is a matter of national concern, and one that would minister very greatly to the health and well-being of the community. I am glad the Minister of Railways has promised in the next revision of rates to deal with the question of the railway rate on the carriage of milk. I should like to urge a reduction as a matter of great moment to a large class of people who are dependent on dairying. Under present conditions, a dairy farmer sending milk in cans a distance of, say, 200 miles, is charged 3d. a gallon for his product, for which, during the summer months, he only gets 6d. a gallon. The Railway Administration in this instance consumes one-half of the dairyman’s substance. That is a very heavy burden on the production of milk, which the industry cannot stand under present conditions. The condensed milk factory at Donnybrook and the fresh milk preserving industry at Wanstead also deserve consideration—the railway rate on their products being considerably heavier than for milk carried in cans. These industries support a very large and increasing number of farmers in the southern portion of Natal and adjoining district of East Griqualand. The Minister of Finance has indicated his intention to place on the estimates the sum of £5,000 for the restoration of the workers’ hall at Benoni. I have no wish to rake up the embers of the past, but there is a very strong feeling that this is not the sort of action that we should have expected from the Minister of Finance, whose policy has been conditioned by one of fairness to all, and by recognition of the duty of the citizens to obey the law and not to raise their hands against established authority. The Benoni workers’ hall was the headquarters of a very dangerous revolutionary movement that resulted in serious loss of life at Johannesburg, and, but for the inflammatory propaganda that issued from that hall, the unfortunate events of 1922 would never have taken on their final form. The Minister should regard the loss of the workers’ hall as an item of “fair wear and tear.” When one considers the inflammatory propaganda that was focussed from that centre, it would have been far better for the Minister to have observed an attitude of detachment, and to have declined to authorize an expenditure which has provoked a considerable amount of feeling amongst those who Hold that the whole of that movement on the Rand aimed at the overthrow of established authority. It savours of putting a premium on disorder and anarchy. Let me contrast the Minister’s lenient attitude in this matter with his attitude in another matter of expenditure. When the late Government was in power, the agricultural society in my constituency applied for a grant in aid of the improvements it desired to effect, on the £ for £ principle.

On the motion of Mr. Marwick, debate adjourned ; to be resumed to-morrow.