House of Assembly: Vol7 - TUESDAY 11 FEBRUARY 1986
Introductory Speech delivered at Joint Sitting on 10 February
Mr Speaker, I move:
This is a short but essential Bill and is being proposed in order to comply with the requests of interested parties that certain provisions of the Merchant Shipping Act, 1951, relating to the carriage of goods by sea, be amended, supplemented and incorporated in a separate Act. The provisions referred to are contained in Chapter 8 of the Merchant Shipping Act and comprise only five sections in total. These sections are based on the “Hague Rules” which form part of the “International Convention for the Unification of Certain Rules of Law relating to Bills of Loading” signed at Brussels on 25 August 1924, and regulate the responsibilities, liabilities, rights and immunities of carriers with regard to the carriage of goods in ships from any port in the Republic to any other port, whether in or outside the Republic as well as the contracts and effects of contracts for the carriage of goods by sea and claims for short-delivery as well as the loss or damage of cargoes.
†Although the “Hague Rules” were amended in 1968 and are already being implemented widely internationally, the Merchant Shipping Act of 1951 has not been amended to date with the result that the 1968 amendments are not legally enforceable in the Republic.
Provision is also made in the Bill for: new uniform monetary limitations on the liability of carriers for loss or damage of cargoes, subject to the absence of any intentional or reckless conduct; additional protection of carriers and their employees or agents, ie by firstly rendering certain defences available against certain kinds of loss or damage of cargoes, and the limitation of monetary liabilities in such cases, and secondly, empowering an employee or agent of a carrier also to invoke the said limitations and defences; the recognition of a bill of lading as a prima facie receipt by a carrier concerned; and the restriction of liability in respect of goods after delivery of the goods to one year.
This Bill was discussed with interested parties and enjoys wide support due to the curtailment of existing restrictive measures.
Second Reading resumed
Mr Speaker, this is rather an abstruse subject and it is often wondered why the opposition takes any time at all to go into this particular problem. The problem has been raised during the past weeks as to what is the role of the opposition. I would say that it is our duty to go through every Bill that comes before this House and to state what we have to say on it. It also involves us in a tremendous amount of research and investigation and we receive little or no help from the parliamentary authorities as far as that is concerned.
One of the major problems in international trade is the question of liability for damage to cargo. As in many other fields shipowners, in order to protect themselves from liability, began to write more and more extensive exemption clauses into their contracts, which as a matter of maritime practice were incorporated in bills of lading. Not surprisingly, cargo interests, who by and large did not see the terms of the bills of lading until long after the cargo was on the high seas, regarded the unilateral imposition of these terms as being unfair.
In 1924 at an international convention in Brussels a series of rules were formulated which are generally known as the Hague Rules. Virtually every country having maritime interests either signed or acceded to the Hague Rules or enacted legislation which in substance incorporated the rules into the law of that country, and the rules are contained with some minor amendments in sections 307 to 310 of the present Merchant Shipping Act, No 57 of 1951, and this is the Act we are now seeking to amend.
Whilst the rules broadly speaking still function well in regard to such matters as the liability of the carrier and the scope of the exemptions which the carrier may invoke against cargo interests in defending claims arising from damage to cargo, they have in other spheres become inadequate either because of developments in the world of shipping or because of the ravages of inflation. It must be remembered that this Bill becomes even more important as South Africa proceeds to become a larger and larger export country as well as an import country. We must make absolutely certain that we know what we mean when we comply with trading conditions.
Article 4(5) of the Hague Convention provided for a “package limitation” of liability to the sum of £100 sterling per package or unit, and this limitation is contained in section 309(5) of the present Act.
What are some of the problems that have arisen since this Act was passed many years ago?
A £100, which was a substantial sum of money in those days, is no longer a substantial sum of money.
Secondly, with the advent of modern forms of packaging such as containerisation, palletising and shrink wrapping—that is the placing of a number of boxes or items on a pallet and then covering them tightly with plastic and the like—it is increasingly difficult to determine what is a package or unit for the purpose of determining limitation.
Thirdly, there has been a vast increase over the past few years in the carrying of bulk cargoes—we see enormous 500 000 ton vessels carrying oil, for instance. These cargoes include products such as grain, rice, sugar, minerals and the like in so-called bulk carriers and there are difficulties in applying the package limitation provisions to such cargoes.
The second problem relates to the effect of a bill of lading which in Article 3(4) of the convention is said to constitute prime facie proof of the receipt by the carrier of the goods therein described. (Section 308(4) of the present Act.) As we all know, in most international trade, whether in terms of f o b sales or c i f sales, the shipping documents, including the bill of lading, are endorsed by the shipper and delivered to the consignee, who is usually the purchaser of the goods. In this case only one person is affected.
However, in some markets, particularly those relating to minerals, for example oil, the bill of lading may change hands a number of times whilst the cargo is still on the high seas, in consequence of its having been sold by the original purchaser. Hon members in this House will remember that that is what happened in respect of the Salem. It was a typical case of the bill of lading changing hands quite a number of times so that people did not even know what the contents of the ship were.
The question may then arise whether or not it is permissible under the rules for the carrier to seek to rebut against an endorsee or holder of a bill of lading the prima facie evidence—the evidence constituted by this bill of lading—of the condition of the cargo at the time it was loaded. That was one of the problems experienced in regard to the Salem. For obvious reasons such a third party is at an immense disadvantage in any litigation or arbitration proceedings which deal with the condition of the cargo at the time it was loaded on board the vessel.
A third problem arises from the time bar provisions contained in Article III(6) of the convention or section 308(8) of the Merchant Shipping Act. The convention is couched in absolute terms, but in modem litigation extensions of time are frequently sought and granted. The Hague Rules do not, however, specifically authorise the granting of such extensions.
The next problem, occasioned by the form of the original rules, arises from the form of the action which is brought against the carrier. The rules incorporate various provisions into the contracts of carriage. This might interest the hon member for Groote Schuur who has written a book on the laws of shipping and carriage in South Africa. I notice the hon member is looking at me. Well, he is probably one of the few hon members in this House of Assembly who understands the finer details of what I am talking about at the moment. As long as liability is sought to be founded in contract or even if it is founded in tort delict, the person sought to be made liable is the carrier. Under the contract of carriage this is immaterial.
The last problem relates to people such as stevedores. In an endeavour to grant the stevedores the same exemptions as may be available to a carrier, a number of complex clauses generally known as the Himalaya Clauses have been devised, and the validity of such clauses is a matter of vigorous debate.
In order to resolve the various problems I have raised, the Hague Rules were amended in certain respects by a further convention held in Brussels in 1968. The rules as amended are commonly known as the Hague Visby Rules. The principal purpose of the Bill before us, is to replace section 307 to section 310 of our present Act, which was the statutory enactment of the original Hague Rules. In other words, we now have to enact the Hague Visby Rules. The text of those rules is set forth in the Schedule to this Bill; and the principal amendments contained in the Hague Visby Rules are to be found in Articles III(4), III(6) and (6bis), IV(5) and in the new Article IVBIS. All of these provisions seek to deal with the problems I have enumerated above.
There are, no doubt, difficulties of interpretation in regard to the clauses introduced by Visby. In particular, Article IV(5) may give rise to difficulties of interpretation and problems of conversion. The only way in which the problem could be resolved, would be to insert in the Act a provision which empowered the relevant Minister by notice in the Government Gazette to fix from time to time the value, for the purpose of package limitation, of the franc referred to in Article IV(5)(a). I do not think it is necessary to deal with this now, although I may mention that I have from time to time asked the department what the value of the franc was, and every time I asked the value was different from what it had previously been. I therefore think it necessary that a way be found of simplifying it.
There are other possible problems in regard to the Hague Visby Rules. For instance, the question of bulk cargo is not satisfactorily dealt with and neither is it clear whether Article IVbis resolves the problems of the Himalaya Clauses, the clauses which were devised in jurisdictions which do not accept our common law stipulate) alteri.
Now let us deal with the Bill itself.
The first matter is clause 1(1)(d) which deals with the carriage of deck cargo. As will be seen from the Hague Rules this is excluded from the ordinary ambit of the rules. The historical reason for this is that cargo was not ordinarily carried on deck as it was not then regarded as having been properly stowed. Of course, with the advent of containerisation that is no longer true. The hon the Minister will agree that any container ship leaving Cape Town today will have up to five stacks of containers on deck.
Clause 3 is the main defect in the Bill. It repeats without amendment the present provisions of section 310(6) of the Merchant Shipping Act, 1951. What I think is intended is that the courts of the Republic should, if they otherwise have jurisdiction, be entitled to exercise that jurisdiction subject to the power to stay an action notwithstanding a clause in a bill of lading which provides that any dispute should be subject to the exclusive jurisdiction of some other tribunal, whether a court or an arbitration tribunal. The words “or lessen” are, however, a major problem as it can be, and has been, contended that the effect of those words is to invalidate any arbitration agreement whatsoever. Frankly, I would be happy if clause 3 was eliminated entirely, leaving our courts to pronounce under the common law on whether or not they would recognise arbitration or exclusive jurisdiction clauses and stay proceedings.
It is an absurdity that South Africa is a signatory to the New York Convention on the Recognition of Foreign Arbitral Awards and has incorporated the important provisions of that convention in the Recognition and Enforcement of Foreign Arbitral Awards Act, 1977. To have a provision which, at the lowest, is capable of being interpreted as nullifying an agreement to arbitrate in a foreign country is in my view contrary to South Africa’s obligations under that convention. It also contradicts the principles underlying section 7 of the Admiralty Jurisdiction Regulation Act, No 105 of 1983.
There are three grave difficulties with regard to clause 3 and the old section 310(6), which are identical. What is jurisdiction “in respect of any bill of lading or (other) document”? The dispute between the parties is usually whether the carriage contract has been properly carried out. There is clearly a dispute as to the execution of the contract evidenced by the bill of lading but it must be doubtful whether it is “in respect of" the bill of lading itself. The words seem at first sight more appropriate with regard to the right to the possession of the bill of lading and are certainly not as clear as it is desirable they should be.
The hon the Minister of Communications and Public Works could not understand this if he tried.
I note the hon member for Groote Schuur understands every word.
Yes, but Lapa does not; not one word.
Why don’t you resign as well?
Secondly, as is demonstrated by the case of Intercontinental Export Company (Pty) Ltd versus MV “Dien Danielsen” 1982 (3) SA 534 there is a doubt as to what is meant by ousting or lessening the jurisdiction of the courts of the Republic. If foreign jurisdiction clauses are to be regarded as in effect submissions to the arbitration of foreign courts (a view which is supported by The Cap Blanco (1913) case in the English courts), then it is difficult to understand what meaning is to be given to the words if this judgment is held to be correct. On the other hand, it would seem strange to regard a submission to arbitration in South Africa as being null and void. Again this is a matter which should be clarified, certainly if the object is that which is expressed in the Australian case Wilson versus Compagnie Des Messegeries Maritimes of 1954. This can be found in Lloyds Reports Nos 544 and 546.
What justification is there for applying the provisions to outward carriage? If a Panamanian carrier carries South African cargo to a port in the USA under a bill of lading, submitting any dispute to arbitration in New York, why should a South African court, if the matter came before it for instance for the enforcement of an arbitration award, be bound to regard the agreement to submit to arbitration as null and void?
The rules of this House under the new tricameral system make it very difficult to move amendments. The House does not automatically go into committee as it did in the old days. The rules bog down the rights of the opposition parties to move amendments. I would like to move an amendment, but no purpose will be served if the hon the Minister does not accept it. I will therefore put the amendment to the hon the Minister now and send it across to him for his consideration.
I propose to amend clause 3 in the following terms:
- (1) Notwithstanding any purported ouster of jurisdiction, exclusive jurisdiction clause or agreement to refer any dispute to arbitration, and notwithstanding the provisions of the Arbitration Act (Act No 42 of 1965) and of section 7(l)(b) of the Admiralty Jurisdiction Regulation regulation Act (Act No 105 of 1983), any person carrying on business in the Republic and the consignee under, or holder of, any bill of lading, waybill or like document for the carriage of goods to a destination in the Republic or to any port in the Republic, whether for final discharge or for discharge for further carriage, may bring any action relating to the carriage of the said goods or any such bill of lading, waybill or document in a court of competent jurisdiction in the Republic.
- (2) Nothing in subsection (1) shall apply to an arbitration to be held in the Republic which is subject to the provisions of the Arbitration Act (Act No 42 of 1965).
If the hon the Minister accords this amendment we can go through the Committee Stage without any discussion.
Finally, the Bill by its repeal of section 311 of the Merchant Shipping Act, 1951, repeals the remedy which was available under that section against a ship’s agent. I am aware that South African agents generally view that provision with disfavour, although it is frequently useful to cargo interests where the vessel has left before the damage to the cargo is discovered. On balance, with the wider jurisdiction of the Admiralty Jurisdiction Regulation Act, 1983, I am inclined to the view that section 311 has served its period of usefulness and should therefore be repealed.
In conslusion I wish to point out that there is a typographical error in article 4(2)(b) of the schedule to the Bill where it reads: “The substantial fault or privity of the carrier”. I believe the words which are used in the International Convention are: “Actual fault or privity of the carrier”. If one reads it as “actual” it has a clear and well-defined meaning.
With South Africa’s ever-increasing exports and imports and the country’s use of the sea as a means of carriage we on this side of the House welcome and support this Bill which will simplify the whole question of carriage of goods by sea.
Mr Speaker, the hon member for Bezuidenhout astonished me somewhat this afternoon. This Bill was dicussed in depth in the standing committee. The hon member had ample opportunity there to advance all this objections and it is for that reason that I am now somewhat amazed that he should come here and try and find fault with this measure as an afterthought. I believe that the hon member did his homework thoroughly. I believe, too, that he has read extensively on this subject. He dealt in great dept with certain aspects of it—he answered questions which I believe would have been answered perfectly adequately had we dealt separately with each of the clauses of the Bill. However, I just wish to state the fact that the member is now touching on all Kinds of matters here, whereas he did have the opportunity to do so in the standing committee.
In the second instance, Mr Speaker, I want to thank the hon member and his party for being prepared to support this Bill. It is also true that this measure enjoyed the wholehearted support of the entire standing committee. That, too, is cause for sincere gratitude.
In the third place, however, this Bill is also the result of representations by interested parties. These interested parties requested that certain provisions of the Merchant Shipping Act, 1951, be amended and supplemented and be incorporated in separate legislation. The provisions affected are contained in Chapter VIII of the Merchant Shipping Act, 1951 and in reality comprise five sections. In his Second Reading speech the hon the Minister explained that the sections in question were based on the so-called Hague Rules, which form part of the International Convention for the Unification of Certain Rules of Law relating to Bills of Lading, which was signed as long ago as 25 August 1924. It regulates the responsibility and the liability, the rights and the immunities of carriers with regard to the carriage of goods by sea from any port in the Republic of South Africa to any other port whether within or outside the Republic, and with regard to the contents and effect of contracts for the carriage of goods by sea, as well as claims that could arise from that.
The fact is that the Hague Rules were amended in 1968 and are widely implemented internationally. Our own Merchant Shipping Act, 1951, has not yet been overhauled and adapted accordingly, and therefore it has now become imperative that this Bill come up for discusssion.
The objectives of this Bill are: To make provision for uniform monetary limitations; to provide that a carrier can claim in the event of loss or damage, that a conveyer’s employee or agent is also authorised to use the defences and limitations of liability, that a bill of lading may serve as a receipt, and, last but not least, that a carrier’s responsibility is limited to one year.
Mr Speaker, I am grateful to know that organisations such as the SA Handelsinstituut, Assocom and several others, including the Maritime Law Association etc, support this Bill; that indeed, they ask for it, and it is therefore my privilege, on behalf of hon members on this side of the House, to give my whole-hearted support to this Bill.
Mr Speaker, the Conservative Party supports this Bill because it is essential that certain provisions of the Merchant Shipping Act, 1951, dealing with the carriage of goods by sea, be incorporated in a separate piece of legislation. For that reason we support the measure.
Although the Hague Rules were amended and applied overseas in 1968, the Merchant Shipping Act, 1951, was not simultaneously amended accordingly. The amended Hague Rules of 1968 were not legally enforceable in the Republic although they were already being implemented in practice. If this Bill is agreed to now by Parliament, therefore, this situation will be rectified—the situation, as I said, in which certain rules are already being applied in practice whereas they cannot be legally enforced.
It is important, Sir, that provision is also made in this Bill for monetary limitations with regard to the liability of carriers. This of course must be subject to the condition that no reckless conduct has taken place. Then, too, there is another very important provision in this Bill, viz the recognition of a bill of lading as a prima facie receipt by the relevant carrier.
We take pleasure in supporting this Bill.
Mr Speaker, this is a unanimously agreed measure as far as the standing committee is concerned. I did consider taking the Bill clause by clause and dealing with every comma and full stop but I have now decided against that! I think the Bill has been adequately and fully discussed and blessed.
Even if it is an agreed measure the captain cannot be Black!
Mr Speaker, I think that hon member has a screw loose somewhere because I think he is dealing with the wrong Bill. He is unable to talk about the white waves. All he can talk about are the black southeasters and southwesters and black gales. However, perhaps at some stage he may be able to discuss White problems as well.
One problem I had in the standing committee was in regard to the “absolute” requirement to provide a seaworthy ship. That matter has been clarified as far as I am concerned but, I may say, only this morning. I raised this matter in the standing committee and I am now satisfied with the explanation I received. I shall not therefore delay the House by elaborating on this matter. Obviously we will support the Bill.
I must say that I think this measure must have been becalmed somewhere at sea in that it is now 1986 and we are only now implementing an agreement of 1968. As far as England is concerned, one will find that this agreement was incorporated into their legislation dealing with the “carriage of goods by sea” in 1971. It took them three years to do this but it has taken us somewhat longer. However, we have got there eventually and we now have the convention incorporated in our law and we support the Bill.
Mr Speaker, the hon member for Bezuidenhout amazes me. He started off by saying that he had received little or no help from parliamentary officials.
I did not mention parliamentary officials.
To which officials did the hon member refer?
The hon member for Bezuidenhout did refer to parliamentary officials. [Interjections.]
The same advocate who gave us the new clause and who telephoned us yesterday also phoned the hon member, Adv Shaw. He gave the hon member all the information that the hon member gave us here today. [Interjections.] The hon member is a very original person. However, this is a very technical matter, and the hon member read it out word for word as it had been given to him. I have the same story here from Adv Shaw. [Interjections.] I respect the hon member for Bezuidenhout because he has a wonderful brain. [Interjections.]
This morning we had the representatives of the Conference Lines here together with myself and the hon Ministers of Agricultural Economics, Trade and Industry, and Finance. The Conference Lines consist of Safmarine, the Deutsch-Afrika Lines, Lloyd Triestino, Atlantic, Portugal, Spain, England and Holland. They are forming a consortium and those people regard us as their friends. We must co-operate with them. We are an exporting country and we do not want to do anything to bedevil good relations in regard to shipping. We are going to accept this amendment. [Interjections.] It is not the amendment of the hon member for Bezuidenhout.
I did not say it was. I suggested it.
It is the amendment of Adv Shaw who worked in conjunction with these people. [Interjections.]
Order! I want to point out to the hon the Minister that great minds do think alike.
Thank you, Sir.
And fools seldom differ!
Both the hon member for Kempton Park and the hon member for Durban Point are perfectly correct in pointing out that an agreement was reached between members of the standing committee. It is therefore not necessary for us to discuss the proposed amendment to the clause at such great length. By 15 June I will have a problem keeping hon members here. I want to have done with this Order Paper. Once we have reached consensus regarding a Bill, why should we discuss it at such length? That is only a question and I respect the hon member for what he said, Sir. However, we are also in agreement as regards the next Bill on the Order paper. I therefore feel we should try to save a little time because by 15 June some hon members will want to return to their constituencies.
What is magic about 15 June? [Interjections.]
They have already said that there was going to be an election and a referendum.
The hunting season is open etc. [Interjections.] Very well, it may be 25 June.
The hon the Minister is aware that in terms of the rules of this House one cannot move an amendment a second time. If that amendment fails in the standing committee then one cannot move it in this House.
I am not moving an amendment now. I am aware of the procedure. There will be a Third Reading.
Only if there is a Committee Stage.
All I am asking for is a Committee Stage.
That is perhaps what he will get. I am giving him what he asks. Why fight with me?
*I should like to thank the hon member for Kempton Park who acted as chairman of the study group of the NP for doing so. He studied the legislation very thoroughly. I want to thank all members of the standing committee as well. The hon member for De Aar also supports the Bill, and I want to thank him for doing so.
†The hon member for Durban Point raised a few matters in respect of which I fully agree with him. I thank him for his support.
Question agreed to.
Bill read a second time.
Introductory Speech delivered at Joint Sitting on 10 February
Mr Speaker, I move:
Excluding the Annexure, this is a reasonably short Bill which is essential for the enforcement of the requirements of the International Convention for the Prevention of Pollution from Ships, 1973 and the subsequent 1978 protocol thereof. Act 6 of 1981 applies exclusively to damage which occurs after the coast or areas extending up to the outer limits of the territorial waters of the Republic of South Africa have been polluted by oil, and to preventative measures to minimize such damage. Said legislation is based on the International Convention on Civil Liability for Oil Pollution Damage, 1969, which the Republic acceded to on 15 June 1976. Subsequent to this, however, the Republic acceded to the International Convention for the Prevention of Pollution from Ships, 1973, on 28 November 1984, as well as the 1978 Protocol thereof. The convention came into effect for the Republic on 24 February 1985.
†The aims of the convention are as follows: to eliminate the deliberate or negligent pollution of the sea and immediate environment by crude oil or other harmful substances from ships, exploration rigs and other platforms; to improve requirements with which ships, exploration rigs and other platforms operating under the flag or control of a party to the convention must comply in order to prevent pollution; to punish a contravention of the rules by means of sanctions as laid down by the law of the country under whose flag the ship which is responsible for the pollution, sails or under whose control such a ship is; to obtain better co-operation and support from other member states in case of pollution and thereby expediting the disposal of claims; and, moreover, to require through legislation from ships of countries which did not accede to the convention to comply with the requirements of the convention before being allowed entry to harbours of member states.
*Interested parties in the Republic advocated that the Convention be embodied in legislation to give it force of law. To comply with their suggestion meaningfully, the Bill was drafted in consultation with State departments and private bodies concerned.
Finally, I wish to point out that whilst up to now attention has primarily been focused on the combating of oil pollution, in-depth attention will now also be given to measures to offset the dangers of other harmful substances which, in many instances, constitute an even greater hazard to the environment than oil pollution.
Second Reading resumed
Mr Speaker, the International Convention for the Prevention of Pollution from Ships Bill is probably one of the best Bills that has ever been introduced into this House. Let me say that up to now we have dealt principally with oil pollution and we have fared very well as far as that is concerned. One of the features of this particular Bill, however, is that it deals with hazardous chemicals as well. Whereas we have made provision in respect of oil pollution by the use of various pollution control ships, we have made little or no provision for the defence of our coastline against hazardous chemicals. There is a tremendously long list of all the various types of chemicals that can be transported by ship around our coast.
I would like to recommend to the Department of Transport that in conjunction with the Department of the Environment, it should investigate the entire question of combating each and every one of these chemicals in the event of a shipwreck on our coast or some problem in one of our harbours that involves these hazardous chemicals and thereby threatens our fauna and flora.
I would even go as far as to suggest that when vessels are approaching the South African coast, we should be informed if they are carrying these particular hazardous chemicals. In a modern industrial world like the one we are living in today, it will become increasingly evident that larger and larger quantities of these hazardous chemicals are to be found on the vessels coming in.
This is an excellent Bill and hon members on this side of the House will therefore support it wholeheartedly.
Mr Speaker, naturally we on this side of the House wholeheartedly support the legislation. It was unanimously accepted by the standing committee and there are no problems.
Nevertheless there is one point in the Second Reading speech of the hon the Minister which I should like to single out since it struck me particularly. The hon the Minister said that in-depth consideration must be given to ways of countering the dangers entailed by other dangerous substances which in many instances pose an even greater threat to our environment than oil pollution. I hope that the hon the Minister and I both have in mind industrial pollution which is deposited in the sea by rivers or in other ways. If this is indeed the case I want to give the hon the Minister my wholehearted support in the idea he has expressed.
Finally, I just want to say that if we carry on as we have been doing, in the sense that hon members of the Official Opposition speak for up to 20 minutes on legislation which has been accepted 100% by the standing committee—they speak for 20 minutes while the hon members of the other Opposition Parties speak for only two minutes each—we are going to be sitting here until the end of August.
Mr Speaker, may I ask the hon member whether he is aware of the importance of the Carriage of Goods by Sea Bill?
Yes, I am 100% aware of that. I am fully acquainted with the importance of that Bill.
You are talking nonsense.
No, I am not. The Official Opposition has agreed with us that where the standing committee accepts legislation, hon members in this House will discuss it for at most two to three minutes. If they speak for 20 minutes, we shall be sitting here until the end of August.
Mr Speaker, the CP supports this Bill. The Prevention and Combating of Pollution of the Sea by Oil Act, Act No 6 of 1981, is applicable to damage which occurs after the coast or areas including the territorial waters have been polluted. That Act therefore only applies to damage that occurs after pollution has taken place.
In November 1984 the Republic acceded to the International Convention for the Prevention of Pollution from Ships. This convention came into effect for the Republic on 28 February 1985. At present, however, there is no existing legislation to implement measures to prevent pollution of the sea and its immediate environment caused by ships, oil drilling platforms and other structures in the sea. Due to this shortcoming it became necessary to amend this bill in Parliament.
When this Bill is accepted by Parliament it will to a great extent combat deliberate and negligent pollution by ships, drilling platforms and so forth. In my opinion this is the most important aspect of this Bill.
Whereas in the past the main focus was on oil pollution, serious consideration is now being given to the damage caused by other harmful substances. This Bill is therefore very important because it makes provision for penalties in this regard.
Mr Speaker, we also support this measure which means that South Africa now has two measures dealing with pollution of the sea. This Bill is aimed at the prevention of pollution from ships, while the other measure concerns the combating of pollution. This is an internationally agreed measure. This is contained in the schedule to the Bill reflecting the terms of the international convention. Therefore there was no question of amending the legislation. It may be that we shall have to look at the other Act, the one dealing with the combating of pollution by oil to see whether there is any overlapping. In the meantime, however, we have two measures which cover different fields and are both necessary.
In fact, the standing committee felt so strongly about this measure that it increased the fine from R10 000 to R100 000 and the period of imprisonment from two years to ten years. We felt that R10 000 to a multimillion shipping company was like buying somebody a whisky before supper, and that the penalty should be something that they would feel.
I want to make an appeal to the hon the Minister to talk to his colleague the hon the Minister of Environment Affairs and Tourism because, while we are here passing a second Bill to prevent pollution, the hon member for Amanzimtoti is sitting there while in his constituency chemicals are being pumped out into sea, polluting the whole of the South Coast to the extent that the Natal morning newspaper The Natal Mercury wrote a leading article asking whether there was in fact not a member of Parliament for that constituency because they had not heard from him. Furthermore, the Government refused to give any information on the contract under which the company which was pumping the pollutant into the sea was operating because they said that it was a private agreement.
I wrongly accused the hon member for South Coast on another occasion. This is not taking place in his constituency but in the hon member for Amanzimtoti’s constituency. I want to ask the hon member for Amanzimtoti whether he has as yet lifted a finger to obtain the information which the town councils and beach authorities in his constituency want to get hold of. In the meantime, a newspaper has to make people aware of the fact that pollutants—chemicals—are being pumped into the sea, staining the whole of that coastline, ruining the fishing, affecting the holiday trade, and yet he does nothing about it.
Therefore, I hope the hon the Minister, who is doing something by means of this Bill, will talk to his colleague the hon the Minister of Environment Affairs and Tourism and shake up that member of his party who is doing nothing to prevent pollutants from being pumped into the sea. [Interjections.] If the same enthusiasm is shown by his hon colleague we will welcome the measure and give any help possible in tightening up that measure.
However, as far as this measure is concerned, we accept and support it. We hope that it will have the effect of helping to protect our coastline, our sea and our tourist industry from the often deliberate and careless pollution—of course, there may be accidents—which is caused by passing shipping. We shall support this Bill in all its stages.
Mr Chairman, the hon member for Bezuidenhout referred to hazardous chemicals. We have appointed a committee to investigate the whole matter. The hon member is not here at the moment but I shall personally tell him about this later.
*The hon member for Kimberley South dealt clearly with the question of shorter speeches. I am most grateful to him for his standpoint.
The hon member for De Aar also supported this measure and quoted certain references. I thank him very much indeed.
†The hon member for Durban Point referred to the pollution of a river. I shall contact the hon member for Amanzimtoti and the hon the Minister of Environment Affairs and Tourism in this regard.
*However, he has a wonderful talent. The hon member for Durban Point is an old parliamentarian—he uses legislation such as this about the sea to get at a river in Amanzimtoti, and therefore at the hon member for Amanzimtoti as well. I must say that he took the gap wonderfully! [Interjections.] He talked the man right off his feet.
Question agreed to.
Bill read a second time.
Introductory speech delivered at Joint Sitting on 10 February
Mr Speaker, I move:
This measure, which provides for a number of divergent adjustments to the Post Office Act that have become necessary, was dealt with during the recess by the Standing Committee on Communications and Public Works and was presented without amendments by that committee. I should like to place on record my appreciation of the positive approach and spirit of co-operation that have characterised the deliberations of this committee.
Since the standing committee has already considered the Bill in depth, while in addition each clause has been dealt with and elucidated in the explanatory memorandum tabled with it, I believe that it is not necessary for me to deal with it here in great detail. I shall therefore confine myself to a few important aspects.
Section 12F of the Post Office Act allows the Minister, subject to certain restrictions, to grant authority during the course of a financial year for the total amount appropriated in the estimates to be exceeded or for funds to be expended on purposes for which provision has not been made in the estimates.
One of the requirements stipulated is that such expenditure should be submitted to Parliament for appropriation in the next ordinary estimates. In practice, this requirement has proved to be too stringent because such expenditure can, for example, be allocated to a wrong financial year as a result of a clerical error and then only come to light at a stage when the particular estimates in which the expenditure should have been reported, have already been finalised. A wider margin should be allowed here and it is accordingly proposed in clause 2 that such expenditure should be reported for appropriation in estimates as soon as practicable, instead of specifically in the first estimates following the expenditure.
†A second proposal in the Bill I wish to refer to is that which amends the section of the Post Office Act dealing with the repayment of loans to the extent that amounts being used for the repayment of loans, and not only amounts with which overdrafts are being repaid, will be regarded as having been appropriated by law. The effect will be that the amounts will no longer have to be appropriated in the estimates. The proposal is contained in clause 4.
The proposal brings the applicable arrangements for the Post Office in this regard into line with the already existing legal arrangements in respect of both the central public service and the South African Transport Services. The arrangement has become particularly necessary for the Post Office right now, as it wishes to introduce an arrangement whereby the expenditure on the redemption of loans is spread over suitable periods in the financial statements. This will make it easier to reflect a correct image of the Post Office’s operating results in financial reporting.
Finally, I would like to deal briefly with the proposal in clause 5 which involves the Post Office being vested with the legal power to invest its funds as it may think fit and to trade freely in its securities. The extent of the financial activities of the Post Office and its need to act competitively on the domestic market, make it essential that it be vested with these powers. Similar powers were granted to the South African Transport Services during 1983. I should also like to mention that in matters of this nature the Post Office, as part of the public sector, remains in close contact with the central financial authority and the other sections of the public sector, and it must of necessity always act in the public interest.
The proposed provisions also involve the granting of the powers retrospectively since the Post Office was, as a result of financial developments, compelled to commence with the trading of its stock.
Second Reading resumed
Mr Chairman, at the outset let me thank the hon Minister of Communications for the explanation given in his Second Reading speech and the explanatory memorandum that is attached to the Bill before us. I do not know that other than the rules of this House which permit a 30 minute speech on the Second Reading there is any restrictions upon a member of Parliament in addressing this House for any specific length of time unless he exceeds those 30 minutes. I should like to remind the hon member of Kimberley South—who only got up to speak here today with regard to the length of speeches at the Second Reading—that the discussions in the standing committee are secret. They are not published, the public is not aware of it and the proceedings of those standing committees cannot be made public. To my mind the role of a member of Parliament is to stand up in this Parliament so that the world and the nation and everyone can know what we are doing and what we are discussing. Unless, of course, the hon member thinks that the role of all members of Parliament is irrelevant and that, because a matter is discussed and agreed to on the standing committee, we cannot come to this House in order to discuss matters of great importance to the nation and internationally such as the Bill that we have just discussed. [Interjections.] I think the hon member owes this House and members of this Parliament an apology for the attack that he made here today.
The hon the Minister as well.
The Bill before us is an important one because it deals with one of the most important pieces of legislation in terms of which the Post Office acts on its own. Since it has such a large budget and involves the entire community of South Africa intimately, it is important that we reflect for a moment or two upon the provisions we are asked to enact in this House.
My difficulty with section 2B of the Act to begin with, is that it was never intended to vest the Postmaster-General with powers to interfere with contracts pertaining to personnel. The Post Office Act itself allows the Postmaster General to vary a contract and it may well happen in contracting with various firms doing work with the Post Office, and other departments for that matter, that in the course of a contract there can be an error, there can be a variation, there can be an insolvency, and he needs to act and he needs to vary that contract, and that power he has. However, whether it was or was not used to interfere with a contract pertaining to personnel I do not know, and perhaps the hon Minister can tell us. This amendment is being introduced in case it may be interpreted that the Postmaster General can vary a contract pertaining to an individual. It cannot be done because we have to distinguish between the Post Office Act and the Post Office Service Act of 1974 where as far as individuals are concerned it is a staff management board that can deal with that type of situation.
The amendment to section 12F is probably the most important provision because it relates to appropriations and whether appropriations are exceeded or funds are spent for which provision has not yet been made. It has been argued that the present situation which provides that details of the excess expenditure must be tabled in Parliament in the financial year after the expenditure took place is too stringent. Therefore we are being asked to amend it to provide that this be done as soon as practicable, but the words “as soon as practicable” give rise to some difficulty because these words can be given a very wide interpretation. Who will determine how soon this is practicable? This caused considerably difficulty and gave rise to much discussion in the standing committee. It is a very important power because Parliament is the watchdog of South Africa. Excessive expenditure or expenditure that is not on the estimates is a very important aspect. We have to look after the expenditure so that we can fulfil our role as watchdogs of the public of South Africa. If we fail to do that, it will mean that the extra money required will have to be raised by means of an increase in tariffs, and we do not want to bring about increases in tariffs unless it is absolutely necessary. So it is important to restrict this expenditure.
We discussed whether in fact we should move an amendment on the standing committee to provide that this be done as soon as practicable provided that it be not later than the third financial year following the year in which the expenditure took place; in other words, to give more scope in order to meet the too stringent argument, and to make it the third financial year. I believe that this will find favour with the officials. I believe it could be dealt with legally, and I give notice that I intend moving a motion in terms of the rules later on after the Second Reading. I intend to ask this House to consider going into Committee in order to discuss the amendment to alter the words “as soon as practicable” to “but not later than the third financial year” etc.
In clause 3 it is proposed that the words “an appropriation account” be replaced by the words “a statement”. This deals with statements to be submitted to the Auditor-General, and there is no problem as far as that is concerned. Expenditure is charged to the financial year in which it takes place, and I think this is an improvement because it will show that the estimates are more accurate. Where all the money is not spent the part which is spent will be shown then and the balance will be shown in the year in which it is spent. In this way we shall get a truer reflection of the accounts, which is welcome.
As far as the proposed section 120 is concerned, the repayment of loans shall be deemed to have been appropriated by law. So it is no longer in the estimates. Expenditure on the redemption of loans is also now given a correct image.
The amendments to section 120 which are proposed in clause 5 vest the department with the legal powers to invest its funds as it thinks fit and to trade in its securities. Now we are asking the Post Office to compete in the open market. Bearing in mind that the Post Office is a protected body and has a monopoly, I am sure that the hon the Minister and the Postmaster General will use this power judiciously in determining their policies with regard to competing in the open market and with private enterprise. However, as certain transactions have already taken place—we were told about them—the amended provisions are given retrospective effect. This was done, I believe, in the interests of the Post Office. I am sorry that it was done before the Act could be amended, but we nevertheless accept that it had to be done. I therefore express my approval of the retrospectivity.
Section 12R which deals with the recovery of losses and damages is amended by clause 6. I think it is important for me to state that this relates to personnel who have acted in an irregular fashion—whether they are responsible for claims against the department or allegedly have failed to carry out their duties—thus incurring losses to the department which must be recovered. However, one must emphasise here that this relates to personnel who were employed, not who are employed in the department at present. I trust that there would have been some form of enquiry made by a departmental committee in order to establish whether that person was in fact responsible and to determine the exact amount for which he is responsible. The stringent provision made now means that if there is any amount owing by way of salary or wages this can be used in order to compensate the department for its losses. Only the other day I heard of a case of which I will inform the department where an employee was asked to give notice and, having given notice, his position in the department was terminated. Moneys are due to him, he has no other source of income, but he cannot get his money because they say other moneys are owing to the department. I think we must be a little cautious about this, and I trust that in giving this power to the Postmaster-General and the department, it will be used judiciously.
There is this deduction that I have mentioned, but it is important to remember that the deduction now does not relate to book value. In other words, if a tool is lost it has a replacement value, but if that tool is 20 years old and has to be replaced at today’s replacement cost it will come to a very substantial amount. Therefore I appeal to the department and to the hon the Minister that this should be looked at very carefully.
Other than the amendment I referred to, we shall approve the Second Reading of the Bill.
Mr Chairman, I do not propose to deal with the clauses of the Bill extensively. The hon member for Hillbrow has already said what could be said, apart from the introductory speech made by the hon the Minister.
The hon member saw fit to attack my colleague the hon member for Kimberley South because of his remarks about the protraction of a debate. I believe the hon member for Hillbrow has himself again shown that the Official Opposition in this House has no other motivation than to drag out legislation unnecessarily.
The Chief Whip of the Official Opposition says “nonsense”. I submit that when the Official Opposition moves an amendment in open debate—or gives notices, as the hon member for Hillbrow has done that he will move an amendment in open debate—it basically amounts to an admission of defeat. The hon member for Bezuidenhout has already lamented the fact that the new system, as he says, inhibits the opposition parties from moving amendments. The point is that Joint Rule 33(5)(b) prevents a member from moving an amendment similar in effect to one negatived by the standing committee.
I say therefore it is an admission of defeat when the Official Opposition comes here with a proposed amendment. It simply means—and the inference is clear—that they were unsuccessful in persuading anybody on the standing committee as to the merits of the amendment which they proposed.
Henceforth we must know that whenever the Official Opposition moves an amendment to a Bill, which had already been dealt with by the standing committee, they admit defeat. They admit that they have been unable to persuade the members of the House of Representatives or the members of the House of Delegates or their colleagues in this House that there is any merit whatsoever in the amendment which they want to move. Consequently the Official Opposition says in so doing, by their own admission, that they have become irrelevant in politics in South Africa. They do not need the resignation of a leader to show that. They show it by their own actions. [Interjections]
We have considered this measure in detail. The standing committee has decided that the wording of clause 2 of this Bill is adequate and will not allow any irregularities to take place. That was the considered opinion of the three select committees which form part of the Standing Committee on Communications and Public Works.
I for one am satisfied with that. I have little doubt that this Bill will be passed in the other two Houses in the same form as it will be passed in this House. I support the Bill.
We on this side support this Bill. In fact, this Bill at present before the House of Assembly is similar to one which gave these powers to the SATS in 1983.
Moreover, the functioning of the Post Office is being brought into line with the statutory provisions applicable to the Central Government, ie the Public Service. Therefore it would not be inappropriate for the Poste Office, too, to acquire those powers to such an extent.
What I welcome is that the Post Office is being accorded the right to invest and freely withdraw its funds as it sees fit. My reasons are as follows: Due to the poor performance of the rand at present it cannot be wrong if, for example, investments are made and made use of to obtain supplies, the price of which is due to rise sharply within a short time. The advantage is that the supplies can be purchased at better prices. It is preferable to act in this way than to wait until the money in the savings account has totally lost its value due to inflation.
As far as clause 6(a) is concerned I have been assured that if an official in the employ of the department loses property of the department, action will not be summarily taken against him, but instead that the matter will be gone into in depth. It is possible that that equipment, whatever it may be, may have been stolen and reported to the Police. In such circumstances it would be unjust to take action against that official and request him to pay the replacement value of such an article. My mind has been set at rest in that regard and I support the legislation.
Clause 6(b) deals with officials who owe money to the department. In this instance, too, I have been assured that action will not be summarily taken against them but that in the event of payment not being made, the law will eventually take its course.
Accordingly I support this amendment Bill.
Mr Chairman, the amending Bill under discussion contains a number of provisions. We too will be supporting it and I do not intend going through each and every clause.
However, in common with the hon member for Nigel I think the most important provision contained herein is clause 5. In my opinion it is as well that the Post Office has now achieved the same status as the SATS did in 1983, whereby it may now, in the words of the hon the Minister, invests its funds as it sees fit and trade freely in its securities. In my opinion this is very important. I concur with what was said by the hon member who has just resumed his seat namely that it is particularly important in the current economic climate.
Generally the Bill is one of streamlining a process. Quite a number of the provisions we know are included at the request of the Auditor-General. We believe that this is a gentleman whose voice must be heard at all times if we are to be in a position to produce a presentable set of accounts at the end of each financial year.
In clause 3 of the amending Bill we have corrected a contradiction in the principal Act. I should like to express my appreciation to the chairman of the standing committee and to the officials who issued each member of the committee with a copy of the Post Office Act when they presented us with this Bill. This sort of thing allows one to do one's work far more effectively, particularly during the recess. I think that is very important. I am particularly fortunate indeed to serve on two standing committees, namely Communications and Public Works and Home Affairs, where arrangements are made for each member to receive a copy of the principal Act, wherever possible. I commend this as a thought to all other standing committees because it certainly makes one’s life a lot easier. As hon members well understand, Butterworths are not always readily available.
With those few words I wish to state that we support the measure and wish it well.
Mr Chairman, I shall merely concentrate on the legislation and not on the private discussion going on between the Whips and the members. The Department of Posts and Telecommunications is a fairly peaceful department, and if they want to wage war they would do well to make use of another occasion to finalise their arrangements.
†The hon member for Hillbrow supported all the clauses of this particular amending Bill except clause 2(1) which provides for the amendment of section 12F of the principal Act by the substitution of subsection (6). The hon member makes the point that he wishes to move an amendment. As the Act stands at present, it is provided that any unauthorised expenditure must be reported in the next financial year. The problem is that we do not know when that financial year is because sometimes the expenditure is carried over to the next financial year and possibly even into the one thereafter. We already have difficulty with this particular provision and that is why we have asked for it to be amended.
The hon member for Umhlanga passed a few very positive remarks about the Auditor-General. Any expenditure that we incur that is not on our budget, the Auditor-General will pick up in the first year after that and he will report it to Parliament. There is therefore no way of sweeping that expenditure under the carpet and hoping for the best. It is irrelevant to say: “Within three years’”. It could be within four years or five years—that is only an arbitrary period. That is why we have asked for it to be reported “as soon as practicable’”. It might be within the first year. It might be within the next year.
It might be 25 years!
The Auditor-General will point out to Parliament that we have incurred expenditure which is not on our budget. So there is no way for the expenditure just to disappear. The hon member for Bezuidenhout says 25 years but the hon member for Hillbrow has suggested three years. That is therefore an arbitrary figure and what the hon member for Bezuidenhout has just said proves it. I do not think it could be 25 years.
Although I do not know exactly what the rule is if the hon member wants to move his amendment, I can at this stage say that I do not think that one could accept an amendment that is not going to make our administration easier but is only going to limit our actual administration. That is why we use the phrase “as soon as practicable”.
The hon member for Hillbrow raised a question of replacement costs. Clause 6(a) which relates to the replacement costs is a very important clause. I can say quite frankly that there is a very low incidence of theft of money or equipment in our post offices. The Postmaster-General and our top executive are very strict in this respect. From time to time we have had to ask people to leave our service because they had contravened the law in this regard. In a business like ours, we cannot allow people to take equipment out of our workshops or money out of our funds. However, once equipment has been taken, there is obviously an investigation. We cannot charge a man with misconduct unless we have found the equipment or tools that he might have stolen. If he is found guilty, the present Act provides that the equipment has to be replaced at book value. Although the equipment could still have lasted for many years, it might have been written off at book value already. He could therefore have taken something that is worthless on our books, but if we have to replace it, it will cost us thousands of rand or more. If therefore one is caught and convicted either in court or by one’s department, one has to replace the stolen goods at their replacement value.
The present Act provides that if a person who was employed by the department and whose services have been terminated, owes money to the department, only his pension contribution can be held back. We might, however, have leave money and a part of his salary and, hard as it is, we have to recoup this money in some way or another because it is public money. That is why we are adding in clause 6(b) that not only pension money, but also any other money that we have, may be held back. We treat these cases as speedily as possible and we try to pay out whatever we owe to him as soon as possible.
*I should like to thank the hon member for Umlazi. I would like to bring to his attention that this Bill has been approved by the other two Houses and that this is indicative of the speed with which the Post Office normally acts. If it were therefore approved in this House as well, the matter would actually be out of my hands and it would go to the State President.
As hon members know, the Department of Communications very seldom proposes amendments to existing laws, but when this happens, it is for administrative purposes. The hon member rightly said there is, after all, a lot of time to discuss the matters concerned in the standing committee. The entire system of standing committees is important in the tricameral system we have.
I also wish to thank the hon member for Nigel who supports the measure as well. He made an important point on the question of investments. It is very important because from time to time we have money which we want to invest for a short period before it has to be paid out. This has happened, and some hon members will know that in the standing committee it was explained to them that for this very reason the measure will become effective retrospectively. It would also give us an opportunity, however, to invest any additional monies we may have judiciously; and if we were to invest money we could issue, exchange, or negotiate stock.
†I would once again like to thank the hon member for Umhlanga for his support and also for pointing out that some of the measures here are actually at the request of the Auditor-General. We have a very good working relationship with the Auditor-General who does all our books, if one can put it that way, and compares our budgeted income and expenditure with our actual income and expenditure. His report is tabled in Parliament every year. We have no fear that he will investigate the matter. In fact, he might discover something that we have missed. As I have said, we have a very good working relationship with him.
As far as the hon member for Hillbrow is concerned, I am afraid that I cannot accept his amendment. I therefore ask the House to support this proposed measure.
Question agreed to.
Bill read a second time.
Introductory speech delivered at Joint Sitting on 10 February
Mr Speaker, I move:
This Bill amends the various Acts relating to the universities, technikons, tertiary education and schools for Blacks, with the main object of improving efficiency. Firstly, as far as the universities are concerned, Mr Speaker, the Bill amends the university Acts concerned so as to alter the constitution of the university, the council, senate and convocation. Thus the Bill makes provision in respect of each university, in clauses 1 to 18, inter alia for the following: Firstly, that more than one vice-rector may be appointed and may serve on the council, senate and convocation. In this way the position at the three universities concerned is brought into line with that at Vista University and all other universities. Secondly, it is provided that more than one registrar may be appointed. According to a legal opinion obtained, only one of these officials may be appointed in terms of the university Acts concerned as they read at present. However, for administrative reasons there is a need for more than one registrar and in fact, all the universities have in practice appointed more than one. It is therefore necessary to legalise this practice. Thirdly, provision is being made for increasing the representation of donors on the council from one person to two in recognition of the important role that donations play in the financing of universities.
Mr Speaker, the Education and Training Act, 1979 (Act 90 of 1979) is being amended inter alia to make provision for the establishment of intermediate schools, ie schools for primary and secondary education up to a standard not higher than the seventh standard. This makes it possible to provide a measure of secondary education to rural communities where the population is too small to justify the establishment of full-fledged secondary schools. This is provided for in clause 19.
Secondly, to regulate anew the constitution of the governing body of a private or State-aided special school in consequence of certain problems presently being experienced in practice. It is considered essential that it be made possible to appoint departmental representatives to the governing body, but the present provision does not lend itself thereto. This is provided for in clause 23.
In addition, the provision pertaining to the confirmation or otherwise of a teacher’s probationary appointment is more clearly stated, since uncertainty exists at present with regard to the interpretation of the provision in question. This is provided for in clause 24.
†Furthermore, the Bill amends the Technikons (Education and Training) Act, 1981 (Act 27 of 1981), inter alia so as, firstly, to alter the constitution of the council of a technikon. This is contained in clause 26. Secondly, to shorten the period for which a student is registered at a technikon from one year to not more than one semester, as most courses are in practice offered on a semester basis. This is contained in clause 27.
Thirdly, the same clause provides for the cancellation of the registration of a student refusing to participate in the prescribed educational programme; and fourthly, the Bill requires that regulations framed by the council be approved by the Minister and published in the Government Gazette. The present provision does not contain this requirement, creating an anomaly when compared with the University and Technikon Acts which do contain such a directive. This provision is amended in clause 28.
In conclusion the Tertiary Education (Education and Training) Act, 1984 (Act 92 of 1984), is amended so as to abolish the Council for University and Technikon Affairs (Education and Training), as the extended functions of the Universities and Technikons Advisory Council, established under Act 99 of 1983, render the continued existence of this body redundant. This is done in clauses 29, 30 and 31.
The Bill now before Parliament aims at promoting the interests of education for the Black community.
Second Reading resumed
Mr Chairman, when this Bill appeared before the standing committee in its original form, it covered a number of matters relating to Black universities and technikons. Most of the provisions were of a technical nature and dealt with the administration of some of these institutions. The standing committee found difficulty with three aspects of the Bill in its original form. One of the difficulties was in respect of those clauses relating to the South African Certification Council Bill, 1986, because those clauses were in fact anticipating another Bill which has not yet come before or been debated in this House. That presented the standing committee with one problem. The standing committee resolved this problem by deciding that those particular clauses, namely clauses 21, 26 and 27 of the original Bill should stand over.
Another matter which gave cause for concern was the composition of the council of technikons dealt with in clause 28 of the original bill. The standing committee felt that the Minister was being given too much scope in appointing people to those councils, that matter was dealt with by means of an amendment which subsequently came before the committee and which suggested to the Minister the sources to which he should look in making appointments to the councils of Black technikons.
Then there was also that rather vexed question contained in clause 29 of the original Bill. The clause related to the registration of students at technikons and, in particular, to the termination of such registration. As regards the termination of registration, clause 29(b) of the original Bill provided that:
We found that clause in its original form totally repugnant. We saw it as a deeming provision which would deprive a student of his registration merely for uttering something to the effect that he was going to stay away from classes or lectures or whatever the case may be. We considered it totally repugnant that such an utterance should be sufficient to deprive the student of his registration. We also found it totally unacceptable—and we said as much in the standing committee—that the student’s refusal to attend or his absence from classes could result in the sanctions being applied against him and subsequently in his losing his registration as a student at that institution. There was a fairly acrimonious debate on this issue in the standing committee, and as a result an amendment was brought forth which at least provided that the student could not lose his registration. The amended provision in the Bill which is now before the House added the words that the council may only, “after affording a student an opportunity to present his side of the case,” cancel the registration of that student if he by utterance or other action does these things. That is certainly marginally better than the Bill in its original form, but my hon colleague and I, who represented the Official Opposition on the standing committee, made it clear that we found that particular clause repugnant despite the amendment. We believe it has no place in legislation of this kind. We feel that it imposes far too stringent a restriction and sanction on a student at a technikon. It is excessively harsh and could become the object of abuse. The invocation of this provision could, in fact, cause difficulties within a Black technikon.
What is more, we also believe it to be totally unnecessary. Section 12(3A) of the Act we are about to amend reads as follows:
In the original Act, the council of the technikon has the authority, if it thinks it is in the interests of the technikon, to cancel the registration of a student. If this subsection is to be retained, I cannot for the life of me see why it is necessary to add a provision such as that contained in clause 29 of the Bill before us, which deals with a student who “by utterance or other action refuses to participate in the prescribed educational programme”. The Act as it stands gives the council of a technikon the authority to terminate the registration of a student.
Although it has been amended, we still find this provision repugnant and consider it unnecessary. For these reasons the Official Opposition is obliged to vote against this Bill, despite the other matters dealt with in it.
Mr Chairman, the hon member for Berea mentioned the fact that the student can become a subject of abuse under the new set-up. He omits to say that such a student may also make the institution a subject of abuse. Why does the hon member not spell that out? At the present juncture, not only now, but in all circumstances—we have to face the possibility that students, or one single student, can totally disrupt student life.
But the council now has that power.
The council does not have the power to do it immediately, because it first has to follow a certain procedure before it can cancel a student’s registration. In the interim, while the council is carrying out the procedures it has been empowered to institute, this kind of student carries on. He disrupts other people who want to make use of the opportunity to study and puts them in the position of being unable to do so. We simply do have certain students who exert power in their way. It does not matter how it happens, but the hon members know that it does happen. The whole student community suffers as a result. What is wrong with the new arrangement?
Therefore the student gains the opportunity to state his side of the case. He is not simply suspended without further ado.
Now, therefore, the process will be that the student is first called in and is accorded the opportunity to state his case. Only afterwards can his registration be cancelled in the following circumstances.
That is to say protest—
To what wilful action or abuses of power and authority is the student being exposed here? He is being exposed to nothing of the sort. This is merely an honest effort on the part of the legislator to clamp down on the people whose aim it is deliberately to disrupt the tuition provided at a specific institution. However, this is still being done with the proviso that he be accorded the opportunity to state his side of the case.
I think the time has now come for the authorities and the governing body of a technikon or university to be given the necessary teeth to act against these people whose sole aim it is to disrupt and cancel the process of tuition at the tertiary institutions for education and training.
Mr Chairman, the CP supports this Bill. It deals with universities, technikons and schools for Black people and certain technical improvements that will result in better education being provided to those people. We are in favour of it.
Clause 27 of the Bill deals with disciplinary measures. I can only say that this clause is as fair as a clause and a provision can be.
It is not aimed at the student who is at an education institution in order to study, qualify and further his career. The clause exists specifically to provide for the individuals who are not there with the aim of studying—as recent experience has taught us—but with the aim of disrupting the educational institution and preventing the other students from completing their studies. This clause is aimed at such students.
The educational authorities at that institution must afford the student an opportunity to state his case. If the student does not utilise the opportunity, or if he states his case and says that he is not there to study, or if he performs acts that indicate that this is the case, then the authorities at such an institution may take action against him. One could not imagine anything fairer than that.
To that I want to add that any educational institution at which there is no discipline cannot perform its task of education. In that we differ with the hon members of the Official Opposition. Their purpose and aim is that there should be disorder and a total lack of discipline in all spheres in South Africa. [Interjections.]
That is rubbish!
Of course it is true. Therefore I can understand that they do not wish to support this clause, because it suits them and what they stand for that there should be chaos and that those people should not develop to the optimum extent.
You are talking nonsense.
It is not nonsense, but the truth; otherwise the PFP would have supported a step which promotes discipline.
We support this clause. For the rest I can understand that the Official Opposition is seeking a reason to vote against this Bill, because it provides that Black people will have their own institutions from the primary to the tertiary level in which they can undergo education.
I think the left wing of the NP may have their reservations, but the right wing of the NP ought also to support this Bill.
Mr Chairman, we in these benches support this amending legislation. The amendment referred to by the hon member for Berea was thoroughly debated in the standing committee, and I believe that what is important here is that that type of action of which hon members of the PFP disapprove is being allowed in accordance with certain guidelines laid down by the academic board and approved by the council. I think it is important to realise that the council consists of one person appointed by the Council for Education and Training, two members of such local Government institutions as the Minister may determine—each appointed by the Minister after consultation with the institutions concerned—at least two people who have distinguished themselves in the fields of science or commerce and industry, and who have special knowledge or experience in the functioning of a technikon—the latter two also appointed by the Minister—and one person nominated by every body, institution, group or association which, in the opinion of the Minister, has an interest in the technikon concerned. These council members, together with the rest, are to make up a total of not more than 20.
The body of 20 people comprising members from the broad spectrum of society has to approve of that action to which hon members of the PFP object so vehemently now. In view of the fact that the miscreant—or whatever other term should apply in this instance—has the opportunity of stating his case, I believe, that council will not very easily or unnecessarily approve of any action recommended to be taken against him.
What is interesting, however, in relation to this matter is a report in today’s Cape Times. On page 2 of that newspaper there appears an article under the heading “Whites leave after boycott”. It is a report about six White undergraduate students at the Medical University of Southern Africa who have decided to leave the university because of the tension being caused by their presence on the campus. According to the said report the tension is the result of a boycott brought about, no doubt, by a small group of people, and those boycotting students have made certain demands, inter alia, that students who fail their first year of study for the first time be readmitted—in other words they would like to rewrite the rules of the university—and that the registration of six White students who have been admitted to undergraduate courses for 1986 be cancelled. This university, established under this department, has in fact to all intents and purposes been granted full autonomy, and the principles that have been strictly applied during the selection of the 1986 students have resulted in the acceptance of only six White and nine Asian students.
It would appear therefore that the powers of universities to take action in cases of the abuse of educational institutions are inadequate despite what the hon member for Berea said in his speech earlier. I say this because I believe that those babies who are running around on university campuses creating circumstances of the nature referred to in the newspaper report I have mentioned are not always present on the campus so that action can be taken against them there.
They are not always babies either!
That is true. They are not always babies either, Sir, as the hon member for Umhlanga says now. It is, however, very obvious that the requirement for stricter disciplinary measures at institutions such as these has to be met in order to bring about a situation of stability and also to allow other students—who are by far in the majority—the opportunity of continuing their studies.
Mr Chairman, we in these benches have no problem supporting this measure. I really believe that one can take the question of championing the liberties of the individual just that little bit too far. I believe this is especially a case in point, Sir. Therefore we will be supporting this measure.
Mr Chairman, I thank the hon member for King William’s Town for supporting the legislation on behalf of the NRP.
In referring to the composition of the governing body, the hon member for Berea said that in the standing committee they had had certain objections to it, but he did not spell out exactly what the objections are. He merely referred to them briefly.
In that connection I should like to say that when one looks at the composition of the governing body, one concludes immediately that it is now much broader than before. It is also very clear that the composition is much more democratic. This broader representation is not confined to fixed bodies from one institution, but it is very clearly stipulated that that governing body is drawn from various bodies, institutions, groups and societies. I do not know, therefore, what the objection of the hon member for Berea is. This side of the House is sure that this Bill is a great improvement in comparison with the previous one.
The second matter raised has been dealt with by previous speakers, but I think the hon member for Kimberley North made an important point in referring to the student who deliberately obstructs the academic programme of an institution. The Bill states clearly that the termination of the student’s registration can be brought about by the student’s utterances or by certain actions through which he indicates—I think these words are important—that he refuses to participate in the prescribed educational programme and activities. We are dealing here, therefore, with someone who does not want to study. He attends an academic institution, but refuses to take part in the educational programme and activities. An institution cannot be surrendered to the high-handedness of a student who does not want to study. I therefore think the criticism of the Official Opposition as far as this clause is concerned is quite unjustified. I should like to support this Bill.
Mr Speaker, thus far, apart from the hon member for Berea who has stated that we are going to oppose this measure, no hon member in this House who has spoken has appeared to understand the climate prevailing in South Africa at the present time. Nobody appears to understand that nothing is likely to be more provocative than the insertion in a Bill dealing with education of a clause such as the one this House is about to pass, despite, unfortunately, our opposition.
The way to deal with unruly students and the way to deal with any form of rebellion at a school, technikon or university is surely to examine the underlying causes and then to do something which will obviate the necessity for students to behave in that way. I do not know why hon members in this House appear to assume that people who have entered technikons do not want to study. Surely the object of attending a school or going to a technikon or university is to learn something which is going to benefit those students in their later lives once they leave those institutions. People do not enter these institutions with the idea of causing unrest. Something happens that makes them behave in that way.
I may say that the hon the Minister of National Education and his Deputy appear to have some understanding in this regard. However, the clause that is being introduced this afternoon does not seem to my mind to take any cognisance whatsoever of the climate at present prevailing in the country. I believe that we are looking for trouble. Already we have had the spectacle of hundreds of thousands of schoolchildren boycotting the schools. Thank heavens those children have been persuaded to go back to school, largely I would say, because of the efforts of parents’ committees which have prevailed upon the children to return to school. This is also due to the fact that the hon the Minister and his Deputy have to some extent met the demands of those students. They did take the trouble to examine the causes of the problem.
Here we have a clause which relates to the constitution of Black technikons and which allows for the deregistration of students on the most absurd pretext. It is not as if the clause stipulates that for such deregistration to apply, the students need have been absent from classes for any length of time or that they must have fomented rebellion or generally disrupted the activities of the technikon. A simple statement—“utterance” is the exact word used in the provision—such as: “I won’t go to class tomorrow”—and it need not be for any longer than one day—“to demonstrate my objection to some aspect of Government policy”, would be enough to deregister that student.
He can explain it to the council.
I like that hon member telling us he can explain it to the council!
It is in the Bill.
Yes, I know. We moved that amendment and that hon member voted against it. [Interjections.] All of a sudden he is telling us that he justifies the insertion of this provision because now at last the democratic provision of allowing the student to put his case to the council has been accepted by the standing committee. [Interjections.] The same, I might say, applies to the hon member for Lichtenburg who objected to the insertion of the slightly redeeming clause that we are considering.
I did not object. You are making a mistake.
You did not vote against it? Well, I apologies if I am mistaken. Certainly, however, the hon member for Kimberley North objected and he does not deny it.
It does help to know that the student is at least able to have a hearing, but that is all this provision does. It gives him a hearing. Thereafter he can be deregistered in the shortest possible time if the council decides to do so.
I want to ask the hon the Minister whether this provision exists in the law relating to any other institution that he knows of. Does it exist in the legislation relating to Coloured technikons? Is it to be found in the law governing White technikons? It may well be embodied in the regulations. I would not know as I have not examined them. We know that this provision does not hold good for White technikons but I am not sure—although I doubt it very much—whether such a provision is to be found in the law governing Coloured technikons.
I want to warn this House that it is looking for trouble. At the very first instance of a student being deregistered as a result of a protest, as a result of stating or uttering his intention not to attend classes, there will be a wholesale boycott of the technikons. That, I believe, is the last thing we want in the present climate of unrest in South Africa.
Mr Chairman, I should like to convey my sincere thanks to those hon members who have supported this Bill. I think the hon member for Kimberley North pointed out very effectively that the need for the stipulation which evoked the criticism of the Official Opposition lies in the very fact that we are dealing with special circumstances; that our recent experience of particular circumstances has made it necessary to deal with a matter which in the past was left to reasonably informal arrangements, in such a way as to combat effectively those who undermine order at our educational institutions. That is why the hon member for Kimberley North rightly said the authorities must have the muscle to deal with this matter.
The hon member for Lichtenburg, whom I also thank sincerely for his support, rightly pointed out—actually that is the point raised by the hon member for Houghton towards the end too—that at our institutions for higher education we are presently having to contend with a category of person who comes there with the very purpose of inciting trouble and unrest. It is the experience of every one of the universities’ rectors that unfortunately there is a minority group of trouble-makers—one can almost say professional trouble-makers—which is planted at the universities and technikons. They have to be dealt with in a special way—by means of measures which might not have been thought necessary in a normal, tranquil educational set-up.
†The hon member for King William’s Town has very correctly pointed out with reference to criticism about the possible abuse of this measure, that there is a guarantee incorporated in the composition of the council, which is the body that is authorized to deal with this matter. The council will see to it that this power which is granted by the clause concerned will be handled in a responsible way.
*The hon member for Potgietersrus also stressed the important point that we are dealing here with a body of which the composition is being determined anew in this Bill. The point here is the composition of the council of the relevant technikon, which with confidence can be left in control of the situation. We cannot expect that council, however, to maintain the order and stability at the technikon—also in the interests of the majority of students who want to study—if we do not give them the reasonable instruments or “muscle” with which to fulfil that responsibility.
†The hon member for Houghton asked whether a similar clause existed in the legislation of other institutions. The answer to that question is no. Normally one would not provide this kind of clause but the experience of what has happened recently promoted the technikons concerned to come to us and to say that it has now become necessary. They can not handle the situation merely by means of the existing legislation.
It is also an oversimplification to say—as the hon member for Houghton said—that students do not enter institutions like technikons to cause unrest, and that one should look at the underlying causes behind the complaints which incite or motivate them to unrest. I want to point out firstly that it is quite clear form experience that there are—as I said a moment ago—students who have actually been planted there with the purpose of causing unrest. I have been informed by two of the rectors of the universities concerned that they have incontrovertible evidence that some students are actually funded by subversive organizations to go those universities and to operate there, using the funds at their disposal to influence other students to follow their example.
It is also necessary to emphasize that while the Deputy Minister of Education and Development Aid, the department and I myself are constantly trying to identify the underlying causes of the situation through discussion and negotiation, while we are trying to determine which of the complaints coming from students who are dissatisfied are reasonable, one invariably finds oneself in a situation where one has to deal with a moving target. A certain cause of dissatisfaction may, for example, be identified and, if the discussions reveal that the complaint is justified, the necessary measures are taken to eliminate the cause for complaint. However, the very next moment one has to deal with just a slightly different variation of the same complaint. One thus has to deal with a target which one simply cannot hit because it is continuously moving away.
The example which the hon member for King William’s Town mentioned in this regard is very pertinent. The students at the institutions for higher education—the technikons and universities designed especially for the Black communities—have been complaining that those institutions which they have to go attend are not open institutions. Therefore, by a change of the legislation last year, authority was given to the councils of these institutions also to admit students from other population groups. In the case of Medunsa, where there were four places vacant in the third year of medical study and two places in the second year of veterinary study, students from the White population group have been admitted. This is a typical example of this moving target. Whilst the students at medunsa at first complained because that university was not open, and often gave this as a reason for their boycotts and demonstrations, now that it is open they say that they do not want it open in that way.
I repeat that there are often reasonable causes for complaint which we try to identify, to address and to solve. However, we also have to reckon with the fact that there are people who are not interested in improving and promoting education but who are simply interested in getting the whole educational process bogged down and in making the administration and the educational functioning of these institutions unmanageable.
We must have discipline at all our institutions, but we shall exercise discipline in a responsible way, in a way which is in accordance with the spirit of education and of training proper at an institute of higher learning. However, a point is reached where students through boycotts and through refusal to attend the normal educational programme really also effect a standstill in the whole operation of the institution. They wreak havoc and therefore this boycotting of activities has become a new feature which has to be specifically addressed.
Although the hon member for Berea initially argued that on the one hand he considers this clause repugnant and on the other hand unnecessary, I should like to point out that in addition to the general provision in the section which he quoted there has from experience been found to be a specific need, in the light of what has taken place recently, for dealing with this specific type of disorderly conduct, namely a refusal to participate in the teaching activities. This is not just a refusal; it is a refusal which is expressed in such a way as to bring about disorganisation and disorder on the campus of the institution concerned.
We have very serious appeals from the parents and from the students at large—even from students who are actually at present through intimidation forced to boycott these institutions—to assist them because they want to continue with their studies, by applying more effective and more strict discipline and to enable the authorities to apply discipline at these institutions.
Mr Chairman, may I ask the hon Minister a question? I should just like to ask him what he thinks the reaction will be of other students if for example a single student is punished for uttering a threat not to go to a lecture. What effect does he really think this will have on other students, given the circumstances which he says he is so aware of—the unrest and so on?
I am convinced that the councils of these institutions will not punish a student simply because he has made an utterance of protest. There are circumstances, however, in which these councils as responsible bodies have found there are students who, through constant refusal to attend lectures and through conspicuous boycotting demonstrations of the educational activities, have poisoned the whole spirit of that institution to such an extent that they simply must be got rid of. I can give you the assurance, Mr Chairman, that I have every reason, together with the hon members of the House who support this matter positively, to accept that our councils are responsible and circumspect in their actions. Indeed, we often get complaints from responsible people in higher education that perhaps certain universities’ councils could be stricter, but we understand that they are dealing with a very explosive situation, and have to act with great caution and diplomacy. I am convinced that they will do so in this case too.
We are dealing with real trouble-makers and this clause is necessary with a view to the elimination of such people. We have thousands of students who would like to proceed with their studies, whose opportunities are frustrated year after year by this small group of subversive elements which has only one purpose, viz to bring this country to a standstill. They have a ridiculous cry of “freedom before education”, whereas logically it is surely “education for freedom”. Which people who want to see political emancipation can do so in a responsible way to the benefit of their own community and everyone else if they are not properly trained and educated to do so? I therefore think the arguments of the hon members for Berea and for Houghton, as indeed was found in the standing committee, do not hold water. I request the House to accept this Bill as it stands. We simply need this measure supplementary to the general provision which is already contained in the legislation on technikons to enable councils to exert discipline. This is a specific case which, in the light of experience, requires specific measures.
Upon which the House divided:
Ayes—113: Alant, T G; Barnard, S P; Bartlett, G S; Botha, C J v R; Botha, J C G; Botma, M C; Breytenbach, W N; Clase, P J; Coetsee, H J; Coetzer, H S; Coetzer, P W; Cunningham, J H; De Jager, A M v A; De Villiers, D J; Du Plessis, G C; Du Plessis, P T C; Durr, K D S; Farrell, P G; Fick, L H; Fouché, A F; Fourie, A; Golden, S G A; Grobler, J P; Hardingham, R W; Hartzenberg, F; Hefer, W J; Heunis, J C; Heyns, J H; Hoon, J H; Hugo, P B B; Jordaan, A L; Kriel, H J; Kritzinger, W T; Landman, W J; Langley, T; Lemmer, W A; Le Roux, F J; Ligthelm, N W; Louw, E v d M; Louw, I; Louw, M H; Malan, W C; Malherbe, G J; Marais, G; Marais, P G; Maree, M D; Meiring, J W H; Meyer, W D; Munnik, L A P A; Nothnagel, A E; Odendaal, W A; Olivier, P J S; Page, BWB; Poggenpoel, D J; Pretorius, N J; Pretorius, P H; Rabie, J; Raw, W V; Rencken, C R E; Scheepers, J H L; Schoeman, H; Schoeman, R S; Schoeman, S J; Schoeman, W J; Scholtz, E M; Schutte, D P A; Scott, D B; Simkin, C H W; Smit, H A; Snyman, W J; Steyn, D W; Stofberg, L F; Streicher, D M; Swanepoel, K D; Tempel, H J; Terblanche, A J W P S; Terblance, G P D; Theunissen, L M; Thompson, A G; Treurnicht, A P; Van Breda, A; Van den Berg, J C; Van der Merwe, H D K; Van der Watt, L; Van Eeden, D S; Van Heerden, R F; Van Niekerk, A I; Van Niekerk, W A; Van Rensburg, H M J (Mossel Bay); Van Rensburg, H M J (Rosettenville); Van Staden, J W; Van Vuuren, LMJ; Van Wyk, J A; Van Zyl, J J B; Van Zyl, J G; Veldman, M H; Venter, A A; Venter, E H; Vermeulen, J A J; Viljoen, G v N; Visagie, J H; Volker, V A; Watterson, D W; Welgemoed, P J; Wessels, L; Wilkens, B H; Wright, A P.
Tellers: J P I Blanché, W J Cuyler, A Geldenhuys, C J Ligthelm, R P Meyer and J J Niemann.
Noes—18: Andrew, K M; Bamford, B R; Burrows, R; Cronjé, P C; Eglin, C W; Goodall, B B; Moorcroft, E K; Olivier, N J J; Savage, A; Sive, R; Soal, P G; Suzman, H; Swart, R A F; Tarr, M A; Van der Merwe, S S; Van Rensburg, H EJ.
Tellers: G B D McIntosh and A B Widman.
Question agreed to.
Bill read a second time.
Introductory Speech delivered at Joint Sitting on 10 February
Mr Speaker, I move:
During a diplomatic conference which was held in Geneva, the institute of the United Nations Organization for the Unification of Private Law (Unidroit), adopted a convention on 17 February 1983, which is known as the Convention on Agency in the International Sale of Goods. The Republic of South Africa has subsequently acceded to this convention, with the result that it must now be made applicable in the Republic by way of appropriate legislation. The reason why it is imperative to embody this convention in legislation, is that accession to a convention or the conclusion of a treaty is not a legislative act, but is in fact purely an executive act. The provisions of the international deed does, therefore, not become part of the law of the Republic by mere accession, and consequently it must be expressly declared as being part of the law of this country.
In the Convention on Agency in the International Sale of Goods, provision is made for the adoption of uniform rules which govern agency in the international sale of goods as well as for different social, economic and legal systems which would contribute to the removal of legal barriers in international trade and to the promotion and development of international trade. The convention, on which I do not intend commenting here is attached to the Bill in the form of a schedule. I would, however, like to draw your attention to a few important aspects of the Bill.
The first substantial provision is found in clause 2 in which the convention in toto is declared to be applicable in the Republic.
†The provisions of this clause also have the effect that subsequent amendments of or additions to the convention which are adopted by the Republic could be incorporated in the Act by means of amendments to the schedule, and this could be done by proclamation by the State President. However, copies of such proclamations have to be laid upon the Table in the respective House of Parliament within certain specified periods after publication thereof in the Government Gazette.
Clause 3 of the Bill empowers the Minister of Trade and Industry to make regulations in order to give effect to any provision of the convention. Furthermore the Minister is authorised to prescribe fees to regulate the recovery of any expenditure incurred in connection with the application of the convention in the Republic.
Since the Bill relates to the international trade relations of the Republic and could have an effect on the Republic’s international image, clause 3 further provides for all regulations promulgated by the Minister also to be laid upon the Table in the respective Houses of Parliament within a specified time. However, should a regulation be disapproved by all three Houses of Parliament, such disapproval shall have the effect of annulling the regulation concerned as if such regulation had been repealed by a statute of Parliament. In such an event the provisions of section 12(2) of the Interpretation Act of 1957 shall apply which states that anything properly done or suffered in the meantime under the particular regulation until the moment of annulment shall remain valid and of full force and effect.
Second Reading resumed
Mr Chairman, the Official Opposition will be approving this measure. It is a purely routine matter. The UN’s International Institute for the Unification of Private Law adopted the Convention on Agency in the International Sale of Goods, and recently South Africa’s representatives approved it. We have to change what was an executive action into legislative action by passing it legislatively through this House.
There are adequate protections in this measure, although regulations can be proclaimed by presidential proclamation. These can be set aside if all three Houses decide that the regulations are not suitable. It is a legislative matter. However, it does make one think of the problems we have overseas with our foreign trade as we trade under extremely difficult circumstances at the moment. Obviously, anything that facilitates our trade or which enables us to co-operate with foreign agencies overseas like the Gatt requires our support and endorsement. Therefore we agree to this measure and consequently we approve this Bill.
Mr Chairman, I thank the hon member for Walmer for his party’s support. He rightly pointed out that this measure restructures South Africa’s position in the world of international trade.
We live in a world of dramatic changes in trade among different countries. One need only look at the tremendous problems existing at present between an enormously strong exporting country like Japan, and America, and the trade deficit America is experiencing in its transactions with Japan. One encounters further proof of this when one follows the debate on protectionism, in which the Third World countries are trying hard to stimulate their exports to the so-called developed countries like the USA. Indeed, our own position with regard to disinvestment shows how important this measure is. It is of vital importance that South Africa remains part of the international community.
For us as members on this side of the House and those on the Opposition side it is a pleasure to support a measure such as this because we know that we form part of the world of international trade which is becoming increasingly more competitive and complex. It is of the utmost importance that the world of trade be structured in such a way that there is no prejudicing of any country participating in these trade transactions. It is also important that the agencies acting on behalf of various countries and bodies in the conducting of trade should protect everyone’s interests.
It is interesting while Europe is breaking down all barriers and permitting freer trade, there is tremendous competition, particularly due to an overproduction of agricultural products. Throughout the world people are saying that they can only save their economies by a dramatic effort to stimulate exports. Ultimately, however, the question is still where one is to export to, because every country in Europe is seeking to sustain its economy by exporting. A powerful country like America can only keep its economy healthy by exporting. Japan’s economy is dependent on the export of many goods. The question also arises how countries like the USA, that produce at high cost and are in essence opposed to protectionism, manage to keep their economies healthy. Due to the GATT negotiations they are finding themselves in a situation in which they are compelled to permit free trade and within their own country must endure the consequences of free trade because they have to compete with countries like Brazil, Taiwan and Japan, the leader in the technological sphere.
Mr Chairman, may I ask the hon member for Innesdal whether he thinks that the pronoucement of the hon the Minister of Foreign Affairs will in fact improve matters relating to this legislation?
You are really “simpel” (simple-minded)! [Interjections.]
Order! The hon member for Turffontein must withdraw that remark.
Mr Chairman, I withdraw.
The hon member for Rissik may proceed with his question.
I shall formulate the question better for the sake of the hon member for Turffontein, who is not always present in this House. Does the hon member for Innesdal think that the speech by the State President in this House last Friday will be to the benefit of our international trade?
Although this is not relevant to the discussion of this measure, I wish to say to the hon member for Rissik that any speech made by any Minister of the NP in any circumstances will promote South Africa’s cause internationally far more than the actions and statements of the hon member for Rissik and his colleagues in the CP. [Interjections.]
I wish to conclude by saying that we are grateful that the Official Opposition supports the measure. We are pleased to have proposed a measure which maintains our position in the international comity of nations and which will also protect South Africa’s interests at a time and in a world of very severe competition. I therefore support this measure. Because I did not serve in the standing committee I can only say that I think those fellows did a good job. They dealt with it so promptly that when I asked some of them what the measure involved, they first had to sit for a while and think before they could reply. I therefore thank my colleagues.
Mr Chairman, we are dealing here with a fairly complex piece of legislation. When we consider South Africa’s situation, and how we have done business abroad in recent years, we see that we have had a good past, that we have never had difficulties with our trade and that we have never resorted to the UN as has in reality happened with this legislation. Naturally a country does not want to set itself apart from others unless it is necessary. In this legislation, however, there are a few matters that give rise to concern. The first reason why the CP and I will not vote for this Bill has to do with the fact that a State President who has to sign a Bill before it becomes law was earlier not a leader of a political party. Today the State President, the leader of a political party, can sign a Bill the moment this House agreed to it and it and all its schedules will become a law of South Africa. This also applies to regulations or changes to the Conference which are agreed to next year or the subsequent year, and all that is necessary for the State President is to proclaim them by proclamation in the Gazette. I shall not accept that because in the NP banks is sitting a political leader and not a State President. That is only one of the important matters we must deal with.
Moreover, it is not clear who is regarded as part of the Republic of South Africa for purposes of trade. Are Transkei and Bophuthatswana, for example, regarded by the international world as part of the Republic? Are they regarded as such?
Yes, of course.
Oh, then they are regarded as such? Therefore, if they act as an agent or perhaps enter into other transactions, then in terms of the provisions of the Convention we shall be held responsible for their actions because their laws and ours run parallel. I request the hon the Minister of give us the assurance that this is not the case. The provision in the Bill to the effect that the Minister may make regulations and submit them to this House for approval is by no means adequate because all three Houses must in any event agree to those regulations; and if they reject those regulations then section 12(2) of the Interpretation Act, 1957, is applicable—whcih in any event justifies an action which has already been carried out.
The situation we are faced with in South Africa at this moment is such that what we are doing is kowtowing before the outside world. We are joining organisations that cannot be of great benefit to us in the longer term. We cannot get away from the fact that in trade nowadays one cannot isolate oneself. Nevertheless one must weigh up the advantages against the disadvantages.
In the schedule that accompanies this Bill, for example, it is stated that social systems and problems must, among other things be taken into account in an effort to remove legal barriers. I ask you, Sir, for what reason on earth one should concern oneself with economic and social problems if one is dealing with trade? Surely that has absolutely nothing to do with the economy as such. [Interjections.] The moment the United Nations includes social problems and all kinds of other matters in its economic activities, one must realise that one is moving on dangerous ground. We are simply getting deeper and deeper into a mess as far as our trade is concerned, because owing to the fact that our creditworthiness has deteriorated so considerably, we have alienated the people with whom we have traded over the years. We no longer occupy the first place on the world’s economic list. [Interjections.] We are simply no longer in that position; and it is this Government that is the cause. It is statements such as these that the State President announces for the world to hear and from which one can infer on man, one vote, that is the cause of this. According to them it is now necessary to change over to a process of one man, one vote and full citizenship for all in order to attract world trade and foreign investments to this country. After all, they are now concerning themselves with social problems. However, when the hon the Minister of Foreign Affairs expresses the natural and logical consequence of their actions, he is sacked. [Interjections.] Yes, then he is sacked. I do not give tuppence for P W Botha or Pik Botha. To tell the truth, I do not like Bothas at all, particularly not the Bothas in this Parliament.
Whom are you speaking about now?
Just listen to that! Whom am I speaking about now, that hon member asks! Can it be that he still does not know? I am speaking about the leader of the NP!
Oh, you are talking about the State President?
Yes, I am speaking about the leader of the NP. [Interjections.] The fact remains that this country has been harmed this week as a result of the politics in this House. This week South Africa’s trade was dealt a crushing blow. [Interjections.] Most hon members laugh because they do not know what this is about, or because they wanted to be counted. They know that the hon member Mr J W van Staden counts them one by one, and that is why there is such bravado and laughing at the back over there. As a result of politicking, the country has suffered an economic blow in the past week in this House.
Oom Jan, stop him!
There speaks one of the Pik men who lacks the courage to say that he is one; now he wants to stand there shouting at me. Tell that to the State President!
The Americans recently said to us: “Your country is unstable. In the economic sphere the country is in difficulties. You will get no further because day after day you are creating more problems for yourselves.” Look at the Roper Poll of the USA, even if the majority of hon members do not know what it is. It showed—and this was not broadcast by the SABC—that 60% of Americans think that South Africa’s internal policy should be left alone. They feel that the country must be seen in an international context so that it can be kept as part of the West. The banker can go and see for himself whether his investment is secure or not.
Order! The hon member must deal more specifically with the Bill. [Interjections.]
We belong to GATT and we have always complied with its requirements. The problem is that we have lost our credibility in the world. [Interjections.] The Government seizes upon cases like Anatoli Shcharanski to cause a worldwide fuss, but I believe they have not succeeded in doing so. I am informed by a report from Israel that it is to be announced in this country tomorrow that Mandela is to be released. [Interjections.]
Order! If the hon member does not deal more specifically with the Bill he will have to resume his seat. The hon member may proceed.
Mr Chairman, may I address you on this? I am dealing with international trade, and anything done in this House which may cause problems in that regard and lead to us being cut off or no longer being admitted, gives us …
Order! We are dealing with the Convention on Agency in the International Sale of Goods. The hon member may proceed, but he must confine himself to the Bill.
Has this convention not been arranged by the UN? A UN convention includes the social problems of the country, and that is written here. They investigate the economic and social problems of a country and they then decide whether that country will be admitted on the basis of its socio-economic policy. Where does one find an open agenda to permit one to join such a Conference when one wants to? Whatever steps are taken in the country, with or without the permission of that government, there must be an agreement on the laws of that country, there must be an agreement on the laws of that country between the principal and a third party. The hon the Minister of Trade and Industry has an easy way of shaking his head and saying: “That is not it.” He reminds me of Tutu on television. The hon the Minister must tell us today that we are not responsible for debts incurred by Transkei, Venda, Bophuthatswana or Ciskei.
In this explanatory memorandum the hon the Minister states that South Africa must have a good image abroad and therefore it will make regulations and also impose levies. Does the hon the Minister not trust any businessmen in this country? From whom are these monies to be levied? The hon the Minister of Trade and Industry is now going to become a Minister of Finance who levies taxes.
These are the things we are approaching with our eyes closed. It is only later that we find out that we have to make payments that are not justified. [Interjections.] That is a fact.
Shcharansky is free, and tomorrow it is to be announced here that Mandela has also been freed. [Interjections.] Do the hon members of the NP opposite, who accept the convention know that Mandela is to be freed? [Interjections.]
Mr Chairman, I shall resume my seat.
Mr Chairman, we as new young members of this House try to emulate the example of more senior hon members by learning from them how one should debate. After listening to the hon member for Langlaagte, however, I must truly say it is clear to me that this hon member sets us no example. [Interjections.] The hon member used no argument with bearing on this Bill to debate why the CP does not support this Bill. When the hon member had the opportunity to speak on this Bill in the standing committee, no one contested this unopposed legislation.
You were not even there!
As the hon member for Innesdal pointed out, this Bill is aimed solely at allowing South Africa to participate in an international convention to promote trade relations among all the countries of the world. The hon member for Langlaagte says the Government is plunging the country into even greater economic difficulties. I simply cannot understand how he and his party will be able to promote the economy of South Africa if they want to apply their policy of isolation on this unopposed measure as well.
I am delighted to associate myself with other hon members in support of this legislation.
Mr Chairman, I do not propose to explain again what this Bill is all about; it has been done very adequately by hon members including the hon member Mr S J Schoeman. I also do not propose to get myself involved in the stories of the hon member for Langlaagte. However, he does have a point in respect of the State President signing these amendments and his being the leader of a party as opposed to being a neutral State President. However, I do not feel it is of sufficient importance in a case such as this to worry to much about it. He is the head of State and somebody has to sign the document. The NRP is quite happy to accept that. However, it does raise something of an argument where the State President is a political entity as well as the head of State.
There is one point about which I would like to raise a query and I apologize for not doing so in the standing committee. It concerns clause 3(4) of the Bill. It states that the Minister may amend the regulations which then have to be laid upon the Table of the House. Again this is fair enough as the Minister is the one who has to make the amendments. It is also stated, however, in clause 3(4), that the only way in which one can reject those amendments is by a resolution by the respective Houses of Parliament—and this, of course, means all three Houses. Now, this does raise in my mind a problem in that the question arises of how one goes about getting a resolution passed in all three Houses. Presumably one has to get someone to put forward a resolution in each of the other two Houses.
In respect of this particular Bill I am not unduly worried; I am not perturbed about it at all. It does appear, however—to create a precedent in terms of which something that has been Tabled can be rejected by means of a resolution being put forward in all three Houses. It has to be approved—or turned down, in this case—by all three Houses. This appears to be contrary to normal procedure. In respect of other legislation if is rejected by one House it goes to the President’s Council, or one of the other constitutional procedures is followed. In this particular instance one can indeed have it rejected by two Houses, while only one House passes it. It is then still approved.
This is the only query I would raise in respect of this Bill. Naturally we are going to support the Bill because it is of importance to South Africa. Having raised this point and having indicated clearly that we are somewhat unhappy about a particular provision, we still intend to support this measure. I have, however, raised this issue for the record and in order to ensure that note is taken of it in the event of it arising elsewhere. It should therefore be clear that we have not accepted this as a precedent. Otherwise we have no objection to this Bill and we will be supporting it.
Mr Chairman, this is a very clear and simple measure with a view to giving the Convention legal effect in South Africa. Hon members set out its meaning clearly and therefore I am not going to make any further reference to the details thereof. The fact is simply that South Africa is an important member of the international trading community. On the strength of the total trade volume, South Africa is probably the fourteenth or fifteenth most important trading country in the world. For that reason our international trade relations are very important to us, as are our membership of organisations such as GATT and other international trade organisations.
For the information of the hon member for Langlaagte, I can point out that GATT is also an agency of the United Nations, and that the multilateral agreements organised by the instrumentality of GATT, are of the greatest importance to South Africa’s trade. Membership of this convention will therefore promote trade and strengthen South Africa’s membership of the international trading community.
†I thank hon members for their support of this measure. The hon member for Walmer mentioned that this Bill was merely aimed at facilitating the functioning of the Convention in the South African situation. I also thank other hon members for their support. The only other question or two relating to the measure now before the House concern the position of the TBVC countries.
*In this connection I can inform the House that as soon as this legislation has been promulgated, the necessary negotiations with the TBVC countries will be finalised in order to make the Convention applicable to them too.
†The hon member for Umbilo put a question to me regarding the provision that a regulation laid upon the Table of the House by the Minister concerning fees in relation to the execution of the provisions applicable to the Convention must be rejected by all three Houses. I think this is merely a way of expressing the fact that it can only be rejected in exceptional circumstances. The fact is that this is an international convention and, should regulations be promulgated and subsequently amended by an Act of Parliament, it could have quite a far-reaching effect. I would imagine that is why it was felt that all three Houses should have to approve the measure before it could be regarded as an Act of Parliament. It will really only involve minor issues in connection with the fees with which to implement the convention in South Africa and I do not think the hon member should be unduly concerned about it.
I am afraid that I cannot give the hon member any further clarification on the matter. This is a point which he should have raised in the standing committee.
I apologise for that.
I realise that. The hon member made reference to this issue. However, since it is of no great importance in this particular case, I hope the hon member will accept it as it stands and that he will support the measure.
*Mr Chairman, for that reason I am delighted to thank hon members for their support and to move this amendment.
Mr Chairman, may I put a question to the hon the Minister?
Order! The hon the Minister has resumed his seat. I cannot permit a question now. The hon member may put it outside the House.
Question agreed to (Conservative Party dissenting).
Bill read a second time.
Introductory Speech delivered at Joint Sitting on 10 February
Mr Speaker, I move:
The Maintenance and Promotion of Competition Act, 1979 (Act 96 of 1979), which became effective on 1 January 1980 has proved to be a practical instrument whereby the Competition Board, which was established in terms of this Act, positively contributes to the effective maintenance and promotion of economic competition.
However, certain practical problems which limit the board in the performance of its duties still occur, and it is intended to remove these problems by way of certain amendments to the Act.
The most important amendments comprise a broader and better definition of the term “restrictive practice”, as well as an extension of the board’s authority to investigate an existing monopoly. Further amendments are of a consequential nature.
In view of the traditional philosophy that the existence of economic power is not as important as the abuse thereof, the Maintenance and Promotion of Competition Act, 1979 does not make any provision for the investigation of and, if necessary, action against an existing concentration of economic power.
Restrictive practices, that is market behaviour, can indeed be investigated and prohibited either on an ad hoc or a general basis, whilst an increase in economic concentration of power—by way of an acquisition, i e by a takeover or a merger—can also be investigated and prevented. As the Act reads at present, a monopoly as such—that means an existing concentration of power which came about earlier as a result of internal growth or take-overs or both—cannot be investigated. It follows that existing economic power structures are presently immune to competition policy.
It is accordingly imperative that the Competition Board should be empowered to investigate such structures to do justice to competition policy. In fact, it will be an important development in the competition policy of the Republic of South Africa if the mechanism can be created for the Competition Board to investigate a monopoly situation. The insertion of this provision in section 10(1) of the Act wil empower the Competition Board to investigate monopoly situations.
At the same time it is important to point out that the criterion to be employed in the course of such an investigation remains the public interest, and the prerogative to act on a recommendation by the board rests with the Minister subject to appeal to a special court.
*A further amendment is aimed at greater flexibility with regard to notices in terms of section 14 pursuant to which the responsible Minister can prohibit particular trade practices. In terms of section 14(5) the Minister can specify exemptions by means of notices. The present provisions contain a rigidity which does not provide for the most practical phasing in of prohibitions.
The phasing in of a new prohibition may require that several temporary exceptions have to be granted to avoid unnecessary disruption by allowing the relevant organisations opportunities to adapt to the new circumstances. It is confusing and unnecessary to burden such a notice with a number of time-bounded exceptions. Furthermore, as a result of unexpected developments it is sometimes essential to grant an exception expeditiously. The existing time consuming procedure of giving notice does not make it possible to act quickly and efficiently. This problem will be solved by inserting a stipulation that the notice makes provision for exemptions without necessarily having to specify each exemption in the notice.
During the investigation by the Competition Board in 1985 into collusion on prices and conditions, market sharing and tender practices, it became evident that an exceptionally flexible system with adequate provision for exemption is absolutely necessary in this regard. The board must be able to handle exemptions in such a manner that undesirable disruption of industries which have traditionally been cartellised is avoided. The approach which is being followed is that the phasing in of prohibitions of this nature by industries which have historically utilised restrictions of competition on a considerable scale should be introduced with considerable circumspection. Although I have indicated that the relevant prohibitions will only come into force on 2 May 1986, it is essential that no legal uncertainties should exist which will prevent that the exemptions, which will have to be granted to certain industries to avoid disruption, will emerge. It is accordingly necessary that this clause should come into force with retrospective effect from 1 June 1985 in order to create security of justice.
The proposed amendments will largely contribute towards enabling the Competition Board to promote the objective of effective competition more efficiently.
Second Reading resumed
Mr Chairman, the Act which this Bill will serve to amend, is a unique and a very important piece of legislation for this country. All countries have Maintenance and Promotion of Competition Acts, or similar ones, but, in this country where there is a vast underprivileged section of the population, it is more important than in any other country. These people are evaluating the free enterprise system all the time and it is their perception of that system which will ultimately determine its future in this country. Should they perceive it as exploitive, they will reject it. If they are not included in it and they see no advantage to be gained by it, they will reject it.
Make no mistake, whatever plans hon members on the other side of this House may have to sustain an apartheid-based type of Government, many of us—and the overwhelming majority of Blacks—do not believe that the State President addressed the nub of this apartheid problem when he said that it was an outmoded concept and suggested alternatives. The crux of the matter, namely the legislation of people into ethnic groups and the allocation of rights to those groups, remains.
This Bill represents an attempt the gain the support of the Black population for a free enterprise system. It must be used as a tool to ensure that it achieve that objective and that they do not see this system as expolitive.
This particular Act has been on the Statute Book for quite some time now and there have been some quite courageous decisions and recommendations made by the Competition Board which, as we know, is an arm created by the Act. However, the Government has not always displayed the same measure of courage in carrying through the recommendations of that board. A point which immediately comes to mind is of course its attitude towards the recommendations concerning the liqour industry. In that instance the Government failed to endorse the recommendations of the board.
The future of the free enterprise system depends entirely on our ability to convince 85% of our population that it is not solely for the benefit of the Whites but that it represents their best opportunity for a successful and rewarding future.
One finds a peculiar attitude to this approach among businessmen themselves. This should be seen as legislation to protect longterm business interests but frequently organized business resists the provisions of the Act because they see it in a very short-term context. They must be more enlightened with regard to their attitude to this Act. They must expect it to hurt them from time to time and to chafe when they are trying to carry out some of their own business strategies, but in their long-term interests if they see this in its correct context, they will realise how important this piece of legislation is for them.
There is a particular problem about the legislation that is before us at the moment which is not a problem of the Government’s making. I think through some lack of communication the Federated Chamber of Industries’ submission did not arrive in time for the standing committee to take it into consideration when the committee was considering the amendments that are now before this House in the shape of this Bill. The points which they raised were really quite simple. Without affecting any amendments I think the hon the Minister could probably deal with some of the points by means of a statement of intent. One of them, for example, is that instead of stipulating the exceptions which can be applied for and specified, provision be made for exemptions which the Minister may grant on the recommendations of the Board. The Federated Chamber of Industries is very unhappy about that. They feel that the discretion to grant exemptions is left entirely to the Minister who does not have to explain the notices and the grounds for those exemptions. They see it as part of a process of regulating restrictive practice by means of Ministerial fiat. I hope the hon the Minister will be able to make suggestions as to how he will succeed in overcoming some of the concerns which the Chamber evidently has in this respect.
The other matter that concerns them, is that in publishing notices of exception the provision is made that the notice does not have to be published in full. Clause 6 of the Bill seeks to amend section 14 of the principal Act by removing the requirement under section 14(5) that an amending notice has to publish the entire notice. The Chamber points out that subordinate legislation, if amended, is usually published in full. I do not know whether or not the hon the Minister can accede to that in some way because under the new system it is extremely difficult to do this after Second Reading.
We will be supporting this measure We believe that the Competition Board must be given the strength it requires to carry out its purpose in the long-term interests not only of the underprivileged people in this country but of the free enterprise system itself.
Mr Chairman, I am surprised that the hon member for Walmer has raised complaints of the South African Federated Chamber of Industries here as price fixing was prohibited as early as 1955. It has always been policy first to conduct an investigation before such a practice carries a general prohibition. A commission on which the chamber also served was later appointed under the leadership of Dr Mouton. At the time the chamber had no complaints whatsoever on that aspect of price fixing. Last year an investigation into this was ordered again and notice given in the Gazette. The chamber was telephoned specifically to furnish comment, but this was never received. There is a memorandum now but one can really not wait indefinitely for comment from interested parties.
We should also remember that the new approach to price fixing which is now to be pursued is enormously important to the country. The consumer requests this type of action. If one compares the hon member for Walmer’s argument on the chamber which he has raised here with his previous arguments that the consumer should be protected, one notices they are actually conflicting. Neither can one have a regulation specifically prohibiting each of these practices per company; one has to apply a general prohibition. It is administratively just impossible.
I also wish to go further and say that, if we examine this Bill before us, we should note that two characteristics of our legislation on the maintenance if a promotion of competition emerge. The first characteristic to consider is that this is an enabling measure containing no prohibitions per se; this is a very important characteristic. This means that, if the Minister regards a matter contrary to the general interest, he may request an investigation which is made public. Evidence is taken and then the Competition Board follows with a report and recommendations. If the institutions concerned are dissatisfied, they may lodge an appeal.
This is an important characteristic because, if one examines the American system, one notices it operates more on a system of general definition of prohibited action, namely “conspiracy, restraint of trade, monopolising, attempting at monopolising,” types of action which they immediately upon announcement regard as illegal. This means one finds in the USA that if a practice is declared illegal, a case has to be brought to court for innocence to be proved. We first investigate and then declare the action illegal. This characteristic of our legislation furnishes security to our industry, the chamber and all institutions concerned.
This characteristic of an enabling element which we have here also has a certain disadvantage which is that the functions and powers of the Minister are clearly set out in the legislation. This means that, if there is a practice contrary to the interests of the community and that practice is not correctly defined in the legislation, the Minister cannot act. This means that this Bill before us now modifies the Act slightly to make better provision for improved definition of the type of practice which could possibly be against the national interest. We should remember that in the course of time the ambience changes and new malpractices are always emerging which is why the legislation has to be modified continually.
The other very important characteristic of our legislation was that it was based chiefly on the abuse principle. Initially this was set out in our Act of 1955 where it was directed especially at conduct in the market. Our approach in 1955 and subsequently was that possession of a monopolistic right was not necessarily detrimental or undesirable per se but only in its abuse.
In the course of time countries began taking action against further malpractices. The OECD conducted an investigation in 1970 and issued its findings in a publication called Market Power and Law to the effect that not only conduct in the market should be examined but also market structures. As I have already mentioned, in the USA general action is taken against the malpractices already mentioned and they are illegal. In various Western countries legislation has gradually been introduced, however, which also takes the problem of market structure into consideration.
In our 1979 legislation we moved in this direction and attempted to provide for investigations into the acquisition of controlling interests in order to prevent undesirable formation of monopolies. Nevertheless this was inadequate because it did not give the board sufficient power to investigate an existing practice or existing market structures.
We wish to correct this deficiency with the legislation before us now which empowers the board to examine existing market structures as well but we adhere to our philosophy that is enabling in the sense that investigation is to be conducted, evidence submitted and that there should be a right of appeal. I think this makes our legislation in this sphere an example to many countries.
I also wish to refer to a third aspect of this Bill which is the way in which the Minister gives notice of a prohibition of certain restrictive practices after an investigation by the board in terms of section 10(1)(c) of the Act. The purpose of this is to enable the Minister for practical considerations to act quickly and effectively in the best interests of all who are affected by such a prohibition. This is obviously no new principle but it lends greater administrative efficiency and flexibility to our system.
Last year an investigation was carried out with recommendations by the board but a situation arose recently in which the Minister had to make exceptions because, if he had immediately prohibited certain practices, problems would have arisen regarding practices which had been part of our private sector action for years. If these had suddenly been disallowed, it could have created enormous problems for them. This legislation enables the Minister to make exceptions as the recommendations can be phased in to make it easier for the business world to discard these practices.
I wish to close by saying that this legislation is of enormous importance to South Africa. It is of no avail to speak of deregulation and privatization. We are a country with a small economy and we should attempt to promote domestic competition as far as is practicable. I support this Bill and I am certain it will be a great success.
Mr Chairman, this Bill is one of the laws that South Africa has needed for a long time and which in my opinion should have got the muscle it has today, very much earlier. When legislation of this nature is introduced, as was done in the past, but power is not given to it, people in those practices are protected and strengthened. Although an Act of this kind exists, people can still do what they want to because there is no legal power and the matter is not carried any further. One of the most difficult things in any country is to differentiate between concentration of power and abuse of power.
One should have a bit of “magsdeling”.
When one talks of company take-overs it is not so easy. It does not often occur that people have a definite point of view in regard to when it is or is not in the interests of the country as a whole to have a take-over—to undertake a combined effort in mining. Is it in the interests of the country to have these big mining organisations? Small groups are not feasible. Substantial shareholding is conducive to production.
In most cases, a businessman’s first priority remains the accruing of shares for the benefit of the shareholders. The country as such is not his primary consideration. Therefore it is necessary that the Government has the means to curb anything that becomes uncontrolled, for example, the making of unnatural profits. An unnatural profit is that which is gained by the misuse of the power, structure and size of an organisation in order to eliminate competition. However, it is also not realistic to imply that the existence of a company, by being too large, is not in the interests of this Government or of the country. If we were to adopt this attitude, then the Railways would have no right to exist. Many of the other businesses in this country run by the Government would also have no right to operate under the present system.
One of the biggest problems today is that larger companies cause inflation to increase daily by agreements on free binding, uniform pricing, mark-ups and predated pricing. This is one of the biggest problems. For example, if one takes any minor item that one buys in a shop, whether it be Coca-Cola or whatever, the scanning mark is indicated on it. Therefore one can deduce that the price was agreed upon many months previously. No short-term action will lower the price. It is a long-term process and a problem to the industry.
Again, the people who have to apply these laws, have considerable problems. A Minister must sometimes have the right to step in and say “Now we are tackling problem A”. The next question then is how this will affect another section of the economy. Therefore we support this measure.
We can only say to our department that we are very proud of them. Listening to them in the standing committee was a pleasure. It is gratifying to be able to listen to people who know what they are talking about. They have no self-interest in it. We had to listen to some businessmen giving evidence in the standing committee on another occasion. When they have an interest in it, one can understand that these people are excited about the changing of a law. The officials who were present could give us the answers to every question. They really studied the situation very well, with the result that they know and understand the situation particularly well. At the same time they are not pushing for unrealistic laws. For that reason we should like to thank them.
Mr Chairman, I am very happy to support this Bill, and also to declare my agreement to a very great degree with the speech of the hon member for Langlaagte. We have spent a lot of time in this House discussing and fearing Marxism, Oliver Tambo and various other Black leaders who will bring communist tendencies into South Africa. However, I believe that one of the greatest dangers facing South Africa today is not this, but the situation we already have in South Africa with restrictive practices, a member of very substantial monopolies and the practice of price-fixing. There is far too much of that. This amending Bill extends the powers of the Competition Board not only to investigate new mergers but also to look into existing prima facie monopolistic organizations. I believe that this is a very important clause, and I hope it will be used and used effectively.
One of the problems is that these massive monopolistic organisations have a great deal of power. They can afford to employ the best economic brains and the best legal brains to fight their case for them. I am afraid that the Government and various other organisations are generally prone to back down before them. If we allow this to happen, as the hon member for Walmer pointed out, how on earth can one expect the Black people of South Africa to have respect for the free enterprise system if they cannot participate in it and enjoy some of its fruits?
I accept the fact that mining organizations have to be monopolistic to a large extent. There is so much capital involved. On the other hand, is it necessary to have monopolies in respect of small businesses which are all being closed down by the big supermarkets? Every butcher, small draper, grocer, haberdasher etc is being pushed out of business by these supermarkets. I realize that supermarkets do serve a certain purpose and that one-stop shopping enjoys a certain popularity. However, it also involves a certain danger, namely that it is being made impossible for the small-time potential entrepreneur, be he Black, Brown or White, to get into business. This worries me. For every one of these supermarkets that opens, anything from 30 to 70 small shops get knocked out of business as a consequence.
I believe that this is a monopolistic tendency that has been allowed to go too far in South Africa. When therefore one talks of investigating the monopolistic tendencies in existing businesses, I hope they will also look into this.
There is one further point I would like to make to the hon the Minister whilst I am speaking on this subject. I rather suspect that if one looks at the tax structures and the taxes paid by these large monopolistic organizations of the type I have just been referring to, one finds they are nowhere near the same magnitude as was being paid in revenue to the Government by the proliferation of smaller businesses we previously had. As far as I can gather when one reads the balance sheets of these large monopolistic organizations that have been taking away all our small businesses, they pay very, very little tax relative to their turnover.
The NRP will also be supporting this Bill and we hope that the Competition Board will make hay while the sun shines.
Mr Chairman, in opening I should like to draw hon members’ attention to a few mistakes which crept into the Bill and for the sake of completeness I should like to explain them to the House now.
As regards the Afrikaans text, on page 8 the “c” opening the first line should be changed to “b”. On the same page the “d” starting line 33 should be altered to a “c”. In line 48 “artikel 6(c)” should be changed to “artikel 6(b)”. The same changes apply to the English text and should also be corrected in the House to facilitate references.
†On page 9 the “c” in the first line should be changed to read “b”; in line 32 the “d” should be changed to read “c” and in line 45 “section 6(c)” should read “section 6(b)”.
I thank hon members for their support of a very important further measure concerning competition in this country. The hon members for Walmer and Umbilo referred to the importance of creating an atmosphere of free enterprise that would encourage members of the other communities not only to participate in the free enterprise system but also to believe in it. I think it is our responsibility to make free enterprise work in this country. It is the only way in which we will be able to create enough growth, economic activity and economic strength to meet the challenges ahead. I do not disagree with the points made by the hon members and I believe that a policy of competition is one important instrument in making private enterprise work and in improving market conditions in this country. It is not the only measure; there are many others. One of my hon colleagues is more directly involved in deregulation and there are many other measures that supplement the work of the Competition Board and of competition policy in creating that kind of private enterprise environment that will encourage growth in this country and will give us the economic muscle we require.
However, I find it a bit strange that the FCI should now present the hon member with a memorandum.
*The hon member for Waterkloof referred to the fact that an invitation had already been extended to the business sector last year to comment on these amendments.
†I can tell the hon member that the FCI in particular was informed about the changes. As far as my knowledge goes I am not aware of any representations by them to the Competition Board.
Nevertheless, the two points, as I understood the hon member, referred to concern firstly the question of exemptions—exemptions in terms of a notice published in terms of section 14(5) of the existing Act. In terms of this Act I published a very important notice towards the end of last year and I think the House should take note of the importance of this notice in terms of section 14(5) of the Maintenance and Promotion of Competition Act because it concerns the very practices to which several hon members referred.
In terms of section 14(5) I published a notice declaring any agreement, arrangement, understanding, business practice or method of trading referred to in the following paragraph unlawful. The following paragraph listed the following agreements or business practices: (a) Resale price maintenance; (b) horizontal price collusion; (c) horizontal collusion on conditions of supply; (d) horizontal collusion on market-sharing; or (e) collusive tendering.
As people who support competition policy, no hon member in this House will, I think, disagree with the steps taken in terms of the Maintenance and Promotion of Competition Act in order to rid this country of cartels and all other kinds of unacceptable business practices. It is also in the light of this notice that it is necessary to grant exemption.
*The hon member for Waterkloof referred to this. Mr Chairman, I think there is inadequate appreciation of the giant stride forward as regards competition policy in respect of this announcement. It is an important about-turn that a prohibitive provision now applies to a large variety of these activities. In order to phase in this prohibition to create as little disruption as possible, however, it is necessary for the Minister to be able to permit specific exceptions even if those exceptions are intended merely to give the undertaking concerned the opportunity of adapting to changed circumstances or phasing out its prohibited activity in terms of the provisions of section 14(5) over a period.
†In other words, Mr Chairman, the object of the exemptions was really to facilitate the operations of the business community so that their needs could be met and so that disruption could be avoided. If the Federated Chamber of Industries is concerned because the exemptions are granted by the Minister without publication, I am quite prepared to inform the FCI or to issue a public statement regarding the exemptions from time to time. As I have said, then, if that is really the concern of the FCI, then I willingly undertake to issue a public statement at such time as we grant exemptions specifying the exemptions granted and naming the sections of the business community that have been granted exemptions.
*The hon member for Waterkloof made a very interesting and valuable contribution in the form of his explanation of how the policy of competition had evolved in South Africa. Its development commenced as early as the fifties. That was period in which greater attention was paid to conduct in the market; as if such conduct were the only and most important consideration in competition policy. The hon member pointed out that the aspect of structure gradually also emerged. He also indicated that increasing attention was being paid, not only in South Africa but also in other countries of the world, to take-overs, mergers and other actions influencing the concentration of power or the formation of monopolies.
In consequence it appeared that in terms of the existing legislation there was also a need for the Competition Board not only to be able to institute investigations into takeovers and mergers as regards future concentration of power but also that the Competition Board be authorised to investigate monopoly situations or concentrations of power which originated as a result of an historical situation. The amendment is being inserted to provide for such an investigation. This does not mean that a campaign is going to be launched to eliminate and address the concentration of power in South Africa. It is important to stress the necessity for a good balance here.
The hon member for Langlaagte referred to this point. I wish to say to him that, if he provides contributions such as he has done in this debate, I am pleased to respond to his speeches. If the hon member’s contributions in no way further the debate, however, he should not take it amiss if I do not respond.
I no longer take any notice of you. You do not know what you are talking about.
That leaves one with a need for quoting the writer of Proverbs if one wishes to explain why one does not reply to a certain person.
The hon member at least pointed out that the concentration of power per se, in other words existing monopolies, not necessarily … [Interjections] Mr Chairman, I find it extremely difficult to speak if the hon member for Langlaagte shouts with such volume from the other side.
The fact is that existing large groups in South Africa are also necessary because many economic activities cannot be undertaken by smaller or medium-sized groups. Large investments are called for in mining and other industrial sectors which are possible only for large financial groups with great capital resources. That is why we require the big as well as the small businessman in the South African economy; there is room for everyone and I think this balance is necessary.
I have a bone to pick with the hon member for Umbilo who pleads on behalf of the consumer on the one hand.
†He is very supportive of competition policy in this country. I accept that he would like the board to act in terms of the amendments and implement the policies as they stand. I am grateful for his support. The hon member has, however, a very strong feeling about supermarkets. There are certainly many sides to this problem, but supermarkets, by definition, cannot be regarded as a monopoly. There are a number of supermarkets in this country in fierce competition with one another, and that is to the benefit of the consumer. There is no monopolistic situation. The hon member may argue that many smaller enterprises have, over the years, been squeezed out by supermarkets; that is true. In the business environment, however, even the smaller entrepreneur has to adjust. I believe that there are many niches which can be filled by the smaller businessman or entrepreneur, even next to a supermarket. I can quote examples to the hon member. I am grateful for his contribution and support as far as competition policy is concerned, but I believe we must administer the Act in such a way that we maintain a balance. Unless we do that, we shall destroy business confidence which is of great importance for the promotion of business activity in this country.
*I think this has covered the most important changes as well as hon members’ comments on them. My thanks to hon members for their support.
Question agreed to.
Bill read a second time.
Introductory Speech delivered at Joint Sitting on 10 February
Mr Speaker, I move:
The Liquor Board is currently engaged in a comprehensive review of the Liquor Act. However, as an interim measure, certain amendments which have been identified as of immediate importance are being introduced.
The 35 clauses contained in the Bill are mainly aimed at removing colour as a basis for distinction from the Liquor Act. By doing so not only are all remaining discriminatory provisions removed from the Act, but unnecessary economic restrictions which hamper the development of healthy trade patterns are also removed. The supply of liquor to any person upon any licensed premises will henceforth be in the discretion of the licensee or authority holder.
The most important restrictive and discriminatory provision in the Liquor Act comprises the prohibition on the holder of an on-consumption licence, excluding the holder of a club liquor licence, to sell or supply liquor, meals, accommodation and refreshments to persons other than Whites. However, on application by the licence holder, the Minister of Trade and Industry may grant authority to provide for the needs of non-Whites—the so-called “international status” authority. With regard to premises having permanent “international status”, the responsibility has since 1982 vested exclusively with the licence holders to take care of orderly behaviour on their premises. Licence holders not having “international status” authority can be granted authority on an ad hoc basis to provide for the said needs of non-Whites. These authorities may even be granted ex post facto.
In view of the practical experience where it has been found that no problems are experienced with the presence of non-Whites on White premises, and the section’s differentiating character, the section is being repealed. This section was not only injurious to those who had been prohibited from making use of the facilities for which provision is made on licensed premises for the public, but it also resulted in unfortunate incidents. The restriction has unnecessarily disturbed good relationships and has already caused South Africa much unfavourable publicity. The hotel and tourism industries have increasingly experienced this measure as a serious impediment for the promotion of both internal and foreign tourism.
Accordingly, no valid reason exists why this provision should be retained on the Statute Book any longer. The removal of several unnecessary restrictions from the Act will contribute towards sound economic principles such as demand and supply and free enterprise playing a more definite role in the liquor trade. The nature of the product which is at issue here, requires that marketing should take place in an orderly and responsible manner, subject to the necessary control measures. It is unfortunately also true that excessive regulation together with a variety of obsolete and unnecessary restrictive measures have been responsible for many of the undesirable economic distortions which have come about in the liquor industry. This situation has not only been to the detriment of the developing communities, but is also the reason for many of the undesirable practices which have developed in the course of time. The proposed law amendments directly address several of these problems. In the complete revision of the Liquor Act with which the Liquor Board is busy at present, this aspect will have to receive further thorough attention in view of the particular needs of the various communities.
†The second important differential and discriminatory measure comprises the granting of special authorities to members of specified race groups for the sale of liquor to members of specified race groups only. The special authority was originally intended to authorize a licence with other, usually lower, standards than those required in respect of an ordinary licence. At present, however, the standards of the said authorities are on a higher level. Coloured and Asian holders of authorities in terms of section 23(1) have for several years already been able to sell liquor to all race groups, and Black holders of authorities can also, on application, sell liquor to other race groups. Separate provision for liquor sales by the various race groups appears, therefore, to be obsolete. Accordingly, section 23 is being amended to provide that holders of authorities may sell or supply liquor to any person. Furthermore, the substitution of section 23 will have the result that machinery is created for the licensing of outlets which, because of their particular nature, could previously not qualify for a licence or authority. The substitution of the relevent provision removes all reference to race in the granting of such an authority. At the same time it provides for a flexible authority to deal in liquor which is not confined to the scope of one or other defined category of licence. On both counts the amendment should promote the fuller and freer participation in economic activities by all population groups.
The third related measure regulates the provision of on-consumption facilities—the so-called Coloured and Asian bars. In the light of the unrestricted access to licensed premises of all population groups, subject to the discretion of the licence or authority holder, the necessity for the retention of this measure falls away.
The provision which limits to 9 litres the quantity of liquor that may be introduced into Black areas is repealed in order to permit the normal and uniform distribution of liquor in all areas. This is necessary in order to promote unrestricted trading and hence healthy competition in accordance with the principles of free enterprise.
The Act presently compels members of the South African Police to seize liquor, vehicles or other things suspected of having been possessed or used for an unlawful purpose or in connection with the commission of an offence or intended offence. Once seized, goods become automatically forfeited to the State. The Act provides for a procedure whereby the person acting upon the authority of the Minister of Trade and Industry may, upon application by an interested party, consider and grant the return of such goods. Both seizure and forfeiture are adequately governed by the Criminal Procedure Act. These are matters more suited to judicial than administrative tribunals. In the past these aspects have adopted a quasie-punitive character outside the framework of the due process of the criminal law. Since many persons involved are never brought to trial, the normal conduct of licensed business has been hampered and considerable hardship has been occasioned by the loss of usage and depreciation of goods during the protracted application procedures. On the whole the hardship caused through implementing these measures is grossly disproportionate to the gravity of the offence committed or in most instances the mere suspected infringement of the law. Provision for seizure and forfeiture under the Act is consequently deleted.
When a licence or special authority is granted, the Act also provides the responsible Minister with the authority to impose certain conditions of restriction in respect of that licence. However, it is not possible for the relevant Minister to remove existing differential or discriminatory conditions of restriction in a uniform and efficient manner. The proposed amendment will remove the obstacle and enable the Minister also to abolish outmoded conditions of restriction.
It has been found that existing penalties for contraventions of the Act are no longer adequate as a deterrent. Consequently, the maximum jurisdiction of the courts in this regard is increased substantially. An upward adjustment is firstly necessary to provide a realistic correlation in penalties to the current rand value. Secondly, this measure is seen as a more effective and equitable means to punish illicit liquor dealing and non-compliance with licence conditions. It is connected with the repeal of the seizure and forfeiture procedures.
Under the new constitutional dispensation no reason exists why the executive State President should exercise certain powers under the Act. Provision is therefore made for the transfer of such powers to the Minister of Trade and Industry.
Mr Speaker, the provisions contained in the Bill should contribute towards the promotion of private enterprise, healthy competition and better relationships among the various communities in our country.
Second Reading resumed
Mr Chairman, the hon the Minister will not be surprised to learn that we support this Bill but he will probably be very surprised if he gets any support from my hon colleagues on the right, the CP, and perhaps the far-right hon member of the HNP. In any case, we will be supporting this Bill.
It went through the standing committee in a very short space of time. As the hon the Minister said in his Second Reading speech the main provisions of this Bill are to remove any references to race from the Act.
This will have two fundamental effects. Firstly, anybody can now be served on licensed premises subject to the discretion of the licensee only. I must add that this country has gone through an extremely long and painful process in reaching this stage. Thousands of individuals, both South Africans and visitors, have experienced incredible hurt and offence. In addition the implementation of the provisions of the Liquor Act has also caused this country much harm.
However, along the way we reached a number of milestones. First of all we saw the introduction of international hotels to cater for visitors and functions where it was otherwise impossible to have people of different races coming together. Then we had amendments to make exceptions for sporting clubs in order to normalise sport. Before this happened the Liquor Act was used to prevent mixing at sports clubs. Then there was a whole range of regulations whereby one could apply for special permits for special occasions.
I can recall once applying for such a licence myself where a group of us wanted to attend a meeting at a so-called “Coloured” hotel. After going through an incredibly long and involved rigmarole we eventually obtained permission to wine and dine with our guests but we were of course not allowed to dance together. Presumably this is now behind us as well.
I would imagine that this will cause the biggest problems for our CP friends. The repeal of section 16 of the Immorality Act caused them problems, so now that people can drink and dance together I shudder to think what unspeakable behaviour the hon CP members imagine our populace to be getting up to. I have full confidence that my supporters will behave in a correct and proper fashion. Obviously the hon CP members do not have the same confidence in their supporters. [Interjections.]
Hon members will know that the provisions of the Liquor Act were in the past always used to control access by different groups of people to licensed premises. Hon members will also know that on unlicensed premises the provisions of the Group Areas Act were used to control the access of people to these premises. I would like to ask the hon the Minister as the matter is not clear to me whether in terms of the amendments which we are passing, hotels will in future be free to accommodate any quests they wish to accommodate.
Mr Chairman, I should like to ask the hon member whether the explanation in the explanatory memorandum which states that the deletion of all differential and discriminatory provisions so that liquor may be supplied to any person upon any premises in the discretion of the licensee also means that liquor can be provided to women at the discretion of the licensee. [Interjections.] Does “any person” include women? [Interjections.]
Mr Chairman, I must admit that I really cannot answer that question. I would hope, however, that via me the hon member for Houghton has found a very good way of directing her question at the hon the Minister. Perhaps he will answer it. I am sure, however, that the hon member for Houghton would probably not want to enter any bar in Cape Town straight off the street.
You are quite wrong! [Interjections.]
Mr Chairman …
Will women be allowed to dance as well? [Interjections.]
Secondly, Mr Chairman, there is another effect this amendment will have and one which we on this side of the House do welcome indeed. It means that in future it is going to be possible more easily to conduct normal commercial practices. There are going to be fewer restrictions which will make it possible for commercial practices to be conducted more along the lines of supply and demand. We obviously welcome this as well.
Finally, Mr Chairman, by way of a last political dig at the hon the Minister, I want to remind him that this party has pleaded for years to get where we are getting now in relation to the Liquor Act, and presumably I could say: Well, we told you so. The only thing, however, I should like to add is that this is one more area in which we are allowing people some sort of freedom of choice. All I want to ask, is: How much more agony and trauma do we have to go through before freedom of choice will ultimately be allowed in all spheres of our lives? [Interjections.]
Be that as it may, Sir, we do welcome the fact that this legislation is being reviewed. I believe this step is long overdue. We are looking forward to seeing that will be placed before the standing committee, and we will certainly co-operate and assist as much as we can in order to improve the existing Act.
One last point I should like to draw to the attention of the hon the Minister is the following. In the amending Bill all reference to race is being deleted from the principal Act. If, however, the hon the Minister would care to look at section 33(c) of the Liquor Act, 1977, he will see that there is still a reference there to Black compounds. Perhaps the hon the Minister, when he replies to the debate, will comment on that. I believe it is owing to an oversight and could best be changed by way of an amendment.
Mr Chairman, I should like on behalf of hon members on this side of the House to put on record our support for the Bill under discussion.
Which side of that side of the House?
The right side. [Interjections.]
Mr Chairman, study of the measure now before the House clearly shows an actual deviation from circumstances currently applying. I listened carefully to the hon member for Pietermaritzburg South; he said with considerable glee inter alia that hon members of his party would be justified in saying “We told you so” at this stage. One should be careful, however, because, if one wishes to examine matters in their various facets, it would be equally easy for me to say maliciously to hon members of the PFP regarding the political aspect that we had been warning them over the past seven years that they had the wrong man as their leader; that our statements have now proved true. Nevertheless this is not the way a person operates politics positively at all. If we had lent an ear to the arguments from the PFP side in connection with the Liquor Act each time, I believe it would actually have come down again to doing the right thing at the wrong time with the possible result that the situation in which we find ourselves today would never have arisen. Consequently in the light of this I continue to believe in the approach of my own party which believes that the right thing should be done at the right time in order to result in the correct developments. In fact, this is the reason for our successes over the years. [Interjections.]
Mr Chairman, as regard the legislation before us, I wish in the first place to convey my thanks and appreciation to all the members of the standing committee for the support and contributions received from everyone there. I believe this is a very good example of the successful operation of the new system we are following in the new Parliamentary dispensation.
The different clauses of the Bill under review include provisions with regard to the hours of sale of liquor to the various population groups in the country. It is interesting to draw the attention of hon members to the fact that the reason for the difference in hours of sale of liquor to the various population groups should be sought in requests put by the members of the three Houses in the standing committee. Surely this indicates that when members of the various population groups can use a system in which they can state their divergent needs to one another, it can give rise to a useful and practical arrangement as is very clearly illustrated by the case under consideration. I take pleasure in pointing this out to emphasise the successful operation of the new Parliamentary system of standing committees.
In accordance with Standing Order No 19, the House adjourned at