I would like to ask the Minister of Finance when he is going to lay on the Table the Loan Estimates for this year. Time is getting on, and I think it is about time that we had them.

I hope shortly.

stated that His Excellency the Governor-General had requested that a message under section 58 of the South Africa Act convening a joint silting of both Houses of Parliament for the purpose of considering the Mines and Works Act, 1911, Amendment Bill, be conveyed to this House, and announced that he was the bearer of the message.

The Prime Minister handed the message to Mr. Speaker.

read the message as follows:

Message from His Excellency the Governor-General to both Houses of Parliament—

I move—

Why don’t you say all industries?

I say some of the proposals are revenue proposals, not in order to give the Treasury more revenue, but to safeguard the revenue already assigned by the tariff passed last year where diffiulties have arisen in regard to administration, but the principal recommendations are to give effect to the Government’s policy of protection. Some of the more important of these proposals have already been discussed on a former occasion, and I gave the House certain information in regard to our proposals in connection therewith. Notably the wheat and flour proposals, the sugar proposals, and the increased taxation on potable spirits. All these details might perhaps also be more conveniently discussed when we are in committee, but perhaps it is advisable that even at this stage I should briefly give the House certain particulars in regard to the more important of these items. Let me remind the House that nearly all these important proposals have been dealt with, and ably and exhaustively dealt with, in the report of the Board of Trade and Industries which I have laid on the Table for the information of hon. member's, and which the press of the country has also been good enough to publish for the information of the general public. So I think generally the grounds on which these recommendations are made have been made available to the public in the best possible manner. Let me proceed to deal with some of the specific proposals. The first one we get is tariff item No. 2, Yeast, where it is proposed to increase the duty of 20 per cent. to a maximum duty of 3d. per lb. Here we have certain existing industries that use considerable quantities of South African products in the shape of raw materials, and which also give employment to a considerable number of European workmen. But there is frankly another consideration. Hon. members will know that during the past year or more there have been abnormal importations of this product into the country, mostly from the Continent, which, owing to its cheapness, has undoubtedly resulted in a good deal of illicit brewing. This will tend to decrease the heavy importation of this stuff from overseas which has that result. The second item is wheat, and in connection therewith we might conveniently discuss the proposals in regard to flour, both being commodities which are used to produce an article which is consumed by the people of this country, and that is bread. As I stated before, these proposals have been in force for some time now, and they have not had the effect of increasing the price of bread, and they should not do so, for the simple reason that we are not disturbing the actual price paid for flour, which controls the price of bread in the country. As hon. members are aware, we do not produce a sufficient quantity of wheat in the country to provide for the requirements of our people. Consequently, our home supplies have to be augmented by extensive importations from overseas. These in the past have been in the shape of flour and wheat. We have in the past deliberately adopted a policy of encouraging the importation of wheat to encourage our own milling industry, which is an important industry, but for a long time it has been felt, and I think if has been admitted, that the ratio which has existed in the past in the duty between wheat and flour was rather ill-balanced. The board investigated the matter very fully, and came to the conclusion that it would be possible to put forward proposals to the Government—which we have accepted—which would have the effect of giving increased protection to our wheat fanners, a protection which is very badly needed, and an increased protection which fortunately would not have the result of increasing the price of bread. I submit we have achieved that in the proposals which are now before the House, and which I hope will be translated into legislation afterwards in order to sufficiently safeguard the various interests concerned. I want to give again to hon. members the position as we find it at present. At present, besides our ad valorem duties, we are also entitled under our legislation to levy certain dumping duties, that is, duties to be levied under circumstances where the product is sold in the country of origin at a price above that at which it is sold here to the consumers in this country. That is broadly the way to put it so that it can be understood by the man in the street. The result of that has been in the past we have had no dumping duty levied on wheat, but dumping duties have been levied on flour, namely, on Australian flour, which made up about 80 per cent. of our total importations. The average of these dumping duties for the last few years amounted to about 7d. per 100 lbs. But of course, as hon. members know, it is very difficult to administer these dumping laws, and especially in regard to wheat and flour. There are various considerations, and as a result very often it has happened that these duties have been evaded, with the result, very often, that we have not been able to collect the duty to the actual extent possible in dumping, but, as we have been able to calculate it, I can say that these duties have averaged, in the past, about 7d. per 100 lbs. on flour, as far as the Australian importations are concerned. The other 20 per cent. from Canada do not pay any dumping duties. To give the wheat farmers that increased protection on wheat, the board has proposed that we should replace the existing dumping duty—not the dumping duty we may collect in the future, but those which have been collected in the past—by an ad valorem duty put on the existing duty on flour, with the result that we propose to increase the maximum duty on flour by 5d. per 100 lbs. As hon. members know, the maximum duties are payable by countries other than the Dominions, the Dominions getting preference. But we propose to make provision in the Bill which will come forward later on that if extraordinary dumping takes place— that is, dumping out of the common, and to which we are ordinarily not accustomed— dumping over and above that which has been taking place in the past, it shall be possible for the board to review the position to bring into operation the ordinary dumping laws. That the farmer must get his protection as far as flour is concerned is what we are after, and you can do it in this way only. With wheat we propose to give him 5d. Here, again, the increase in the price of wheat will not have the effect of increasing the price of bread, because this is regulated by the price of imported flour. It is still a payable proposition for the miller to continue to import wheat, and if you increase the price of Australian wheat you increase the production of wheat in this country, and the farmer here gets a better price for his wheat. It has the effect, I am informed, of slightly increasing the price for his wheat.

He is getting a very good price—26s. 6d.

I do not think farmers will agree that it is a very good price, and such a very remunerative proposition. I come to the next item—15b—malt barley. The present duty is 3s. per 100 lbs. and we propose to increase it to 4s. Here, again, it is an increase of duty in order to protect an agricultural industry more especially. There are agriculturists in the Western Province who produce this barley. Local brewers have facilities for brewing the South African product, and the board has agreed that we should increase the protection to the extent we propose in the motion now before the House. Then we come to macaroni There, also, it is a protective duty in order to give protection to an existing industry. It is proposed to raise it from 20 per cent. to 30 per cent.

How many factories are there?

I think there are two. Then we come to sugar. The present protection is 4s. 6d. for 100 lbs. and we propose to make provision for a suspended duty of 3s. 6d per 100 lbs. only to be imposed on the fulfilment of certain definite conditions. In regard to this sugar question, here, again, we have, I submit, a very valuable and exhaustive report from the Board of Trade and Industries. Members who have read the report will all agree that the subject has been exhaustively investigated, and very valuable information placed at the disposal of the country, to enable it to judge of the merits of this particular and very thorny question. Generally speaking, the Government has come to the conclusion that, provided we can protect our consumers from exploitation, and that they shall not be called upon to pay more for their sugar than they are paying at present, it is worth our while to take steps to preserve this industry for this country, and especially preserve our South African market for sugar which we ourselves grow in this country. That is an important consideration. Conditions which we expect to be fulfilled before this suspended duty will become operative, are these. In the first place, I may say, we have placed the report at the disposal of the various interests concerned in the industry. We have told them—

They must confer with each other and come to a reasonable arrangement. One is, that the agreement between the planters and the millers should be revised, and a more equitable arrangement should be arrived at. I think it will be generally admitted that, in the interests of the industry as a whole, these two parties should come to a mutually satisfactory arrangement if they want to see the industry preserved for both parties. The second proposal is submitted in order to protect the public ; namely, we have told the parties that they must voluntarily agree to the Government taking steps to fix, by legislation, the retail price of sugar to the consumer in this country. That is nothing out of the common. We have had that in the past, when attempts have been made to regulate the price of sugar. It was done in 1913, and in 1922.

Why not fix the price of bread?

This matter of price fixing will be possible only in case of a localized industry, where the parties have agreed to this thing ; and not a commodity like bread, where you have various interests all over the country. Here you have the parties themselves who voluntarily are prepared to submit to the regulation of the price of their output. The Government is justified in agreeing to the proposal, and in a Bill which will be introduced later, power is given to the Governor-General by proclamation to fix the retail price of sugar at the ports. We are not attempting to do what was done previously, and fix the price all over the country. We found there were difficulties at the time to bring that into operation ; and, therefore, we shall only deal with the prices to be charged at the coast towns. The prices inland will be regulated by the additional transport expenses, etc., to the inland centres. I do not think the public could be handicapped or prejudiced through our not fixing the prices inland, because if any inland centre should overcharge it would be open to the people there to get up sugar from the coastal towns. The other condition relates, not to the ordinary consumer, but to those industries referred to by the hon. member for Cape Town (Central) (Mr. Jagger) the other day, that is to people who preserve our fruit and make jam etc., and also the confectionery people. The position is that, at the present, there is an agreement between these industries whereby certain reduced prices are paid for sugar for those industries.

Can you give us the prices?

I understand the price is regulated by the price at which the Java sugar could be imported. It is adjusted automatically according to that. I understand that this is a very satisfactory arrangement to both parties and, what we want to see, is that that agreement is continued so that those industries are properly protected both as regards the confectionery and the jam people. If those conditions are satisfactorily settled then the board will be empowered—in the case of importations into this country of sugar, to compete with our own article produced here and in order to preserve the article imported for our own producer—to impose that additional suspended duty.

What are the prospects that this condition will be accepted?

I understand the sugar industry are considering the report, and as far as I know there is every prospect that they will come to a voluntary agreement, and will ask the Government to take the necessary steps to give effect to this recommendation.

They will agree and fleece the public.

No, because these proposals contemplate that the public shall not pay a fraction more than they are paying now. The maximum price will be based on the price which has been charged for sugar in March, at the principal coast towns. I submit that this is reasonable.

At the ports?

Yes, and the other prices will come down accordingly. We did not try to fix the prices inland, because one place is further away from where the article is produced, and the transportation charges are accordingly more.

Who is going to fix the price per 100 lbs.

Certainly not the consumer Probably this will keep out the sugar from oversea. We are sending sugar out of the country, and what we are trying to achieve is not that this extra price should be paid, but that the article should be kept out of the country altogether. We want the people in the country to buy our own products. Then we come to perfumed spirits. There is an increase there to support local manufacture of eau de Cologne and similar things, and partly to equalize the duty on non-spirituous perfumery. In regard to potable spirits, we have decreased that. Our proposals are that the prices of other potable spirits, whisky, gin, randy, etc., will be increased by 7s. 6d. per Imperial gallon or roughly about 12s. 6d. per case. I explained formerly how that works out in relation to the excise duty paid overseas, if you make the necessary adjustments as far as proof spirit is concerned. Then I come to another important item, ready-made men’s clothing. Here, again, the proposals are in the interests of the local industry. Hon. members who have studied the report of the board will see the great scope which there is in this country as far as the development of this particular industry is concerned. The proposal of the board was that the existing duty of 15 per cent. should be increased to 25 per cent. Well, the Government could not go so far. What we have accepted is that the duty be increased to 20 per cent., but, in addition, we make provision for a decrease in the duty on cotton piece goods of 2½ per cent. This will give additional protection to the ready-made clothing industry inasmuch as it will enable them to get in their raw material which they use at a reduced price.

What about woollen piece goods?

They were reduced last year. That was the complaint that it was not given to cotton goods and, whereas a large proportion of the material these people use is a mixture we now propose to decrease the duty on that material. That will, of course, not only assist this industry, but also your ordinary housewife who makes her own clothing and the clothing of the family circle. Until such time as this protection will become effective or wholly effective, it will, of course, mean an increased revenue, but that will be offset by a considerable loss in revenue in connection with the proposal to decrease the duty on cotton piece goods. The one duty will be offset by the other. Hon. members will, of course, see that it will not apply to all classes of ready-made clothing. Certain overcoats and under-clothing, etc., are excluded from this increased protection. Then we get ladies’ trimmed hats. The duty has been increased from 20 to 30 per cent. also in order to protect the millinery industry. I think it will also act in the interests of economy. It will be very good if we can save the ladies from purchasing these most expensive hats which are imported. But hon. members will see in the definition of trimming we have made it so that girls’ plain straw hats with a band only, and similar school headgear, are excluded.

You should have left hats trimmed with ostrich feathers.

We prefer to trim them with ostrich feathers here by our own milliners.

You should have let them in free.

Do you think so? Then we come to the proposals to assist the engineering industry. Here hon. members will see that the board made very important proposals. They proposed that we should select quite a large number of items for this protection but the Government did not find itself able at this stage to accept all these proposals and only a few have been selected where we think this protection could reasonably be given at the present stage. The items selected have been buckets, skips, tubs, etc., and provision is made for a suspended duty of 15 per cent. to be imposed when the industry proved that it is able to manufacture these articles at a reasonable price and of a reasonable quality. We have selected these articles because we are convinced that the prices to the purchaser will not be increased. I explained the position the other day in regard to rock drill spares which are used by the mining industry, one of our primary industries, which we want to help as much as possible, and not to increase the working cost if we can possibly avoid doing so, but we are convinced that these higher duties will not entail an increased price to the industry.

What convinced you?

The assurances of the people who are manufacturing these articles that they will reduce the price. Then we have been told by the mining industry that if these people overcharge it will be possible for the mines to supply themselves at a cheaper price.

Why don’t you make the same condition with regard to sugar?

Because you cannot apply this to an article like sugar. It is always open to the Government if it finds that any industry takes advantage of the protection afforded it, to take certam steps which will revise the position.

Do buckets include milk-cans?

No, they were dealt with last year when we protected the industry at East London, which was supplying milk-cans at a very satisfactory price. The duty on bucket skips, etc., is a suspended one, and will not come into operation now. Another item that has caused considerable discussion is No. 103—spare parts of engines and motors for fishing and whaling boats and mercantile marine purposes, and of trawl and whaling winches. Until 1924 this marine engineering industry had protection as far as concerned the manufacture of spare parts for engines. When we came into power we introduced legislation to exempt this particular industry from certain duties, and very considerable concessions were given in regard to the engines themselves. But when you admit a machine the spare parts are automatically admitted at the same rate. That took away from the engineers the protection they had enjoyed up till 1924. What we propose is simply to restore the protection which was taken away last year. During the war the marine engineering firms actually did supply all the spare parts that were required, and they also did so for a considerable period after the war.

What about agricultural machinery?

Last year we exempted agricultural machinery practically altogether. It is unfair to complain that the Government is not sympathetic to the fishing industry. In 1924-’25 the proposals we made had the effect of letting in articles required by this industry at a low rate of duty or free. I am informed that there is very little prospect of prices being increased, and if they are it will be up to the board to take steps to prevent it. As to item 108 (e) barrels for miniature rifles and for single-barrelled shot guns of a calibre not exceeding .420, this is a customs adjustment. Last year we did not make provision for the barrels of miniature rifles, and we are now simply bringing them into line with ordinary rifles. Item 116, miners’ and bucket lamps, acetylene, is an increased protection caused by competition from Germany at present. The Item, lamp-shades, electric, not enamelled, is in an amendment to clarify the existing position. In committee I want to introduce an amendment to add to this lampshades and reflectors of glass and metal to keep them at the persent duty. The customs department were obliged to admit these articles at the 5 per cent.—free rate. We propose to definitely lay down that they shall come in at that rate. With regard to the machinery for the conversion of electric power, the duty is increased from 3 per cent. to 5 per cent., also as the result of difficulties which have arisen through the interpretation of the tariff. It was contended that these electric motors did not transform electric but mechanical power, and under that interpretation should come in at the rate applicable to ordinary mining machinery. We come now to electrical batteries. Here we had an anomalous position in that batteries used for different purposes came in at different rates. It is impossible for the Customs Department to follow the use to which these various batteries are put and therefore, what the Board has done here is to lay down a more or less fixed rate of duty which shall be applicable to all kinds of batteries. The duty will have the result, I am informed, of encouraging the erection of factories in this country to manufacture these batteries.

One—an American concern. They will take it out of you, that is all.

We will be glad to get even the Americans to have the industry here. In any case it is an adjustment of the existing duties which range from 3 to 20 per cent. We propose to make them now 10 to 15 per cent. Precious metals and ingots: It is proposed to levy the duty mentioned on these articles which are imported mostly, I understand, by dentists and jewellers. Other metals are free, but under the existing classification they could also bring in the precious metals. We do not see the necessity for that.

Is the gold industry asking for protection?

These things, I understand, are in ingots and they are used here, but there is no reason why they should not bear an increased duty. This is one of the eases where if people want to have their teeth filled with gold, then let them pay for it. Enamelled metal sheets are also industrial. I wish to give additional protection to an existing factory. As to motor-car chassis, I have explained on a previous occasion. We propose to have an intermediate duty between the 10 and 15 per cent. on chassis that are imported in connection with bodies partly to be built here partly from raw materials found here and partly from manufactured raw materials imported into the country. I explained on a previous occasion that if we had to force these people to build the whole body here altogether from South African raw materials, it would entail the erection of very expensive machinery which is perhaps not warranted by the demand in this country, and, therefore, I propose to extend the concession given last year by having an intermediate duty. We require them to perform a very considerable part of the bodybuilding in this country in order to get the concession.

They can simply get the various parts and put them together here.

No, it is intended to allow them to import steel linings, but we have provided that a considerable part of the work will still have to be performed in the country. Our difficulty will be this, representations have been made that we are not going far enough and that it will still be very difficult under these proposals for the people in this industry to come here and do what they propose doing, but I do not find myself justified in giving further concessions. I hope this concession will have the effect of getting them not only to do the mere assembling, but also a considerable portion of the actual body building in this country. Steam wagons and parts: Here we propose to bring the steam wagon into line with the motor lorry, charabanc and motor truck. These at present pay 20 per cent. duty, whereas the steam wagon is free. We now propose to have a duty of 20 per cent. on the steam wagon. In the first place we do not see why the steam wagon should be in a privileged position over against the lorry, but this will also enable us to carry out our policy in connection with the steam wagon of forcing the people to build the bodies here. Then we come to rivetted iron pipes, etc. These are all in connection with the engineering industry. The same remarks apply to this item as apply to the case of rock drill spares and structural steelwork. Earthenware and stoneware: These proposals are designed to give protection to the clay industry. At Olifantsfontein there is a well-equipped factory that specializes in the manufacture of these various articles. The board has examined the position there and finds that, if protection is given, the industry there bids fair to expand and provide work for a good number of people. They use South African raw materials, turn out a satisfactory product, and the board has come to the conclusion that it will be justified in recommending and the House in adopting protection for this industry.

Is there any guarantee about price?

No, this is a case of suspended duties. They will only be imposed provided that the industry satisfies the board in regard to the quality and price of the article which is turned out. Alumina-ferric and aluminium sulphate in bulk: This is also industrial. It is manufactured in South Africa from raw materials by the S.A. Explosives and Industries, Ltd. We propose to increase the protection by another 1s. 6d. This is also done as a result of very careful investigation by the board. The board has come to the conclusion that in order to enable the industry to sell its product in competition with the imported article, it is necessary to have this protection. This protection will take the place of the existing dumping duties, which will be taken off.

The protection they have is about 70 per cent.

I understand that even this will be insufficient, unless my hon. friend the Minister of Railways agrees to give them certain benefits in the way of railway rates to the coast. The board says that the success of this particular industry will depend on this increased protection and also certain railway benefits so far as lower railway rates are concerned to enable them to compete in the coast towns with the imported article.

Where is this industry?

At the other side of Pretoria, at Hammanskraal. Brushes: The rate of duty is increased on certain types of brushware.

Does that include stable brooms, the articles that the farmer uses?

I am not sure on that point. I will find that out. Carpet brushes are at present protected, but we wish to extent that to all other kinds of brushes, with the exception of paint brushes and brushes for toilet use.

How many factories are there?

I cannot say at present, but I am informed there is a local industry here. Paper bags: We propose to increase the existing protection from 1¼d.to 1½. per lb.

Why was not the 1¼d. sufficient?

I am informed that the existing competition is such that they cannot compete successfully, and that they must have increased protection.

It is a bastard industry.

Pocket books: This is merely a customs adjustment. In regard to protection for printing generally, hon. members will see from the schedules which are laid on the Table that there are extensive decreases in connection with the printing industry. Catalogues of foreign firms: These were formerly admitted free, and they are now raised to 40 per cent., except in the case of catalogues sent to particular firms, merchants, etc. This increased duty will apply to catalogues that are broadcasted by foreign merchants.

The wording of your resolution is—

not sent to merchants. The majority of these come in cases.

We do not want them to come in in cases. We want the merchant to get the catalogues that he gets for his indenting. We come to advertising samples. They were formerly admitted free, as they were regarded as being of no commercial value, but they really are, in some cases, of commercial value, and they will now be taxed as advertising matter. We now come to Ruberoid. This is to be provided for, because we found that the duty on shingles, tiles, etc., was being evaded by the importation of this article, and in order to bring it into line provision is now made for felt Ruberoid to come in under this duty. I think I have dealt with nearly all the items which will entail increases of duty, and when the Bill comes forward hon. members will find that provision is made for the decreases, and also for including in the Bill provision for the free admission of raw material in connection with certain industries.

seconded.

I would like to join in the eulogy of the Minister of the Board of Trade and Industries. Had the Government adopted all the recommendations of the board, I should have got up with great diffidence to criticize the Minister, for fear that I should be told that while I might know my business as a diamond merchant, I had no right to set up my opinions against those of the board, composed of experts. But when I found that the Government accepted only a few of the board’s opinions, and refused to accept a long list of recommendations, I realized that the Government itself has criticized the board, and that in criticizing the Government I am really defending the board. In these new tariffs I presume the Minister intends to carry out the policy which he has enunciated as the aim and policy of the Government. The Minister, speaking in reply to the debate on the Part Appropriation Bill on 12th March last, referred to the report of the Economic and Wage Commission, and was rather wroth about it. He said that whatever the commission reported, the Government was committed to the policy of protection and of seeing that more civilized labour was employed, and, having deliberately embarked upon that policy, would continue on it until facts had proved it wrong. If the Minister meant he would like to see more industries established and more work being performed so as to widen the field of employment for the youth of our country, then I am heartily in agreement with the Minister, and would say that is the policy of our party as well, but not protection as an aim in itself, and not civilized labour in the sense that the ideal is realized by placing poor whites in positions now occupied by coloured persons or natives. The problem is not whether A or B or C shall do the work, but that there shall be work for A+B+C. Where we differ from the Government is that we see no solution in civilized labour on the railways by the replacement of coloured workers and natives. When we talk of more scope for employment, we desire, when our children leave school, that suitable work should be available for them. I am quite sure that we as parents, who educate our children to the best of our means and ability, do not look forward to employment for them in the railway service in the capacities and with the pay that it is capable of giving to people who replace coloured or natives. The Minister need not have fallen foul of the report of the Economic Commission, because, although very rightly it sounds a note of warning against indiscriminate protection, it does not conflict at all with the aims of his policy. There are three references in the report which appeal to me most, and which should carefully be weighed in considering any tariff policy to be imposed. The majority report points out that as the revenue, per head, in agriculture is much lower than in any other branch of industry, and as it is the fundamental industry of the country, the greatest care should be exercised to ensure that a gain to another section of industry is not made at the expense of agriculture. That I subscribe to in the fullest sense, and in the light of this recommendation the Ministers’ proposals should be examined to see how they affect this fundamental industry in South Africa. The commission also sounded a note of warning against such a protection policy, the effect of which is to divert labour and capital from industries which have proved their efficiency in the face of world competition, on to industries which produce a smaller quantity of wealth and which are not soundly established. This clearly refers to the other primary industry, namely, mining. The report also points out that the developing of manufacturing industries by means of protection will have no effect upon the employment of white labour and capital, because it simply withdraws them from one industry to another. If it handicaps other industries by the additional cost it imposes upon them, it may effect a net reduction in the openings for white employment. We should examine these tariff proposals to see how they affect our primary industries. The Minister spoke of the patriotism of the farmers which would make them willing to bear extra burdens, but if it is shown that the patriotism of the farmers is called on uselessly, that it is unnecessary ; if that could be proved, then I think it was wrong to make use of the patriotism of the farmers for this purpose. Again, we should examine the proposals very carefully to see whether the duties imposed handicap civilized labour. I have attempted to investigate and enquire how the duties now proposed and the customs policy which we are pursuing affect the primary industries and civilized labour. The information was very difficult to obtain, because the reports of the Board of Trade are not always easily available and are often published six months or a year after the event, and because there is a complete lack of certain essential statistics which ought to be compiled, and because there is usually unreasonably long delay in issuing many Government reports and returns. I enlisted the services of an economist of some repute, and I got my staff to help me, and while I do not ask the House to accept my figures as finally correct, I do submit that I have taken such care with them that they should be taken as an honest attempt towards solving this problem. For this reason I ask the House to accept my figures for the time being until we have the report of a commission or committee of enquiry which, I think, should be appointed at once to enquire into this important matter. As the result of my enquiry, I found the most extraordinary and alarming position which I submit merits the attention of the House. I found that the burden due directly and indirectly to the customs duties borne respectively by artizans, farmers and natives in European employ (taking as the basis, the list of necessities of the family budget of the workman, as accepted by the Cost of Living Committee) is as follows: The average artizan bears no less than £50 a year. From the average farmer we take no less than £25 a year, but from the average natives—I mean the native in European employ—the so-called uncivilized labour—we take only £2 12s. 3d. The burden of customs taxation on agriculture could be estimated, perhaps, in the following manner. According to the census of 1921, there are 115,185 farmers, who employ, or have dependent upon them, 48,647 other European agriculturalists, and for every two farmers there are roughly five non-European servants. On the basis of the Cost of Living Committee’s family budget, assuming that the farmer pays half what the artizan pays, each farmer takes responsibility for indirect burdens for himself and family and for his employees, to the extent of £42 6s. 9d. per annum. According to the agricultural census of 1923, the total value of agricultural and pastoral produce on the farms was £64,668,924 in that year, which works out at about £550 per farmer, and we find that the farmer would pay something like 8 per cent. of his gross income in indirect burden. That is a cruel and crushing burden, none the less because farmers in general are not aware of it. It is a very colossal burden for an industry which is so important to this country, and on which the future of the country depends. The same thing might be put in another way. It might be estimated that, at most, not more than one-third of the gross income of the farmer represents profits and payments for the farmer’s own services. This means that the average farmer’s income is under £185 per year, an appalling result which is pretty well borne out by the figures given by General Kemp to the hon. member for Uitenhage (Mr. Bates) in regard to the scheme of compulsory insurance in February last. On this net income of £185 a year the farmer, on the minimum scale of civilized living, bears about £25 in customs taxation or 2s. 8d. in the £; and this, when the Government has decided that no one who receives less than £400 a year shall pay any income tax at all. £400 is well over twice the income of the average farmer, who has to pay 2s. 8d. in the £. There are three points which suggest themselves to me with reference to the present system of indirect taxation, namely: Firstly, a system of indirect taxation which imposes a burden of £50 a year on white workmen, as against £2 12s. 3d. on natives, or nearly twenty to one, is a heavy handicap on civilized labour, and the prolific parent of unemployment among Europeans. Secondly, if customs duties and indirect taxation generally could be got rid of to some extent, costs of production could be reduced by at least 7½ per cent. in our primary industries. Many concerns, which cannot now be worked, would then become profitable, and the increase in the yield of the existing direct taxes would go far to make good the loss in revenue, while the net increase in national wealth might be enormous, Thirdly, in some cases the standard of real wages, i.e., remuneration in terms of commodities and services, ought to be and could be raised. This appears to be particularly the case in regard to our farmers. We say we want more civilized labour in the Union, but is it reasonable to expect that, under a system which places the burden of £50 on the European civilized workman and only £2 10s. on the native? A handicap of something like twenty to one is such as to frustrate the very thing we are aiming at. If that heavy burden of indirect taxation on the farmers could be removed, the development of farming in South Africa would be such that all Europeans, who desire to go on the farms, could probably easily be employed, and more Europeans would return to the land. I think I have made out a case that an enquiry should be made really to see how this policy of taxing the artizan and a primary industry like farming is working, and whether we are really wise and succeeding in our aim to preserve European civilization in South Africa. I do believe we are moving much too fast, and that we are too ready to ask for protection. The Board of Trade seems to be putting itself in the place of a fairy godmother to any person who wants to start an industry in South Africa, whether it is a real industry or not. The board says—

It does not even wait for people to ask, which in most cases they are only too ready to do without justification. I do not say this without my book. I know of a case, which I shall refer to later on in committee, where this has taken place. I have spoken so frequently of the gold mining industry that I shall try to be brief. The gold mines bear an enormous amount of indirect burdens. After all, it is a primary industry on which 250,000 Europeans and 1,000,000 natives depend directly and indirectly and it is a very important industry to South Africa. It is the last thing I would suggest that the gold mining industry as such should pay less taxation. If the indirect burdens are reduced a greater burden of direct taxation may, if found necessary, be imposed. It is much better to put a tax on profits, because that cannot ruin any man. If a man has to pay part of his profit he, at any rate, has the rest of the profit for himself. If you tax indirectly an industry like the gold mining industry, you throw an equal burden on both the mines which can, and the mines which cannot, afford it. The tax on rich ore is then as high as that of poor ore. The report of the departmental committee of the 20th January, 1925, on the mineral resources of the Union, pointed out the precarious position of certain of the gold mines and that certain of these mines were nearing their end. The report also stated that the taxation of the gold mining industry, as well as of other minerals, should be so adjusted as not to increase working costs, but only to fall upon the net revenue obtained. This allows the lowest grade ore to be worked, since employment and expenditure are practically proportionate to tonnage of ore crushed and not to its value. If you want to preserve the industry you must help it and not take an undue amount in railway services and other indirect burdens. You must charge them only for services rendered, and then tax them directly on profits. In that direction you will get many more Europeans and coloured people— citizens of the Union—lucrative and suitable employment. If the Government were to change its present policy of fostering certain secondary industries at the cost of the primary industries —farming and mining—and were to follow a policy of really fostering those primary industries then, in the case of mining, a considerable reduction in costs could take place. Assume, for instance, a reduction of something like 4s. per ton, say from 19s. to 15s. per ton. and the results would be amazing. 150,000,000 tons, at present unpayable, would be brought into the payable zone—an increase of one-third in the present scope of the industry ; £130,000,000 of additional wealth would be created, of which probably about £100,000,000 would remain in the Union. There would be additional European employment in the Union to the extent which could be expressed by saying that additional employment would be provided for 5,000 Europeans for 20 years and a proportionate number of non-Europeans. By a bounty system we can get as many industries and workshops established as by tariffs, and we would not injure our primary industries. The total customs revenue is about £9,000,000 per annum and, as 75 per cent, of the national wealth is produced by the agricultural and mining industries, these primary producers have ultimately to pay most of this enormous burden, although in the first instance it falls on the consumer. If these primary industries are handicapped, the result is the unemployment that exists in our towns. I will not deal with millinery and the expensive hats which ladies buy nowadays, because Mrs. Havenga will probably deal with that problem when the Minister gets home to-night. But there are such items as wheat, flour and sugar which are the necessary food of the people. I believe it would be much more satisfactory to assist these by means of bounties. I agree with the Minister that the country must make sacrifices to protect the sugar industry of Natal, but I do not think the best way is by means of protective duties. Some of the suspended duties apply to kinds of sugar which cannot be produced in South Africa because the demand is so small. Is that not putting an additional expense on the people who use it? While protection may justify itself in certain cases, its operation generally must be very carefully watched, because its effect in many cases is to give no permanent benefit at all to the industry sought to be protected. Take the case of wheat for example. Wheat lands are sold at about ten times the net annual revenue, and the effect of protection on wheat is to increase this revenue and, therefore, the purchase value of wheat farms. The first generation of owners is therefore enabled to sell at an enhanced price, but once they have sold the farms, the new owners are in no better position than the farmer owners were before protection was imposed, except that their gross income is larger by the amount which they have to pay in interest on the enhanced value of their land. With regard to rock-drill spares there are people in England. Scotland and America who, at big expense, have for years carried out, and still are carrying out, research work for the improvement of rock drills. It is due to their efforts that we have the present very highly efficient rock drills, which have been the salvation of the mining industry because without them many of the low grade mines, now working, would un-doubtedly have ceased operations long ago. These people rightly look to the sale of rock-drill spares as a natural way to recompense themselves for the heavy outlay involved in carrying out these valuable experiments, which no manufacturing concern in this country could carry out as well.

Let them come and establish the industry here and supply us.

If the result is that the price of rock-drill spares is increased, which is bound to follow the imposition of the duty, the Minister particularly hits those mines which are not making a profit. The position of low grade mines has not been so acute in recent years, but now this new burden is being imposed upon them. The position is that local people began to manufacture spares and made the simple parts. The Minister puts on a duty of 17 per cent. which taxes both the high grade and low grade mines equally. I think it is a most improper tax. He will help to make unpayable the very mines which buy the product of the local manufacturer. The very people themselves who manufacture these rock drills in the Union did not ask for this protection, I am informed. Some of the smaller ones may have asked but I have a letter from the biggest manufacturer of engineering spares in the Union which states that the Board of Trade did not consult him. He considers these duties will injure his business and would be very pleased if even now they are removed. I hope the Minister will see that these duties are removed even at this juncture. As to the mining industry starting its own shops and manufacturing its own rock drill spares, it would also have to carry on research work, because if we do not improve we go backward. I wonder how popular the mining industry would be if it began this business and knocked out of the market the local manufacturers of rock drill spares. The people who import rock drill spares have already notified us that they will charge more. The Minister does not achieve his object at all by protecting the manufacturers of rock drill spares which is at best a bastard industry. With regard to the readymade clothing industry and the manufacture of clothes in South Africa, the tendency of the Government’s policy appears to be in direct opposition to its intention to encourage civilized labour. Many more coloured and Asiatics are employed in this industry than a few months ago. The effect of the protection has not been an increased amount of civilized labour, which is one of the objects of the Minister, but an increase of coloured people, Indians and natives employed. The increase amongst the Asiatics has been particularly large. Something like £2,000,000 of clothing is imported and it is not possible quickly to set up a local industry to manufacture this amount. It is the artizan and the farmer who are going to suffer. I hope the Minister will see his way to abandon that duty also. I know very well the Government have their majority, and having once laid down their policy, which they think will protect civilized labour, naturally they will not accept what I suggest, but for all that I hope that the Minister will be convinced by the facts I have shown and by the few figures I have given, that an enquiry is necessary. All the figures on which my conclusions are based are at the disposal of the Government and the Board of Trade. I hope, they will convince him that before we continue this policy of giving protection whether it is required or not, and giving protection to secondary industries to the prejudice of the primary industries, a full enquiry should take place as to how our system does affect the primary industries in this country and whether it handicaps them. I agree with the part of the report of the Economic Commission which states that farming and mining are the backbone of the economic life of this country, and nothing should be done to injure them. To give you another illustration of the effect of the policy. We put on dumping duties and tariffs for protection purposes in the Union and these apply automatically in the mandated territory of South-West Africa. Will the Minister be surprised when I say that the Consolidated Diamond Mines of South-West Africa, Limited, during the last year, in providing additional equipment for the production of diamonds—on the revenue from which the whole of the mandated territory depends—paid no less than £50,000 in customs duties when quite clearly there is no prospect of establishing a manufacturing industry there?

What was that on? Give instances of the duty.

I cannot at the moment but I will supply them to the Minister.

Surely when you make a statement like that you should be able to substantiate it.

All my figures are at the disposal of the Minister. It was only this morning that I went through the annual balance sheet and chairman’s speech, from which I obtained the information about the £50,000, customs duties on plant and equipment for the company in South-West Africa. The Minister has said he will reduce the duties on raw material required for production. Why then should we pay? We cannot build a Chinese wall around the Union, and therefore we ought to watch what happens in other parts of the country. I have recently visited northern Rhodesia and find that the cost of living there is cheaper than in the Union. Would the Minister be surprised to know that the cost of living and the cost of mining is cheaper in northern Rhodesia and the Congo with enormous transport difficulties and distance from the sea than in the Union? What the Minister is doing by the policy which he is pursuing is to drive away capital, which would be employed in mining in the Union, to other parts of Africa. Not that I am against opening up the interior, but it cannot be a good thing that capital which ordinarily could be used in the Union to open up new mines, and replace wasting mines and create new employment, should through customs duties be driven away from the Union. I appeal to the Minister that before we continue this policy of putting on duties which often are ill-considered and have unexpected and unwanted results, he will appoint a commission to enquire what effect his policy has on the primary industries, the farmer, the artizan and the policy of civilized labour, so dear to his heart.

I think the speech and figures of the previous speaker should have made a considerable impression on the House, especially the figures dealing with the proportion of duties payable by various sections of the population. These heavy duties tend to handicap the European in South Africa in his competition with the coloured man and native. My hon. friend has shown that the best class of artizan pays £50 alone. This same principle applies also to the European who is not so highly paid, but who lives at a higher state of civilization than the coloured man. Consequently, he pays more than the coloured man and the native, and must have a certain wage to maintain that as against the native and coloured man, and therefore he is driven out of the labour market, where the coloured man and native can undersell him. It is no use relying on the Government. They can pay what they like, but the vast majority of the employment in this country is given by the private employer who has to pay his way, and will not pay more wage than he thinks is fair, and than he can get the job done for. He has to make his living, and has to look at the wage he pays. The higher the duty, the worse the position gets, and the white man, even the unskilled man and the poor white, must get a better wage, to keep up his standard of civilization, than the coloured man and the native. Furthermore, it is having this effect: It is tending to the migration of the population as well as capital from the Union towards Rhodesia, because, on account of the lower tariff in Rhodesia today, it is cheaper to live up there than down here. Capital similarly is going to Rhodesia, because it can get a better return. I think these things should be borne in mind by the Government. The Minister said, in his opening speech, that he was making certain reductions in the customs which would balance the increases on the tariff. I take his word for it. So far as the Treasury is concerned, it about equals. That I can understand, but the taxpayer will have to pay more. For a lot of these things we shall have to pay more on the major portion, and what is saved in his reduction will go into the pockets of the manufacturer. He says there is a reduction of 2½ per cent. on cotton cloth, to increase production. Of course, that doesn’t go into the Treasury, but into the pocket of the manufacturer.

Not only the manufacturer, but thousands of housewives will get the benefit.

Partly, but the great bulk is paid in for the manufacturer. I want to call attention to the very inadequate information that is given to this House and the taxpayers in regard to these duties. Here you bring forward a measure which, so far as the taxpayers and consumers are concerned, is going to mean an increase in taxation, and you are going to give certain benefits to a certain class of people at the expense of the taxpayers. But the House has very little detailed information indeed. The Minister put two or three reports on the Table in regard to the general tariff, I think not more than three, for a House of over 130 members! I have had the advantage of looking at them, but what chance have the bulk of members to read that report?

The press published it.

By the grace of the newspaper! Is that a dignified position for the Government to take up? The Government are so niggardly that they get it done gratuitously by the newspaper. This Government do not believe in giving too much information to the public. I say that advisedly. They do not want the public to know too much in these matters. The law as it stands, Act 28 of 1923, which organized this Board of Trade, says that every recommendation or report made by the board shall be laid on the Table of both Houses within one month of its receipt, or if Parliament be not in session, within one month after the ensuing session.

Is that not carried out?

No, we have not had the report on bread stuffs.

Do you know when it was received?

That makes it worse. You put it in the tariff, and you have no report. There is a tariff on brushes and brooms, but I understand there is no report out. In fact, the board says that separate reports will be submitted to the Minister dealing with superphosphates—which I have seen—soda-ash, wheat, flour and sugar. I have seen the one in regard to sugar, but the one on wheat and flour I cannot find. We are not kept properly informed as we should be in these matters. Let me point out that it is the same policy in the Railway Department. I cannot get the Minister of Railways to publish the monthly statements that I used to publish on the branch lines. They want to hide it from the public for some reason which I cannot understand. The idea seems to be that the public will draw wrong conclusions, and do not understand these things, and therefore they should not be given this information. That is the explanation of the bureaucrats. In the United States there is a special commission dealing with matters of customs tariff, and there is also one in Australia ; there may be others. To get impartiality in the United States, the commissioners are composed in equal numbers of both parties, that is, a certain number of democrats and a certain number of republicans, but Australia has a much better system. There the commission sits in public, and the evidence can be taken on oath, and all the reports are published. Further, the Board of Trade, or whatever they call it there, publish an annual report. There is nothing of this kind here. It is monstrous that only three copies of a report should be laid on the Table for the information of over 130 members. Persons who represent the taxpayers never have the slightest opportunity of seeing the reports. The public have the right to all information possible, and it cannot be said that the late Government did not supply that information. I am a strong believer in letting the public know everything. What have the Government to hide?

Their sins.

The system is also open to abuse and corruption.

What system?

The hole-and-corner system which is in practice to-day. I am making no implication.

You have no right to say that.

I do not agree. The board must not complain if the public get very suspicious as to how its conclusions are arrived at.

Do you accuse the board of corruption?

Nothing of the kind. I don’t think there is any corruption, but under the system it is liable to creep in.

It is a very strong insinuation.

Not at all. In the board’s own interest they should take the hint I have given them, and the Government should order them to have their meetings in public and let the world of South Africa know what is being done. Under the Act of 1924, which provided for the establishment of the Board of Trade, it was laid down that it is the duty of the board to report on all aspects of any matters referred to it and on the effects on the revenue, the consumer, and those employed in industry. Where is the report as to the effect of these duties on the revenue, on trade and on the consumer? The board reports that it was confident that an increase in the duty on ready-made clothing for men, in conjunction with the duty on second-hand clothing, would be fully justified by the development of the clothing industry and the consequent employment of civilized labour. There was not one line of evidence in support of that. So the report is only an assertion. The increased duties on ready-made clothing has not tended to increase the employment of civilized labour, but has resulted in giving more employment to Asiatics and natives. On the strength of the board’s assurance and without any evidence—

How do you know?

There is no evidence here.

They might have taken it.

Why don’t they publish it then? The consumer is just about the last man who is thought of by the Board of Trade. The outstanding feature of the tariff is the heavy duty on engineering supplies, but I will not go into that in detail as the matter has been dealt with by the hon. member for Kimberley (Sir Ernest Oppenheimer). This reflects very gravely on the Board of Trade which actually recomended a duty of 17 to 20 per cent. on windmills and harrows although—and to their credit be it said—the Minister and the Government turned it down. What confidence can you place in a board that makes such a recommendation? We have droughts in South Africa and if a farmer wants water he erects a windmill for pumping purposes. Were the farmers consulted on this? The number of locally made windmills is very small. We know what a small return the farmer gets for all his efforts. The farmers will come to another conclusion before very long when another burden in the shape of the Board of Trade is added to the burdens they already carry. The board’s justification for this recommendation is that the production of pig iron—I believe it commenced within the last ten days—and the arrangements which have been brought to a finality for the establishment of a steel industry entitles the Government to give protection to the engineering industry with a view to placing it on a firm commercial basis. I suppose this is only a first instalment. The board also recommended a duty on phosphates, but the Minister rejected it. No evidence appears to have been taken on this proposal, except from an official from the explosives company. The farmers were not consulted. It appears to be quite sufficient if one factory is started, or is going to be started, for an increased duty to be imposed. The increased duty on electric batteries is suggested because an American company propose to start operations here.

Why not?

I will show you what will be the effect of this policy. I suppose you will admit that when you place your stuff entirely in the hands of one monopolist—and that has been done in several cases—all the users of batteries have to be taxed for the benefit of one factory. Glycerine in bulk comes in free, but those manufacturing industries, except the explosives industry, which require refined glycerine have to pay a duty of 25 per cent. All these people are now placed in the hands of a monopoly. In August, 1925, the price of refined glycerine was £87 per ton of 2,000 lbs. ; in November the price went up to £90; in February to £98, and this month to £114.

And the overseas price?

My information is that they can land it here at less than £114. I always thought that the Board of Trade spent sleepless nights in looking after prices. The price of this article has gone up from £87 at the time the duty was put on, to £114 in the present month.

But it has gone up overseas.

My information is—I cannot say further than that—that we can land it at a less price. That is an important point. There are scores of industries in the same position, just in the hands of one factory, because the market here is so small that it does not pay other people to start another one. Once a man gets a start he is likely to maintain his position alone, because the market is so small. Let me give two examples. Take the match industry. I remember the time when the duty was first put on. Several factories were started, but after a time there were two factories, one here in the Cape and one in Natal, and there is only one company, and a good paying company, too. The consumers of matches are in the hands of a monopoly at the present moment. Take plywood. There were two factories making ply wood here in South Africa, one in Durban and one in Cape Town. They could not both live. One has had to go under. My point is that where you get an industry like this, supposing two factories do start, after a time they will find that the market is so small that they cannot both live; then they will try to negotiate an amalgamation, or one to buy out the other. If that does not do, one has to go under. We shall be in a good many cases, I think I can say in scores of cases, literally under this policy of my hon. friend, just in the hands of monopolies.

The remedy, of course, is free trade.

I am just showing the evil results of this policy. Take brushes. I see you ropose to put 25 per cent, on brushes. There is not a word in these reports about brushes to justify this recommendation. I now come to two other items, flour and wheat. The duty on wheat is increased from 1s. 2d. to 1s. 7d. per 100 lbs. and on flour from 3s. 3d. to 3s. 8d. No report on this matter has been placed on the table of this House. We are asked to sanction certain additions to the taxation on foodstuffs, and no information is given to this House in regard to it. Hy hon. friend says he intends to take away the dumping duty of 7d., but he intends to keep in his hands still the power so that at any time, if dumping is started again, he will be able to enforce it. The position really is this, that this duty which was in the past a dumping duty, which could be taken away at any time, will now become a fixed duty. My hon. friend has remarked that this is badly required by the farmers. Does he know that the price of this article has gone up from 23s. 3d. in 1923, to 26s. 6d. in the present year. Considering the price of wheat to-day, I do not think my hon. friend is justified in piling up the duties on the consumers of this country. I now wish to deal with the sugar position. As I said before, the output of sugar last year was 235,000 tons, while the home consumption was 170,000 tons, leaving a surplus to be exported of 65,000 tons. The duty at present is 3s. 6d. and there is an excise of 1s., and on loaf sugar the duty is 6s. I may just mention at this stage that the annual report of the Customs Department for 1925 has not yet been issued, and so I have had to take the imports for the year 1924. It is now proposed to add a fixed duty to the 3s. 6d., making an effective duty of 4s. 6d. It is also proposed to put on a suspended duty of 3s. 6d. in addition, making a total of 8s., although it is only fair to say that the 3s. 6d. will only be imposed under certain conditions. Even if I am mistaken in regard to the 1s., the duty on common sugar, if this arrangement is carried through, will be 7s., or about 40 per cent. I think I had better perhaps quote the conditions—

There is no retail grocer in this city who could conduct his business on 9 per cent. The consequence is you are going to hamper trade in sugar. No retail trader will keep a big stock of this article. Further—

There are certain other agreements. These are the conditions. Whether they will be agreed to we shall have to wait and see. The price fixed if these conditions are agreed to is £25 per ton or 25s. per 100 lbs. To-day the price is about £23 per ton, c.i.f. Cape Town. The price of the imported article is 15s. 10d. per 100 lbs., c.i.f.—a vast difference. My hon. friend mentioned that other countries in which sugar is grown levied a heavy duty. That is perfectly true. This gives a full list, but there is no indication in this list that these duties are effective. Let me give an example of a similar duty we have. We have a duty on maize. Does that make the slightest difference to the price of maize in this country? Not a sixpence. A man has to sell his maize at what the world price will give him and nothing else. So it is a fair inference that in places like Cuba their sugar is sold locally at the price they can get overseas, exactly as we sell maize locally on the basis of overseas prices. The duty on sugar would have no effect in South Africa but for two things. First of all £17,000 worth was imported in 1924. The import of Mozambique sugar is now practically at an end. And, secondly, there is a combination in the Natal sugar trade. They call themselves the Natal Sugar Association.

It is only a farmers’ association.

Anyhow, it is effective in keeping up prices. The price you can get today for export will probably not exceed 13s., whereas the price here to-day is 23s. If it was possible for them to sell their sugar where they could, naturally they would prefer to sell it even at 20s. than send it to London and only get 13s. [Time limit.]

There is a difference between the policy enunciated by the hon. member for Kimberley (Sir E. Oppenheimer) and that enunciated by the hon. member for Cape Town (Central) (Mr. Jagger). The hon. member for Kimberley, whilst criticizing very materially the tariff policy of the Government, approximates in some directions very closely to the policy preached for years by the Labour party which favours the fostering of certain industries by means of bounties. The hon. member for Cape Town (Central) does not agree with that. He is an extremist; he is a free trader and nothing else. I believe the extreme policy he advocates is not likely to help South Africa to provide extended opportunities of employment for white people. It is imperative that every effort shall be made to establish industry on the basis of affording opportunities of employment for white people. The solution even of the native problem is dependent on that policy. By continually extending the avenues of employment for white people, and encouraging thereby the influx of white people, so that the number of white people approximates more and more the number of natives, if it does not actually overtake them, you will lessen the native menace. The hon. member for Kimberley, in the course of his remarks, gave us some very informative and interesting figures with which, at the present moment, it is not possible to deal fully. The hon. member has given interesting figures to show that the artizan in South Africa pays something like £50 a year to indirect taxation ; that the farmer pays £25 and the native something over £2. I am concerned with the first two figures, which prove up to the hilt the point I made to the Minister the other day, that having regard to the fact that indirect taxation is comparatively heavy, it is more and more necessary that, so far as the people with small incomes are concerned, something should be done to counterbalance it by relieving them from direct taxation. When we take the figures for the present year, we find that the total amount anticipated in customs duty arid excise is £9,572,000. This is virtually our indirect taxation. According to the census returns the actual amount of taxation received from the native population is about £2,000,000. The native pays £900,000 by way of ordinary native taxes, and £50,000 for native passes, so that he pays £1,000,000 by means of indirect taxation. This reduces to £8,500,000 the indirect taxation paid by the white population, and it must be obvious that the hon. member for Kimberley (Sir Ernest Oppenheimer) has miscalculated, or has arrived at a wrong basis on the figures he quoted. It is necessary to warn the country against these alarming figures of the hon. member. He wants to rely again on what I thought had been an exploded position—the majority report of the Economic Commission. They are free traders, and do not believe in any form of protection, and they adduce any argument against any form of protection.

Who has exploded them?

The people in America and on the Continent, and in England, do not accept that theory. Mr. Baldwin’s government, supported by the so-called left wing of the Labour party in England, has taken up the position that something has to be done, either by way of protection, a bounty, or the Trade Facilities Act, to establish industries in the country, and provide employment for the hundreds and thousands who are unemployed there. We find a dwindling number of economists who are accepting the theories laid down by the Economic Commission, and the hon. member for Cape Town (Central) (Mr. Jagger) is one of the die-hards on the question of free trade. He realizes on that matter that he does not speak for his party or the people of South Africa. I thoroughly agree—and I think the majority of the members of the Labour party agree—that, as far as the farming population is concerned, unadulterated protection is no good to them, but unadulterated free trade is no good either, because it implies that you are importing a large proportion of your requirements. It is true that, in order to pay for these imports, you must have exports. In this country the bulk of our exports is obtained from the mining industry. As far as the farmer is concerned, if he has to rely upon an unadulterated free trade policy, it means that the mining industry is run on the cheapest possible basis, and the farmer will have a very small and restricted market. He will have to depend upon competitive markets overseas for the possibility of selling his produce. It is surely better for the farmer to support a policy which will develop the local market, and have a local market for his goods, than to be dependent on the goodwill of external countries. Personally, one would prefer to have the consumer at one’s door rather than to look overseas for one’s markets.

We are producing too much for that.

Let the hon. member see how many people there are who have not sufficient bread, sugar and the other necessities of life. Our mistake is that we are not doing enough to foster a population that is earning sufficient to consume what is produced here, and that is why you must seek markets overseas. It is essential to adopt a policy which will create internal markets, and to see that the production and the wealth of the country are equitably distributed. As far as the farmer is concerned, probably the greatest burden on him is due to the inequitable method of distributing his produce, and the toll levied by the distributors—and the unnecessary number of distributors in the country. Let me take the case of the United States of America, a very favourite quotation. Of the total prices paid for the commodities produced by the farmers there, the farmers get 23 per cent., and the remaining 77 per cent. is used up amongst all sorts of middlemen and other people who are dependent upon the produce of the farmer. I believe in South Africa the farmer gets something like 33 per cent. No man wants to protect farmers more than the hon. members on these benches. I submit we have to consider ways and means of saving the farmer from a good deal of this toll that is being levied upon him. Another point that the hon. member for Kimberley (Sir Ernest Oppenheimer) made that called for some comment, is that he said if the mines were freed from indirect taxation, they would be able to reduce their cost by something like 4s. a ton, and the effect would be to provide employment for an additional 5,000 Europeans, plus a proportionate number of natives, for a period of 20 years. I accept that ; but the hon. member does not tell us whether the mines would be prepared to make up the difference by means of direct taxation. But the point I want to make in connection with that is that the mining industry, in its desire for cheap production, desires completely to free itself from indirect taxation. It is true that on that basis you would be providing additional employment in the mining industry, but what would happen to the tens of thousands of people who are being more and more absorbed in industry generally through a policy of fostering industry? Whilst agreeing with the policy of fostering and protecting industry wherever necessary, the question we should consider is whether the protection should be given by means of an indirect tariff or by means of a bounty, and whilst it is probably not feasible to apply the bounty in every direction, I say, and I think the Labour party says definitely, that wherever you are dealing with the necessaries of life, and where protection is necessary to foster industries for the supply of such, protection should be by means of a bounty, and get the money necessary for it by means of direct taxation. In a scientific budget—not the present one of the Minister, but in a proper budget—the taxation would be raised by levying on the basis of the ability of the people to pay. Unless you foster such industries by means of bounties, the effect is that until such time as you produce the total requirements of the community in necessaries of life, the consumer does not pay only for what is produced in the country, but also pays extra for his imported article. If you require 100 articles, and only produce 30 under the ordinary tariff policy, the consumer has also to pay a high price on the 70 imported articles, which otherwise would come in at a cheaper rate. So that he is paying without specifically fostering the industry. It should be remembered that a protective duty is not really a policy, but an instrument of policy. A duty is not the be all and end all of the policy, and in matters which affect the ordinary cost of living, industries should be fostered without unduly increasing the price to the consumer, and the most effective way is by means of a bounty. I must say I cordially agree with the complaints made as regards the duty that is being imposed on three items of the present tariff. I believe the increase on ready-made clothing will probably result in an increased price to the working class, and perhaps to the farmers and bywoners, not commensurate with the benefits, in the shape of increased employment, which would be secured by the 5 per cent. increase of the duty. It must be remembered that nothing has been done to carry out the provisions of Clause 4 of the tariff, which provided definitely that in giving protection, avenues of employment should be opened up for white people, and the protection of the consumer should be considered. In regard to the duties being imposed on flour and sugar, the policy of the Labour party in regard to these matters is well known. Perhaps it was most effectively put by the Minister of Labour in his Minority report of the Profiteering Commission. I honestly believe that so far as the farmer is concerned, in regard to the tariff on wheat and flour, he is not going to be benefited by the Minister’s arrangements, because his experience has been rather unfortunate in connection with that matter. In March, 1925, Victorian wheat was landed at Cape Town at 29s. 9d. per 200 lbs. The duty at that time was 1s. per 100 lbs., so that the actual landed price in South Africa was 31s. 9d. You would have imagined that the farmer would have been able to get that price, but he found himself at the mercy of the miller. The miller is in the position of saying you are not producing enough for local consumption, and cannot compete overseas. I am the only person who can buy your wheat, and therefore I can dictate the price you have to accept, and if the Government is good enough, in its ignorance, to impose a tariff. I, the miller, will benefit by it. Then the fact of the duty on flour also places the baker and the consumer at the mery of the miller. I forgot to say in my previous remarks that, instead of the farmer getting 31s. 9d., the millers actually offered 29s. and 30s. so that the farmer was not benefiting by the duty.

What quality?

The same quality as imported.

No.

The baker has to pay the price which the miller charges him for his flour, and that burden will be passed on to the consumer. Therefore, you are really doing something which will not benefit the farmer, but will place a very heavy and unnecessary burden on the consumer of bread. Even if the price of bread is not increased, it must be remembered that from 1922 onwards there was a tendency for prices to fall, and last year prices went up ; so that even if the price is not increased it will not fall.

Why should the price go up as a result of the proposals?

Because the consumer is at the mercy of the millers and the bakers.

Is he not so without these proposals?

Of course he is. But these proposals will help the miller.

How do these proposals alter the status quo?

I am pointing out that it will not alter the status quo, but it will stabilize the price, which was in excess of that in 1923. The previous arrangements were not satisfactory. If the farmer is to be adequately protected, the Minister should stabilize the price of wheat by guaranteeing to the farmers for a certain period a minimum price for wheat. Then the farmers would not be at the mercy of the importers or the millers, but they would be encouraged to produce more wheat. That is not a socialist policy, but one which the British War Cabinet—of which the right hon. member for Standerton (Gen. Smuts) was a member—adopted when it found that Great Britain had to depend on its own products for the necessaries of life. The result of that was that a tremendous amount of idle land was cultivated. Simultaneously with that the Government should, by means of licences, control importations, so that when the miller wants to import wheat or flour, the Government have a check, and would allow to be imported only sufficient to make up the difference between the quantity grown here and that needed. The Government could, by means of such control, impose conditions on the miller as to the price which he is to charge for his flour to the baker, and similarly impose on the baker conditions as to the price he may charge for bread. You would by this method encourage and protect the farmer, whilst also protecting the consumer. I am only suggesting to the Minister what he proposes to carry out to a certain extent in regard to the sugar industry. That industry today is in the very fortunate position of having for once conferred a great service on the country, for it has brought the Minister to accept the very excellent principle of fixing prices. The proposals in regard to the sugar industry are equally alarming. I am not going to rely for my facts on the Baxter report, but on the Board of Trade reports, which should be published at the cheapest possible price, so that every citizen could acquaint him-self with the facts. I wish to say, without any disparagement to the members of the board, that their report vitiates the conclusions they have arrived at. They state that the planters are not receiving an adequate price, that protection must be given to the planter, that the miller is not producing sugar at a remunerative price, and that protection must be given to the miller. Those conclusions are only justified if the figures which the board give us in that report are definitely accurate, but those figures that they give us are vitiated by their own findings. They state in various places that in reality the figures upon which they are working cannot be completely relied upon. They say that there is excessive depreciation by the millers; that the book values of machinery and the like are put down at less than the actual value, and that maintenance expenditure has not been correctly dealt with, and that many items of a capital nature for replacements have been charged to revenue. Mr. Meyer, in his technical report, points out that part of the excess cost of production is due to the fact that from time to time crushing was stopped, owing to the shortage of cane due to inefficient calculations. Lastly, the board comment on, I think one might almost be justified in saying, the disorganized method of distribution and the high cost of distribution of the commodity. Until we have figures in which all these factors are taken into the most accurate consideration, it is not right to come along at the present time and propose the tariff which is submitted. One aspect of it which strikes one even more forcibly is that the sugar industry will be able to export its excess of 66,000 tons at £15 a ton, as compared with £25 a ton, at which the South African sugar is sold to the consumer here. Looking at the position of the South African consumer under this arrangement, he will have to pay £10 a ton more for his sugar than the price at which the industry is going to export overseas. This means that the South African consumer is going to pay £1,700,000 more for the sugar that is produced in this country than the price at which it is sold on the overseas market. It seems to me that that is a very unfair and very heavy tax that the industry is going to place on the shoulders of the consumers in this country. [Time limit.]

There are a few points which have been raised by the hon. member for Kimberley (Sir E. Oppenheimer) which, I think, the House should be quite clear about. He has indulged in a number of sweeping statements and a number of generalities to which the Minister has already taken exception. One of the points which he put forward particularly that I want to deal with is the question of the engineering industry. Speaking here on behalf of the mining industry, he speaks as a mine proprietor as if he were the sole person interested in the mining industry. He tells the Minister that he must not interfere with the production of these spares by a special group or section over which they are particularly holding their hands. Had the hon. member stopped there I probably would not have refuted his argument, but when he tells the House that, by the adoption of this new tariff, the Government is going to drive the mining industry, particularly the low-grade mines, back over the barrier and kill them once again, I think he is insulting the intelligence of this House, or else he has misinformed himself. Another point I take exception to is his remark that the Board of Trade, on insufficient evidence, has instituted these two tariffs as a protective barrier against the industry. He gave the House the idea that this is a sort of tin not industry which has no right to exist. According to the industrial census, engineering works and foundries, excluding railway work-shops, employed 3,192 Europeans and 3,559 coloured persons, and the railway engineering workshops employed 7,584 workers. Is that a little tin-pot industry that does not want to be fostered by the Government? One of the reasons given by the Minister for this protection is that we have just started with our iron industry, and that it is beginning to bear fruit. The hon. member for Kimberley questioned the fact that that industry was bearing fruit. These engineers have knocked at the door of the Government, and said the position was impossible owing to the way in which the mines are holding the dice against them at the present time. In the past we have had mining houses interested in their own machinery firms, and to-day there is a shrewd suspicion that these rock-drills, which can only be manufactured satisfactorily overseas—7,000 miles away—represents the same position as that which existed then, that is, the groups themselves are interested in the manufacture of these rock-drills overseas, and their objection is not to the loss to the low-grade mines, but to what they will lose on their own properties. I want to quote from the “South African Mining and Engineering Journal.” They take exception to this manufacture overseas. They say the man who manufactures these drills should be familiar with the industry. The copier conducts a financially successful business ; he is protected by distance; in other words, if they can get spares manufactured out here by these people, they can get a cheaper article. The hon. member for Kimberley (Sir Ernest Oppenheimer) was aware of these facts when he informed us with crocodile tears that this was the ruin of the mining industry ; that the Government had specially singled out the mining industry. I do not think the hon. member was particularly lucky in choosing these two things. I feel convinced the Government will not only have to protect this engineering industry, but they will have to go considerably further in the future. Our iron industry is in its inception; there is great hope in its development, and I contend that the Board of Trade will have to keep its eye closely on the development of that industry, so that it can replace not only rock-drill spare parts, but probably manufacture the rock drills themselves, and all the necessaries that the mines require in this country. I think if the hon. member, who poses as being a good South African, had told the Government he was prepared to assist in the development of the engineering industry, he would have impressed us very much more. I think the hon. member will have to look to his arguments, and I hope the Minister next year will have a further extension for the protection of these industrial articles which can be manufactured in South Africa; and I wish to congratulate him and the board upon the splendid tariff they have turned out for a protective policy in this country.

The hon. member for Troyeville (Mr. Kefitridge) told us that the policy of the Labour party with regard to the duties on the necessaries of life, was so well known that it did not need any repetition. That is so as regards promise, as regards what they say, but I think he will find that in this House, and also before the country generally, it is more with what they are doing that we are concerned, than with what they are saying. We know perfectly well what they have promised, but now, for the first time, they have the opportunity of showing what they will do. It is a case of facta non verba. I do not know whether it is by accident that this afternoon not one of the Labour Ministers has been in the whole afternoon, or is it that they are ashamed of the Government proposals? The fact remains that they are conspicuous by their absence. I find that in 1921 there was a motion moved on behalf of the Labour party, by the hon. member for Jeppe (Mr. Sampson), saying they would not go into committee of supply until the Government agreed to the abolition of taxation on flour and wheat. Now we find a collective responsibility for an increase in the duties on flour and wheat. Here are the names of the hon. members who voted for that motion: A. G. Barlow, T. Boydell, W. Madeley, J. Mullineux, W. J. Snow, J. Stewart, T. Strachan, R. B. Waterston, M. Alexander and H. W. Sampson. That was the promise ; to-day we see the performance. The name of the Minister of Defence is not there. I think that was when he was suffering a little temporary eclipse before he blossomed forth with the opulence he now enjoys, and evidently intends to enjoy, shedding all principles to do so. For we find when we take the point—what they have often urged with regard to the restoration of public servants’ salaries—that what happened the other day, was that the Minister of Defence moved that the House be adjourned, and claimed a division so that that other matter should not be allowed to come on. That was the performance—the other was the promise. What has become of the State Bank? What has become of the eight hours’ day?

Coming!

The country will be able to appreciate the value of the protestations and declarations made from time to time from the Labour benches. I think that the country will recognize, when the inevitable time comes when the Nationalists shield the hon. gentlemen, they will go without favour to their own place. I was very interested from many points of view in listening to the Minister of Finance this afternoon. From the mere point of view of the trouble it involved, he had a taste of what a—

means. It has been my fate to see customs clerks struggling with the scientific tariff, and the Minister, dealing with one-twentieth part of it, found it somewhat taxing. He might have a little sympathy with those men who have to undergo all the rigours of a scientific tariff. The Minister told us that there had been no dumping duties on wheat, and repeated it.

It is not in force, and has not been collected for some time. There are no dumping duties now.

It was in force last year. I wanted to find out what the dumping duties had been, and I have a return showing that over £7,000 was collected last year. I have it in writing from the Customs Department. I think the Minister had better correct that, and look at it again. The Minister seems to think that it was quite sufficient to say that he was convinced that these duties would not increase the cost. That does not carry anything. If a man wants to be convinced he can be convinced of anything. In committee the Minister must give us details, and tell us upon what he is convinced. To have interested people say that it will not increase the cost does not mean anything to me.

It is based on the same thing as that on which you base it. You say it is going to increase the cost.

We will go into that in committee. With regard to the Government’s policy, I think they are carrying it too far, and to the detriment of the country. I recognize that they have the country with them. The country says they are agreed to have protection in the tariff, and are prepared to pay for it, but only in moderation, and not to the extent the present Government is pressing for the matter. The Government has to hold the balance between various interests, and they are asking the primary producer and the consumer to pay altogether too much for the benefit of manufacturing our own requirements. We are not exporting our manufactures, not only to neighbouring colonies and to Kenya, but we are only manufacturing our own requirements. The country is with the Minister in that, to a certain point. I know in my part of the country, where there is a considerable increase of manufacturing, the effect is that you are drawing white people into the towns to work in these factories, and sending the native to the land. The balance of power in a country must lie with the people on the land. This policy of the Government is not sound, and is being pushed to the extreme for the benefit of the few, and not the many. Would the farmer apply to his own farm what we apply to this country? He specializes. One man goes in for sheep; another finds his farm specially suited for cattle or for fruit. He cannot do everything ; and no more can we, as a country, do everything. We have to find out what are the things the country can do most profitably, and it should specialize in those things, and do nothing that will work against the interests of those industries for which the country is specially suited. You can grow fruit in winter under glass in London in a hot-house, but no one would do so economically. It seems to me that the Government and the board are taking the wrong line in starting with the idea that any mortal thing you like can be manufactured in this country, provided a sufficiently high tariff wall is built.

What about boots in Port Elizabeth?

I have always, since I have been in public life, taken a great interest, and I was bound to take a great interest, in that part of the population which is bound so often to be forgotten—the consumer. I cannot help feeling alarmed at the progressive burdens being put upon him through the customs tariff. In 1903 I was present as one of the delegates of the Cape Colony at the customs conference, when representatives of the various states in South Africa came together and agreed upon a tariff. The ad valorem rate was really 7½ per cent., with an additional 2½ per cent. on foreign goods. It would have caused consternation to propose or to see that duties of 20, 30 or even 40 per cent. were put on. The country would have been staggered with the idea. Now this board calmly recommend a 40 per cent.—I am not sure it is not 50 per cent. in some cases—and apparently the members of this House, on whom it will be imposed, are prepared to take it without turning a hair. I cannot help feeling deeply concerned about that. It is the cumulative effect of these duties. Mr. Rhodes was not a free trader, but he knew the effect of these things on a country that has to depend on its primary products, and fixed in the constitution of Rhodesia that they can never have a higher ad valorem duty than 9 per cent., and that holds to-day. Incidentally this increasing of our tariff is bound to affect our trade with Rhodesia, which is largely done from open stocks, and Rhodesia is prospering with an increased trade. It means that the man who imports direct to Rhodesia can get the goods through at 9 per cent., but the man in the Union who sends them on to Rhodesia will be handicapped to the extent of the difference between the 9 per cent. Rhodesia will pay and the amount he will have to pay to our customs. It seems to me it is going to have quite a serious effect on our open-stock trade with Rhodesia, which is not an inconsiderable item. The Minister is also going to have a try at price fixing—a very very dubious thing indeed, and one that I have no confidence in. I would like to refer to one of the duties. Wheat is the one thing that I never had any doubt about, in regard to adequate protection, but not too much, because I have had to do, many times, with this question of customs dues, and have never been prepared to be very rigid about giving protection to wheat, recognizing that this is a necessity to the country, and in times of danger and war we know what happened. I am always prepared to give the greatest possible encouragement to the wheat-grower, but you must make sure that it is going to benefit the wheat grower, and I think there is a good deal in what the hon. member for Troyeville (Mr. Kentridge) said on this point. In regard to sugar, I think the Government are on the wrong lines altogether, and I cannot help feeling that the appetite of these sugar people grows with what they feed upon. I throw my mind back to the commission appointed in 1912. You may say it was a long time ago, and that conditions may have changed very much. But then the most the sugar people asked for was 6s. and that was provided the protection that they got from the preferential railway rate was done away with. That commission recommended that the duty on sugar should be put at 5s. and that a preferential railway rate which they reckoned equivalent to 1s. 6d. per 100 lbs. should be done away with. That would be the equivalent, seeing that the railway tariff is in existence, to 3s. 6d. only. I won’t say that was a strong commission—I was a member—but there was one member on it who, I suppose, knows the sugar trade inside out, Mr. C. G. Smith, who is at present a member of another House. He gave his signature to that in 1912, as fair to the sugar industry. Now, if the suspended duty comes into effect, it is proposed to give this industry 8s. and to leave them with the preferential railway rate, which is now worth at least 2s. That is equal to 10s. If you take off the 1s. excise it will be 9s., which it is proposed to give them. They only asked in those days, for 4s. 6d. and the commission agreed to 3s. 6d. I tried to read through the Board of Trade sugar report, but I only got hold of it for a short time. I feel we have not had a fair opportunity of going into these things owing to these reports not being available, but I could not see that any case was made out for this high preference to be given. There was something almost prophetic in the saying, in the 1912 commission’s report, by a member who put in a minority report. He was speaking about this same sugar business. I disagreed with that hon. member. He wanted the whole protection swept away altogether. He said it was fairly certain that when the production of sugar was equal to or in excess of the requirements of the country (that is the position now) it would be taken in hand by a trust for the purpose of regulating the output or to dispose of the surplus overseas at the smallest price possible at the same time taking advantage of the protective tariff on the local market. That was in 1912, and was absolutely prophetic. I cannot see what the Minister says about price fixing, and think that in dealing with this very important matter of tariffs, sufficient consideration is not being given to the consumer, and I hope when we get into committee the Minister will still see his way to reduce, at any rate, some of these imposts which he seeks to foist on the public.

It would facilitate our work on this side of the House if we knew what the exact economic policy of hon. members opposite was. According to the speeches to day we cannot think otherwise than that the Opposition has no policy. It is not only our view but also that of a large number of people belonging to the South African party. Supporters of that party are beginning to feel that their party does not possess, as a matter of fact, any fixed and definite economic policy. In proof of that we find that at the recent congress of the South African party the first point for discussion on the agenda was—

That was sent in by the Durban executive. If such a body tells the congress that the time has come for a definite economic policy and asks the head committee to take steps to draw up such a policy, it is very clear that everything is not in order as regards the confidence of members of that party. Notwithstanding the urgent request contained in the draft resolution of such an important body, the party has not yet succeeded in framing a definite policy. We should like to learn from a responsible leader of the party where we are, so that we may know how to treat their criticism and can say on what point we differ from them and defend ourselves. It is not necessary for me to refer again to the differing views of the Opposition. That was done during the budget debate. We saw how one member of the party after another rose to contradict what the previous one had said, but notwithstanding the fact that this happened only the other day, they bring up the same arguments again to-day. After the confusion during the budget, when they dusted up each other, after the supporters had controverted what a leader had said, we expected that they would not again dare to bring forward the same arguments and yet we now get them repeating the same thing. As the song says—

While our present Government is following a definite policy and is being attacked on all sides, it would not only be of assistance to the House but also to the country if we could learn where is the exact line of demarcation between the policy of the Government and that of the Opposition, and on what principle the policy of the Government is being attacked. But there seems, apparently to be no chance of our having such a clear statement. One thing I feel, and which hurts us much on this side of the House, is the continued attacks by hon. members opposite on the Board of Trade and Industries, attacks which in my opinion are not justified. Every discussion on import duties and cognate matters is coupled with insinuations and personal attacks on the members of the board. We had an instance of it last year when hon. members opposite made personal attacks on those members. We remember how the hon. member for Port Elizabeth (Central) (Col. D. Reitz) quoted extracts from a play which was written by one of the members of the board. What had that to do with the views of members of the board in connection with economic matters? I do not know. Personal attacks and insinuations are constantly being made by one section in the House on members of the board. The hon. member for Cape Town (Central) (Mr. Jagger) refers constantly to the danger of corruption. He says the board works in a way which can only lead to corruption. Why does the hon. member say that? If it is so, the hon. member should produce proofs, or some scintilla of proof. It is unpleasant for members of the board, and for us in the House, to hear these veiled attacks, where the hon. member says we must take care because the Board of Trade and Industries works in the dark and meets behind closed doors with danger of corruption.

Business suspended at 6 p.m. and resumed at 8.8 p.m.

I was protesting against the attacks made by hon. members opposite on the personnel of the Board of Trade and Industries. I pointed out that it was not an attack on the merits, not on the principles which the board had laid down, but was directed to the personnel of the board, and the way in which the members did their work. I pointed out how the hon. member for Port Elizabeth (South) (Sir William Macintosh) made an attack last year on the person of the chairman of the board. I further pointed out how the hon. member for Cape Town (Central) (Mr. Jagger) is again to-day making all sorts of insinuations against the board. To an interjection by me as to whether he suspected the members of the board of bribery, he replied—

That from a responsible member of the House! It must raise a feeling of suspicion among a part of the public. The followers of the hon. member who have confidence in him will say that he would not say such a thing if there was no truth in it. Is it fair and just and manly to make such insinuations? We have, unfortunately, come to the sad position that we do not trust our own people ; we do not trust our own capable young men, who have been well educated and are fit for their work. We prefer to import foreigners, Englishmen or Germans, or what not, and then we think that we have something wonderful, and we accept their advice. That happens in our public life, and what is the result? In connection with the elevators and the electrification of our railways, we preferred the advice of foreign engineers who did not know the conditions of the country to the advice of our own engineers. If we have people to enquire into the economic position and into wages, we bring people from overseas to hold the enquiry, so implying that we have not sufficiently capable people in our own country. The consequence is that we lose millions because we do not follow the advice of our own people. And, as was the case with the Economic and Wages Commission, we reject their report and disapprove of what they suggest. Why not give full confidence to our own people, people who have both studied abroad and have local experience? Why not? In each case in the past where there was a conflict between the view of our Afrikaans experts and people who have been here for a few weeks from overseas to investigate matters, the advice of the local people has in the long run appeared to be best. If we had strangers from other countries on the Board of Trade and Industries, hon. members opposite would not have so much to say about its personnel. Then there would only be admiration for the wonderful knowledge of these people. When young Afrikanders, who know the conditions of our country and are sympathetically disposed towards all sections, towards industries, agriculture, etc., want to make a report, then reflections are made on the members of the board, and their method of working is criticized. I cannot understand this inexplicable distrust of our own people, and hope that hon. members will not continue in this way. I personally have the greatest confidence in the members of the board, and all our departments are using them to-day, including those of agriculture, industries, finance, labour, etc. When there is anything to be investigated, we go to them. The board consists of men whose interests are South African. It concerns them as much as anybody else whether one or other industry succeeds or fails. I protest against these petty attacks, and hope hon. members will deal with matters on their merits. When the board makes proposals, let them be treated on their merits, and let it not be said that it is inspired by enmity towards one section or another. Members should not say that the way in which the board does its work is futile. In connection with import duties, we are constantly shown by hon. members opposite the darkest side of the picture. The figures quoted here with reference to the increase in white employment are represented in the darkest light, and it is never pointed out how much good arises from the policy. We have heard how good the result has been, although the policy has only been pursued for eight or nine months, and we have heard how large is the increase of civilized labourers who have found work. I will mention one case to prove that, although conditions are not yet generally so good as they will be, in certain cases the increase of white labourers is so great that we must feel that the tariffs are going to be of great assistance. Take the case of a boot factory at Port Elizabeth. Compared with March, 1925, 68 whites, 1 coloured man and 2 natives more were employed in that one factory in March, 1926.

What are they paid?

I do not know, but it is a fact that more men have been employed. Much has been said in connection with the import duties on ready-made clothes. The hon. member for Port Elizabeth (South) said that if the consumers should see the price marked on each article and the duties they have to pay, they would stone the Government and the board. He said that when the people had to pay 6d. or 9d. tax on medicines, they became angry, because they knew what the tax was. If the people saw how much the article cost and how much was being paid in indirect tax, they would always be a little dissatisfied, but that is the state of our economic structure. If the hon. member were to put on his goods what the purchase price was, what the tax was, and what his profit was, then the consumer would not stone the Government. They would stone the trader.

The profit is not so high.

The hon. member says that they do not make a large profit. I can give a concrete case of ready-made clothes where the purchase price was £1 10s., the tax 6s., and the selling price £3 10s. If the dealer were to put on a label giving the purchase price £1 10s., tax 6s., and sale price £3 10s. (which means a profit of £1 14s.), what, then, will be the attitude of the consumer?

You went to the wrong shop.

That may be, but I am mentioning a concrete case. One cannot always select good shops such as those of the hon. members for Cape Town (Central) (Mr. Jagger) or Port Elizabeth (South) (Sir William Macintosh). I am astonished at the hon. member for Port Elizabeth (South) protesting in this way against the Government’s import duties. I wish he would read the “Eastern Province Herald,” which compliments the Government and thanks it for what it has done to assist Port Elizabeth to become a large industrial centre. The hon. member only takes a few items out of the list, to which he then objects. Why does he not also mention the other items? Those, e.g., by which the Government is trying to push the motor industry? The “Eastern Province Herald” is pleased at the Government’s action in this connection, because it will result in large assembling factories being established in Port Elizabeth. I should like the hon. member also to thank the Government for what it is doing, and not only to find fault. No objection is made to some of the items. I think the hon. member for Witwatersberg (Lt.-Col. N. J. Pretorius) recently complained about a matter where someone had ordered an article from Europe (I think England), and afterwards ascertained that the import duty on it was more than 100 per cent. That may be, but then I ask why the man had not bought the same article which is produced in this country. If the import duty is so high, we can be certain that it is an article which can be obtained quite as well in South Africa. Take the ease of exercise books, on which a heavy import duty is charged. If one orders a consignment from abroad and then learns that the import duty is 100 per cent. or more, it is his own fault, because they can be made just as well in this country. I consider it unfair of hon. members opposite to stress every case which they object to, giving the country the impression that as a whole they are opposed to the proposed import duties. Let hon. members opposite say clearly: We are not in favour of this, but we are in favour of that. Hon. members opposite make the country think that they disapprove of all the proposed import duties. I come now to another point, one raised this afternoon, viz., that of the mines. The hon. member for Kimberley (Sir Ernest Oppenheimer) has spoken as if the Government was unsympathetic towards the mines and wanted to do everything possible to oppress and ruin this basic industry. My personal grievance against the Government is that it does not take sufficiently strong action against the mines. During the last two years hon. members opposite have always been pleading for the mines, saying they were unjustly treated, though the mines had done so much good to the country. When one remembers what hon. members opposite said a few years ago, this is strange. The hon. member for Yeoville (Mr. Duncan) said in a speech a few years ago at Hartebeestpoort dam—

I agree.

The mines have done a great deal of good.

The hon. member laughs. I admit that the mines have done much good, and that they must not be oppressed and ruined. My point, however, is that hon. members opposite plead so strongly for the mines. Take what the hon. member for Standerton (Gen. Smuts) said a few years ago—

The hon. member for Standerton is not here, so you think you can say what you like.

The hon. member need not think I will not say that in the presence of the hon. member for Standerton. It is not my fault that he is not in the House at this moment.

Who reported that statement?

That is a report from the “Star,” and the speech was made somewhere in the constituency of Pretoria (North). As for me, I am disappointed with the Government, because it has not fulfilled one of its election promises.

That has been the case with many promises.

The hon. member now says that the Government must fulfil its promises. I will assist in getting that done, and I hope he will also help. One of the points in the manifesto of the Nationalist party before the recent election, promised that we would enquire how far the incidence of taxation is evenly balanced and that enquiry would immediately be made to see how far the mines are contributing their fair proportion to revenue. For quite a number of years whilst the Nationalist party was in opposition, it advocated the reinstatement of the Mines Profits Tax of 10 per cent. The hon. member for Kimberley said he was not opposed to the Mines Profits Tax. I want the Government to fulfil its promise and as the hon. member for Johannesburg (North) has promised to assist in getting it carried out—

The Government made a wrong promise. I will assist when the promise is right—

Now the hon. member is afraid, but he gave his promise and I hope he will keep it. I will read what is said in the manifesto—

No one wants to injure the mining industry, and it ought to enjoy the protection that other industries enjoy, but there is every reason to think that in the past the mines were favoured by the Government in a way to which they were not entitled. They should be compelled to contribute their just share to the revenue. I want the Government to make the mines pay that portion. We have heard about low grade mines which are dying out, but we were glad to learn from the report of the chairman of the Chamber of Mines that the gold production of the Transvaal last year exceeded that of the previous year. The gold output last year was larger than ever before, and I do not know how hon. members can speak of an oppressed industry, because even with a shortage of native labour the mines this year have had a record output. Consequently I urge the Government to fulfil its promise with regard to the taxation of the mines.

We had a speech from the hon. member for Vredefort (Mr. Munnik) this afternoon who was beating the air and told this House that about 30,000 tons of steel was already being made in different factories in Johannesburg. I make bold to say that up to the present there has not been one ounce of steel made in the Union of South Africa. It was a very bitter speech and we have had the pleasure of hearing a speech from the hon. member for Kimberley (Sir Ernest Oppenheimer) in the best possible tone, and the hon. member hinted that the hon. member for Kimberley was prompted by sordid motives in that he had some kind of interest in the firm that made rock drill spares or had them made. Well, of course, one doesn’t like that kind of thing, and it is lowering the tone of the House very much, but I suppose while we are in politics we have to put up with it. As far as I know, from this side of the House, we make no personal reflection on the members of the Board of Trade, and what we wish to do is to lead them on in the ways of commercial wisdom, while we criticize their action we make no reflections on them as men of honour. The sugar industry in Natal has been well looked after by our legislature, and it does not employ more than five per cent. whites for the whole of its works, and I ask the House to consider the cause that we people in the north have for the development of our own industry. With regard to agriculture, the Government are spending millions of money on the development of the country, and I would ask the Minister why he should not foster the gold mines and give them every facility for expansion. There is no doubt that there is a general feeling of uneasiness that the taxation to be imposed is driving away capital from this country, which we need very much to-day. On the East Rand section we have large areas of ground which are crying out for development, which can take place only by an immense amount of money coming in, and unless we get capital that ground will never be utilized or reopened if the mines on adjacent territory close down. Therefore, when the Minister comes before us with his little taxation proposals—not meaning much in themselves, but they do drive people away from investing money in this country—we may be thankful that there is no greater taxation on the mines, but while there is this indirect taxation hanging over us we shall not develop this country as it should be developed. Men who know the country better than I do believe that South Africa is on the threshold of great development in mining, but people will only put something in if they believe there is to be stability in taxation. Not so many years ago the shares of the New Modderfontein Company were standing at eighteenpence, and it is only with their courage in going on that these two great producing gold mines have achieved great success. I hope the Minister will see to it that the Board of Trade will go to the people who can give them proper advice when they come to the question of taxation. There are hundreds who would be willing to help them in their arduous task. To-day South Africa is certainly not an industrial country, and there is not an industry which, in some form or other, is not a bastard industry. We import the woods to make our matches, and the chances are we are importing everything else in connection with the matchmaking industry. That is only one item, and there are hundreds of them. There is nothing produced in South Africa to-day that cannot be landed as cheaply as we can produce it. I never was a free trader, and since other countries raised a barrier against us free trade cannot be what we wish it to be. I believe in moderate protection, but we must protect those industries in which we believe a greater number of young whites can be occupied. If you are going to open up further avenues for the coloured and black population, protection is in vain. You must say that in every industry there must be 20 per cent. of the number of employees, white youths. With regard to rock drill spares, I may say that all my life in Johannesburg I have been dealing with steel and the steel industry. One of the reasons the Board of Trade gave for the duty on rock drill spares is that they wanted to increase the steel industry. Everybody wants to encourage a key industry. When you begin to produce pig iron and convert it into steel you have thousands of different phases before that steel can be brought to any manufacturing shop. Steel has to go through any number of processes before it can be brought to the market, and none of these functions is done by any one manufacturing concern. In the great steel firms of England the ingots are transferred from one factory to another—one is transformed into razor blades, another into armour plate, another into watch screens, and so on. The same thing applies, in a sense, to these rock drill spares. To use the argument that we have now started a steel industry and that it is proper and right to put a duty on rock drill spares, is going too far. These spares have been highly priced articles and the men who are making them say they can make them cheaper than the imported article to-day. The people engaged in making these spares are making a handsome profit, and do not need any protection. When you put a special tax on a special class of goods, prices rise. It is going to mean a further tax on the mining industry. I will read a few lines from a letter received from the Chamber of Commerce—a circular which I believe other hon. members have received. It states that the mining industry is unable to pass on any extra cost imposed on it, and the effect must be a proportionate increase in the cost of mining operations. It also states that if rock drill spares are made in the Union there is no reason why spares for agricultural machinery could not also be made in the Union. On the general question of protection the fact remains that other than our own limited markets we have no markets outside the boundaries of our Union, and that is always going to handicap the industrial progress of this country. Last year we had a tax on screening, which is being manufactured in Johannesburg. The wire is being imported free, and most of the weaving is done by Kaffir labour. Last year a tax of 5 per cent. was put on the screens, and also a tax on imported disinfectants. If there is one thing that engages attention more than any other in Johannesburg it is the health of the people on the mines, and disinfectants might have been allowed to come in free. These are small things, and unworthy of a tax being put on, but it is these little pin pricks of taxation which prevent people bringing any money in, and helping to develop the country as it ought to be developed. In the interests of your white labour policy, I say, do away with these things. Most of them are not necessary and ultimately we will win through without special protection. The other point arises that the moment you put on special protection on certain lines, you stop the introduction of certain things into the country ; therefore you have a restricted market and only a few suppliers and the price goes up against the consumers. I am going to touch on a question which in one sense does appeal to a good many people and that is the tax on potable spirits. If this tax is a protective tax only, then I say to the Minister and to the Board of Trade particularly, that that tax should have been put off until this country was able to produce a brandy or a potable spirit of five years’ maturity. The Government should not force down the throats of the people of this country an immature spirit which is not fit to be drunk. In two or three years’ time I think the position will be altered, because I understand the wine merchants are laying down stocks and in the course of time this country will be able to produce brandy as good as is produced by France or any other country. If it is purely a question of revenue, I suggest to the Minister that in putting on 12s. 6d. on the imported spirit the excise on the local spirits should also be increased. In a sense this is a tax that touches only one section of the people. Nine-tenths of the people who drink whisky in this country are in one section and I think the Minister was ill-advised to put on an increased tax on the potable spirits from abroad and not increase the excise on the local spirits. I would like to say again to the Board of Trade, from this side of the House, that we want to do everything to make the burden of the Board of Trade lighter and I think it would be wise of them, before they submit taxation proposals to their Minister, to take advice and counsel from those of us who have grown old in commerce and know the pitfalls and other things that do not appear on the surface. I am sure I speak for the mercantile community when I say that insofar as they ask our aid we shall be delighted to give it.

I think that the hon. member for Parktown (Mr. Rockey) who defends whisky ought to thank, rather than blame, the Government that whisky is not taxed more than an extra 7s. 6d. per gallon. In my opinion it ought to be higher. We are taxing whisky with 45s. only, whilst in England Cape brandy has to pay 72s. As a representative of a grain district I wish to speak on the proposed increased import duty on wheat and flour. The former Government refused time after time, when I urged it, to put an increased duty on imported wheat, in conflict with the recommendation of their own Board of Trade and Industries. That board reported in 1921 after investigation that the import duties on wheat and flour should be doubled ; and they showed by figures that even if the price of wheat, which at that time stood at 23s. 6d. were increased by 5s., the price of bread in the towns ought to remain unchanged. Minister Burton and his friends ignored the recommendation, the reason given being that the price of bread would rise. Whether that was well-founded or not can now be judged, as a result of the proposals by the Minister of Finance. Has the price of bread been increased? No, it is the same as in March. The hon. member for Caledon (Mr. Krige) wanted to represent that the Minister by his proposals was reducing instead of increasing the wheat farmers’ protection. I challenge the hon. member to vote against those proposals. If he or the hon. member for Swellendam (Mr. Buirski) dares to appose then they would never smell this Parliament after any future election. If the proposals are to have an injurious effect on the farmers, how is it that immediately after the announcement of his proposals by the Minister the price of wheat rose at the end of March? And the price did not only rise 10d. per bag, but 1s. and 1s. 6d. It rose from 23s. 6d. and that revival in the market is directly due to the announcement made by the Minister in his budget speech. If there is one part of the population that deserves protection from the Government, it is the farmer, and especially the wheat farmer, who renders such a tremendous service to the whole country. The hon. member for Standerton and the hon. member for Cape Town (Central) both stated that there is no industry which pays so badly as the farming industry. One of the chief reasons for the unfortunate position of the grain farmer is that he is not able to protect his own produce. Lawyers and other classes of professional men, and all business men are protected by their unions. If wheat farmers could protect themselves by means of a co-operative society, which had control over the whole wheat production, they would not have to come to the Government for assistance. Unfortunately they cannot do so. I am glad that the Labour party is beginning to see it. It was a pleasure to listen to the speeches of the hon. members for Liesbeek and Troyeville (Messrs. Pearce and Kent-ridge) who both approved of the protection proposals of the Minister. They and their colleagues see how desirable it is that the producer of foodstuffs should be encouraged. Their manly speeches compare favourably with those of the representatives of Caledon and Swellendam. As regards the reduction of dumping duties on imported flour, to 7d. per 100 lbs., I would rather see all the dumping duty remain on flour, but still the proposal of the Minister will have advantages as well as disadvantages. Whether there has actually been dumping of flour last year is doubtful. A buyer orders, e.g. a quantity of flour in Australia in January at a certain price on condition that delivery shall take place in April. But in April the price has risen in Australia, and then the Government regards the difference in price as dumping. This view has caused much dissatisfaction. Well, the Minister now wants to end this unpleasantness by conceding 7d. per 100 lbs., and in its stead he demands a permanent import duty of 5d. This alteration taken in its entirety also works out in the farmers’ favour. The extra import duty of 5d. is applicable to all flour coming in, while the so-called dumping tax only applies to certain consignments. Furthermore dumping only takes place when the Australians have a large surplus which they cannot sell at a reasonable price in the world market. That is seldom. Then it must be added the Government now binds itself not to allow any dumping of more than 7d. in any case. If the Minister’s proposals on the whole work out unfavourably to the wheat farmer, as certain members of the Opposition alleged, then the farmers should get less to-day instead of more than in March for their wheat. Undoubtedly the result has been satisfactory. I appreciate the Minister’s courage in what he has done for the grain farmer and wine farmer, and hope he will continue along the same lines.

I do not wish to go into the general question of protective duties, but there is a point which I wish to raise with regard to the administration of customs tariff. My complaint has been the subject of correspondence between the customs and the Board of Trade, and there is some reference to the matter in the press this morning. In section 16 of Act 36 of 1925 the definition is given of—

which is to be taken into consideration in respect of goods imported into the Union. I find from personal experience, that if you import from a continental country the goods go into bond in England, and therefore do not pass through the English customs. These goods are sent here where they are valued for customs purposes, and the department add to the price of the goods the duty which would have been paid in England if the articles had passed through the British customs and had been sold in England. The effect of that in many cases is that the duty payable here is very largely increased. If that was the intention of the Act the matter should have been brought before the House, and people should have had an opportunity of knowing what was to be done.

It is in the Act!

I don’t deny that.

The Act was passed by the House.

That is a point which would not occur to the ordinary observer, and did not occur to any member of the House last session. The mere fact that there has been this correspondence between the Board of Trade and the Customs Department shows there has been a very considerable doubt about the matter. If it were our policy to increase the duties, this House and the country should have had an opportunity of knowing what was to be done, and of expressing an opinion upon it. But that is not the only point. Naturally, an impost of that kind placed upon goods taken into England in bond, is going to act as an inducement to people to send for their goods direct from the foreign country in which those goods are produced, without the intermediary stage of those goods going to England. That will deprive the English merchant of a good deal of business, and it will seriously militate against the interests of British shipping. I do not want to go into the whole question of whether this policy is British or anti-British, etc., but it does seem to me to be very much on the lines of the policy which was pursued last year in regard to the diminution of the British preference, because the effect of it must inevitably be to hamper what I believe is called technically the entrepot trade in England, because where the merchants in foreign countries can send their goods to this country direct without the intermediary of England they are allowed to do so. I think that is an unfortunate thing, and I think also that if we are to deal blows at British trade and British shipping we should have had this matter thrashed out on the floor of the House. I understand that on wines imported from foreign countries, on which there is an excise in England, the same procedure is not followed, and that the English excise is not added to the domestic value on which the duty is assessed here. If excise is not added, then it is difficult to see why the duty on wine should be added. This goes to show that the matter was not fully considered at the time. I do not profess to be an expert on these customs matters, but, as far as I can see, the effect of this business is that not only is the consumer in this country taxed to a very considerable extent more than he was before without any warning and merely on the construction of a particular section imposed upon him by the officials, but also that the policy which underlies this procedure is going to seriously militate against British entrepot trade and British shipping.

I was completely astounded at the attitude of the hon. member for Port Elizabeth (South) (Sir William Macintosh) in his assertions as to the deplorable position of members of the Labour party in reference to taxation of foodstuffs. I noticed that when someone asked what attitude he had assumed in regard to this matter he was not strangely silent, because there are none so deaf as those who won’t hear. I looked upon the hon. gentleman as the very soul of honour, one of the ornaments of Port Elizabeth—the honest port—a place where virtue is triumphant and vice hardly known. It was disappointing to find one, who had all those good qualities, and one specially selected for distinction, could throw a slur on members of the Labour party for not using their influence to carry out their principles now they are associated with our friends, the Nationalists. What the hon. member alluded to was a resolution proposed by Mr. Mullineux in April, 1923.

No. I did not. I gave you the date—6th May, 1921, a motion proposed by Mr. Sampson.

The illustration is far better in 1923 than the one given in quotation by the hon. member. The Rev. Mr. Mullineux moved—

The point is what are your leaders doing to-day?

No, here is the point. I want to show the hon. gentleman who has asked us for examples that he himself should have set us an example. We find that when the proposal to tax the bread and the medicine of the people was before the House, the Labour party voted against it, but the hon. gentleman was amongst the 59 who were in favour of it. His party will remember the medicine tax—they had to take their medicine in 1924. The hon. gentleman, for years and years, has been an out-and-out protagonist of free trade.

No.

I think my hon. friend has rather a weak memory, because my recollection is that I put through the post time after time various publications to try and convert him from the error of his political ways. I was a protectionist all the time. I feel certain that the boots of Port Elizabeth have done much to kick a great many free traders of that interesting city into advocating at least a scientific tariff, if not complete protection. How wonderfully good and virtuous hon. members opposite, now out of office, are in supporting what people want! I understood the other day that they were looking for a new leader. That is denied. Anyway, according to their own press, they are looking for a new policy. The hon. gentleman, in his difficulty, looks round and makes his appeal to whom? To the Labour party. He is wise—we are willing to be his guide. I was delighted indeed to hear the lurid warning the hon. member for Kimberley (Sir Ernest Oppenheimer) gave to our friends the farmers. That solicitude was touching, and so very honest! The hon. gentleman was very earnest. The farmers are discriminating enough to see that the nearest market is their best market. Industrial centres only can secure that advantage to them. They have learnt the good of having a Johannesburg and a Kimberley. So far as taxation is concerned, I rather doubt the hon. gentleman’s figures, a great heresy possibly, but anyway we are going to study them very closely, and the whole question comes to this, not what the amount of taxation is, but the capacity of people to bear it. For instance, we tax diamonds and gold. Well, the profits are so great that whatever tax put on would not touch the hon. gentleman at all. If you can get your goods to the consumer, you may get the consumer to pay the tax ; otherwise, it has to be paid out of the profit. The greatest statesman connected with mining in this country was Mr. Cecil Rhodes. His doctrine was—

I warn the hon. gentleman and his assistants who are working the assets of our country, our gold and diamonds, that they are mining under licences which can be recalled. The whole thing comes down to this. From the products of a country taxes have to be paid. It is an adaptation of the old system of tithes rendered complex by modern conditions. If those who run the big enterprises in regard to our mineral wealth do not spread industries, and broaden the basis for taxation, then inevitably the people will tax their mining, because it is the only industry that can stand taxation. Mining, unlike agriculture, is not an unprofitable and precarious proposition. His argument that a drop in the costs of working gold by 4s. a ton will bring in a large number of unproductive mines, and thus widen the industry and increase employment, is a specious argument, but the weak point in it is this, that unless you increase the output value to a greater extent than you reduce the total cost, the people do not gain. All the rich mines would get an additional 4s. a ton profit, which would go in dividends overseas. That is exactly how it would work out. If he said to. We will concede the 4s. to you on the profitable mines,” then there would be something to talk about. This country profits most by the cost of production being maintained in both gold and diamonds; that is what we are living on. It would be very much wiser if the hon. member turned his attention to see how secondary industries could be increased, so as to broaden the basis of taxation. The people have the votes; financiers hold the value, but the people who have the votes will take the needed revenue from those who hold the value. There is no question about that. The hon. gentleman shed the usual capitalist tears over having to pay £50,000 more for goods and equipment in South-West Africa, but concealed the amount taxed. The recent increased freightage put on by his friends in the shipping combine—particularly from America recently—will not alarm him in the slightest. He and those associated with him will say, “We will put it on diamonds, and the rich Americans will return it to us plus interest, and we have no need to worry.” This constant carping at reasonable taxation is detrimental to the mining industry in every possible way, and I think there is no necessity for it. It is ridiculous to make a song about these paltry spare parts, which could be made here. Mining magnates seem to be very ungrateful to their friend the Minister of Finance, who has just handed them back £180,000 a year, but there is no gratitude at all for it. They just take it, and then come down and criticize a few items which they think will add a penny or two more to their tonnage cost.

What has the Minister given to us?

The hon. gentleman is so accustomed to putting half-a-million or so in each pocket, that when he is handed back a mere £180,000. it passes him unnoticed. I allude to the abolition of the employers’ tax in the Transvaal. As a protectionist, of course I welcome every step that is taken to build up this country and ensure work to its people. I am not very much enamoured of the mode in which this protection is put on. I have expressed this view before, and I need not therefore, go into it again. A two-line tariff gives no adequate security for industries. I cannot see why limitations of the price of sugar should be only at the coast, and why it should not be controlled also at centres like Johannesburg, Pretoria, Kimberley and Bloemfontein. It is known what railway carriage is to these places, and the amount can be calculated to a decimal. I again remind the Minister that he is losing a large sum in not collecting the excise on brandy used in fortifying wines. In regard to a further tax on ready-made clothing, to a certain extent the wearer can determine to make a coat last a little longer or a little shorter time, and it depends largely on the state of his purse. The number of poor tailors is very great, and what we may lose on the roundabout we are picking up on the swings. If we have that value which is added to our wool in making it into cloth and clothes, the taxation on the tailors is on the other side, and they are assisting the revenue of another country, but if we bring tailors to this country, the added value put on the cloth enables them to contribute to the revenue of this country. So we broaden the basis of taxation. We seem to have drifted again into that everlasting question of protection versus free trade which every country has to go through, and we cannot avoid it, notwithstanding the experience of other countries. Let me repeat the dictum which has never been answered by any free trader, and can never be effectively answered—the opinion of Abraham Lincoln.

Who?

Abraham Lincoln—a name very well known—almost as well known as that of George Washington. Lincoln said—

That has never been answered, and can never be answered.

Because it is not correct.

Although the hon. member for Port Elizabeth (South) (Sir William Macintosh) has been converted and has now disappeared—

Under your fire?

Although that hon. member has been converted, we give up the hon. member for Cape Town (Central) (Mr. Jagger) as a hopeless case. He will never see that bales of merchandise imported are not equal to the importation of humanity, and the only thing that can make a country is that human element. We have had a long delay in the development of this country, a delay which is now passing—light is breaking, and the Cinderella of the empire is coming fast to her proper place—richest in gold, richest in diamonds, and richest in resources.

I just want to endorse what the hon. member for Piquetberg (Mr. de Waal) said about the support given to the wheat farmers in the tariffs, but I must add that I am not so enthusiastic as he. In the first place I acknowledge that the hon. member has each year advocated along with me the interests of wheat farmers. I only know of two exceptions. In 1921, 1922, 1923 and the first half of 1924 he assisted me, but in the second half of 1924 during the first session of the present Government and last year, i.e. 1925, when I advocated the raising of the import duty on wheat, the hon. member remained quiet. This year, however, now that the Minister has seen his way to increase the duty on imported grain he has, rightly, expressed his thanks. At the same time I cannot omit to refer to the reproaches made by the hon. member for Piquetberg against the previous Government. The previous Government did not impose the increased tax of 2s. a bag, but I remember the excellent report which was made by the then Board of Trade and Industries with regard to wheat, which recommended as the hon. member for Piquetberg has said the increase of the duty by 2s. a bag. The then Government did not do so, which of course disappointed me. But that Government did impose the addition to the old custom duties of 2s. a bag, a dumping duty which was divided into three classes. They were contained in the Act of 1922, and further elaborated in that of 1923. In the first place there was a “dumping” on the price, secondly one on the freight, and thirdly one on exchange (i.e. on the gold exchange). The last was of course never applied because it was not necessary with regard to Australia and Canada. It is certain that the dumping duty imposed by the previous Government benefitted the wheat farmers, because I read, e.g. that in January, 1922, a miller in Durban had to pay £6,000 dumping duty on a cargo of wheat he had imported from Australia. It goes without saying that he recovered it from the consumers, because the £6,000 was of course spread over the price of the flour from Australia, and the duty contributed to raise the price of our wheat. I can assure the Minister that our wheat farmers require protection this year more than ever before. According to reports from the whole country the quantity of water for irrigation is so small that hundreds and thousands of farms will have only half as much land under wheat as in former years. Therefore we can expect that the wheat harvest this year will be insignificant, and it is therefore doubly necessary to protect the farmers, because there can be no question of disputing, but that the lot of the wheat farmers in general is not a happy one. We heard last week from the hon. member for Cape Town (Central) (Mr. Jagger) that farming does not pay, and if the Government in one way or another does not support the wheat farmers, then more land will be put under cotton, tobacco and other produce, and still more wheat be imported from other countries. As mentioned before it costs a farmer 16s. 6d. to produce a bag of wheat and that does not include 5s. interest on the capital put into the ground, quite a moderate calculation. And what is the position when the wheat is turned into bread? Then a bag of wheat fetches more than £3 10s. The farmer himself only gets 22s. or 23s. so that after deducting 16s. for expenses there is only 7s. left for himself. The report mentioned shows clearly that of the price paid for the bread the farmer only gets 31 per cent., the miller 19 per cent., the baker 37 per cent. and that the delivery of the bread is accountable for more than 12 per cent. The farmer therefore does not even get one-third of what the consumer of the bread pays. It seems further as if the South African farmer does not stand alone, because it appears from a report of a Commission of Enquiry in America that the farmers are complaining even more bitterly there, and it appears that the farmer only gets 20 per cent. of what is eventually paid for his wheat. As for the imposition of a duty increased by 5 per cent. per 100 lbs. that is 10d. per bag, it is much less than what was recommended by the former Board of Trade and Industries, because they recommended 2s. per bag. I have the report of the board before me, but unfortunately I notice that separate reports are to be given to the Minister dealing with wheat and flour. I could not get those, and I do not know whether the Minister has received them yet, and if they will be laid on the Table, but I am very curious to see the report of the present board and how it compares with the 1921 report. I am, however, certain that this board also will clearly indicate that it is absolutely necessary to give protection. Now the Minister of Finance gave notice in the Government Gazette of the 1st of April, that the dumping duty of wheat from Australia was being removed as from the 30th of March. It is therefore true that there is 10d. per bag more import duty on the wheat, but the dumping duty has been removed.

No dumping duty was levied this year.

Fortunately the Minister still has the power to reimpose the dumping duty because the 1922 Act with the amendments of 1923, according to which the Minister, through the Governor-General, can impose the dumping duty, has not been repealed. It therefore remains quite in the power of the Minister when he thinks it advisable to again impose the dumping duty and I hope he will not hesitate to do so. It will then be a new concession about which every wheat farmer and especially the hon. member for Piquetberg and myself will be delighted. On the other hand when I read the tariffs I find certain recommendations by which the farming population are hit to a certain extent and one of the chief is Item 65, ready made clothes, jackets and waistcoats for men and boys. There is no doubt that this will be seriously felt by the farming population. It is entirely a wrong idea that the farm woman to-day as was the case thirty or forty years ago makes her husband's clothes. They are mostly bought ready-made. Of course the farming population do not go so far as the better-off people to have a suit made by a tailor. That seldom occurs, but the farmer gets his clothes ready made in the shop and he will now have to pay a tax.

It is not a tax that only hits the farmers, but the whole community.

And then the workpeople. I can give the Minister the assurance that it hits farmers with large farms fairly hard. I know, e.g. that I expend annually between £30 and £40 merely for clothes for my workpeople, natives, and I think every wheat farmer will agree that that is a fairly high amount. Then I want to mention enamelled goods. I make bold to say that there is no other class of the population that uses enamelled goods so much as the farmers. The farmer’s wife has her dishes, serving-dishes, cups, basins and everything the children and the workmen use made of enamel. Breakables and earthenware are only for table use. I think increase of import duty in this connection will rather hit the farmers. Another point, e.g. pipes and conduits of castiron. They are used for dam pipes, water-leading and other farming purposes, and here also the farmer will have to pay his share. I want, however, to add at once that the Minister need not be disquietened that there will be much complaint on the part of the farmers about the taxes I have mentioned. Why not? Because the farming population, at least in the district I represent, have always been prepared to bear its share in indirect as well as direct taxation so long as the farming industry is also properly protected. I sincerely hope that the Minister will go into the matter again. I do not know what is recommended in the report of the Board of Trade and Industries, but I hope the Minister will quickly replace the dumping duty on wheat or at least raise the import duty to 2s. per sack.

I have listened attentively to the speech of the hon. member for Kimberley (Sir Ernest Oppenheimer), and when a financial authority like him speaks, then an amateur like myself feels fairly hesitating to express a different opinion. As far as I can judge, the hon. member tried to prove from certain figures he quoted that the protection policy of the Government would be detrimental to the interests of the farming population. He took the total income of the farmers, the value of the produce of the country, and he gave the number of farmers, but he apparently included, as I understood him, all the bywoners who also produce and co-operate on the farms, and all the married sons who farm on their own account and are taxpayers. That in itself alone shows that his figures cannot be right, The hon. member took that total which we pay in import duties, then calculated the average amount, and said: This is the amount every farmer pays, this proves that the farmers are damaged, because each one pays a very large sum. The calculation of the hon. member made me think of the calculations of a certain accountant (this will, perhaps, interest the hon. member for Cape Town (Central) (Mr. Jagger), who took the stock book in a business and in the case of 200 articles, which he found following each other in the book, compared the purchase price with the sale price. He took the profit on each article, divided the total profit by 200 and, in that way, calculated the percentage of profit. He quite forgot that some of the articles were often repeated in the list, while fewer of others appeared on the list. He forgot that people do not buy the same quantity of each article. They possibly buy a large quantity of cheap articles, but few of the expensive ones. In the same way the hon. member also made his calculation. Such a calculation is ridiculous. If the hon. member had taken a 1,000 or 10,000 farmers, and mentioned what articles each farmer bought and what percentage it represented on the long list of imported articles, then he possibly could make such a calculation. If he has a list of the articles the farmers use most and of the tax which is paid on each of them, then he can make the calculations of how much the farmers or any other class of man pays per head in import duty. Otherwise it is impossible. In the calculation he has given us he did not do that. Consequently, anybody with sound common sense, and a little knowledge of arithmetic will say that the whole argument is absolutely valueless. This astonishes me much in the case of a financial authority who further added that the figures had been checked by a great economist.

I wish to assure the Minister that the wine farmers appreciate what the Minister has done in increasing the duties on wines and spirits, and we are pleased that he did not follow the terms of the resolution proposed in this House in 1924, as that would be doing the wine farmers harm. It has been urged that we, on this side of the House, are against protection, but we have always shown ourselves ready to protect agriculture whenever necessary ; certainly we have differed as to the methods of doing this. I wish to express my appreciation of the speech of the hon. member for Kimberley (Sir Ernest Oppenheimer)—it was of the greatest value to us as producers. South Africa has only two sources of income, agriculture and mining, and to a small extent fishing, and they have to pay for everything. If minor industries are protected at the expense of these main producing industries, the latter will suffer. It will be a stupid business even to place an import duty on wire netting, as has been suggested, and I trust the Minister will never impose that suspended duty. The Minister of Finance said that the board did not recommend it. I am not attacking the board at all. Let us take the board’s recommendation that an import duty should be placed on windmills. Last year the Minister thought that these things were so necessary to the farming community in an arid country, that we should allow them to set off expenditure in this connection against their income tax. Now the board makes a suggestion to put a duty on windmills and harrows. Where are you going next? This is taxation directly on one of our main industries—to me out chief industry. We are now placing a duty on pipes and piping and tubes of 20 per cent. We have gone further than that, and placed a duty on wrought iron pipes in a country which wants to use every little drop of water that it has, and which requires these pipes for that purpose. Nothing could be more directly against the interests of the farming community than that. I wish to warn the Minister, because you don’t know how far this kind of thing may go. I would have liked to see the Minister admit free of duty boxwood for packages used by jam manufacturers, and for canned fruits. If he had allowed these to come in free, as well as the other boxes, he would have given some relief to an industry which really requires it. I view, in the same way as the hon. member for Lydenburg (Mr. Nieuwenhuize) has done, with alarm the duty on ready-made clothing. Who are you going to tax there? You are going to place the heaviest burden on the poorest class of your employees. Those who use tailor-made clothes—the well-to-do—gain both ways, inasmuch as they do not now pay any duty, and the raw material used for that clothing is allowed to come in free. Nothing could be more against your civilized labour than putting that duty on ready-made clothing. Then take the duty which is to be placed on structural steelwork for the staging of machinery. We are encouraging industries on the one side and it is necessary to stage your machinery for the purpose of carrying on your industries, but here we are placing a duty on the other side. We, as farmers, and particularly those of us who are large employers of labour, view with alarm the direct and indirect burdens which are being constantly heaped on to the producers in the community.

I am surprised to hear the remarks of hon. members opposite that the wheat farmers are not sufficiently protected. When the former Government imposed the dumping duty on superphosphates to protect a factory which only supplied a small part of the quantity required, we heard nothing from hon. members opposite of the burden that was thrown on the wheat farmers. To-day, however, we hear of the small protection of the wheat farmers. Not twenty-two months ago I interested myself in the matter with the hon. member for Piquetberg (Mr. de Waal) that the dumping duty should be removed, and its removal by the Government was an incalculable relief to the wheat farmers. To-day an endless quantity of phosphates are used in the Western Province, and they are commencing to be largely used in the Eastern Province. That is what the Government has done. I should also like to thank the Government and the Minister for seeing their way to place an increased duty on wheat and flour. I know, as the hon. member for Lydenburg (Mr. Nieuwenhuize) has said that there is a desire that the duty should be still higher, but I can understand that everything cannot be done at once. In connection with what was said by the hon. member for Cape Town (Central) (Mr. Tagger) I should like to give a few figures. On to-day’s taxation it is 2s. 10d. on a sack of wheat, 6s. 8d. on a sack of flour. We must understand that a sack of flour requires more than a sack of wheat and the relative amount to equalize the import duty on a sack of flour with that on a sack of wheat is not 6s. 8d. but 5s. 100 lbs. of wheat can be ground into 75 lbs. of flour. I just want to make plain that the consumption of wheat in the country is about 3,600,000 bags per annum, while the production of wheat during the past year was about 2,400,000 bags. I just want to point out that if the white population of 1½ millions together with the ½ million coloured people who also consume wheat and flour, i.e. 2,000,000 people in the Union consume about 3½ million bags per annum, then one can calculate how much one person consumes per annum, and how little each person pays in taxation for the flour he uses, and as a fact wheat has gone up since the Minister’s statement and flour gone down. Wheat, when the farmers delivered in January, was not 26s. a bag but 24s. When one calculates this you find that it is a very small amount to the consumer, but that it is a large sum of money and a great help to the wheat producers. We must do one of two things. We must clearly say whether we think that the country can produce enough wheat for its own consumption. If it can then the wheat farmers must be protected. I think the Minister of Finance told us in his speech that there was plenty of room for increasing the production of wheat, and that there was every possibility that if protection was given, enough could be produced to meet the requirements of the country. I just want to say that it has been calculated that a bag of flour of 200 lbs. can be made into 240 lbs. of bread. When one reckons that a loaf of 2 lbs. weight is sold at 7d. then the consumer pays £3 10s. for a bag of flour, and this where the price of a bag of flour is actually 35s. As the hon. member for Lydenburg (Mr. Nieuwenhuize) has rightly said, it is on the way from the producer to the consumer that the price rises from 35s. to 70s. per bag. I think enquiries should be made into the matter. I want again to thank the Minister for seeing his way clear to place the increased import duty on wheat and flour, and increasing the duty on whisky from 37s. 6d. to 45s. per gallon.

When the hon. member for Troyeville (Mr. Kentridge) was speaking this afternoon he explained the whole theory of price fixing, and continued with a system of import licences. I am perfectly certain that with a little bit of encouragement the Board of Trade will accept his doctrine and we shall have a complete system of price fixing and also fixing the quantity of imports and the price at which all the goods would be sold. It will have another advantage ; it will give us another batch of inspectors. The position to-day is that in every three men working I suppose there is an inspector to look after them. The country has to pay for all this unnecessary inspection and all these unnecessary officials, for looking after a machine that could quite as well and very much better look after itself. I would like to refer to the first essay in price fixing. I think on the whole I agree with the hon. member for Troyeville (I don’t often agree with him in any respect) that it is a very satisfactory thing that the Board of Trade are going to make this essay in a new system of running a country which up to the present I suppose has really only been tried completely in Russia and during the war. The conditions then were entirely different from the conditions at present eight years after the war has ceased. That is really the essential difference, or one of the essential differences, between our view of the whole question, and the view of the Minister of Finance as expressed by the Board of Trade, because the Minister is satisfied with the conclusions and the methods of the Board of Trade. Let us take as an example this question of sugar. I know very little about sugar, but I know something about price fixing. The Board of Trade is going to fix the price of sugar to the consumer, and the price to the wholesaler, and the price the wholesaler can charge the retailer. The price the retailer is to charge the public is 3½d. per lb. and he has to pay 26s. 3d. for a 100 lbs., to the wholesaler. That leaves him a gross selling profit on his selling price of rougly 8½ per cent. Now the Minister of Finance is one who is always amenable to reason, and let him consider what is going to happen to the per cent., and how far that per cent. is going to go. In the first place, what does he propose the people are to be paid who are selling the sugar? The rate for the staff would be somewhere in the neighbourhood of to 7 per cent.

But we merely say that we should not charge more for the sugar than you are charging at present.

I think that the price is a little more than 3½d. per lb. and nearer 4d.

The prices are based on the March figures. I do not know what the price is now.

I sell sugar, but the Minister does not. The retailer will have to pay 6½ per cent. to the people who are selling the sugar. I would remind the Minister that a colleague of his has brought in a Wage Bill whose principal function, as the public know it, is to increase wages. They are putting up a Wage Board who are going to do away with anything in the way of sweating, with which I agree. But if you are going to make the storekeeper and the retailer pay his staff a decent wage, you must allow the storekeeper to make enough profit on his product to pay the wages.

He will make it on other lines.

The Minister recognizes that any money that is paid to the staff is paid out of the difference between the cost and the selling price of an article. That leaves 2 per cent, for any other expenses. I can assure the Minister that the rent of a store alone will be 2½ per cent, on the turnover. Before a retailer has sold a pound of sugar he has to pay more than all of his profit on two items alone of his expenses. The next stage is that he allows the wholesaler 1s. 3d. for all the expenses of selling 100 lbs. of sugar. I can assure the Minister that it cannot be done, and that the wholesaler is bound to lose money on it, and there is also the other case: What will the Wage Board say? We shall have another set of inspectors coming in from the Department of Labour and pointing out that you must pay your staff the 1s. 3d. that you get on your sugar. You are going to have two departments both making it impossible for the merchant and retailer to exist. I will give the Minister some idea of what is going to happen: At the present time the wholesaler finances the retailer ; that is, he provides the goods on credit, and to a certain extent he provides the capital for the trade. The wholesaler is going to cease doing that, and somebody else will have to do it. The money will have to be found, and the retailer will be told that he has got to pay cash for the stuff. The wholesaler will also refuse to deliver.

Why does that not happen now?

I will explain. The next item that the wholesaler is going to get rid of is the investment in sugar. I do not think I am exaggerating if I say that at any given moment there is a sum of £500,000 invested in sugar in the hands of the wholesalers, taking Johannesburg, Port Elizabeth, East London, Cape Town and Pretoria. I think I am rather understating the case. The wholesaler is not going to put up that £500,000 any more. He is not going to stock 10,000 bags. He will only stock a couple of hundred bags or pockets, and the manufacturers will have to hold the rest of the stock, and the public will always be running short of sugar. In addition to providing the capital for this sugar, you have to remember that that amount of sugar does not go on a threepenny bit. You have to provide storage, and that has to be paid for. I want to explain to the Board of Trade, through the Minister, that all these details have to be taken into consideration when you are discussing fixing the price. I do not mind the Minister experimenting with price fixing. It is rather an interesting study in socialism, but if I were he, I should start by taking one thing at a time. There is an old saving that it is wise not to put your foot out further than you can hold it down, and I would suggest to the Minister that he fix, if he likes, the retail selling price of sugar. Then the retailer could make up his mind whether he is prepared to stock sugar if the wholesaler charges him too much, and the wholesaler could do the same if the manufacturer overcharged him. but to deliberately say that these two distributing agencies shall be limited to a certain amount is a wrong step to take. If the Minister wants to try a socialistic experiment, he should do so under the best possible circumstances. Personally, being an individualist, my belief is that sugar will find its right level much more easily under the ordinary conditions of competition than by any interference of any board or Parliament. The Minister mentioned that the price of sugar was 3½d. per lb. in March, but my information is that it was nearer 4d. The reason for that price is that sugar has never brought any considerable profit to either wholesaler or retailer. The only people who have made money out of sugar are the gentlemen in Natal, but the wholesaler and retailer have not even made their expenses. The Minister has got hold of the wrong horse, and is making a great mistake by trying to deal with the retailer and wholesaler.

Why worry about too little profit?

We are not talking about making too little profit, but about reducing our losses, and that is where the Board of Trade are entirely mistaken. If they made their investigations thoroughly—not that I want them to, for that would mean another batch of inspectors and books going to Pretoria and a general disorganization of business —they would find that no retailer in the grocery trade can ever make a profit on 8½d. I do not suggest that people are going without sugar. Even if we have the harsh and arbitrary methods of the Minister applied, the retailer would still supply sugar at 3½d., but he will do so as an advertisement in order to obtain other trade, and he will increase his profit on other lines so as to recoup himself for his losses on sugar. Next year the Minister will say “What a fine position I have put the public in—I have kept their sugar down to 3½d.” The only thing that will have happened is that the housewife will have got some sugar at 3½d. which she should have paid 4d. for, and she will have paid 4d. for something else that she should have got for 3½d. That will satisfy the craving of one section of the House who want this socialistic method of price-fixing installed in this country. I am afraid that the Minister of Finance, who I thought would have been the last Minister to have been caught by this chaff, has fallen, and it will only be by bitter experience that he will recognize that what we are telling him on this side of the House is fact, and that what they are telling him on the other side is fiction. I am not at all certain that the wholesaler is going to take up the position that the retailer will. I think you will find that the wholesaler will sit tight. I would say this to the member for Zululand (Mr. Nicholls), that if this sugar business is to go on the conditions that you have laid down, the manufacturer will have to perform all the functions which the wholesaler will refuse to do. The manufacturer will have to hold the stock, he will have to store it, and I may say in passing that they cannot store it all in Durban. For instance, there are certain times of the year when it is unwise to store sugar in Durban, and then they send it down to Cape Town and hold stocks here, because the climatic conditions are more suitable. The manufacturer will have to supply all these additional facilities which the wholesaler supplies at present, and, incidentally, the wheels of business are going to be hindered, and there will be a lot of dislocation. No one will be more interested than I shall be in the experiment, and I think it just as well that this country should have a few experiments in socialism. There is such a lot of loose talk goes on both in this House and outside that it is very much better to have certain concrete examples to prove whether we are right or the other side are right, and, as I say, this consistent and continuous talk about the profits more particularly which are made by the retailer in foodstuffs is absolutely false, and the sooner the public sees that is so by real experiment, the better. It will only cost the country a few thousand pounds. I think the hon. member for Troyeville (Mr. Kentridge), a great supporter of the Minister of Finance, said it was going to cost £1,700,000 to the public. It will be cheap at the price if you once and for all settle the loose arguments of the gentlemen on the cross-benches.

Supposing it turns out all right?

It will turn out all right. As I pointed out, it will be camouflaged. I would like to refer to the schedule. These are small details, but one noticed that when the Minister was introducing the motion he mentioned that many of the items were caused by an incorrect or uncertain description in last year’s schedule.

No. I did not say that.

No, you did not say it, but you pointed out certain items which were to correct certain items passed last year that were wrong. It was because the actual wording of the item was not sufficiently carefully laid down. I will give him an instance. He was referring to the way in which he was going to see that women were not extravagant any more, a very wise thing for him to do. In item 69 you have—

That may be all right, but when you come to dealing in the actual thing, it is a different matter. Let us take the item of bands. What is a band on a bat? The customs man does not mean the band outside, but the band inside. All these definitions are put down by people who do not see the implication of the words. I would suggest to the Minister that he would get nearer to his intention if he were to put the actual price instead of the description. The Minister said something to the effect that he was going to except schoolgirls hats. The natural question one asks at once is: Supposing an importer imports schoolgirls’ hats, and someone, who is not a schoolgirl, comes in for them, they are going to pay no duty on them. It is very difficult to define what a schoolgirl’s hat is. I suggest, if he were to put ladies’ trimmed hats, say, over 72s. a dozen, he would cover the whole field right away, and there would be no necessity for these extraordinary regulations. They call them elucidations, and after the Minister has put through an Act like this, for the rest of the twelve months we have the Customs Department every week ‘elucidating” the wording of the Act, and the interpretations which are issued by the Customs Department would fill our library. As the hon. member for Port Elizabeth (South) (Sir William Macintosh) said this afternoon, no shipping clerk in South Africa can keep track of them, and I doubt very much whether the customs officials themselves can. I will give another instance. You will notice item No. 129—Motor-car chassis, not including rubber tyres and tubes. The ordinary member does not quite grasp the inwardness of this—

The reason is that, when the Minister put this item through last year, he put it through as motor chassis alone. Well, naturally a man brought in a motor chassis with four tyres, because tyres are an essential part of the vehicle, and you cannot move a chassis without tyres. The customs officials got hold of it, and issued one of their celebrated “interpretations,” and it was that it did not include tyres and tubes. Now the Minister is going to make that right, and agrees that, in many of the instances, he is putting right what was wrong last year.

Not wrong.

I will accept from the Minister that it was not wrong last year, but the customs officials made it wrong by ruling that a motor chassis did not include the tyres and tubes. Now. I maintain that the tyres and tubes are as much essential parts of a motor chassis as the brake, the windscreen and the speedometer. The customs officials say that the speedometer is an integral part of the chassis, but not the tyres. You would hardly credit it, but there are instances in these big lorries that the duty on the tyres under the interpretation of the Customs Act has been practically within £1 or so of the duty on the whole chassis. It is wise of the customs people to get as much duty as they can, but they should not put the Minister in the unfortunate position to put right, not what was wrong, but was a wrong interpretation. The hon. member for Cape Town (Central) (Mr. Jagger) mentioned the danger of establishing a monopoly in the motor industry. I quite agree with that warning. I am very much afraid that, unless the Minister keeps a very shrewd eye on the whole business, he will find that the motor industry in this country is in the hands of two firms, who will, at any rate, be put in a very strong and over-reaching position as regards the rest of the motor industry, and I would warn him, before entering into any such arrangements as he is entering into, to see that we are going to get an enormous benefit.

Business interrupted by Mr. Speaker at 10.55 p.m. and debate adjourned ; to be resumed tomorrow.