I am sorry that the Minister would not accept my reasonable amendment last night. I would move—

Under the exemption of agricultural machinery under tariff No. 118, it is only machinery and apparatus not specially provided for which come in free, and I am afraid that unless we put this in the item now under discussion it is possible—

This item deals with chassis. I am afraid the hon. member (Mr. Stuttaford) is out of order.

A motor tractor, to a large extent, is chassis. It seems to me it would come in most conveniently here.

That is a different article.

Shall I be in order in moving to insert it after “129,” making it 129 (a)? I move to insert it as a special item. I am afraid that unless we make it perfectly clear the Customs Department will consider that it comes under one or other items of motor transport generally. Item 129 deals with motor cars.

But we cannot take items that are not submitted to us.

May I point out that item 129 deals with all kinds of motor cars.

No ; motor chassis.

May I say to the Minister that this is an amendment of a certain item in Act 36 of 1925, and that—

Yes, but we are dealing with what is before us. We cannot deal with Act 36 of 1925 now.

I would submit that this clause is an amendment of section 129 of the 1925 Act.

Yes, but we have nothing to do with that.

I would like to have your ruling, Mr. Chairman, because this is an important matter. I understand that we are now dealing in the schedules before the committee with an amendment of the customs laws. Under the circumstances is it not within the province of any member of the committee to move a reduction of any item in the existing customs laws of the country?

As I have said, hon. members may only move reductions on what is proposed and submitted to us, whatever the Act may say. Rule 115 applies to it. On the motion of Mr. Roux, an amendment was made in the Dutch version which did not occur in the English.

I move—

The hon. member is again introducing motor tractors, which we do not find in the item.

I would like to move another amendment—

I feel in this case that the difficulty is perhaps due to want of knowledge of the mechanism. The engine of the chassis of the tractor is a similar class of article. There is no definition here that the motor chassis shall only be used on the road. Under this clause anyone importing a motor chassis would be charged under this item. You would find that the Customs Department would consider that this comes under this item.

I do not see how that can be so. This only refers to motor cars, not to tractors in any shape or form. Item 130 might be made more to apply to tractors, although it is not mentioned.

Perhaps the Minister would explain why he has made this change, because I think the change he has made going to defeat the object which encouraged the House in a previous session to make a great difference in the customs duties on motor chassis being imported for the purpose of having bodies built in the Union. Under the existing tariff, chassis, the bodies of which were to be assembled in the Union, came in at 10 per cent. Those of which the bodies were to be assembled in the Union came in at 20 per cent. Now we are going to allow a duty of 15 per cent, upon chassis, the bodies of which are simply to be assembled here. Does the Minister think that is going to encourage the coachbuilding industry of the Union? Instead of building up a body-making industry, the chassis will be imported ; the stamp signs will come in, a coat of paint will be put over them, and you are going to give them a duty of 15 per cent. If you are building up a really genuine motor car body building industry, one would not have an objection to altering the tariff.

The right hon. member is wrong, I think. All that we mean to be imported are panels, stampings, and the structural parts of metal shaped but otherwise in the rough. All the other usual work connected with bodybuilding, all the wood and leather work, is to be done here. If we had a sufficient demand we would probably do the stampings here, as they do in Australia, where they have five times the number of cars they have here in this country. Our demand is comparatively small, and it would entail the installation of very expensive machinery.

What otherwise have they to do with the shaped metal? Screw it on and paint it?

A motor car does not consist of only steel work. It says here, “not fashioned or cut to shape.”

But what is done besides screwing it up?

It is finished off. We are convinced that a very important part of the work of body building is to be done here, and that this concession is justified.

The Minister has not made himself very clear. Upholstering is not what he is protecting—he is protecting the metal.

If the other parts are imported we do not give protection.

The Minister is trying obviously to establish the metal part of it as an industry in this country. It is not the leather work and the upholstery work he is trying to protect.

It is the other way round, the very things I do protect. Is there no wood work in connection with the thing?

In item 129 of the old tariff, under the head of motor cars, you will find, chassis imported for body building purposes, 10 per cent. ; motor trucks for body building purposes, 5 per cent. The whole of the superstructure can be made of any material grown in South Africa. This one, as far as I can understand, is really for the benefit of the Ford people and the South African Motors— that they should start an assembling works.

Where?

In Port Elizabeth.

That is why the hon. member for Port Elizabeth (Central) (Col. D. Reitz) is so against it?

Oh, no; be fair. The Ford people find they cannot get the stamping done in South Africa, and they import the stamping. The Minister says it requires heavy machinery to do it. I am not supporting the Minister— I abominate all these various things—but I am only trying to make these things clear.

The Minister will excuse me, but his punctuation is so prolific that it confuses, and I find very great difficulty in appreciating the meaning of this. The other material seems to be perfectly free. Either it wants more commas out, or some more in.

Take them all out!

Item, as amended, put and agreed to.

On item 130,

; Steam wagons have hitherto been free, and are to be charged 10 per cent. Why put in an item like this? Steam wagons are used only by contractors, municipalities and divisional councils. No firm in South Africa is going to make them—these wagons are made by large firms overseas, like Merry-weathers, arid others, which specialize in these. It is only putting an increased burden on public bodies, and I hope my hon. friend will reconsider this. It will not bring a single man here.

The hon. member is probably right. The steam wagons will not be made here, but the bodies will, and that is what we are after. We admit the chassis at 5 per cent., and the bodies can be made here. If you have the whole article free you will not encourage the building of the body in South Africa. Although motor trucks pay 20 per cent., in practice they are not imported nowadays. In every case the body is being built in this country.

Why do you want 5 per cent.?

It is to put it on a par with your motor-truck which, at present, pays 10 per cent, on the chassis. Our present policy is to force the people who make the chassis to build the body here.

The Minister has let the cat out of the bag. He says the duty is to put the steam wagon on a par with the motor truck. The motor truck is burning oil which we import from America. The steam wagon is burning our coal. I find that the imports of steam trucks are going down. In 1924 we imported 60,000 and, for the last six months of 1925, the figure was only 26,000, and prices are going up higher every day. This tax is going to accelerate the price more than ever. This cannot be a protective tariff because we do not build these things in South Africa, and never will be able to build them here, and as a revenue tax it is highly objectionable. The Minister wants to put a tax of 5 per cent, on the steam wagon because they are going to build the body. Let the steam wagon come in free and tax the body. The farmers in the Free State are beginning to use these steam wagons, and I know it is the farmer who is going to pay in the end The Minister’s constituency is next to mine, and we are running steam wagons to bring in the produce into our constituency and that of the hon. member for Boshof (Mr. van Rensburg).

How many farmers in your constituency are using the steam wagon?

The son of the late Mr. Fichardt is running them from Bloemfontein to different places. We are going to make it more difficult for these people to run these steam wagons which will assist the Government in the western Free State. Why tax them? The municipalities and the big contractors are using them. The Minister will get no revenue out of it.

In spite of the plea of my hon. friend, I am not afraid of the effect of this tax either on the farmers or the municipalities. He has told us that the importations are decreasing. There is absolutely no reason why this particular article should have an advantage over the motor lorry and charabanc and these things, and what we are after is to get the body built down here. It is only 5 per cent, on the chassis.

How much body is there to a steam wagon?

A large portion of the bodies are being built here.

Our cry was “South Africa first," but it appears to be “America first.”

No. The hon. member says the steam wagon burns our coal, but we can get rid of our coal in other ways.

I do not often agree with the hon. member for Bloemfontein (North) (Mr. Barlow), but I do on this occasion. I do not know whether the Minister knows that there are a great number of steam wagons used in the wattle industry.

We would like to have the information. If the farmer uses them let him pay the duty.

They do not use coal to make their steam. They use wattle wood. This industry is growing because the wattle farmer has found out that, instead of having a great area of land for running his oxen, it can be better used for wattle, by using mechanical transport. I hope the Minister will have some regard for this portion of the country which is using these wagons. Why increase their difficulties?

The last thing I should desire is to interfere between the bark and the tree. While agreeing with the Minister that he is justified in doing everything, he can to assist in the building of bodies for steam wagons in this country, which bodies are very often fairly large and are a legitimate industry, that is no reason for putting on a duty of 5 per cent, on the chassis which previously came in free. Last year traction engines and trailers, stone crushers, and street sweepers, which had previously paid a duty of 3 per cent., were put on the free list. Why not allow steam wagons without bodies to come in free? Divisional councils are using a large number of steam wagons for road construction purposes.

The Minister will not listen to me, and therefore, I will quote something to him from “Die Burger” of 14th April. It says—

That is enough.

On this question the hon. member for Bloemfontein (North) (Mr. Barlow) seems to be antiquated. He says the reason for using the steam wagon is because it burns our own coal, but we can consume our own coal by making electricity, and if sufficient inducement offered, we could also obtain motor spirit from coal. The farmer has a very much cheaper vehicle in a motor wagon than in a steam lorry, which is entirely antiquated. The tendency to-day is to use petrol and electricity and not steam.

The district I represent is a wattle one, and has an enormous amount of wood and bark transport. Two or three years ago there was quite a boom in the Sentinel steam wagons, because they were admitted free, but to-day petrol driven lorries are more in favour. I have yet to see a steam driven lorry which will carry twelve tons, but that is quite a common sight with petrol motor lorries.

I understand the Minister said his object was to get the bodies of steam wagons built in this country. According to item 130, motor trucks, trailers and vans and charabancs, the bodies of which can be made here, are not protected. I do not know whether I read the item aright.

It seems to me that the hon. member (Col. D. Reitz) does not quite understand the position. He will see that the completed vehicle is heavily taxed, not because we want to get the revenue from that vehicle. If you take the other item, we let the chassis in at a low rate, and this has the result that the body is built here. We find that people do not import the completed vehicle. We do not want them to import the steam wagon and pay the duty of 5 per cent.

The point is why charge this duty on chassis of 5 per cent.? If it is desirable to encourage people to import chassis in order to induce them to build the bodies here, why not let them in free?

The reason is that last year, when we dealt with the tariff as a whole, we said we could not let the chassis in free altogether. We had to get something from them.

This is purely a revenue duty?

It is a revenue duty

Item put and agreed to.

On item 134 (a),

I think this is going a very long way. Iron pipes, which are used for irrigation purposes and for bringing water into towns and cities, are to bear a duty of 20 per cent. But that is not all. Further on I see that pipes, piping and tubes for drainage purposes are also going to be taxed 25 per cent. If that is encouraging industry, I don’t know what is encouraging industry, that’s all! Where is the encouragement to a man who wants to carry out irrigation work?

I would like to support the protest of the hon. member for Cape Town (Central) (Mr. Jagger). All the big piping brought out to this country over 20 inches in diameter, every bit of it is rivetted when it comes into this country. There is not the machinery in this country to-day to make this big piping. It cannot be made here, and won't be made here for years, so what is the use of putting a duty on material of that kind?

The pipes are brought in here free. All that is done here is the rivetting, which any engineering shop can do.

The piping is all made in one; you cannot get the pieces out and rivet them together here.

I am advised that these pipes are rivetted in the shops here.

Your information is wrong. All the piping that comes to this country, that is, piping worthy of the name, comes out rivetted. The large consignments of pipes come out manufactured and finished, and it cannot be done here. There is the whole point.

The whole point is that it can be done here.

Do I understand from the Minister that what he is protecting is the rivetting, not the pipes?

Yes, the pipes come in free.

Is that the sort of protection we are indulging in? Is the Minister trying to create an industry out of a man taking a jack-hammer or a monkey-wrench and screwing these rivets together? It seems to me that this is protection run mad. We are putting on a protective duty of 20 per cent, for the purpose of creating a class to screw in rivets. It seems to me an extraordinary way of building up a South African industry.

You don’t want to see the engineering shops here extended.

If this is extending engineering shops, I am sorry for the industrial future of South Africa. This is of a piece with the whole system. You are protecting bastard industries. There is no sign in this tariff that I can see, with the possible exception of sugar, of protecting any bona fide South African industry by creating and encouraging industries that are using South African raw materials. Can this Souse imagine a more parasitical, a more bastard, industry than this rivetting business? All our key industries that can be established here are ignored in this tariff. This tariff as it stands is simply going to harass the public, increase the cost to the public and establish not one single industry of any significance in the Union. It is a tariff of nick-nacks.

I am afraid I must differ from the hon. member for Port Elizabeth (Central) (Col. D. Reitz), in his estimation of the value of an engineering industry or engineering workshops in this country. I believe the hon. member is in favour of an iron industry in this country. This is one of the subsidiary industries. We hope one day to make the iron and this will be one of the subsidiary industries. Let me tell the hon. member that the material is imported in sheets and it is smoothed out, perforated and rivetted here. There is a lot of labour in connection with the whole thing. Our object is to provide employment for our own people. The hon. member does not want that, apparently.

That is very weak.

I think I am perfectly entitled to draw that conclusion.

Get the iron industry firmly established first and then you can come along with this.

It seems to me that the Minister has not read the item. We are dealing with piping, not sheets.

The iron is imported in that form and the pipes are made here.

I agree with the hon. member for Port Elizabeth (South) that this is protection gone mad. The cost of the piping to the consumer in this country is not represented altogether in the 15 or 20 per cent, ad valorem duty, but also in the additional expense that will be caused to him owing to the extra cost of making inferior pipes in this country. To my mind this protection appears as ridiculous as it would be if anybody said: We shall nut an enormous tax upon iron safes, because you can manufacture the keys in this country.

I am surprised to hear some of the statements which are being made in this House. The hon. member for Beacons-field (Col. Sir David Harris) would never dream of importing this stuff in their workshops in Kimberley. They make these things—not only rivet them, but make them complete. We are in this position, that we are producing the raw material in the country.

We are not.

Within the next few days we shall be making pig iron in this country. The Vereeniging steel people are pushing ahead to make the very material that these pipes are made of and we have the finest mechanics in South Africa. Some of them are looking for work to-day, while stuff that can be made in our own shops is being imported. Not long ago the Minister of Mines and Industries paid a visit to some of the workshops on the Witwatersrand and in one of these saw a big job being carried out for the Irrigation Department, largely consisting of wrought iron rivetted pipes.

I would like to correct the statement made by the hon. member for Germiston (Mr. G. Brown) that we manufacture pipes in De Beers' workshops.

You can do.

The point is, we don’t do it. The only pipes that are made, as far as I know, in the workshops of the De Beers Company are the pipes made by the kafirs, which they smoke themselves.

I must say I think the explanation of the Minister was somewhat weak. Every time we criticize an item in this tariff, they invoke the sacred name of white employment. That is no argument. We, too want more white employment.

No, you do not.

Yes, we do. That is an unfair method of meeting our criticisms. We are as anxious to see white employment in this country and more so than the other side, lut we want it done on the right lines, and not on uneconomic lines.

What do you mean by that?

I mean you arc starting at the wrong end. Let the Minister come forward with a comprehensive scheme for starring pig-iron and making these sheets from our law materials. He is looking at it through the wrong end of the telescope. When hon. members on the other side bring forward a policy under the sacred name of white employment, or this or that, I always suspect them. They have in the past exploited the public in the name of South African patriotism, and I am afraid they are going to do it again under the sacred name of white employment. We are just as desirous of strengthening the position of the white man, and of seeing economic employment, but we think we have every right to criticize an unsound tariff without having it thrown in our faces that we do not want white employment. We are desirous of helping the Government.

Your actions do not show it.

The South African party Government initiated a policy of white labour in this country. We started it on the railways, in forestry and at Hartebeestpoort. We gave employment to thousands upon thousands of whites. The Minister is a fair-minded man ; surely he will give us credit as South Africans for being anxious to see the position of the whites strengthened in South Africa. That is why I appeal to him, not to meet us with this argument every time we legitimately criticize the tariff. It is untrue and unfair. I will prophesy that this series of bastard industries will not strengthen the white position in this country. The bulk of these industries are going to be conducted by coloured and native labour.

I would like to say to the hon. member for Port Elizabeth (Central) (Col. D. Reitz) that it is a very dangerous thing in South Africa to prophesy, especially for the South African party to attempt to do it. He said that his party is in favour of the extension, I take it, of the field of employment for white labour. Are we to take that as read?

Certainly.

He also claimed on behalf of his party that they initiated a white labour policy. I would be the last man to take from them any kudos to which they are entitled, and I am quite prepared to say that they did start making openings for the employment of white men, notably on the railways, but we must also admit in common fairness that a good deal of pressure was brought to bear by both the Nationalists and the South African labour party in that direction.

Come to the item.

I will come to it. The hon. gentleman himself is but an item.

Only a back bencher!

The new democracy!

My hon. friends, due modesty will recognize that fact.

I think we had better adhere to the item.

I am coming to the item. They introduce it, but their efforts this afternoon demonstrate that they are in favour of putting a period to it. What would be the result if my hon. friend (the Minister) departed from his attitude in face of the near manufacture of pig-iron with its consequent subsidiary industries? The hon. member for Germiston (Mr. G. Brown) is perfectly correct; we can make these pipes here to-day. We can make them, have made them, and are making these pipes. I want to deprecate the asseverations of those hon. gentlemen who are constantly decrying our capacity for doing these things. We have the men and the material to do it— yes, and the money too, if certain corporations we know of do not filch it all. Are members on the other side perfectly consistent when they claim that they are anxious to develop white labour, or any other labour, in face of this tariff? The question of the imposition of a tariff has no effect whatsoever in the increase in the price of articles to the various people who use them.

What nonsense!

I am going to show the hon. gentleman what is a fact in that connection. An engineering factory in Benoni, manufacturing spuds and air-cocks, had already got contracts with several mining companies for the supply of these articles. It was admitted on test that they were superior to the imported articles. What happened? Contracts were already held, and they were supplying the articles to certain mining companies. Despite the superiority of the locally made article, despite the fact that it was 6d. cheaper on a 7s. 6d. article, these companies cut out these particular orders, and were taking them from overseas. That is what increases the cost to the shareholders.

You have not stated all the facts of the case.

I have stated every item of the facts. Do you question my veracity?

No, your intelligence, not your veracity.

I am always prepared to meet my hon. friend’s argument with argument. These are all the facts. Don’t let us bring in hypothetical questions like intelligence—from that side of the House. I saw the books, I saw the articles. I saw the orders, and the letters cancelling the orders.

Did you see the books of the company to see the price they paid?

No, but surely something can be left to our own knowledge and our own common-sense. These are the facts. These are factors that operate more than the imposition of a tariff in increasing the price to the consumers of South Africa. The Minister, rightly or wrongly, is now engaged in fostering the industries of this country in the only way possible, that is, by protecting the people engaged therein.

I don’t doubt the word of my hon. friend, but one sees so many of these statements. I do not think he knows all the facts. I have no doubt he things he does, but I cannot conceive business men conducting these big affairs deliberately going out of their way to import from overseas when they can buy cheaper here. It is downright folly. The statement is frequently made that a South African-made article is just as good, but it is not—from actual practice. My hon. friend here mentioned steel shells for rollers. I don’t know what they are, sat the statement was made that they are just as well made here, but the people who use them know they are not. Then take the rock-drills. I am told you cannot get them here. The statement is made that you can. They are not the same quality.

I have been making them, and I know they are.

I have used them, and that is different.

The Minister has not made them for years ; and he has got a better job now. I know these assertions are being made from insufficient information. I say my hon. friend has not sufficient information. The Minister accused the hon. member for Port Elizabeth (Central) (Col. I). Reitz) of not wishing the employment of white labour, and being in opposition to it. Well, of course, that is absolutely wrong. You are taking about the best steps you can to deprive white labour of work here. As I have said beforehand I believe it is the experience of other countries, you are doing the best to hamper the primary industries of the country by laying on these heavy duties. My hon. friend says you have not taxed the farmer ; but his requisites are taxed up to the hilt. I am against protection run mad—that is an exact definition of this tariff.

All protection “runs mad ”!

This is carried to extremes, and one effect is going to be you are going to drive men off the land. My hon. friend does not pay £7 10s. for a suit of clothes when he can get it for £6—especially when you have got to make your living, you try to get things cheaper. It is admitted that the farmers do not make a big income, and you are interfering very seriously with that income. The tendency will be, as in every country—it has been shown to be so in America, and in some little degree in Australia and Canada—to drive people off the land. In the mining industry the tendency of this legislation is to increase the working costs, and, as has been pointed out by the hon. member for Kimberley (Sir Ernest Oppenheimer), the more you increase the working costs, the more mines you make unpayable, and the fewer men are employed. If we advocate moderation in these things, it is done with the same idea as my hon. friend does it ; we believe our policy will lead to more employment of white labour.

It has not in the past.

Why not? I do not agree with you in the slightest. The white population has increased. How many more have you put on the land by this policy of yours? You have put some in Government employ—that we are well aware of—and you are going to have an increase in the railway rates in the future. The tendency is for people to leave the land and go into the towns.

What about free trade England?

Free trade England is paying her debts. She, with all the mistakes my hon. friend says she has made, is paying 20s. in the £, and has stood the burden more than any others.

I must really congratulate the Minister of Finance on the very excellent red herring he has drawn across the trail just now. He threw out an impalpable charge in the attack he made on the hon. member for Port Elizabeth (Central) (Col. D. Reitz)—that he was against the employment of white labour. I know, and every member knows, that that is a thoroughly unjust charge, because there is no man who has done more than the hon. member for Port Elizabeth (Central) to give true encouragement to the employment of white labour, in the comparatively short time he has been in the House.

What did he do?

I am not going to be drawn by another red herring! I would like to ask the Minister of Finance, what is the industry that is actually being protected? First of all, he told us it was that of the rivetters, and then he went on to say you also encourage drillers, and then the people who roll the sheets to make tubes. I see that 134 (a) puts a duty on rivetted tubes. How do unrivetted tubes come in? On Item 127, the Minister is putting a very heavy duty on the very foundation of which the tubes have to be made.

I am sorry if the hon. member thinks I have done the hon. member for Port Elizabeth (Central) (Col. D. Reitz) an injustice. The remarks I made were based on my experience in this House during the debates of the last few days, and I judged by the very “cordial” support I got from the hon. member in these proposals, where we are trying to increase the avenues of employment in this country. He is telling us that he favours protection, and is at one with us in getting more employment, but all the measures trying to give effect to that policy he has bitterly opposed. I admit that I have had support from certain hon. members opposite, but not from the hon. member for Port Elizabeth (Central).

Your methods are all wrong.

We provide work in connection with this policy in our engineering workshops, where a variety of work is performed. This is one of the things they do in these workshops. If this policy of hon. members opposite is followed to its logical conclusion, we will import all these articles, and close all these workshops. Would we send all these people on to the land? What has been the result of the policy of hon. members opposite with regard to unemployment? The unemployment position is already better to-day, because we have already absorbed a number of these people—

In Government service.

Not in Government service. In Rustenburg, according to a report in this morning’s newspaper, the co-operative society has provided work for 25 youths—work that was formerly done by natives. That is the result of the example we have been setting, and giving white men a chance that they did not have before. I suppose we will have a time of trouble in this country again, at some time or another, when we shall be very glad to have the engineering shops in this country. We appreciated their presence in the time of the war. I think I was perfectly entitled to make the deduction I did from the conduct of the hon. member for Port Elizabeth (Central). At present it may be true we are importing steel plates. We hope that very shortly we shall turn out iron and steel in this country, and the hon. member for Newcastle (Mr. Nel) may be able to give us information about that. The pipe is made in this country. The hon. member for Germiston (Mr. G. Brown), who speaks with some authority, has given us the assurance that these pipes are being made. We are not paying a heavy duty on this raw material under item 127—those are enamelled sheets. We want to put a duty on the finished article to encourage the completion of these pipes in our own engineering workshops, and if these people get a chance, there is no reason why this sort of work should not be turned out in this country at as cheap a price as the article we are importing. It may be true that, until they are putting down the proper plant and machinery, we shall have to pay a little more; but if you want to follow a policy of protection, we must make some sacrifice.

You will have to pay more for all time.

The mines will probably be worked out some day, and as regards the farms, people are slipping off the land. What is the future of South Africa to be if the policy of my hon. friend opposite is to be followed?

A far better and sounder one than yours.

Well, we can only judge by results. The hon. member has had a chance—let him give us a chance. I have no doubt to-day that, if an appeal be made to the country, whether they prefer the efforts now being made to provide work for the people, what the verdict will be—I know what the verdict will be. No, this is all very well— to talk about your primary industries and to protect them—but one thing has been clearly demonstrated in this country, that your primary industries, in the mines and farming alone, will not provide work for all your people. There are hundreds of people in our towns to-day, many of whom inherited farms, but they are off these farms to-day. People are slipping off the land. There are many factories which have influenced this. We are still doing our best to stimulate both those primary industries. Take your average farmer. He may have three or four sons. They won’t all stay on the farm. Some say they have no inclination for farming, and some will go to the towns no matter what you do, and that is what you have to reckon with. That is why we are adopting the same course as other countries, and following a policy that will provide us with manufacturing industries and thus provide work for our people.

Does the hon. the Minister think that he is going to assist in keeping people on the land by making them pay more for the implements they require?

We don’t.

The quarrel which I and several other members have with the Minister is that he is going out of his way to protect all sorts of things without a full investigation as to whether you can build up a legitimate, stalwart industry in that direction.

Why not?

Because there are certain industries which, if they get a period of time, and are prevented from being clubbed out by importations, will gradually establish themselves in this country. I always thought that the argument of hon. gentlemen opposite was that, in addition to our own South African market, we have the great eastern market, and to get that you must be able to produce goods as cheaply as other countries. I was delighted to hear the Minister of Posts and Telegraphs speak so enthusiastically this afternoon. We missed his friendly smile and his thundering eloquence yesterday when we were discussing duties upon food and the cost of living.

You voted for him?

Had he been here and as eloquently addressed the House, I think the Minister of Finance would have trembled, because he would have seen that the old policy so eloquently advocated by my hon. friend and his colleagues would have carried the day. The Minister says to the hon. member for Port Elizabeth (Central) (Col. D. Reitz) that when they appeal to the country they know what the opinion of the country is. But will they appeal to the country in the voice of the Minister of Finance, or that of the hon. member for Bloemfontein (North) (Mr. Barlow)? In regard to these pipes, if you can prove that, by putting them together here, we are going to employ a certain number of people, that is some argument. But I plead that before you put a penalty upon a large section of the agricultural people, who use these pipes very largely in their irrigation works, the Minister should consider more than he has done in the past, whether this is a legitimate case for introducing a moderate system of protection.

I am delighted to see the cheery face of the Minister of Posts and Telegraphs. His tone seems to have changed entirely.

Are you trying to goad me?

The song that he sings now is a different tune to that which he voiced before he entered the Cabinet. On this subject I do not doubt his veracity for one moment. He told us that imported air cocks, which were inferior in make, cost 7s. 6d., while the locally made ones were 6d. cheaper, and of a better quality. I would like the Minister to be a little more explicit, as I want to enquire into this thing. Where did this take place, and who are the people concerned?

I will make an arrangement for the hon. gentleman to accompany me to the firm referred to to look at the books. I won’t disclose the name of the firm here.

A great many members on the other side of the House do not seem prepared to admit that the industrialist has the same capacity as the business community. Their whole case seems to be that in this country as yet our artizans are not equal in ability and efficiency to those overseas.

No.

One hon. member pointed out a certain type of work that he contended could not be done in this country. He referred to the cutting of plates. I am prepared to state that as yet there is no plate that has come into this country that our men are not able to bend, cut, drill, rivet and erect. During our visit to the various industries up north, one engineering works on the Witwatersrand had a notice posted in a conspicuous place which stated that nothing in engineering is impossible to the South African artizan, and I believe that to be true. If these men are given the opportunity, they are fully competent to produce the requirements of this country, but the position in regard to engineering, along with other trades, is that because of the oversea production by lower standards, we are not in a position to compete. Give them the necessary protection, and our engineering trade can be made second to none in the world. I have been unable to grasp whether we have a free trade opposition or a protectionist one. They speak with many different voices, and are unable to decide this important matter themselves. I am not prepared to admit that under a free trade policy you will eliminate or even reduce unemployment, but under a tariff wall we have a far better mode of livelihood for our workers than under free trade. It may be pointed out that in protected America you still have unemployment ; that I also admit. But in free trade Great Britain, unemployment is far more acute and consistent, and the general conditions of the workers cannot be compared with those of the American artizan.

Order. The hon. member must come back to Item 134 (a). We are discussing details, not general policy.

Mr. Chairman, I apologize for getting off the rails, but I thought the whole of this discussion was based on free trade versus protection. Well, sir, if I must come back to steel pipes, I am quite satisfied that if the engineering trade are given this little protection that has been asked for, the steel pipes that are required in this country can be produced by our artizans. I believe the hon. member for Port Elizabeth (Central) (Col. D. Reitz) tried to introduce a subject which he seems to know nothing about. In speaking against this protection, and about rivetting, he immediately brings in a kafir with a spanner. Anyone who knows anything about rivetting will know the difference between bolting up and rivetting up, but he apparently does not know.

A hammer, not spanner.

Oh, no; the hon. member stated distinctly this rivetting would be done by a kafir with a spanner. Well, sir, I would like to quote a few figures in regard to imports and exports as showing what is happening in regard to free trade versus protection.

Order.

Am I being called to order? If not, then I would suggest, sir, that you call to order those Opposition members who are so fond of interrupting.

The hon. member may proceed. I have not called him to order.

I wish to quote figures showing that during 1925 Great Britain increased her imports to the extent of £45,000,000 above that of 1924, but dropped her export trade to the tune of £28,000,000, and at the same time she increased her unemployed army by throwing out of work not less than 150,000 persons per month. Now I may be told that the reason for all this is on account of high wages, but that also is not true, because during the same period she had taken steps to reduce the wage of those who were in employment to the extent of £75,000 per week. Well, I am sorry if I have again got off the track, but if that is the kind of business revival we got for the workers under free trade, then I am supporting the Minister in his protective policy.

I have given the hon. member a considerable amount of latitude, but he is going a little too wide now.

The hon. member (Mr. Fordham) has been very unfair in his argument. All I did was to press for full particulars of the case mentioned by the Minister of Posts. The hon. member’s argument went to destroy entirely the argument of the Minister of Posts and Telegraphs, who demonstrated that the Union article was produced at a lower cost and of a better quality than the imported one. I would be the last person to throw mud at the working man, and I wish that we could manufacture all our requirements in this country.

I think the Minister of Finance has mistaken the object of the criticism from this side of the House. It is all meant to be helpful to him and to the country. He should be the last person to put up the doctrine of papal infallibility as to the selection of items to be protected. These selected items on the tariff before us are based on the recommendations of a body from which the Minister himself has made a selection, rejecting others because evidently he thought they were not practicable. We wish to know what justification the Minister has for putting a number of these items on the list.

I am prepared to withdraw any item for which no case can be made out.

It is not fair for the Minister to assume that the criticisms made by hon. members on this side are made with the desire to limit the scope of white employment in this country, for that is absolutely incorrect.

I do not object at all to criticism, for these matters are very important, and they should be discussed, but I think the attitude of the hon. member for Port Elizabeth (Central) (Col. D. Reitz) was rather unreasonable. Not a single item in the tariff has appealed to him. We believe we have given the items a close scrutiny.

You should not be so intolerant of criticism.

I am not intolerant ; the hon. member’s actions belie his words. In his eyes there is nothing good in this tariff, and he is merely paying lip service to the doctrine of protection.

Hon. members opposite are continually pointing out how the consumers are going to be affected by the tariff.

We have had to take over the Labour party’s function in that respect.

I would like to give an illustration showing how protection works in regard to farmers. It does not necessarily follow that because you put on a protective duty that the consumer will have to pay more. I want to give an illustration to show this.

The hon. member should have debated that point when Mr. Speaker was in the chair.

In the schedule it says that the present maximum duty tax on “wrought iron or steel pipes and tubes—rivetted” is 1s. ad valorem. The words “ad valorem” ought to go with the 15 per cent, and 20 per cent, proposed duty. When I refer to the old schedule of the tax then I find that it is 1s. per 100 lbs. and not 1s. ad valorem. The old tax was 1s. per 100 lbs. and the proposed tax is now 15 or 20 per cent, ad valorem. It is clear that the words really ought to go in columns 3 and 4. The Minister quoted the report of the Board of Trade and Industries. The board seems to me not to be so very positive that the article can be made here. The board says in its report that that proposed tax of 15 per cent, and 20 per cent, is on wrought iron or plates and pipes and 25 per cent, on steel windows and parts thereof. (The Minister has dropped the 25 per cent, duty on steel windows). The report further says that the articles in this item have been selected after careful consideration whether they can be made in the Union, and that sufficient can be made to provide the country’s requirements if existing machinery is extended. The board by no means says that the article is already made here, but that it can be so made, and that sufficient can be made to provide for the requirements of the country by making alterations to the machinery. The Minister has made it prefectly clear that the duty is imposed to protect the manufacture of plates and wrought iron. Now I ask the Minister if he does not himself think that the tax now imposed is too great a jump, viz.: from 1s. per 100 lbs. to 15 and 20 per cent, ad valorem?

We want the work to be done here and the foreign articles to be excluded.

The difference in duty seems to me too great and I fear the result will be that the article will be dearer in the future than it is now.

The article can very well be made here.

I hope it is as the Minister thinks and that the increased duty will not affect the price, because the difference is very great. 15 per cent, and 20 per cent, ad valorem tax means a duty of 7s. and 8s. per 100 lbs. Take, e.g., a steel pipe with a diameter of 12 inches and a thickness of 8 inches. The duty on this will be 7s. or 8s. This means that the duty will be 700 per cent, more, which seems to be too big a jump. I can understand that protection of home industries is necessary but it is too big a jump. They are pipes which are used by farmers for irrigation, because the carriage by rail on the pipes is small as they weigh little, less than cast iron pipes on which owing to their greater weight more railage has to be paid. The pipes are preferred for irrigation purposes. I hope the Minister will see his way to make the duty 5 per cent, minimum and 10 per cent, maximum, instead of 15 and 20 per cent. Another point is that I should like to alter the word “vasgeklamp” into “vasgeklink” which is the word used in the English text, and quite rightly, because rivets are used for the purpose. I move accordingly.

I beg to move—

I take it the reason why the hon. member for Newcastle (Mr. Nel) has moved this amendment is that he is afraid that this duty if applied to pipes for agricultural or irrigation purposes is going to increase the price. That is not necessary at all, and I would like to point out that in many cases, putting on a duty like this actually decreases the price. Take steel pipes. Steel to-day is almost a monopoly in Europe. It is in the hands of one big trust. What happens, of course, when an industry is started through a protective tariff, especially, is that the price of the steel trust’s pipes promptly comes down in competition. I would remind the House of what happened in Australia in regard to reapers and binders when the protective tariff was introduced. These implements were formerly admitted duty free, but when a 45 per cent, duty was put on the price of reapers and binders immediately went up from £98 to £125. The local factories soon afterwards started production, and, instead of selling at the old price of the imported article, they started selling at £95. Then along came the trust, and notwithstanding the 45 per cent, duty which had been put on, they brought their artificial price down from £125 to £80. To-day with a tariff of 45 per cent, the cost to the farmer has been reduced to £68. That is what will happen in this case. When we get an iron and steel industry, prices will come down.

As soon as we are producing the necessary steel and pig-iron so that these pipes can be manufactured here, this duty can be imposed.

The raw material used here comes in free.

I did not know that. Even so, I submit that so far as agriculture is concerned, these pipes should still be excluded. Until the industry is actually producing in the country sufficient iron pipes, the farmers should not be called upon to pay unduly for these pipes. When the industry is established then, if necessary, the duty can be imposed. I hope the Minister will agree to accept this amendment.

Amendment, proposed by Mr. Nel, put and negatived.

Amendment in the Dutch version proposed by Mr. Nieuwenhuize, put and agreed to.

Item, as amended, put and agreed to.

On Item 138,

There were only three copies of the Board’s report available, and there was such a rush for them that I have been unable to get more than a glimpse of the Report. Before speaking on this item, I would ask the Minister to say whether—

e.g., cane trucks, applies to the Government railways, or whether it refers to the tramways on the sugar estates. At present we are in the dark. I will continue on the assumption that item 138 applies to narrow gauge railways on the sugar estates, but not to the Government railways. May I ask the Minister, without surrendering my chance to speak, whether I am right in assuming that item 138 refers to light railways on the sugar estates?

The Government, of course, does not pay duty on its material.

Does this apply to the narrow gauge railways on the sugar estates?

If they make a bridge, certainly. It applies to all bridges.

I shall move the deletion of this clause. If we hark back to item 89. the Minister told us yesterday that the agricultural industry was excluded from the protection on trucks.

The hon. member cannot move the deletion ; he may vote against it.

My trouble is that I specially want to move the deletion of the cane trucks. I propose moving, “when not to be used for agricultural or irrigation purposes' or for the purposes of the sugar industry I hope the Minister will accept that, because it would be highly inconsistent if he did not. There is no such thing as far as I know on a sugar estate as a cane truck as such. There are the ordinary trolleys built up on pieces of wood to hold the cane. There are literally hundreds of miles of light railways on the sugar estates. I know of large consignments on order which will be heavily penalized. Zululand is intersected by small rivers and creeks and dongas, and ironwork for bridges forms a very important item in laying these railways This is purely an agricultural industry, and the Minister told us under 89 that we were not to worry about it ; it was for the mining industry only. He was very clear that the agricultural industry was not going to be included in this. Let me remind him that the sugar planters in Zululand are without exception Government settlers. I can assure him this item is going to penalize the settlers and the industry very heavily. I formally' move the following amendment—

And I do hope the Minister will accept that.

I must say that on this side of the House, where we have always stood for protecting the interests of the farmers, we are really very glad to see the solicitude of hon. members opposite for the farmers. I am not going to accept this amendment for the same reason that I refused to accept the amendment of the hon. member for Newcastle (Mr. Nel) in regard to pipes.

Why?

Because the farmer is not going to pay more, and the little he will pay is a burden he should carry if he wants to have a protection policy. We have examined these proposals of the Board of Trade, and we have cut out the things where it appears that the engineering workshops are not yet in a position to manufacture those articles at a cheap and satisfactory price, but there is no reason why, if this protection is given, these articles could not be turned out as cheaply as they can be imported. I understand that this cane truck is merely the body, which can be turned out in any engineering workshop and at cheap prices. As far as the axles and wheels are concerned, they come in free under another item. It is just the body which we are going to tax.

That is very strange, because I have a letter from a friend here who is in the sugar business, and who writes on this very point—

There is another point also in this connection. My hon. friend has three items in this list alone where he is putting a burden on the sugar industry. Take 118, plates and frames for sugar presses. That has been put up to 20 per cent. Now on this item of cane trucks the ad valorem duty is increased to 20 per cent. Then further down, item 235, pastes and powders, there is an increase from 3 per cent, to 20 per cent. All these mean an added burden. My friend also writes—

These are the words of a man who knows what he is writing about.

They do not know the proposals, so they cannot know what they are writing about.

But they have seen them. He mentions them by number. I do not see why the Minister should go out of his way to lay this burden on the sugar industry. The hon. member for Zululand (Mr. Nicholls) pointed out the extremely difficult position in which the industry finds itself, and now the Minister singles it out to bear three burdens in this comparatively short list. I do not think it is quite consistent. I should urge the Minister to reconsider the thing. Will these duties be taken into consideration when he gets tenders from Vereeniging? They do not affect the Railway Department directly?

No.

When weighing the respective value of the tenders from oversea and from South Africa, will that be taken into consideration?

It is taken into account that they pay no duty.

In that case the department pays this increased duty. Suppose we get tenders from oversea, and the tender is 15 per cent, below the local tender, and to that 20 per cent, is added, it goes to the local manufacturer—at a price. As a matter of fact, the Railway Department is paying these duties, and you increase the capital cost on your track, and so forth, and the annual charge for interest. There is only one way to pay for these things, and that is by the things produced. That is what the Minister and his friends behind him entirely forget. The things that come in have to be paid for. How does the farmer pay for his clothing? The only way he pays for it is by what he realizes from his produce. To say that I wish everything to come in—well—

The hon. member is now repudiating his own doctrine. He says—

You exaggerate.

If the hon. member’s policy is adopted, within a very short time we shall not have producers on the farms unless we see that there are industries to take their products. In regard to these particular items, the people who wrote to my hon. friend have not the information in their possession. We are allowing to go in, axles and wheels, and all these trucks and trollies will be admitted at the existing rate, that is free—3 per cent. I have laid on the table a long list of the decreases of duty. The idea is not to put a heavy duty on the imported article, but we want to stop the importation of articles which can be made in our own engineering workshops, which they can make as cheaply as the imported article.

I hope the Minister will make this apply very severely to the South African Railways. It is getting very prevalent in the country, and this House, to decry and belittle anything that is made in this country. Every article that is mentioned in this particular item under discussion can be made in our own railway workshops, and more cheaply than they can be imported. The difficulty is that we have officials in our railway service who are continually decrying and belittling the South African manufacturer. During the regime of the hon. member for Cape Town (Central) (Mr. Jagger), a little footbridge was wanted at Germiston, and the officials seriously recommended that it could not be made in this country. It could have been made within a fortnight, not many hundreds of yards away from where it was to be erected ; but it took seven months to get it from overseas. We are importing points and crossings that could be made quite as well at the Salt River workshops, and other articles which could be made as well there, and at the Uitenhage workshops. Even when they were going to build a graving dock in Durban they must try to get an engineer from overseas ; fortunately, our own engineers stopped it, and we constructed that dock, with the result that at least £750,000 was saved on what it would have cost had an engineer been imported from overseas. Last year, or the year before, 1,000 grain wagons were ordered, and I believe they could have been made as well here. I hope we will be able to make axles and wheels here very soon. Cannot iron bridge-work be made in this country? They are continually making bridge-work on the mines of the Witwatersrand, and our own railways, when they want a little bit of bridge-work, call for tenders, through the High Commissioner’s office, and send over to Great Britain or America. I am glad the Minister is taking up the attitude now that the South African article is not inferior to anything we can get on the other side, and that the workmanship is not inferior. If we are to go on importing this work, what is to become of those lads who are passing into those shops? They will have no opportunity to be trained as highly-skilled men. I am glad that the Minister is going to insist on a tariff that will assist to develop this industry, because these things can-and should be made in this country.

I wish to support all that has been said about this item by the last speaker, the hon. member for Germiston, and in doing so I would point out that this will be of far greater value to our local engineering trade than the item we have just passed. That gives a little protection over steel pipes, etc., and is of some value, but this item is of the utmost importance to our own industries, and will certainly mean more employment. Opposition members have continually opposed protection to what they have called bastard industries, and the hon. member for Port Elizabeth (Central) has now moved an amendment against this proposal. Surely, sir, we are not to be told that our engineering industry, the key industry of the Union, is to be classed as a bastard industry. I cannot understand the argument that an industry which is well protected should be allowed free trade for its own requirements. The hon. member wishes to exclude the sugar industry. Well, sir, that industry has been given healthy protection by this House, and I venture to suggest it would be most unfair if we allow them to obtain their requirements in the cheapest possible market overseas, to the detriment of our own engineering trades. No, sir ; this item is of the utmost importance to our local artizans, and I hope the hon. the Minister is not going to listen too much to the blandishments of the importing merchant princes on the Opposition benches.

I would not like the House to suppose that the sugar industry is opposed to this tariff. I have a letter from the secretary of the South African sugar industry, giving the views of the industry on this matter. In this letter the secretary states that he thinks he is safe in saying that there is a general opinion not unfavourable to the increased duties, provided their aim is the development of South African industries, and there is reasonable prospect of that aim being achieved. Naturally, people who had ordered cane trucks and had them on the seas, and as a result of that tariff were suddenly called upon to pay 17 per cent, more on the price, felt that some expression of opinion should be obtained. As a protected industry, the sugar industry naturally supports protection in other industries where there is an opportunity of further employment in the country. The engineering industry employs the greatest amount of white labour in the country, and there is no industry which we can develop so greatly as that and all the other subsidiary industries related to the production of iron, and because it is an industry that can grow in such importance and because its chief markets, will be overseas or in the territories beyond the Union; I think it ought to be protected in its initial stages. Pig iron should be protected by a big bounty, as I advocated in my speech the other day on a motion to go into ways and means. If pig iron can be produced cheaply, the other industries can be carried on cheaply on that basis. I simply rose to say that the sugar industry has discussed these tariffs and is agreeable to the introduction of such a duty.

When this motion was introduced, I put a question to the Minister. I want to know what the policy is with regard to protection—whether the protection and stimulation of the iron and steel industry is to be by a protective duty or by a bounty. Here protection is being given to the subsidiary iron and steel industries. I think the Minister has lost sight of the fact that a large amount of money is being spent in endeavouring to produce pig iron and steel.

The raw material for these industries?

Yes. I think the Minister has overlooked the position the raw material is going to be in. Here you have girders—structural steel. I want to give the relative position of the industries using structural steel, say, at Cape Town. These figures are from, the leading article in the “Cape Times,” and I have ascertained that they are correct. Imported steel can be delivered at Johannesburg to-day at £14 16s. 11d. a short ton ; in Durban at £10 13s. 6d., and in Cape Town £10 10s. a ton. The railway rate from Vereeniging to Johannesburg is 18s. 4d. a ton, and from Vereeniging to Durban £2 5s. a ton, and to Cape Town £4 3s. 4d. a ton. To capture the market or to be able to cater for that market at these various centres, Vereeniging would have to sell on rail at Vereeniging for Johannesburg at £13 8s. 7d. ; for Durban at £8 8s. 6d. ; and for Cape Town at £6 6s. 8d. The latter is, I understand, considerably below the price at which structural steel can be produced to-day at Vereeniging. So far as Johannesburg is concerned, the locally produced article will be able to compete there, but it will not be able to sell a ton of steel in Cape Town, Durban, Port Eizabeth or East London, in competition with the imported article, unless some special form of protection is granted. We hope that pig iron will very shortly be produced at Newcastle. Cleveland No. 1 pig iron can be delivered in Johannesburg via Delagoa Bay at £6 14s. 7d. a ton, at Durban at £4 18s., and in Cape Town at £4 15s. In order to compete against this, we should have to sell pig iron at Johannesburg at £5 16s. 7d. a ton, at Durban at £3 16s. 2d., and at Cape Town at 2d. a ton, as the railage from Newcastle to these points is: Johannesburg 18s. a ton, Durban £1 2s. 4d., and Cape Town £4 14s. 10d. If my figures are correct, this industry will be placed in an impossible position so far as the coast towns are concerned, and unless there is a readjustment of railway rates, or other adequate protection granted, it will be impossible to sell the industry’s products at the coast towns. The only place where it will be possible to sell is Johannesburg. What does the Minister intend to do about it? High protective duties are being given to the subsidiary industries, but nothing is being done for the key industries. Since this Government has been in power, we have not received for these primary industries which produce the raw material a pennyworth of protection, or even sympathy. I have made efforts to secure some help for the industry, but have always been turned down for political reasons, and no other, because the Government is all out to build up an iron industry at Pretoria. When I brought forward a motion on the subject, I received no sympathy ’whatever from hon. members opposite. I hope the Minister will show some practical sympathy, and do all he can to stimulate and protect this very important industry.

Do you expect it, after blackguarding him?

The industry can be worked economically, and it can produce all the pig iron required in this country. The principle of bounties has been adopted, and the industry is based on that principle. When the bounty was granted, it was assumed that subsidiary industries would be built up on the same principle. We have to look a little further than South Africa if we wish to establish a sound iron industry here, and we should aim at securing the Rhodesian and other markets in the north. That can be achieved only with the help of a bounty. The Minister should take a bold step and assist the industry by means of a bounty, for I am afraid if once it is established on a protective basis, it will be very hard to return to the bounty system. It would pay the country to give a bounty even to the subsidiary industries, so that they may sell their articles in the adjoining state. I believe there is quite a big market in the north. The industry cannot really expand on a large scale on the Union’s consumption only. [Time limit.]

I am very glad to hear from the hon. member that the prospects of Newcastle turning out iron and steel are Very good. He has complained that this industry has never received any sympathy from the Government. What does it expect us to do? I think we laid the foundation in the Act that was passed granting bounties, and that the industry would be fostered by means of a bounty.

The bounty is insufficient.

The Government is considering the whole question of the iron and steel industry. I do not know if Newcastle will be able to satisfy the requirements of this country, or whether we should turn our efforts in other directions. In the meantime we propose to continue the Act empowering the payment of a bounty, because I take it that it was on the prospects held out in that measure that operations were started at Newcastle. Unfortunately, under the Act as it stands now, the period will expire shortly, and it will probably not allow the industry to take advantage of it, but my colleague the Minister of Mines and Industries has introduced an amending Bill to extend the period.

And increase the bounty?

At present, there is no idea of increasing the bounty. I am making provision this year on the estimates to pay a bounty under the existing Act. It was under that Act that the industry started.

Can you guarantee the interest on capital raised now?

I do not want to say anything in regard to that now. The Government is considering the whole question, and it would be premature to make a statement at present in regard to that. Probably next year we shall have advanced a little further in this connection.

What about the railway rates?

That is an important point, but the hon. member will realize that it is a question that my colleague the Minister of Railways and Harbours will have to consider if representations are made to him when once they have started producing.

This seems very cold comfort for the pig iron industry, and it bears out exactly what I and many of us have been saying all along, and that is the Government are starting at the wrong, end. The hon. member for Newcastle (Mr. Nel) has shown that they would have to sell pig iron at 3d. a ton in Cape Town. Yet the Minister says that the Bill must stand as it is.

I suppose you thought the Bill made sufficient provision when it was passed by the House.

Yes, but it does not make sufficient provision. All sorts of bastard industries are protected under this tariff, and yet here we have a case where a law was passed to protect a basic industry, and when the Minister sees that that Bill is inadequate, cold water is poured on it. It is a beautiful illustration of what I have said all along, that the Government are looking at the protection of our industries through the wrong end of the telescope. This is a tariff which is designed to build up the Labour party. It amounts to a bounty to the Labour party, and I hope that Nationalist members will note what is going on. This is a subsidy paid to the Labour party at the expense of the farmer and the rest of the public. Let me tell the hon. members who have threatened me with what my constituents will do, that my constituents will be quite satisfied with knowing that they are represented not by a man who is cringing at every turn and blowing not and cold with every change of the wind.

The speeches which we have had from the hon. member for Newcastle (Mr. Nel) and the Minister of Finance were extremely interesting and also an eye-opener. All these elaborate proposals for the purpose of encouraging the engineering industry have been founded on one thing—the turning out of pigiron at Newcastle. The Minister several times has indicated, and it has been clearly understood here, as far as I am concerned, that one of the reasons why this elaborate schedule has been brought forward has been largely for the purpose of assisting the engineering industry. We have been told by the Minister that they are now turning out pig iron at Newcastle, and they want to find a market for it. Now we are told that they cannot sell their pig iron in competition with imported pig iron. The basic industry of this elaborate engineering industry is itself wanting assistance from the State. In that case this is not a natural industry. They cannot compete with stuff that has to come 6,000 miles ; they have to come and whine to the State. I do not think it would be done of set purpose, but the committee has been put under a wrong impression. I am not blaming the Minister, but we understood you had the pig iron on the spot, and now we find it is not there. Where then is the justification for these heavy duties that you put on these other industries? Some of these industries are importing pig iron because they cannot get it in South Africa at the price. The next thing, I suppose, will be a heavy duty on iron and steel, and up go prices still further.

The hon. member is really very funny. Will he point out to me a single ironmaster in Great Britain whose industry is at the same time an engineering works? Does he not know that the raw material for engineering works is steel and iron? We are talking here of the engineering industry. I think the hon. member is going a little beyond the mark when he accuses us of coming forward under false pretences. All these are to encourage the engineering industry, not the industry of producing pig iron. As for the delicious statement that this was a Labour tariff, why, for the last week we have been hearing that this is a monstrous tariff ; it is going to increase the cost of living by making bread and ready-made clothing dearer— and yet he says this is a Labour tariff. The hon. member forgets he is talking to the same audience. I saw in the papers that he made a speech at Bethel where he denounced the Nationalists for delivering themselves into the hands of the Labour party, and then, only three days later, he denounced the Labour party for delivering themselves into the hands of the Nationalists. He should not do it to the same audience. We are entirely logical in our course. These tariffs are to protect and encourage the engineering industry, that uses steel bars and so on as their raw material.

That is not the story as it was first told to us.

I say this tariff is in the interests of the Labour party, but not in the interests of the working man.

It is a little difficult for us to follow the working of the hon. member’s mind. This tariff is not in the interests of the Labour party, the Nationalist party or the South African party ; it is in the interests of the people of South Africa.

The hon. member for Germiston (Mr. G. Brown) somewhat surprised the House this afternoon by stating, in his most emphatic manner, that railway construction and equipment requisites could be manufactured in the railway workshops of the Union cheaper than they could be imported. The hon. member for Cape Town (Central) (Mr. Jagger) could not credit that, but I find that in 1922, in reply to a question, the hon. member actually verified the statement made by the hon. member for Germiston regarding the manufacture in the railway workshops of buffers and coupling links. The Minister then said that these articles were made cheaper in South Africa than they could have been imported from oversea, and he gave the figures.

That is quite right.

Hon. members can judge for themselves when they hear the actual statement made by the then Minister of Railways. He was asked by Mr. Boydell how many buffers and coupling links were imported during the year 1921 for the South African Railways ; how many buffers and coupling links were made in the railway workships of the Union during 1921, and what was the average landing cost per buffer and coupling link of those brought in and of those made in our workshops. The reply gave the number: Buffers, 6,121; coupling links, 18,090. The average landing cost per buffer imported was £5 10s. 9d., and the average cost of the locally made buffers in the railway workshops was £4. In regard to coupling links the imported link cost 13s. 2d., and the link made in the railway workshops cost 8s. 10d. I think that justifies the statement of the hon. member for Germiston.

Therefore, no protection is required.

Very well, then; it is high time we provided work for the young men in our own country. Consider the record of the hon. member for Cape Town (Central) (Mr. Jagger), when he was Minister of Railways and Harbours, in putting men out of employment, and you will find it difficult indeed to reconcile the state of affairs then with what is said by members on the South African party benches now.

How many were put out of employment?

About twelve thousand.

The figures are absolutely incorrect.

The Conservative Government in Great Britain are endeavouring to make England “a nation of strike-breakers” ; the South African party did their best to make South Africa a nation of heart-breakers. According to a reply given to Mr. van Niekerk during the session of 1920, it was considered necessary to import 240 artizans. The reply stated—

What is the date of that?

The session of 1920.

Exactly ; when I was not in office.

Were you not a member of the party then?

Certainly, but I was not in charge of the railway then

Protection of this kind is absolutely necessary. Let us get on with the work.

The speech of the Minister of Defence was, I will not say dishonest, but very nearly dishonest. There is no question of helping the engineering workshops, but, according to the report of the Board of Trade, to foster the steel and iron industry of the country.

The engineering industry.

Let us get away from that— I am not used to these quibbles. The hon. member quoted links, and now we know why there are so many breakages of links on the South African Railways—probably more than in any other country. But the prices of 1920 do not obtain to-day. Steel used for the manufacture of links is of a very special kind, and it requires very special care to forge the joints. For a very long time it could not be done in this country, but by and by we had the special men to do it, and they are being made successfully now. Probably the breakages are greater than in any other country.

Come, come, we have mechanics here who are just as good as elsewhere.

Who stops the future of our young men in this country? The Labour party. I have tried to get some of my young friends into a big engineering shop in Johannesburg, but I was told that if they were taken they would have every man on strike.

I must say I was rather surprised at the rather warm indignation displayed by the hon. member for Cape Town (Central) (Mr. Jagger). I am afraid I cannot reply to him, because I do not know what he was driving at. He talks about my deceiving the House—where have I deceived the House?

You led us to understand that they were turning out iron at Newcastle.

When did I do so?

I think I can appeal to hon. members who were present in this debate. What justification has the Minister for saying that, within a few months, you will have an output of iron and steel?

I repudiate any suggestion that I deceived the House. Here we have the report of the Board of Trade on which these protective duties are based. They start with the iron and steel industry, and tell us exactly what the position is. They made certain recommendations, which were not accepted, because the Government was not satisfied that iron and steel production had actually started. That was why I said that the hon. member for Newcastle. (Mr. Nel) would give us the information. The board states distinctly—

What is the date of that?

The 18th of March, 1926.

That is six weeks ago. If they were on the we of production then, they should be producing now.

I deny that I suggested anything to the contrary at any time during the discussion. The Government did not accept this recommendation, because they had not commenced production, and the industry had not sufficiently advanced. Then they deal with the engineering industry, and discuss it from every angle. And there we picked out certain items which we think they can be made here economically to-day at satisfactory prices, and accepted them. Mere, for the last hour, we have been discussing an item of steel pipes, where it was distinctly stated that the raw material—steel plates—was being imported free. Where am I deceiving the House? The whole burden of the song this afternoon has been that I am giving protection to the engineering industry, and they are importing the raw material. I did not deny it. What ground has the hon. member for saying: Here is a revelation? I do not think it is right. They talk about the Government being unsympathetic to this iron industry.

I say that.

I thought this matter was closely investigated by the previous Government when they passed the bounty Act. The industry has started on that prospect. I have asked the Board of Trade, and they say that no representations have been made to them by the iron and steel industry for any further protection. I do not know whether the Minister of Railways has had any representations made to him in regard to railway rates

Must they come to the Board of Trade?

I was twitted a few days ago, and told that this iniquitous Board of Trade have offered protection without being asked for it, and I tried to show that there was no truth in that.

There are several reports where they have offered protection to people who have not asked for it.

I shall be pleased if the hon. member will give examples. I am informed that what happened in some cases was that application was made for protection, and the Board have gone in a few cases to people in the same line of business to see whether they agree with the application. The hon. member complains that in some instances not enough evidence has been taken. We deliberately state here that as far as the proposals at present before the House are concerned, they are in the interests of the engineering industry, an industry which we have got in the country—an industry trying to carry on in the circumstances in which they find themselves. If we get this pig-iron produced cheaply, I suppose the industry will have a better chance, but even while that state of things has not come to pass, we allow them to import the raw material free. I do not see why we should not keep these people going. I think the hon. member will see he was wrong in saying that I had deceived the House, and that something has come out now that absolutely upsets the case of the Government.

The hon. member for Park-town (Mr. Rockey) has made charges against the Labour party in regard to the limitation of apprentices. The hon. gentleman, who is such an authority on the working classes, should know perfectly well that this is a matter of arrangement by the apprenticeship committees, which are composed of equal numbers of employers and employees. Why does he not accuse the employers, representatives whom he represents in this House? We are quite prepared to answer for what we are responsible for, but the Labour party has nothing to do with this, and is not prepared to take the blame. But I might tell him why it is not advisable to have too many apprentices. What is the good of having shops full of apprentices and have the fathers of the boys going about looking for work? The hon. member wants to have six fathers applying for one job, so that the law of supply and demand will operate with the inevitable result that the maintenance of the civilized standard of life will be seriously threatened in this country.

Might I take the opportunity to correct the impression created by the hon. member for Cape Town (Central) (Mr. Jagger) in regard to the production of steel? If he had referred to the Union Steel Corporation’s report, dated 26th March, he would have found a statement by Major Butler, the chairman, who says that as regards the future, everything points to the development of industry which will rapidly absorb the output of their steel works. He states that they are already producing 30,000 tons, and that if they are to meet the prospective requirements of other important industries, further additions will have to be made to their steel plant.

It is from scrap.

It is very good steel, no matter what it is made of. The hon. member was giving an impression that no steel is being produced in this country. Whether it is made from scrap has nothing to do with whether we should absorb a product of this country.

I have not had a clear reply from the Minister, as to whether the encouragement of the iron and steel industry is to be by means of a bounty or protection.

I have told the hon. member that we are continuing the policy laid down by the previous Government, to give them a bounty when they qualify for it.

I want to know also from the Minister what is going to be the position if, during the next six months, pig-iron is produced in large quantities and dumping takes place in the country. Is he going to give us protection, because the iron and steel industry in Europe and England is under an international agreement at present to export their products to any country at 33½ per cent, less than the cost at which it is sold in those countries. The result is going to be that immediately we start producing pig-iron, it will be dumped here at 33½ per cent, less than the price in the country of production. Is the Minister going to give us protection against dumping and has he taken into consideration the position I mentioned, in which I clearly demonstrated that it would be impossible to compete in the coastal areas of South Africa with imported steel and pig iron? This is a very serious matter, and unless something is done, the protected engineering trades will use imported material, as Newcastle will not be able to compete at the ports. The matter should be very seriously considered both by the Government and the Board of Trade.

The hon. member is a little bit out there. Pig-iron is of no earthly use until it is manufactured into something. What the country requires is not to export the pig-iron but to provide a home market for it, and we should develop our internal markets. It is no use talking of exporting, seeing that India is landing pig-iron at Durban at £5 10s. a ton f.o.b. We cannot deliver pig-iron at that price, but we should assist the engineering trades to create a market for the goods they make out of the pig-iron. In the meantime a large, number of our boys, who should be trained to trades, are drifting into blind alley occupations, because there are not sufficient industries here to afford them employment.

Business suspended at 6 p.m. and resumed at 8.6 p.m.

I would like to know what is the reason for putting on this increased duty. Chinaware, to my certain knowledge, costs at least 50 per cent, to land here.

This is a suspended duty.

Yes, that may be the case, but how long is it going to be suspended? Surely my hon. friend must have some consideration for the consumers. It costs 50 per cent, to bring the stuff into Cape Town ; what it costs up-country I do not know. So far as I am aware, there are only two factories in this line in the whole of South Africa.

The hon. member will see what the board state in their report. There is a factory that is turning out a very good article, but we are not satisfied at the present moment as far as this particular article is concerned, and we shall watch the position. These duties will not be imposed while there is a danger of the article not being sold at a reasonable price.

Item put and agreed to.

On item 181,

I would like to know what is the reason for putting a duty of 25 per cent, on earthenware pipes for drainage purposes. Surely this is going to handicap people in the various cities.

You have two factories making these things galore.

It costs a fair amount of money to bring those goods down to Cape Town. This proposal simply means handicapping sanitation in the bigger towns.

Item put and agreed to.

On item 138,

It will be necessary to revert to item 138, on which I should have mentioned an amendment which had been moved by the hon. member for Port Elizabeth (Central) (Col. D. Reitz).

I would like to speak on this amendment. It has been said in this committee several times that we can do work just as cheaply in South Africa as they can overseas, and an example was given before the adjournment, of the buffers which are manufactured by the Railway Department. It is some three or four years since that took place, and I am not aware of the exact circumstances, but I have got a list in this report of the Departmental Committee of the Railways which shows the fallacy of that statement. Louvre catches cost at Uitenhage 7s. 3d., while the imported local cost is 11d. Spring, table and folding catches cost 10s. at Bloemfontein and 2s. imported. Luggage racks (heavy) cost at Durban. 8s. 6d., while the imported price is 2s. 3d.

I think the hon. member (Mr. Jagger) has already spoken twice after the amendment was moved right at the beginning of the debate.

I just wanted to put the committee right on the question of these costs. I could give a good many more examples, but, I won’t trespass on your time any further.

Amendment put and negatived.

On item 186,

On the motion of Mr. Nieuwenhuize an amendment was made in the Dutch version which did not occur in the English.

Item 214 put and negatived.

New item 214,

I move—

The hon. member (Mr. J. H. Brand Wessels) is moving the amendment on my behalf. I cannot move it myself. Aluminium sulphate is not made here at present. That is why we are putting it back on the free list with a suspended duty of 20 per cent.

Amendment put and agreed to.

On item 235,

I think we ought to have some explanation of this item. I understand that this is another tax on the sugar industry. Is this article made in South Africa?

It is used for sugar refining and is made here.

Item put and agreed to.

On item 244 (a),

This proposal is for the protection of the factory near Pretoria, Hammanskraal. We put the duty on last time, and now it is to be further increased for the benefit of a small tinpot show. I am informed that carbonate of soda, sodium carbonate as it is called in the schedule, is required in a good! many industries, and you are going to tax a good many industries for the benefit of this particular factory. I have had some correspondence about this matter, and it has been represented to me that carbonate of soda is used for several other industries. This duty is going to hamper those industries just for the sake of a small affair, which, I believe, does not turn out more than £1,000 worth a month.

This industry has been in difficulties from the start. The previous Government dealt with the matter and tried to do something for the industry, and since we took office I have had to deal with it all along the line. The industry has claimed that it ought to have a dumping duty. It is entitled to a dumping duty now, and I shall have to either increase the present duty or put on a dumping duty. The board, after investigating the matter, bas come to the conclusion that this would be the better way of dealing with it. Unless I can get the Minister of Railways to give them that special rate, they will still be in difficulties. So far the Minister of Railways has not been prepared to give them that rate. The board, in their report, state that unless they get the increased duty and also the special rate, they will remain in difficulties. I believe this is a fairly valuable industry ; they have a big place, and they have sunk a lot of capital there.

Item put and agreed to.

Items 249 and 264 put and agreed to.

On item 282,

What is the reason of putting this extra duty on paper bags not printed? We had a duty last time of l¼d., which has now been increased to l½d. Is that because the other was not sufficient? I suppose this is just the preliminary. We will have any amount of further applications.

They are not all granted.

Well, there are two here, at any rate.

I do not wish to disagree with the Minister, but I would like to draw his attention to another aspect of the bag industry in South Africa, and that is linen bags. The position to-day is that paper bags are protected up to the hilt. The Minister gives as the reason for this increased duty that the protection already afforded was not sufficient. I want to plead with the Minister to afford some protection to the manufacturers of linen bags. I understand that we are sending something like two millions of money out of the country annually for the purchase of bags of various kinds.

You are thinking of trousers.

Aren’t you going to include Oxford “bags” in this?

I would like to include you in one of these bags and drop you somewhere. Tobacco bags, flour bags and cement bags are all being used by industries which receive the utmost protection from this House and, at the same time, they are allowed to go overseas for their requirements in this respect. I do know that two local bag factories are pretty well going out of business owing to competition from overseas. They have the machinery to produce all the requirements of this country. I am not referring to grain bags or wool bags, but to the linen bag used mainly for tobacco, and pocket sugar, or flour bags, but they are all being brought from overseas. I am told that your local bag manufacturers have quoted a price pretty well equivalent to the price of the imported article, and still they have not been successful. I can quote a case where one of our local industries gets its requirements from overseas, and yet you will find stamped upon the imported bag the words—

I might point out to the hon. member that this item only refers to paper bags.

I think I will be justified in asking the Minister to make this applicable to other kinds of bags. I can only conclude by asking the Minister to give serious consideration to the points I have raised. You have a suspended duty hanging over these goods, and I do hope it will be put into operation and give the necessary assistance to our own bag industry.

We cannot discuss an item which is not on the paper.

As the hon. member knows, there is a suspended duty on this class of bag, and the board is at present looking into the position. We have not been satisfied up to the present that it has been made here at a satisfactory price. If they can satisfy the board, the duty will be put on otherwise, not.

The people using these bags are more than satisfied with them.

I cannot allow this discussion to go on now.

Item put and agreed to.

On item 296,

I would suggest to the Minister that he deletes the word “postage” and inserts “sent ”, and after “institutions,” at the end of the item, insert “for their personal use.” I quite appreciate the intention of the Minister. He wants to allow the merchant to get in the catalogues which he requires to order his goods, free, but he wants to penalize other catalogues coming in. The clause would be perfectly right, except that he restricts the method of transport to the post. I suggest the word “sent” should be put in H (2). The reason is this: That the majority of merchants get at least as many, perhaps more, of their catalogues by freight. These catalogues are enclosed in cases with various goods. In order that it shall be only such-catalogues as are used for business purposes, by the merchant, I suggest that, at the end of the clause should be inserted “for their personal use." I move, as an amendment—

The hon. member, of course, realizes that this amendment was made in the interests of our own local merchants. I think if his amendment is accepted some people will import these catalogues in case lots and post them all over, and our object will be defeated. We do not want them to be sent all over the country.

Why does not my hon. friend knock it out altogether? I do not agree with the hon. member for Newlands (Mr. Stuttaford). This is one of the narrowest things; I have seen. Take the farmer. I suppose he gets catalogues of agricultural implements. You debar that. Under this, you cannot get a catalogue from overseas of agricultural implements. Look at the narrowness of it—that the public in South Africa should not get catalogues from overseas. That is what it amounts to. If the importer cannot live without this, he does not deserve to live.

I move, as a further amendment—

Up to the present the position has been that these advertising samples, if subject to a specific duty, were charged by the customs authorities, but if subject to an ad valorem duty we could not do that, because they were regarded as of no commercial value. This is now being put right, because, when they come in with a printed label, that is regarded as advertising.

There are a large number of samples of this character really of no commercial value coming into the country constantly. They are samples of things which are not produced, and will not be produced, in our lifetime, or the lifetime of our children. If the Minister will consult the medical profession, he will see that they get samples of medicines sent out. The revenue my hon. friend will get from them is infinitesimal. Here you are making provision that catalogues, if they are posted to merchants, manufacturers and public libraries or similar institutions, come in free. We are constantly getting catalogues of very great value to us, with valuable plates of agricultural machinery, both from Europe and the U.S.A.

But they are posted.

No, they cannot come to me if I am not a merchant—if this goes through.

Of course they can be sent, but you have to pay duty.

That is what I mean. If my hon. friend will give me ten minutes after the House adjourns, I will show him catalogues, admirably got up, which are of the greatest assistance to the agricultural industry, and without these catalogues farmers would have no opportunity of ordering the newest scientific instruments. Really, this is protection run mad.

The position is, of course, that this is analogous to what we are doing to encourage our South African merchants. We want to discourage people, having no stake in this country, sending these things from overseas. We are giving a preference to the people who are taxpayers, in this country, or to merchants who have a permanent agent in this country. We do not give the merchants much protection, as a rule, but here we say they have their stocks and are prepared to do business in this country, and why should we encourage people to get these things direct from overseas?

May I give the Minister a concrete rase? The only way of my knowing of certain agricultural machinery which is not stocked in this place was from the description I found in a catalogue.

I wish the Minister would tell us what industry he thinks he is protecting under this. Take the case of a firm in England making incubators. They send their catalogues here. The Minister forces that firm to have an agency here, but you cannot force them to do so if it is economically unpayable. It is apparently an industry of agents.

It will bring in revenue.

It will keep out catalogues which are of interest to the public. I suppose catalogues of the latest books are included in this. You are excluding knowledge. I depend very largely for my reading matter on catalogues I get from overseas. I think this is going too far.

interjected a remark.

I know the hon. member for Riversdale (Mr. Badenhorst) never reads anything. Farmers depend largely on catalogues for their implements. Take the medical profession, which gets catalogues from which a medical man selects the instruments he wants. Does the Minister seriously intend to force instrument makers to have an agent here? They will not do it, and the result is that you will debar medical men, schoolmasters, artists, literary men and farmers— one can hardly think of any branch of intellectual activity that will not be prejudiced by this. It is a very important market, though a limited one.

This proposal has no industrial significance whatever, and is put forward purely in the interests of local trade. If the House thinks that this should not be encouraged, it can vote this down at once. Strong representations were made to us by local merchants. I leave it to the sense of the House.

As a protectionist, I hope the House will vote this out. It will have a serious effect on industry itself. Think of the thousands of tools factory managers obtain through catalogues—of which they would never have heard except through a catalogue. The sugar industry gets hundreds of catalogues, showing the improvements made in machinery.

: I hope the House will accept this proposal of the Minister. We learn from catalogues of new methods of cultivation. Only the other day I asked a merchant to import for me certain kinds of seed I saw in a catalogue which came from Europe. Many of these catalogues are instructive and interesting to us as farmers.

I move, as a further amendment—

With leave of committee, amendment proposed by Mr. Stuttaford withdrawn.

Remaining amendments put and agreed to.

Item, as amended, put and agreed to.

On Item 318,

Is any of this manufactured in this country?

This is a material which has been imported in such a manner as to compete with local tiles, shingles, etc. They introduce the material and cut it up. It was never intended they should be admitted free under this item. This does not interfere with the material in rolls which comes in free.

Item put and agreed to.

Motion on taxation proposals on customs duties, as amended, put and agreed to.

Resolution to be reported.

I move—

1. (a) in the case of companies the sole or principal business of which is mining for gold or diamonds, for each pound of taxable amount, three shillings ;
2. (b) in the case of all other companies, for each pound of taxable amount, two shillings and sixpence ;
3. (c) in the case of persons other than companies, for each pound of taxable amount, one shilling and as many two-thousandths of a penny as there are pounds in that amount, subject to a maximum rate of two shillings in every such pound:

Provided that when any portion of the taxable amount of a company, whether such company falls within the terms of paragraph (a) or (b) above, is due to the inclusion in the taxable income of such company of any debenture interest disallowed as a deduction in terms of paragraph (a) of section thirteen of Act No. 40 of 1925, the rate of tax in respect of that portion shall be two shillings for each pound of that portion:

And provided further that where any portion of the taxable income of any company is derived from or relates to the business of life assurance, including the issue of annuities, the rate of tax in respect of that portion shall be one shilling and sixpence for each pound of that portion.

The Minister has just been expressing a considerable amount of sympathy with merchants and manufacturers, and unfortunately was not able to translate that sympathy into practice, but here I think he has that opportunity, and I hope he will grasp it. Last year I pointed out that under his methods of taxation of public companies, he charges an investment in a public company at a higher rate than the most wealthy individual in the country which is 2s. in the £ normal tax. Under the resolution as we have it, the Minister is charging income, small or large, at the rate of 2s. 6d. in the £. I would like to refer the Minister to the report of the Commissioner for Inland Revenue for 1924-’25, which was the last we have. On page 16 he will find that the taxable income of individuals amounts to £58,000,000 odd and on that they pay a normal tax of £1,754,000. The taxable income of companies amounts to £25,000,000 odd, only half the amount, and they pay £1,886,000 odd. That is, for committing the sin of having your money invested in limited liability companies, you are paying double the rate of normal tax that an individual does. On the same page, he will find that the tax yield per £ of income of individuals is 7.17d. per £. The tax for each £ of income of the limited liability companies is 17.99d. That seems to me conclusive evidence that the Minister taxes an investor in limited liability companies at more than double the rate that he charges a private individual and the next report of the Commissioner of Inland Revenue will show a greater accentuation of this injustice than even the present one. I think I can appeal to the hon. member for Pretoria West (Mr. Hay) to support me in this. In addition to this injustice, last year the Minister omitted to put in any clause enabling the company to pass on the normal tax to the preference shareholder, and the result is that today if a man has £20,000 a year invested in preference shares, he pays not a single penny in normal tax, while a man with an income of £200 or £300 a year, if he has anything invested in ordinary shares, he pays 2s. 6d. in the £ and in addition has to pay the income tax of the gentleman with £20,000 invested in preference shares. I suggest to the Minister that the whole basis of the tax is wrong and always was wrong. The Minister and his predecessors have started on the wrong basis, and they will always be wrong until they get back to a fair basis to start with. The Minister is always replying that he considers a company is a persona, I think he said.

A legal entity.

That is a beautiful word ; but when it comes to deciding the tax, the legal entity has to pay tax at a higher rate than the individual. He is only a legal entity so long as it is to his disadvantage and when it is to his advantage, he is told you are not the same as an individual. I do not know what the Minister will call him then, and whatever way the matter is looked at, the company is mulcted. There is no essential crime in investing your savings in a limited liability company ; so why should an individual pay a higher rate in the £ in investments in limited liability companies than when he derives his income from any other kind of investment? I do not despair of converting the Minister because he is essentially a fair-minded man. I feel that privately he knows it is unjust ; But the dread necessity of collaring money wherever you can get it, putting your hand into any man’s pocket where you think you are safe, is a vice which even the fairest-minded Minister of Finance acquires in a very short time. I have suggested to the Minister that he should put a tax of a shilling on a limited liability company. A shilling is the basic rate ; that is each individual is charged a shilling plus so much, according to the increase in the amount of his income. If the Minister would put that tax on at a shilling and then each individual would be assessed when they came to deal with his private income at the rate appropriate to his personal income. That is, if a man had £20,000 a year he would pay another shilling, making it the maximum. If he only had £200 a year, he would not pay anything extra at all. That puts the case fairly. I recognize that it is asking too much to ask the Minister to put on sackcloth and ashes to-night and relinquish this unfair gain that he makes and reduce this tax from 2s. 6d. to 1s., but he might reduce the tax to 2s. That is the maximum that any man in this country has to pay, however great his income. Then next year I will ask him to so arrange his finances with the Commissioner of Inland Revenue that he can get back to a just and correct position. I move as an amendment—

and I would further suggest to the Minister that in the Bill incorporating this resolution, he will consider the wisdom of inserting a clause for preference shareholders and other than ordinary shareholders, somewhat on similar lines of Clause 48 of the 1917 Act. That may obviate that portion of a very unsatisfactory form of taxation.

I suppose I must say a few words in connection with what my hon. friend has moved. I am quite sure he is not really in earnest.

Oh, yes, I am.

Well, it is quite impossible for me to alter this whole system of taxation which we deliberately introduced last year and fought out here. The hon. member will remember that the shareholders had diddled us out of what was due to us in the shape of dividend tax. The Inland Revenue Department is absolutely convinced that the only possible way to deal with the question is to regard a company as a legal entity.

Then the maximum should be 2s.

Mining companies are taxed to the tune of 3s. in the £.

Very unfair.

The country accepted the principle that mining companies should pay more than other companies.

I want to see your sympathy with the mercantile community.

I have sympathy, but these gentlemen deliberately incorporate themselves into a limited liability company, so as to derive the benefits of incorporation. We have introduced special legislation giving companies all the benefits of incorporation, and for that reason we are taxing them separately. I would very much like to assist the preference shareholders, for I know some of them have difficulties in obtaining a refund from the British Government, but if we do that you upset the principle upon which the tax is based. I am therefore very sorry I cannot accept the amendment.

I am very much disappointed with the Minister. I thought he had really a soft spot in his heart for the merchant. I cannot see, if he insists that a company is a legal entity, which is exactly the same as an individual, how he can possibly defend a tax of 2s. 6d. on a company, when the maximum tax on an individual is 2s. Another absurdity is that a shareholder resident in England cannot obtain any benefit from the Imperial Treasury for the amount he has paid on the dividend as income tax in South Africa. If you deduct 2s. from a South African dividend paid in England, the Imperial Treasury refund it to you, but because we do not deduct it we do not get the money back from the Imperial Treasury. Of course, this is one sort of support for the Imperial Government, and they should recognize the kindness of the Minister in arranging it.

Amendment put and negatived.

Motion, as printed, put and agreed to.

I move—

Agreed to.

I move— That the rates fixed by Resolution (2) and (3) above shall be the rates fixed in accordance with the provisions of sub-section (2) of section 5 and sub-section (2) of section 25 of Act No. 40 of 1925, respectively.

Agreed to.

Resolutions to be reported.

House Resumed.

stated that the committee had agreed to resolutions on customs duty and income tax, and that he would bring up a report at a future sitting.

Seeing that we started work at 11 o’clock this morning and have had rather a heavy day, and this is Friday night, perhaps the Prime Minister will agree to adjourn now.

I must say I thought very little had been done in the last few days, but I feel sympathy with my hon. friends who have so valiantly battled against these proposals. I am therefore prepared to agree to the adjournment of the House.