as Acting Chairman, presented the First Report of the Select Committee on Pensions.

Report to be printed and considered in Committee of the Whole House.

as Acting Chairman, presented the Second Report of the Select Committee on Pensions.

Report to be printed and considered.

Mr. Chairman, the hon. the Minister of Industries, Commerce and Tourism is of course a big favourite of hon. members on this side of the House. He is one of my particular favourites. In fact, I have often invited him to come and occupy his rightful place on this side of the House. This particular hon. Minister, however, maintains a fairly low profile. In fact, he comes very close to being a shadow Minister.

One of the first points I want to raise with the hon. the Minister today is that as far as the activities of this department are concerned, no consolidated annual report is available to hon. members. We have to depend on annual reports of various organizations which fall nominally under the control of the department of the hon. the Minister. There is, however, no report which co-ordinates and consolidates the activities of his department as a whole. I want to state that it is very difficult to be able to assess effectively, and also to criticize effectively and constructively, the work of this department unless such a co-ordinating and consolidating report is available to those hon. members of this House who take an interest in the affairs of the department.

The purpose of this debate obviously is to establish whether the hon. the Minister carried out his responsibilities effectively over the past year, and also to assess to some extent the intention of the hon. the Minister for the year that lies ahead, and possibly also to give him advice which, we believe, will make it easier to carry out his responsibilities in order to make his department more effective.

Let us examine the situation. I want to examine the situation from the point of view that the Government has obviously accepted as a theme the concept that South Africa is threatened by a total onslaught, that this total onslaught is of communist origin, that it is indeed the communist system and its adherents who are responsible for and who are directing a total onslaught on our society. From the point of view of the Government, communism and the communists are therefore clearly the defined enemies. Because communism is an economic system which is foreign to the economic system that we are supposed to be practising in South Africa—the system of free enterprise—indeed is in direct competition with it, when one assesses the activities of the hon. the Minister, his department and the Government in the economic field, we can say that the effectiveness of their fight against communism and against the onslaught launched by communism, can be measured by the effectiveness with which they have promoted, stimulated and strengthened the free enterprise economic system in South Africa, the extent to which they have made the free enterprise system acceptable and desirable to the majority of all South Africans, the extent to which they have increased the “weerbaarheid” of free enterprise as a system vis-à-vis the communist system as such.

I want to ask the hon. the Minister to make representations to a number of his colleagues regarding steps which, I believe, are absolutely fundamental and vital if we want to resist effectively the communist system, if we want to do it by building up, stabilizing and promoting the free enterprise system in South Africa. Before coming to that, however, I should like to ask the hon. the Minister one question. Many of his colleagues do not yet accept the realities facing South Africa. They tend to deny these realities, to be blind to them, ignore them. The reason why I would like to put the question to the hon. Minister is because it is he who deals with commerce and industries in South Africa, with the economic basis of South Africa, which is vitally important, not only from the point of view of the stability and the safety of this country, but also from the point of view of the fight against the onslaught which the Government has defined. For that, however, we must accept the realities. As I have done before, I want to list them very briefly again.

Does the hon. the Minister accept the inexorable process of urbanization, which cannot be prevented by legislation, which will not even be materially effected by the Government’s new decentralization proposals? Does the hon. the Minister accept that in so called White South Africa by the year 2000, we may, with a bit of luck, have 5 million White people? That is to say if the present tendency of the decrease of White fertility can be counteracted, and I do not know whether the hon. the Minister is really making a meaningful contribution in that sphere. The point, however, is that by the year 2000 there may be 40 million Blacks in White South Africa against only 5 million Whites. That means that while the ratio in 1982 is 2:1, in only 18 years it could be 6:1. Does the hon. the Minister accept the reality of that and what it implies? Does the hon. the Minister accept that in the year 2000 four out of five matriculants in South Africa will be Black people, which will be a far cry form the current figure in respect of Black matriculants, a figure far lower than that in respect of Whites? Does the hon. the Minister accept that by the year 2000 19 unskilled workers in South Africa out of 20 will be Black, and that four skilled workers out of five will be Black? The point is simply that if the hon. the Minister does not accept these absolutely fundamental realities he cannot direct and influence the development of the South African economy in the way that it is necessary to do so to be able to cope with and accommodate those realities over the next two decades.

One of the things we have to look at is the economic growth rate that is required in South Africa. This has often been defined by many people in the Government and also by many people in the private sector as having to be 4,5% if we are to meet certain targets. There is, for example, the need to provide for meaningful and satisfactory employment for most South Africans. The picture in this regard is that at a growth rate of 3,6%, by the year 1987, 2,4 million people will be unemployed, comprising 21,9% of the economically active population. At a growth rate of 4,5%, 1,6 million will be unemployed or 15% of the economically active population. At a growth rate of 5% 1,3 million people will be unemployed, comprising 11,5% of the economically active population. Dr. Jan Lombard of the Bureau for Economic Policy at the University of Pretoria has made the confident prediction that with an economic growth rate of 4,5% per annum from now until the year 2000, an average growth rate of 4,5% per annum, we could to a very large extent equalize the average standard of living of all South Africans. That is a very confident prediction. If we can maintain an average growth rate of 4,5% per annum, by the year 2000 we could wipe out the tremendous disparity in the average standards of living in South Africa of the various race groups and we will also be able to restrict unemployment to the figure of 1,6 million which, in any event, I consider to be a very high figure, comprising as it does 15% of our economically active population. I want therefore to ask the hon. the Minister whether we can accept the fact that it must be an aim of the Government to maintain and sustain an economic growth rate in South Africa for the next 20 years of an average of at least 4,5% per annum.

Let us now try to assist the Government in regard to the steps that have to be taken in order to achieve this goal. What is the record to date? If we take the period from 1972 to 1979, we find that the average growth rate per capita in respect of GDP in South Africa was only 0,21%. When we compare this with the figure for some of our main Western trading partners—Japan with 3,35%, Israel with 0,98%, West Germany with 2,58%, UK with 1,5% and the Republic of China with 6,89%—it indicates that up to the present the Nationalist Government and South Africa have failed to achieve the economic growth rate per capita which is necessary to maintain or provide a satisfactory standard of living and a satisfactory stable and successful economy in our country.

Why is this and what can be done about it? The hon. the Minister will immediately tell me that the next point that I wish to discuss—the shortage of trained manpower in South Africa—does not fall under his control. Perhaps the hon. the Minister of Internal Affairs would stop distracting the hon. the Minister’s attention for just a moment to enable me to put this point to him. He can then tell the hon. the Minister at a later stage about the reports of the President’s Council which I can see are worrying him tremendously. [Interjections.] Yes, I can understand why it is worrying him. Dennis the Menace is really causing the Minister a great deal of trouble! [Interjections.] I know that the training of manpower is the job of the hon. the Minister of Manpower. I want to tell this hon. Minister that he must see to it that in his negotiations and contacts with commerce and industry, he insists that they play their part in providing the trained manpower that South Africa requires.

Let us look for a moment at the situation of managers in South Africa. If we do not have an adequate structure of trained, efficient and capable management in our society, we shall not be able to meet our economic commitments or our economic targets, it is absolutely necessary to have a sufficiently large body of trained, committed and motivated managers within our manpower structure.

Order! The hon. member’s time has expired.

Mr. Chairman, I rise merely to afford the hon. member for Bryanston the opportunity to complete his speech.

Mr. Chairman, I thank the hon. Whip for giving me the opportunity to continue with my speech. In the United States of America there is one executive for every 26 members of the population. In Australia, which is comparable with South Africa, the ratio is 1:11, while in our country we have a very big disparity where there is one executive for every 42 members of our general population. Obviously this is a field in which a tremendous amount of work must be done.

Let us look at the next group which is very important in industry. I refer to the engineers. By 1987—this is from a report of the Human Sciences Research Council, the Institute for Manpower Research—21 000 engineers will be required in South Africa. This means that we must train 1 000 or more engineers per annum from now on, but the fact is that we are training 700 per annum on average, and that figure is, in fact dropping at the moment. Obviously this is a danger signal. If one does not have engineers, one cannot develop one’s economy and one cannot develop one’s industries satisfactorily. A very interesting fact is that in 1979 90% of all engineers in South Africa were White people. This indicates simply that the pool of people of colour, of the Black people in South Africa in so far as engineering is concerned has not been started to be tapped by our society and our country.

For industrial engineers the demand today in South Africa is 3 000 in order to maintain the required growth rate, but we have only 500 available. For industrial technicians the demand is 12 000, but we have only 1 500 available.

I am trying to say to the hon. the Minister that in our top echelon of management and engineers—they are absolutely vital to stimulation and the promotion of economic growth—South Africa is falling short very far. This is not just this hon. Minister’s responsibility or that of the hon. the Minister of Manpower; it is the country’s and the Government’s responsibility. The hon. the Minister of National Education and the hon. Ministers who are responsible for departments in this field have a responsibility to act in concert in order to solve this problem.

When it comes to artisans, the situation is equally bad in South Africa.

Now you are really generalizing.

We need to maintain a growth rate of 4,5% and to be able to achieve that growth rate, we required 23 000 new artisans to enter the labour market every year, but at the moment only 9 000 to 10 000 artisans enter the labour market every year. They number, in other words, less than 50% of the total we require to be able to maintain a growth rate of 4,5%. Once again, if one looks at what the situation is, one finds that in 1980 only 82 Blacks were registered as apprentices and in 1981 only 380. Obviously there is a tremendous shortfall. Here is an indication of where steps will have to be taken to rectify the situation.

I want to say something about commerce and industries itself. If one looks at the performance of various participants in this field on the part of free enterprise, it is clear that many of the companies, and particularly some of the larger groups, are doing an excellent job of work. They are trying. If one looks, however, at the majority of industries and businesses in South Africa, one finds that they have not even started to fulfil their obligations in regard to manpower training. This is where this hon. Minister must exercise influence on them in order to achieve that.

If one looks at a company such as Barlow Rand, for instance, one finds that Mr. Mike Rosholt was reported as follows the other day—

I think that is something which South Africa can afford.

I want to make this suggestion: If it is found that private enterprise is not prepared, on a voluntary basis, to fulfil its commitment in this field, I think it is time that we look at either a system of levying private enterprise in order to provide training where necessary or that other steps be taken to see to it that private enterprise in South Africa as a whole fulfil its commitment.

I should like to go on to enhancing the free enterprise system in South Africa which I believe is a responsibility which is very, very important and which falls directly under the hon. the Minister. Dr. H. J. J. Reynders, the chairman of the National Manpower Commission used the following word the other day—

Unless we commit ourselves to the free enterprise system enthusiastically and totally the free enterprise system is under threat in this country.

Tell us about social democracy.

One cannot have a fully-fledged free enterprise system in a society which is not wholly free. One cannot have a free economic system for all one’s people in a society which is enslaved by a social and political system that denies social and political freedom to large sectors of the community. If we really want a free enterprise society, if we really want to fight communism effectively in South Africa, we have to create a free society—socially, economically and politically—for all the citizens, for all the people of South Africa. That means that apartheid must go, and that it must go now. This hon. Minister cannot have his cake and eat it. By influencing and putting pressure on his colleagues in the Cabinet, he must see to it that we bring about in South Africa not just healthy power-sharing, as the Government now wishes to bring about, but also a healthy system of sharing socially, economically and politically, the entire spectrum of our society. Now what does this mean? It does not mean that we must investigate whether the Group Areas Act can be changed or improved.

What the Government should do is investigate how it can immediately, effectively and rapidly scrap the Group Areas Act with all its restraints on the South African economy. The Government must take steps now to open up the central business districts of all the big towns and cities in South Africa for participation of all races. Why? Because that is the only place where they can get the training and where they can get the opportunity to make a full contribution to the South African economy. When that has succeeded, the Government will have to look at the opening up of all business areas to all races in the country, not just the central business districts.

One of the points that is so tragic is that there is a restriction on, for instance, appointing Black, Coloured or Indian as managers of businesses in White areas. At present they have to serve under Whites in an inferior capacity. This denies to these people the opportunity of the training and the stimulation that they would otherwise get if they could rise to the highest levels. In doing this we are strangling South Africa’s economy because we are not achieving the trained people whom we require. I know that the Government has removed many restrictions, and when the hon. the Minister of Co-operation and Development eventually does come to Parliament with his three Bills, obviously many more restrictions will go. But it is terribly disappointing when the Government refuses to accept the recommendations of the President’s Council to give Pageview and District Six back to the Indians and Coloureds respectively and to open these areas not only to these races, but to others as well.

Allow me to conclude by saying that if the Government is serious about its fight against communism, if it is serious that it wants to defeat communism, then in the first place it must create a system in South Africa, socially, politically and economically, which is better, more effective and more desirable as far as the entire South African population is concerned. If it does not do that, it will not convince us that it is serious about its fight against communism and it certainly will not convince the other race groups in this country.

Mr. Chairman, I shall react in a moment to some of the matters which the hon. member for Bryanston raised in his speech, a speech which is always negative as a matter of tradition. The hon. member is a person who is really incapable of stating a positive case, particularly in regard to what is being done about the upliftment of people in South Africa. In the course of my speech I shall refer to this again.

In the first place I should very much like to congratulate the hon. the Prime Minister on behalf of this side of the House on the constructive and successful conference with President Kaunda of Zambia last Friday, and of the positive reaction it has elicited. We have the greatest appreciation of the hon. the Prime Minister’s efforts to find peaceful solutions to the complex issues of South and Southern Africa. That conference was an important milestone in this process. I have no doubt that not only could these discussions contribute towards greater stability in Southern Africa, in the entire subcontinent; they could indeed also contribute towards creating a climate of progress and development with a view to an improvement in the quality of life for everyone in Southern Africa. I think the hon. member for Bryanston would do well to take cognizance of this.

I should like to refer in particular to certain milestones which the hon. the Prime Minister and his Government have established along the way in their endeavour to establish a South Africa and a Southern Africa in which true freedom and material welfare can be brought to the highest possible level in an effort to improve the quality of life of all. In the first place, the well known Carlton Conference of 1977 laid the foundation for closer co-operation between the public sector and the private sector. On that occasion the hon. the Prime Minister said, inter alia: The basic responsibility of the Government is to establish, maintain and protect the national and international order in the context of which the private enterprise can perform its function of producing goods and services. The primary task of the private sector is, therefore, to ensure economic growth.

Secondly, during the Good Hope Conference of 12 November 1981, the hon. the Prime Minister declared that the Government was in earnest in seeking to bring about effective political participation for all while maintaining a sufficient degree of stability in order to ensure, among other things, healthy economic development and the principle of effective decision-making. Constructive co-operation between the public and private sectors was strengthened by this conference.

Thirdly, I refer to the White Paper and information document which appeared at the end of March this year relating to the Promotion of Industrial Development as an Element of Co-ordinated Regional Development Strategy for Southern Africa. The measures contained in this document hold out exciting prospects to the private sector. This plan is not merely a great and imaginative one; it is also an economically feasible plan. I trust that the private sector will seize upon this plan with enthusiasm.

In this regard I now wish to quote from the economic policy document of the PFP. I find it remarkable that the hon. member for Bryanston did not refer to it. I quote from page 6, paragraph 3.11—

However, the hon. member for Bryanston did not once refer this afternoon to this White Paper and information document relating to the balanced distribution and development of economic activities in South Africa. I gain the impression that the hon. member—the chief spokesman of the PFP on economic affairs—does not wholeheartedly support the economic plan of his party.

Another very important aspect of the White Paper is the declaration of the heads of Government of South Africa, Transkei, Bophuthatswana, Venda and Ciskei with the aim of promoting private investment. Co-operation with the private sector is offered and welcomed.

The Decentralization Board will play an exceptionally important role in this plan. I should like to congratulate Mr. Dougie de Beer on his appointment as full-time chairman of the Decentralization Board and, on behalf of this side of the House, I wish him everything of the best in his task.

In my introduction I referred to the fourth milestone, viz. the conference between the hon. the Prime Minister and the president of Zambia.

I want to state unambiguously this afternoon that at no stage in the history of our country has a climate been created for the private sector to make economic progress to the extent that it is being done now. Political stability and order and economic growth go hand in hand. Due to these initiatives a common purpose has indeed developed between the Government sector and the private sector, viz. the promotion of a regional order in which real freedom and material welfare can be taken to the highest possible level and the quality of life of everyone in South Africa improved. This common purpose, together with the positive attitude on the part of those involved, bodes well for the future.

The hon. member for Bryanston intimated that his party welcomed the free market system. It will be interesting to see what co-operation the official Opposition would get if they tried to promote it, if they were ever to come to power.

This afternoon the hon. member for Bryanston, among other things, spoke in critical terms about economic growth. However, I doubt whether they will succeed in achieving economic growth of any nature at all. Here is a policy document drawn up by a commission led by the hon. member for Yeoville. The title reads: Economic democracy—a charter for social and economic progress.

It is also available in Afrikaans.

Perhaps the hon. member should give a copy of this policy document to the hon. member for Bryanston, because it seems to me that he has not seen it yet. [Interjections.]

It is rather a vague document, Sir, because it had to satisfy both the capitalists and the socialists in the party. I infer from what he said that the hon. member for Bryanston wants to promote the free market system. But let us look, for example, at paragraph 3.16 of the PFP policy document in which reference is made, almost in passing, to the issue of inflation as “a major destabilizing factor in any economy”. It goes on—

However, we too, like the PFP, are concerned about the cost increases, and I shall refer specifically to that at a later stage. However, let us look at the comment on this policy document. I quote from a periodical which does not support the Government, Sir. On 27 November 1981 the Financial Mail said of this policy under the heading “Between two stools”, that the hon. member for Yeoville “was able to boast that it had been possible ‘to reconcile the two poles of capitalism and social reform and gain consensus’”. The periodical continues—

They then give an example and say—

Time and again the conditions set in the policy document are qualified by other conditions. For example, the PFP says: “Nationalization is rejected, but only as a general rule.” [Interjections.]

I have no doubt that the economic policy as stated here by the PFP would be exceptionally inflationary; indeed, it would set a heavy demands on the public and cause unprecedented cost increases.

We on this side of the House would also very much like to know today what the economic policy of the CP of South Africa is. We should like to know what measures this party proposes to achieve stable economic progress and improve the quality of life of all people in South Africa.

Order! I regret that the hon. member’s time has expired.

Mr. Chairman, I merely rise to afford the hon. member an opportunity to complete his speech.

Mr. Chairman, I thank the hon. Chief Whip for his gesture.

I should now like to touch on another subject. Members of the study group of this side of the House on industry, commerce and tourism, paid a visit, at their own initiative and expense, to the department in Pretoria in November last year, to orient themselves with regard to the wide range of activities in the various branches of the department. On behalf of the members of the study group I wish to thank the Director-General, Dr. Du Plessis, and the senior officials of the department for the opportunity and the discussions we were able to hold. We have no doubt that there is an exceptional level of expertise in all the branches of the department. Taking into account the staff position, there is great appreciation for the work that is done. Indeed, I am sure that there are many enterprises in the private sector that would have collapsed if they had been saddled with the same staff position as the department. At the same time, the members of this group visited the CSIR, the SABS, Satour and the IDC on their own initiative and were impressed by the exceptional work being done by each in its own field with the means at its disposal. Here I should also like to convey our appreciation for the friendly way in which the members were received and insight gained in this way.

The Afrikaanse Handelsinstituut, which has a special place in the business life of South Africa, is also holding a very important annual congress from today. On behalf of our study group we want to wish that organization a very successful congress.

I believe it is essential, for various reasons, that the free market system should continue to be acceptable. Among other things, it is necessary to ensure economic growth and prospects. In my opinion, therefore, it is primarily the task of the private sector to ensure that the free market system does not come under pressure, particularly from the general public. Since it is the common aim—as I have indicated—to improve the quality of life for everyone and, where people are in a backward situation, to rectify the situation, the aid of the private sector is indispensable. What I am now going to say, I say with a positive attitude. When I say this, it is by no means my intention to make an attack on the private sector. However, there is a climate of unrest among the public, the consumers, about incessant price increases. In January this year there were reports such as: “Lewensduurte styg vanjaar meer as ooit”. In January/February a prestigious company advertised—and stated it almost as a fact—that in 20 years’ time a litre of milk would cost R3,20, a white loaf R2,60 and super lamb R32,10 per kilogram. The company then makes specific suggestions. This of course gives rise to concern. At Stellenbosch the Buro vir Ekonomiese Ondersoek found that business confidence was dwindling. At the same time, large profits—and greater profits than in pervious years—are indicated, but the situation is not always put in perspective by indicating what the reasons are for the increase in prices. The question which then arises is whether some of the increases are not all too often ascribed to the slogan “inevitable cost increases”. However, a further question arises. Are higher profits always due to higher productivity and better managerial expertise and skills, or is it merely the urge for greater wealth and prosperity? Has the urge become so great that economic justice is forfeited? I should like to refer hon. members to an article written by a senior lecturer of the University of the Orange Free State, Dr. Tromp, in Sake-Rapport of 25 April, and I quote just one brief section—

I am convinced that every entrepreneur must give in-depth consideration to this question from time to time in order to prevent costs from increasing steadily and the prices and profits of entrepreneurs from steadily weakening the purchasing power of the public to such an extent that that purchasing power has to be sustained by way of wage increases, whereas in fact there has been no increase in productivity. The onus remains on the individual to ensure his rights, privileges, economic position and resources by offering his labour, for example, in the most productive way and living carefully and frugally. For the ordinary man, however, it is not possible to evalute his financial position and make projections, and this creates uncertainty and concern. This has a detrimental effect on thrift and a negative effect on productivity. The situation must not be allowed to develop in which people eventually sit back and are or want to be entitled to benefits irrespective of their own contribution to the economy and the increase in their standards of living. In this regard I want to refer to comment, with which I agree, which appeared in the newly established business journal Tegniek. I quote—

However, I am concerned about the climate of constant price increases in which the public is being placed. I believed that more perspective should be given to the problem of the consumer so that the uncertainty as to his economic and financial prospects may be eliminated. There are many countries, in Africa too, where the private entrepreneur would like the stability of this country and the exceptional co-operation of the Government, in order to develop the free market system. The onus is always on the private sector to oppose and eliminate every factor that could contribute towards placing the free market system in jeopardy. I therefore believe that the private sector will have to furnish tangible proof as to how and to what extent it combats and seeks to eliminate the phenomenon of incessant cost increases. The private sector must see to it that economic justice is done at all times, in order to promote and achieve the aim of ensuring that true freedom and the increase in the quality of life of all people is insured.

Mr. Chairman, last Friday, during the Standing Committee proceedings in the Senate Chamber, on behalf of the CP, I wished the hon. the Prime Minister every success with his talks with the Africa leader. As the hon. the Prime Minister is present today, I wish to repeat these best wishes. According to Press reports, it seems as if the talks went off very well. We hope that the hon. the Prime Minister will soon on the basis of those talks, achieve good results for our country, South Africa, and that matters will proceed smoothly in future. It is our wish and desire that all will be well.

The hon. member for Klerksdorp asked me what our party’s policy was. As far as the policy of the CP is concerned, we support the capitalist system. We hope that in this respect, South Africa’s commerce and industry will do well. As we see it, this debate is not a political one. It is not a debate in which we have to state our policy in order to make party-political propaganda. We shall support the Government in everything which is good, and where we find fault, we shall criticize. We shall do this by means of constructive criticism. It is in the interests of South Africa and its people that things go well in the economic sphere. If all is well with one’s country, then things go well regardless of which party is governing.

I wish to associate myself further with the hon. member for Klerksdorp by expressing the gratitude of my party for the White Paper and the information document we received entitled “Promotion of Industrial Development as an Element of Co-ordinated Regional Development Strategy for Southern Africa”. If a country is able to flourish and produce in the industrial sphere, it could do well. That is why I wish to say that as far as we are concerned, we want to ask that industrial development and decentralization should take place as far as it is possible. To concentrate everything in one area in a large city, does not work. It has been proven internationally that it does not work to have large cities. In this regard, I wish to quote from the March 1980 edition of Soeklig, a Volkskas publication, in which, inter alia, the following is stated—

In South Africa we have four large urban complexes in which our industries are also concentrated. I do not wish to repeat the facts and figures again. In fact, this has been done here over and over again. However, we cannot place sufficient emphasis on further decentralization. Nor can the Government do too much in this respect. To concentrate all the industries and related activities in one area is completely unproductive. Dr. Verwoerd’s policy of border industries and decentralization—a policy which this Government has also been trying to apply over the years—is in fact a policy which should be implemented to the full. However, we must concede that not everything that ought to have been done, was always done. Nevertheless, I am grateful for the fact that real efforts are now being made in this regard. This is also apparent from the White Paper which we received. If the policy of decentralization is carried out, and industries are established even in the remote country areas of the Transvaal and the Cape, there will definitely be many advantages attached to this. As I have already said, it will be far more economical, something which has not only been confirmed here, but throughout the world. It will also be advantageous from a social point of view. From a military point of view, it would also have many advantages. As Dr. Lawrence Mc-Crystal puts it in his book, City, Town and Country, the indications are that at least 75% of all industries concentrated in the large urban complexes at the moment, could be shifted elsewhere. It has always been the tendency in the industrial and business world to concentrate everything in one spot. However, I believe that the time has come for people to realize that this tremendous concentration of industries is no longer in the interests of South Africa. Land in our cities is simply becoming too expensive for this. People are being crowded together in the residential areas in an abnormal way, and tremendous amounts have to be spent on subsidies in order to transport labourers from far and near to work in the concentrated industrial areas.

Then there is also another very important aspect. This is the supply of water. If we continue to waste water, as is being done to a large extent in South Africa and if provision is not made for additional supplies of water, South Africa is going to encounter tremendous problems in this respect in the near future—within the next 20 years. I think this is one of the factors which should be taken into account by the Decentralization Board. The future supply of water in South Africa must indeed be given urgent attention. We simply use water too wastefully. However, when we take into account the rainfall in South Africa, and what the population figures within the next 20 or 30 years will be in this country, it is really cause for concern. Serious consideration will have to be given to the question of the supply of water in South Africa.

The city of New York proved beyond doubt that over-concentration is completely uneconomical. That city went bankrupt in the process. This was a direct result of the tremendous concentration of people in one city. Services have to be rendered, something which eventually is just no longer possible.

Another matter which requires attention, is the small business undertaking. I am very grateful to the hon. the Minister for the fact that the amount requisitioned in this year’s budget amounts to R2 million, as against the R805 000 of last year. However, I wish to request that more assistance be given to small businessmen. I am grateful for what has already been done for them. I do not wish to suggest for one moment that nothing is being done for them. However, I believe that the time has come for more attention to be given to the interests of the small businessmen, and for drastic steps to be taken to be of greater assistance to them. If we wish to be strong economically, if we wish to apply a strong economic policy, we dare not forget about the small businessmen. It is true that the large businesses form monopolies, and this is something which the hon. the Minister will definitely have to have investigated. We are really becoming anxious about the acquiring of monopolies in South Africa.

In conclusion, I wish to say a word or two about the S.A. Bureau of Standards, the head office of which is in my constituency. I wish to request that more attention be given to the Bureau, and that the Government will strengthen the Bureau by insisting that greater standardization take place in South Africa. In this respect, I wish to point out what happens, for example, in the case of canned meat, vegetables, fish, fruit, etc. There are sizes which vary from 120 to 130 to 150 in respect of those cans. There are no standard sizes. The hon. the Minister was only recently appointed to this portfolio and if he wishes to make his mark, he should take steps to standardize in this respect. When the consumer goes to a shop to purchase something, he is unable to compare prices. In my opinion, there is complete exploitation in this regard. There is no easy method one can use of comparing prices. If one wants to purchase something, one cannot go into a shop with a pocket calculator, and I want to ask the hon. the Minister to have an investigation to be made into what can be done in this respect.

As far as monopolies in South Africa are concerned, there is the tendency on the part of certain people to acquire large monopolies. The hon. the Minister had to deal with this fairly recently, and we would predict that this tendency is going to occur more frequently in future. If the hon. the Minister can therefore do something to stop this tendency, we shall all be very grateful.

Mr. Chairman, one of the tragedies in South Africa today is that the CP is telling the people of South Africa that there is no threat to South Africa. This proves their tremendous ignorance, particulary in respect of our economy, since the greatest threat to South Africa is in fact situated in the sphere of the economy. Perhaps the hon. member for Sunnyside ought to ponder this for a while, for we are really going to get at them outside for saying this.

In the few minutes today I firstly wish to thank the hon. the Minister and his department under the direction of Dr. Du Plessis and the officials for the part they play in promoting the free enterprise system in South Africa. Few people realize how important the activities of the department, which is also under the direction of the hon. the Deputy Minister, in the total economic picture of South Africa.

Today I should like to touch on a subject which I wish to advocate to the hon. the Deputy Minister and the hon. the Minister, and that is that we in South Africa should give attention to the establishment of a Department of Technology and Research or a Technology and Research Division under the ministry of this hon. Minister. I have had a look at the Economic Development Programme published by the Economic Advisory Council and I have also had a look at the report of the Office of the Prime Minister. I also looked with great interest at the documents we received from the department concerning the activities of the various divisions. It struck me that in respect of research and technology in our economic development programme and projects, we did not have a co-ordinated project, which in my opinion, is essential. We are living in a world in which we in South Africa, as well as the entire Western world, are rushing headlong into this economic and technological revolution, and while we in South Africa are rushing headlong into this technological revolution together with the rest of the capitalistic world, a large number of people in our country are still stumbling around in the dark of the subsistence economy system of Africa. Many people would say that if South Africa leans too heavily on technology, we are going to encounter unemployment in future and that South Africa is therefore not a country which should try to promote technological developments too strenuously. The simple truth of world economy is that we have no choice in the matter at all. With the advent of micro-electronics for example, there are dimensions and developments in the economic systems of the world and if a country does not keep up with them it could become completely out of touch. Let us consider only one aspect: The work done by robots in factories. In Japan, there are 47 000 robots, out of a total of 60 000 in the world, that work in factories. If we take the economic growth rate of Japan into account, as well as the fact that they consider this technological development to be essential, for the number of people there who are willing to do that factory work is diminishing all the time in any event, we are only touching on one small part of the developments we will experience in future. If we wish to remain economically competitive in international trade, we have no choice but to make use of technology in future in order to keep us competitive. It is alleged that this technological development in the field of microelectronics for example, has not resulted in fewer employment opportunities in a country such as Germany, but has in many respects created new employment opportunities, particularly because Germany is a country which exports technology on a large scale. I do not doubt that we in South Africa must succeed in co-ordinating the utilization of technological research which is being done in the world, particularly the research which has to be done in respect of microelectronics.

Bio-technological research is also going to have a tremendous impact on the South Africa economy in future, particularly on the production sector as far as the agricultural economy is concerned, where genetic research inter alia could change the production process considerably, resulting in a considerably increased production.

Research is being done throughout the world in respect of the recycling of raw materials and in respect of new materials which can be used in the economy.

Of course, the technological era in which we are living creates tremendous problems, but it also has many advantages. I cannot imagine that we in South Africa, with the problems facing us in so many areas, can move forward and intercept all those problems with our economy and techniques structured the way it is at the moment. I am thinking about the problem of housing, of 160 000 housing units which have to be provided for Black people. I have no doubt that we shall have to make use of technology to get our production process going, so that the housing can be provided with the aid of mechanization and modern technology. It is true that the CSIR is doing valuable work in this regard, but it is also true that a great deal could still be done and that coordination is necessary.

We want to sell the free market system in the South African context, and in my opinion, it is essential that South Africa should take the lead and that South Africa should be in the forefront of developments and research, even if it is only that we obtain the research which is being done in the Western countries and implement it in good time in our future planning and the practical functioning of our economic machine.

It is true that the new technological revolution we are facing in the economic sphere is going to bring about tremendous changes in the field of manpower. There are many traditional professions which are familiar to us in this House, and which are part of our economic life, which will no longer be there in the future. I see that it is being claimed that in future it will be possible to do away with secretaries when offices are mechanized. Of course, I do not mean the kind of secretaries who sit on one’s lap, but those who have to type and do research. [Interjections.]

We wish to strengthen ourselves economically in future with these modern technological developments, and now the question arises whether our training programmes in our schools are correctly geared to this. My son is at high school, and if I consider the things he is being taught, I ask myself whether he is being equipped for the technological era of the future. If I consider the 185 000 Black people per year who are going to obtain a matriculation or equivalent qualification within 18 years, I ask myself whether those people are going to be equipped to carry out their task in the modern economy, in the technological era.

I have no doubt that we can and will make a tremendous impact on our economy if we concentrate more intently on the possibilities which modern technology offers us, and the technology of micro-electronics in particular. If one thinks of the subject of inflation and one asks oneself what one could do in the manufacturing sector of South Africa by making use of mechanization and these techniques, there is no doubt that we need not leave our people unemployed, but that we could make a tremendous impact on the productivity problem in South Africa. If one looks at the development of the Black States, it is clear that we should do something, in the African context as well, which could lead us away from the mere traditional utilization of manpower, entrepreneurship, raw materials and capital.

If one thinks of the possibilities of modern technology in saving on capital, as can be seen in Japan and West Germany, then one can have no doubt that South Africa, which seems likely to have to initiate a capital programme of more than R54 billion in the next 10 years, will have to try to effect a great saving, and that technology is one means of trying to save capital in future. If one looks at the development of entrepreneurship, there can be no doubt that in the Free World, in Europe and in America, the average manager’s time is, to a large extent, taken up with routine tasks, for example, the arranging of conferences, the organization of various matters, etc. Many of these activities could be intercepted in the world we live in now by means of a table top computer and other mechanical aids for the office. I can imagine that in 10 to 15 years’ time, or even sooner, we Parliamentarians will be able to work out fine speeches or determine whether someone has already spoken on a particular subject by pressing a button on an instrument on our desks. The possibilities of modern technology are unlimited.

I wish to conclude by repeating my request to the hon. the Minister, viz. that we should create a subdepartment of research and technology and that it should function as an off-shoot of the hon. the Minister’s present department. We in South Africa should, in a co-ordinated manner, consider ways in which we can implement modern technology and research in all technological spheres, in order to utilize manpower, entrepreneurship, raw materials and capital to the full in the interests of everyone’s future, and in the interests of the growth of the economy in particular, because we need the economy as our strongest weapon and ally in order to be successful.

Mr. Chairman, I always like to speak after the hon. member for Innesdal because he is an enthusiast; he really believes in his subject. I do think he is one of the more far-sighted hon. members on the Government benches, and as such he makes a contribution to most debates. The hon. member made an appeal to the Government and to the hon. the Minister that there should be a greater thrust towards improving and increasing our knowledge of technical matters, especially in regard to micro-chip technology, the production of industrial robots, etc., and I agree with the hon. member. I believe that South Africa is in many technological fields way ahead of most other countries. In fact, I believe South Africa is in the forefront in many technical fields.

The hon. member made the point that he believed that we could fight inflation with this technology. I do not entirely agree with him. Micro-chip technology, like any other mechanical or management aid, is exactly that, viz. an aid to management. To fight inflation requires a far more basic attack on the structure of the whole economy and financial set up in South Africa.

But I am pleased the hon. member raised this point, because this is what I intend talking about today, viz. South Africa’s greatest and persistent malady, inflation. Besides acting as a disincentive to save, which in itself is serious problem for South Africa because it means that capital is not made available for important sectors of our economy, such as housing, inflation is a silent thief because it robs the ordinary man of his lifelong savings. We are seeing this happen more and more today where people who reach old age find that they have not accumulated enough money to see them through for the rest of their lives. They now find that inflation is robbing them of their savings.

Inflation also robs the working man. It robs the man at the workbench, in the workplace, of the real value of the purchasing power of his hard-earned earnings. As a result of this, there is a potential for conflict in South Africa, and therefore we have got to beat inflation. For this reason I was pleased to note in the annual report of the Competition Board—I think every hon. member should read this report because it contains a lot of meaty and interesting material—that they talk of inflation, of “strong inflation”. “Strong inflation” is inflation which exceeds 10%. I quote from page 1 of the report—

I believe that this fact should receive the serious attention of the Government because it is undermining our competitiveness in the international market. I believe that despite all our technical knowledge and wealth we in South Africa cannot afford to rest on our laurels at the present time. We have had a remarkable performance in recent years. We achieved a gross domestic product growth rate of 8% in 1980 and approximately 5% in 1981, but inflation persists at approximately 15%. I therefore believe that the warnings are very clear for the hon. the Minister. Today the USA is reducing its inflation rate. I believe that it is now running at an annual rate of approximately 6% to 7%. Great Britain hopes to reduce its inflation rate to below 10%. West Germany and Japan are already down to an inflation rate of 5% or 6%. Therefore I believe it is imperative for South Africa to do the same if we expect to retain our competitiveness in the international market. We know that one cause of inflation is the excessive money supply that we have experienced in recent years. We all know that the hon. the Minister of Finance and the Governor of the Reserve Bank are battling with this problem. However, what I want to draw to the attention of the hon. the Minister today is that we know of the greed of some businessmen, of the excessive profiteering resulting from price maintenance schemes imposed by cartels and monopolies in South Africa. This is having a considerable effect on inflation for the average citizen. Therefore I am pleased to see that this is also referred to by the Competitions Board in its report when it talks about the “concentration of wealth” through, what they term “oligopolies”. The report goes on to say—

i.e. towards the concentration of wealth—

I believe that the Government must take cognizance of these facts, and we in this Parliament should continue to bring to the attention of the Government situations which we believe are undesirable as far as the entire economy of South Africa as a whole is concerned.

One now gets the sort of report that one could read in yesterday’s Business Times. I draw this to the hon. the Minister’s attention and I see him nodding his head. In an article under the heading “Corporate monsters trigger earthquake”, written by Stephen Orpen, one reads—

This is something which I believe the hon. the Minister must take cognizance of and we as members of Parliament should bring this up. The article states further—

What does this mean? It means that somehow those companies that have tremendous access to funds or companies which are generating tremendous profits are using these undistributed profits to take-over more and more businesses. I believe that this is something to which the hon. the Minister must give consideration. Maybe there should be some fiscal type of legislation which will cause these excessive profits to be redistributed to the people through better dividends, rather than being held by a few companies to buy up more and more and more.

You sound like a socialist.

I am not a socialist. I am in favour of a free enterprise system. There is, however, an ugly side to capitalism.

[Inaudible.]

Yes, I agree with the hon. member, and I have said before that it is up to this Parliament to see that these undesirable practices do not have an adverse effect on our economy. I therefore appeal to the hon. the Minister to give greater consideration to the recommendations and suggestions in the Competition Board’s report.

There are a number of matters that I will raise with the hon. the Minister later in the debate, such as price control, price fixing, imports protection, etc. I believe, however, that I have brought to his attention the fact that the large companies, those companies with tremendous access to wealth, are gradually gobbling up so much of the wealth of South Africa that we will not be able to achieve a free market system and the development of small businessmen which we desire and to which a number of members referred today, for instance the hon. members for Sunnyside, Bryanston and Kimberley South. We have heard much about the need to develop the small businessman, and so I believe we must stop these big companies from preventing this from happening.

Mr. Chairman, I usually speak after the hon. member for Amanzimtoti. My previous speech was about inflation, and it is interesting to see how people try to over-simplify the concept of inflation. However, we all realize that it is a difficult problem, and if there was a simple way of solving the inflation problem, we should have adopted it a long time ago. It is very easy to attack large companies and refer to the large profits they make, but it is not so simple just to want to write off these people because they supposedly upset the working of the market mechanism.

Under the Co-operation and Development Vote I said that we had submitted a policy for decentralization and deconcentration in the White Paper, but that I was worried because we had not yet worked out and published a clear industrial strategy. In 1958 a commisson was appointed under the chairmanship of Prof. S. P. du T. Viljoen which laid down a blueprint for industrial development in this country. It is also a known fact that the report of that commission led to import replacement, which was exceptionally effective. In addition, it is a known fact that as a result of that report, the Board of Trade and Industries launched an investigation concerning the imported products that could be replaced in South Africa. A great deal was done with regard to textiles, chemical products, iron and steel, etc. Shortly afterwards the Report of the Reynders Commission, relating to exports and export promotion, was published and after import replacement, the idea was to lay the emphasis on exports. After that the Van Huyssteen Committee, and then again the Reynders Committee, were appointed, and I should like to know how much success we have achieved with export promotion. It is a difficult aspect, and I am concerned about the question whether one should only promote exports and forget about import replacement. After all, we are aware of the role played by import replacement in our history, and we are also aware of the role which Armscor is at present playing in the manufacture of military equipment in this country. We also know what degree of success they have already achieved. This Government has also asked the Klue Committee to carry out a further investigation into a new policy, and we are all enthusiastically looking forward to that report, because this investigation has been in progress for a number of years. As I have already said, we should like to see a strategy spelt out clearly, because it will determine how successful our decentralization and deconcentration plans are going to be.

Our industries have a difficult period ahead of them. We have already had the report of the Wiehahn Commission, some of the important recommendations of which have already been implemented. Then there was the Good Hope Conference, and the subsequent White Paper, which put forward the concepts of decentralization and deconcentration. We also had development in the form of the Small Business Development Corporation. There was the problem of the rising company tax and the abolition of certain export aid due to funds not being available. Then, too, there was the weakening of the rand, which also weakened the export position of our industries. We also have the possibility of the further abolition of price control, and in addition, a Competition Board which is particularly active. We therefore have all these developmental elements—the Government is exceptionally active in this regard—but how are we to co-ordinate all this? That is why the Klue Report is so important to us. Our industries have passed through a period of exceptional profits—tremendous profits have been made—but in the process we have moved in the direction of a negative balance of payments. Moreover, our exports have perhaps not performed quite as well as expected. Of course, we know that it is due to the recession overseas that our industrialists have encountered exceptionally strong competition. We know, too, that the exceptionally high economic growth rate within the country, and the very heavy demand for consumer products, channelled many of our exports to the domestic market. We are heading for a drop in the sales of our industrial products. The fact that we are on the threshold of a recession means that we can also expect more problems in the field of labour relations. We can expect to enter a period of more strikes and conflict situations. This is the normal growth process and I do not think one can reproach the Government in this regard. This is simply something that happens in the process of becoming mature. That is why it is so important to introduce another ten-year plan. Here I have in mind, for example, the Viljoen Report, with its import replacement plan.

For the sake of interest I examined a few of the plans of overseas countries and was once again impressed by what the Ministry of International Trade and Industry in Japan has done. They have spelt out for themselves a plan for the next ten years. In the first place, they want to escape the energy crisis in which they find themselves. Secondly, they want to become a technologically based nation. In this regard I agree with the hon. member for Innesdal. They clearly spell out what they want to do in this sphere. They want to improve the quality of life of their people. They also envisage—and this is very interesting—greater development of the decentralized areas and, finally, the creation and development of industrial structures. What is interesting about this Japanese ten year plan is the fact that it includes the increased employment of women and older people. It also envisages the decentralization of industries to certain areas in such a way that the industries that are re-established in those areas are adapted to the character of the region in question. This is precisely what we have in mind. I found it very interesting to see how they were going to do this, and I quote—

This is exactly what this Government plans to do. The emphasis is on knowledge-intensive industries and the production of additional products of high value.

However, it is not only Japan that serves as a model for us in the field of industrial development. Germany, too, serves as an example. The BFMT also has a plan, that stands on four legs. Firstly, there is the rationalization of sectors that are in a state of structural deterioration. Fortunately we do not yet have that problem. Secondly, there is the development of technology—intensive industries. Thirdly—and this is very interesting—they also link their planning for industrial development to decentralization or the regional restructuring of industries. Finally, there is the promotion of exports and investment in developing countries. It is interesting to see what the Germans have spent in these spheres. In the field of regional development the figure is 34,6%; in the field of assistance to certain industries it is 16%; in the case of research and development, 38%; in the case of small industries, 9% and in the case of aid to developing countries, 4%. It is interesting that they are not opposed to amalgamations. In the case of research they give research assistance to large companies, because that is where technology develops. We must be careful not to simply attack the large companies and conglomerates. However, this is important if there are pricefixings, with a view of competition.

In conclusion, I should like to say that I realize that it is extremely difficult to draw up a ten-year plan for South Africa, because the Whites are already in a post-industrial phase while the Black people are moving into the industrial phase. The problems is that as far as their levels of aspiration are concerned, the Black people want the same as the Whites. The trouble is that this would increase wages and so on to such an extent that it would be to the detriment of the labour-intensive industries. As yet we cannot fully enter a high-technology phase. We must take into account the fact that almost two-thirds of our population are still in the Third World.

Mr. Chairman, the hon. member who has just spoken has, I think, touched on a very important aspect in regard to which I should certainly like to support him, viz. the absence of and the need for a proper industrial strategy for South Africa. May I just point out that all the White papers and documentation we have had in regard to decentralization have been in terms of generalities and have not indicated where particular industries should be, where they can be most effectively placed and what the actual objectives are.

What about the latest one?

The reality is that what we have had until now is generalities: The Government has areas in which they can operate, they will attract whoever they can to those areas. But there is no real strategy behind it. That is the reality. The hon. the Minister must get up and tell us what his real strategy is in regard to this. It may be that important aspects have been brought up relating to the questions, as the hon. member has just pointed out, of import substitution and export encouragement, but the reality is that the industrial strategy of South Africa should be directed towards job creation, job creation at the lowest possible cost to produce what is needed on the most effective possible basis. It is there that the major oversight has been. It is job creation, the employment of people, which holds the key for South Africa.

There is one other point I should like to make in regard to decentralization. I think that at least six times I have spoken on this in an effort to get an answer from the Government on what the fiscal disincentives are with which they are threatening the metropolitan areas of South Africa. So far they have said: “Yes, there are things we are going to take away in regard to certain subsidies, transport and housing.” However, the Government does not have the courage to say what they are going to do in regard to the metropolitan areas and to spell it out. I again challenge the hon. the Minister to tell us today what he is really going to do in respect of the fiscal disincentives which are hanging like a swort of Damocles over the metropolitan areas of South Africa. It does not help to create something new somewhere else if in the process one destroys things of value elsewhere in South Africa. It is important that we should have this matter cleared up as soon as possible.

What is interesting is that the PFP’s economy policy has now again become a matter for debate in the House. What is fascinating is that more and more we are being shown to have acted as the pioneers. Even hon. members like the hon. member for Amanzimtoti, that arch-capitalist, have suddenly come out in favour of economic democracy at this stage. We welcome it. There is no greater rejoicing than for a sinner who repents—and they are all around us. I can tell you, Sir, that I was horrified to hear that even hon. members of the CP have suddenly started becoming enthusiastic about this policy. Any minute from now the hon. the Minister will be getting up to champion it. I am very delighted that we are debating this. What is important, however, is—and I specifically want to address myself to this matter today—that the consumer has indeed become the neglected orphan of the South African economy. As has already been pointed out, the consumer is hit by ever increasing prices. Furthermore he is inadequately protected against exploitation, and the ordinary working man and woman missed the boom, were completely left out of the boom, and now that we are entering into a recession, the consumer is going to be the first one again who is going to be allowed to suffer.

There is in existence a body known as the South African Co-ordinating Consumer Council. I want to ask the hon. the Minister today whether he thinks this body is able adequately to carry out its functions, particularly in view of the fact that it has inadequate funds and inadequate staff. The budget provision this year is some R489 000 against R304 000 last year. If we look at the last accounts of this body, however, they actually had R470 000 by way of income, of which R459 000 came from the Government. It also appears from the accounts of this body for 1980 that it received a special allowance for a “Buy South African” campaign. To my mind this body is in reality not able adequately to carry out its functions. I am going to demonstrate that in some detail later.

Let me deal with another matter first. That is the Trade Practices Act. Many of us sitting in this House had great hopes for the Trade Practices Act. Many of us spent many hours working on it. What has happened, however? Since the promulgation of that Act in 1976 only two determinations have been made. Only two determinations since 1976! Only seven matters are under investigation at the moment. For this activity we are being asked to vote R320 900. What is really happening? At a time when, almost daily, we read about undesirable exploitive practices, when stringent conditions are imposed on consumers by way of contracts which are arduous to those consumers, when the consumer has no bargaining power, when he must either take it or leave it …

He can complain!

He can complain, of course. I was actually waiting for that interjection by the hon. the Minister. [Interjections.] The consumer can complain, I wrote to the hon. the Minister asking him to intervene in the matter regarding credit card conditions. [Interjections.] I asked the hon. the Minister to do something about credit card conditions that were being imposed on consumers. What did he answer? He referred me to the hon. the Minister of Finance. What reply did I get from the hon. the Minister of Finance? He referred me to the hon. the Minister of Industries, Commerce and Tourism. [Interjections.]

It is not necessary to get so excited, Harry!

If you do not want to believe me, the correspondence is there. [Interjections.] The correspondence is there to show how the Government deals with matters. That is how they deal with it. [Interjections.] The reality is … [Interjections.]

Allow me to quote another example, Mr. Chairman. The hon. the Minister, the champion of free enterprise, abolishes price control. He abolishes price control, and what happens? He abolishes price control on building materials, for example, and the same …

Do you support price control?

On the very same day, almost in the same breath, the prices of building materials are increased by 17%.

Do you support price control?

I will support price control wherever anybody exploits the public. The public is indeed being exploited in many respects today.

Prove it!

Yes, I shall prove it. I shall prove it by quoting many examples for the sake of the hon. the Minister. I can quote the very simple case of … [Interjections.] I shall quote many cases by way of example. The reality is that if one looks at the profit figures of major companies over the last two years, it appears that their profits have increased while their turnover has not increased. Their profit margins have been put up. I can quote company after company to prove this, and the hon. the Minister knows it. [Interjections.] The hon. the Minister knows it. The reality of what is happening in South Africa is that … [Interjections.]

Give us explicit examples and stop being vague about these matters!

What is happening in South Africa is that opinion making is being conducted by the big boys in South Africa. When people are interviewed, when opinions are expressed, it is always the big guys, the fat cats, that express the opinions. The voice of the consumer is never heard. The voice of the consumer is ignored in South Africa. That is why the Sunday Times can write articles such as the one quoted by the hon. member for Amanzimtoti. That is why the consumer has been left out in the cold.

I have asked in this House many times before that we should have a proper Minister of Consumer Affairs. We still do not have one. Today I want to ask that if we do not get a Minister of Consumer Affairs, that we have a committee of this House, a Standing Committee of this House, that will deal with consumer affairs. I say this so that there will be somebody to whom the consumer can turn, somebody who can act as an ombudsman, somebody who can continually review legislation to ensure that the consumer is protected, somebody who can ensure that these bodies and committees that have been established will be supplied with the necessary information so that those bodies can appear before such a Select Committee in the same way as bodies have to appear before the Select Committee on Public Accounts in respect of the finances and accounts of the State. I do not want any of those boards or bodies replaced because they have a function to fulfil. However, how can anyone tell me that in 1976 we passed a Trade Practices Act and yet today we manage to have two determinations? There can be a list of 101 things that require attention.

Let us take the question of the consumer. Let us look at this report. What is fascinating about this report is that if one goes through it one finds that one is given examples of what happened in 1971, 1972, 1974 and in 1978, there are also a few in more recent years. However, they do not have the staff and the machinery in order to protect the consumer adequately. That is the reality of what is happening. The consumer is not being given a fair break in South Africa. [Time expired.)

Mr. Chairman, it is always interesting to follow the hon. member for Yeoville, particularly when he has been speaking as he spoke this afternoon. Again this afternoon he gave us the typical Schwarz philosophy, and in this regard I should like to quote an article which appeard in The Financial Mail of 27 November 1981 in which mention is also made of the hon. member. It is entitled “Prog economics between two stools” and it goes as follows—

During the discussion of the Part Appropriation, I asked the hon. member when we would have the follow-up on and explanation of these matters. The hon. member for Yeoville begain his speech this afternoon by attacking the hon. the Minister about certain things which had not been done, but immediately after that he attacked the hon. the Minister for the opposite reason. Looking at the statement by The Financial Mail in this regard concerning the hon. member’s economic programme, in regard to which he said to us this afternoon: “We were the pioneers”, we discover that the game being played by the hon. member and his party is precisely as it is described here i.e. “to satisfy both the left and the right wing”. The hon. member has to remain between those two factors and that is what he does in every debate. Taking this into account, I think that the hon. member is by no means in a position to attack us with regard to our economic policy. I say that the hon. member is in no position at all to advance these arguments.

I now wish to touch on a more positive matter. Mention was made this afternoon by the hon. member for Amanzimtoti and other hon. members, including the hon. member for Yeoville, of the deficiencies in our South African economy. However, if we look at the other side of the picture, we find that a journal like Tegniek described South Africa’s growth as phenomenal. During the period 1948 to 1981 during which this party has been in power, we find that at prevailing prices the GDP of R2 136 million in 1948 has increased to R70 710 million in 1981. Between 1948 and 1981, agricultural figures, among others, dropped from 16,8% to 8,5%. Mining figures improved. The GDP at factor costs per capita of the population has increased at prevailing prices from 150 in 1948 to 1 162 in 1981. As far as international trade is concerned, the exports have increased from R286 million in 1948 to R8 715 million in 1981. I could continue to quote similar figures but I just want to say that one can only reach the conclusion that this Government, this hon. Minister and the department, with the officials that have done this work over the years, have performed a phenomenal task. As far as consumer prices are concerned, if we take the figure for 1975 at 100, then in 1948 the figure was 31,9, rising to 203,6 in 1981, signifying an average increase—I say this to the hon. member for Amanzimtoti in particular—of 5,8%. I think it is far better to consider the rate of inflation over a period of 30 years than to consider the position in the short term. Therefore I should like to come back to the point made by the hon. member for Amanzimtoti when he drew a comparison between the present rate of inflation of South Africa and that of West Germany and the USA. It would be very easy to combat the inflation rate, but we must then take into account that the USA is saddled with an unemployment rate of approximately 12 million, while in West Germany the figure is between 3 and 4 million. In South Africa such an unemployment figure would create an untenable situation, and accordingly we shall have to deal with our rate of inflation on a different basis. Over the past 32 years in which the NP has been in power, our growth rate has been unequalled in Africa and in the majority of developed Western countries, not to speak of the Eastern countries. Statistics have already been quoted and I do not wish to repeat them. All I wish to stress is that what the Government has always propagated and still advocates in our country is the model of the free market-oriented market system.

To a certain extent I wish to associate myself with what the hon. members for Yeoville and Amanzimtoti said when I say that I think that two of the most important structures whereby to protect our free market system, and which have the potential to promote it, are the Competition Board and the S.A. Co-ordinated Consumer Council. The one is aimed at the maintenance of competition and the other at the prevention of exploitation of the public.

The Government is doing virtually nothing to protect the public.

No, the Government is doing a great deal in this regard, and that is why I quoted figures over the past 32 years to indicate that the rate of inflation over that short period pointed to greater realism—5,2% instead of the present precentage. One should not only take it year by year; one should take it over the entire period. That is why I say that the Government is in earnest in wanting to do something about inflation.

Referring to the report of the Competition Board, I want to associate myself with the hon. member for Amanzimtoti by heartily congratulating them on the work already done. One can take it that in view to the short period during which they have been operating, they are not yet at full strength and do not yet have all the staff they ought to have. In this regard I associate myself with the hon. member.

What worries me is not the large company per se, not the large company that makes a profit, because I think the idea that “profit” is a dirty word, is wrong. Free enterprise needs profit as an incentive, and that is what it is all about. However, when improper profits are made, that is a horse of a different colour. Therefore I should like to refer to monopolism. I am aware that monopolism does exist in South Africa at the moment. This is something we must prevent. When it is associated with take-overs, as the hon. member for Amanzimtoti said, then in my opinion this poses a danger.

I want to mention a few examples of this. Looking at the paper industry, one notes that at the moment we can import paper at a price 24% cheaper than it is made available in South Africa at the moment. One asks oneself whether this is a healthy situation, since in the same industry, steadily escalating profits are announced every year. As far as I am concerned that is where the problem lies—not in the profit per se, but in the monopolistic trend we encounter in some protected industries. Of course, this ought not to be so. In this regard I also wish to point out that as far as the canning industry is concerned, the can alone at present comprises 46% of the total cost of the product as the housewife receives it. I believe that that is wrong.

I now come back to the Consumer Council. I, too, wish to congratulate them on their tenth annual report. I think they have done very good work over the past 10 years. In a different way to the hon. member for Yeoville who launched the attack, I want to refer to another facet and express my concern in this regard. If hon. members have followed the news reports of the past few days, they will know about the statement of the Prime Minister of Zimbabwe, Mr. Mugabe, who appealed for the co-operation of the churches to help promote the Marxist system on the grounds—and I want to stress this—that capitalism engenders covetousness.

In the tenth annual report of the South African Co-ordinating Consumer Council the following is said on page 12—

I shall come back to this later. However, I want to make the statement that this poses the danger that we shall have to orient the indigenous population to accept a free market system and the benefits it entails, and also to recognize the dangers it entails. The following is said on page 12 of the report—

And further—

The same situation also applies in respect of the Indians. I should have expected that a person like the hon. member for Yeoville or the hon. member for Houghton, who takes such an interest in the Black man and the people of colour, would have supported me when I asked that orientation in favour of the market principle was something we should actively develop and which we could-not afford to neglect in the present situation. [Time expired.]

Mr. Chairman, the hon. member for Yeoville referred, among other things to the importance of creating job opportunities—an apsect with which I have no fault to find—but the hon. member omitted to add another important component, i.e. the importance of the participation of the private sector in the creation of job opportunities, with specific reference to the decentralization policy of the Government. I now wish to discuss this aspect briefly.

At the Good Hope conference, the hon. the Prime Minister pointed out that the Government and the private sector played different roles in promoting regional order. According to the hon. the Prime Minister, the basic responsibility of the Government is to establish, maintain and protect the national and international order in which private enterprise can perform its function of producing goods and providing services. “It is the private sector which combines all the production factors to produce wealth”, says the hon. the Prime Minister. The reaction of the private sector in general to the Good Hope conference, as well as to the White Paper on the promotion of industrial development as an element of a coherent regional development strategy in South Africa, is well known. The aspect to which I want to refer briefly is the role played by the private sector in a particular community, and I should like to refer, by way of illustration, to the example set by the private sector in my region in response to the industrial development proposals of the Government. The region to which I am referring includes two industrial development points, i.e. Newcastle, a border industrial area, on the one hand, and Madadeni Ozisweni in KwaZulu on the other. To evaluate in practical terms the challenge and the importance of the contributions made by the private sector of Newcastle, it will be necessary to place it in the context of KwaZulu. The total population of Newcastle—Whites, Coloureds and Indians—is less than 40 000, as against an unofficial figure of more than 400 000 inhabitants in the two Black cities. Dr. Frank Mdlalose, the KwaZulu Minister of the Interior, once referred to the fact that during the period between 1960 and 1978, 1 900 jobs were created in border and homeland areas every year, as against a conservative estimate of approximately 31 000 jobs which should be created very year in the period between 1981 and 1983. This works out at approximately 130 jobs per day. As far as KwaZulu is concerned, there are fewer than 6 000 job opportunities for Blacks within KwaZulu, as against an estimated labour force of more than 1 million. The question is then correctly asked, in the words of the hon. the Minister—

†On 12 March 1982 well over 400 people attended a symposium on the development of Greater Newcastle. At that meeting the Chief Minister of KwaZulu, Dr. Gatsha Buthelezi, said inter alia the following—

It was furthermore pointed out at the said symposium that industrial development by the bigger institutions was not necessarily the solution to the employment problem among Blacks in the area, but that the establishment on a large scale of small businesses was. The capital cost, e.g. in creating only one job in mining, is R120 000; in the cement industry, R400 000 and in the nuclear power industry, R1 million. The only solution therefore to rapid job creation was to develop opportunities for self-employment and small businesses. It was proposed and accepted that a “Greater Newcastle Development Association” be established, which could study, identify and define the factors which could have an influence on investors in the Greater Newcastle area. The members of that committee, Black and White, were selected from the relevant sectors of the local community and the terms of reference of the committee include inter alia the following: To assess investors’ needs as far as resources and infrastructure are concerned; to highlight the critical areas of the shortage in these field; to identify the factors that may restrict sustained growth and development; to identify secondary industry and other business enterprises that are suitable and desirable for Greater Newcastle; to identify and investigate the channels of communication to be established with central, provincial and local governments and the KwaZulu Government, and all possible development and financial institutions; to formulate appropriate specific development policies and to formulate a development plan for the Greater Newcastle area in consultation and with the co-operation with the central, provincial and local governments and the KwaZulu Government; to solicit assistance and advice from the proposed development bank of Southern Africa, the KwaZulu Development Corporation, the Small Business Development Corporation, the IDC, the proposed PMH Progress and all other organizations which can contribute in any way, and to serve as an advisory body to potential future investors and to act as an intermediary to establish contact between potential investors and the relevant authorities. Mr. D. J. Malan, managing director of Karbochem, concluded by saying—

*The aims of this project present the private sector with a great challenge. Based, from the nature of the case, on the guidelines laid down by the Government, they are co-responsible, together with the public sector, for the development and maintenance of these subnational regions. The necessary measures have now been taken to enable people voluntarily to think and act in concert with others, thereby directly promoting the welfare of the region, but also indirectly the welfare of the RSA. If development is defined as the result of actions which bring greater happiness to individuals and groups of people, the effort of this group of businessmen who took the initiative becomes even more commendable. I trust that the example will be followed by the private sector in the rest of the Republic of South Africa, so that the promotion of industrial development in the regional context may produce some practical results. The opportunity is there, we just have to utilize it.

Mr. Chairman, may I please have the privilege of the half-hour?

The hon. member for Newcastle has made a plea for the private sector to invest in the area from which he himself hails. I think he presented a well prepared case and I hope that for the sake of his constituency, he has success with the development of the Newcastle area.

I now wish to come to the hon. the Minister. Last year I asked him a number of questions pertaining to the apartheid laws in relation to industry and commerce. I recently had a look at the debate in that Standing Committee last year and I found that the hon. the Minister did not give us any answers to the questions I put to him. I want, therefore, to ask the hon. the Minister those questions again, although I do not necessarily want him to give me an answer here and now across the floor. I feel, however, that in the course of his speech today, he should state specifically where he stands in relation to certain laws which, in my view, create adverse conditions for industry and commerce and which I know industry and commerce would like to see scrapped.

The questions that I put to the hon. the Minister were, firstly, whether it was possible for a truly free enterprise system to exist in a society which legislates for racial discrimination. Secondly, I asked whether it was right to deny people the right to seek work anywhere within the system; thirdly, was it correct to deny people the right to site their businesses in the central business districts or even in suburban shopping areas; and, finally, it was correct to deny people the right to take jobs they have been offered simply because of the colour of their skin? I want to elaborate on the last two subjects and, in doing so, I want to quote from the Riekert Commission’s report. We all know that that commission made many recommendations, some of which have been implemented and some not. One of the recommendations which has not been implemented relates to a particular aspect of Proclamations R.3, R.4 and R.5 of 1968. Those proclamations withdrew the exemptions of certain employees, so that—and I am now quoting from the Riekert Commission’s report—

1. (a) A member of one population group was prohibited except under authority of a permit to work as a manager chargehand, supervisor or executive, professional, technical or administrative employee, for a member of some other population group in a trading or business undertaking.
2. (b) A member of the White group was prohibited except under the authority of a permit to be taken into employment in a trading or business undertaking by a member of a non-White group.

I submit, Sir, that by any other name this would be called job reservation.

The reasons quoted by the Riekert Commission is being adduced by witnesses, boiled down to the following—

1. (a) The provisions are of a discriminatory nature and should, in accordance with the Government’s recent undertaking, be abolished.
2. (b) The prohibition on the employment of certain categories of employees was tantamount to job reservation.
3. (c) The measure restricted the job opportunities particularly of members of the non-White groups with university training.
4. (d) The measure deprived members of the non-White groups of the opportunity to gain valuable experience so necessary for the development of business in their own areas.
5. (e) The measure hampered the optimal utilization of the total labour force of the country.

Those are fairly hefty considerations. Finally the Riekert Commission itself recommends that (paragraph 5.17)—

Those were the recommendations of the Riekert Commission some two years ago, but the proclamations have not been altered or amended in any shape or form. I believe that we should know where the hon. the Minister stands on these recommendations. I am aware of the fact that it is not his job to amend them, because this matter falls under another department, but as the Minister in charge of commerce and of industries I believe that it should be his job to intercede with the hon. Minister concerned, on behalf of commerce and industry to ensure that these amendments are indeed brought about. That hon. Minister was always very good at taking a gap as a rugby captain, and I therefore ask him whether he is prepared to take the gap, sitting where he is today, and come out strongly in favour of reform in this particular direction.

You are trying to take a gap where there is no gap.

I am very glad to hear that there is no gap, because if there is no gap, then obviously the hon. the Minister believes that these recommendations should be amended and is about to see to it that they are amended.

The Riekert Commission also reported on free trade areas, and I quote from paragraph 5.18—

The report also quotes the Erika Theron Commission as follows (par. 5.20)—

Then, after a lot of discussion, the commission makes a long recommendation on page 225, a recommendation which boils down to the fact that—

Basically the commission is recommending that there should be more free trading in these areas. I believe that that party has now shed its right wing. I therefore do not think it is going to harm anybody if that hon. Minister now makes a definitive statement on these particular issues, because I have no doubt that these issues harm commerce and industry in South Africa. I therefore believe most strongly that these provisions should be withdrawn. In the last debate on this Vote I also lodged a plea for regulations and restrictions, as they affect commerce and industry, to be reduced to a minimum. The businessman, particularly the small businessman, finds these particular provisions most irksome. As one small example, let me quote from a letter I received in February from a small businessman in a small town in the Orange Free State. He said—

He then goes on to say—

At the time he had the premises, but was not allowed to trade, and I quote his own words: … yet I rent an empty shop in the centre of town, but am unable to open due to a lot of red tape.

I do not think that we can deny that there is a lot of red tape in South African life, but let me lodge a plea with that hon. Minister to try to cut through some of that red tape, with a view to making the situation easier for commerce and industry.

Now I want to deal with another matter which I belive is causing great concern and indeed gives great cause for concern. This relates to the export incentives which the hon. the Minister has recently done away with. We all are aware that our export situation in South Africa is not as satisfactory as it could have been, particularly of course because of the situation overseas and the fact that the economies of the Western World are not as strong or as buoyant as one would like them to be. Secondly, we are aware of the balance of payments problems South Africa has right now because of booming imports and slacking-off exports. Thirdly, it is obviously important against this background that exports should be encouraged. Yet the hon. the Minister has seen fit to withdraw very recently the two most meaningful incentives, viz the incentives relating to, firstly, finance charges and, secondly, freight subsidies.

I believe that a number of things have to be said on this subject. First of all, to an extent I believe that there has been a breach of faith in this instance. Businessmen were aware of these incentives and acted on them. I believe that a number of businessmen invested money because of the fact that they were getting these incentives. They felt they had a competitive edge in foreign markets. They therefore make investments either to increase their capacity and produce additional articles or perhaps to go into a field they had not been in before requiring an investment in machinery, etc. They thought this would provide a return. However, suddenly they find these incentives withdrawn. One must then ask whether industry will be able to invest in exports in future because of Government subsidies. They will now not know from day to day and from time to time whether those incentives will continue to exist. I believe it is most important that industry and commerce should know from the hon. the Minister whether the incentives they are given are going to be for a period of time or whether they can be unilaterally withdrawn at any stage. If this can happen, industrialists will have every right to say: “I should not and I will not invest money in a particular enterprise on the strength of export subsidies, because I do not know where I stand from one minute to the next.”

Industries, I understand, have negotiated long-term contracts based on the assumption that the Government would continue to honour the subsidies. I should like to quote to the House some of the comments of industrialists on the withdrawal of these subsidies. Firstly, it is called “an absolute disgrace”. Secondly: “What has been done is the exact opposite of what is required”. Thirdly, the General Sales Manager of Highveld Steel commented: “The total effect has pushed up production costs R10 per ton”. It has pushed them up by R10 per ton while they are trying to sell in an export market which in terms of capacity is already over-supplied as a result of which every rand makes a difference.

This whole effect, we believe, has been compounded by a number of factors, not the least of which is the increased tariffs on rail and harbour services. Secondly, higher interest rates throughout the country have obviously pushed businessmen’s costs up.

There is the advantageous exchange rate.

Certainly, the exchange rate has made a difference. I would, however, point out to the hon. the Minister that the higher company tax rate has also made a difference. If the Defence Amendment Bill goes through in its present form, which we on this side obviously hope will not happen, this also can increase costs to industrialists in terms of staff going off for longer periods of time. I believe that members of organized industry and commerce have all objected. In fact, in the Financial Mail of 26 March it is said that Seifsa, Assocom, FCI and Safta “will soon meet Industries and Commerce Minister Dr. Dawie de Villiers to plead for a reconsideration of the Government’s shock withdrawal of the two most important incentives to exporters.” I believe the hon. the Minister owes this House an explanation, and I very strongly urge him to reconsider the withdrawal of these incentives. The mere fact that the incentives have been withdrawn illustrates, in my view, a remarkable lack of understanding on the part of the hon. the Minister of the needs of industry and commerce. If he does not reconsider his decision I believe damage could be done to good relationships and understanding between the Government and the export industry, which will not be in the best interests of South Africa. I therefore call on the hon. the Minister to replace these export incentives immediately.

To come now to a matter of more local concern. I should like to deal with the Port Elizabeth area in relation to the hon. the Prime Minister’s Good Hope plan. Last year I pleaded with the hon. the Minister that Port Elizabeth should not be treated as a metropole. In the Standing Committee debate on 7 September 1981, I said the following (col. 426)—

In that same speech I pleaded with the hon. the Minister not actively to discourage investment in Port Elizabeth by way of the withdrawal of incentives. I also pointed out that Port Elizabeth suffered from two most serious disadvantages of high railage and electricity costs. I must say that I am very delighted that the hon. the Minister obviously did take note of my plea last year, and that since that date it has been announced that Port Elizabeth will not suffer from disincentives, and that it has also been given railage rebates, and electricity subsidies as well. I do believe that more should nevertheless be laid on for that area. In this respect I specifically want to mention a deconcentration area.

Every other metropole has its own deconcentration area. Cape Town, for instance, has Atlantis. In order to illustrate what those areas get, I want to quote an example. Atlantis, for instance, gets a rail rebate of 40%. They also get 80% of the total wage bill to a maximum of R70 per worker per month. They receive a training grant, which, of course, everybody receives. They also receive a rental and interest subsidy of 40% for 10 years. They get a housing subsidy of 40%, as well as a relocation allowance and their price preference on tenders is 4%. These are very material benefits that these deconcentration areas get, and every metropole has such a deconcentration area, with the exception of Port Elizabeth. Port Elizabeth does not even have one such area. We know that unemployment figures in that area are increasing. In that respect I can refer to many a newspaper report. Here in my hand I have one. The heading reads: “Sharp increases in East Cape jobless.” This is a report that appeared in the Eastern Cape Herald of 2 February 1982. We are aware of all these problems and I believe that, in view of this, we should have a deconcentration area specifically selected in the relatively close vicinity of Port Elizabeth, a deconcentration area which would get incentives equivalent to those offered to other deconcentration areas.

I believe this is most important because otherwise one could find oneself in a disadvantaged situation. The present areas in the vicinity of Port Elizabeth that do get attractive concessions are all far removed from that so called metropole. The closest one is in the Ciskei, too far away, I believe, to have any real spinoff for the Port Elizabeth area.

There are various other things I should like to recommend, and I want to spell them out at this stage. First of all, I want to make mention of the investigation that was undertaken in the Greater Algoa Bay area. That investigation led to various recommendations which I should like to draw to the attention of the hon. the Minister. It is recommended that there should be more decentralization of Government departments in Port Elizabeth. We know that the Department of Posts and Telecommunications has recently done this in terms of their auditing staff. In doing so they created extra job opportunities in that area. More could, however, be done by Government departments. Another recommendation was made in connection with the small-boat harbour. I have already spoken on this during the course of the session. Lastly, amongst others, there is the development of the irrigation potential of the Lower Sundays River area. I hope to have time to talk on that particular subject at some stage during this session or even during next year’s session.

I do believe, however, that the Eastern Cape in general has been a neglected area. I also believe it is necessary to pay more attention to that area. Therefore I want to ask the hon. the Minister to consider the problems of industrialists in that area with a view to doing some of the things that the survey recommends and some of the things that I have suggested should be done in that area, with particular attention to be paid to the aspect of deconcentration.

Mr. Chairman, various subjects have been mentioned in the course of this debate to which I hope to reply in greater detail at a later stage. The fact is that the Department of Industries, Commerce and Tourism covers a great variety of subjects, and where members raise these subjects during the discussion, time unfortunately does not allow me to deal with each of them in detail. However, I hope to discuss some of these matters at greater length at a later stage.

†I want in the first instance to reply to a few remarks made by the hon. member for Bryanston who referred to my low profile. I am not interested in publicity. In the first instance, I do not think that that is important. What is important, is whether or not I am carrying out my responsibility properly. I think that factor is of more importance. The hon. member went on to ask me whether I accepted certain realities in South Africa and he then quoted a number of demographic statistics reflecting the realities of South Africa. I do not wish to argue with him in regard to the statistics he quoted except to say that the fact remains that statistics can be interpreted differently. In this regard I am reminded of the old gentleman of 98 years of age who argued on statistics that fewer people died after the age of 98 and that therefore he still has a long way to go.

I would, however, like to refer to a point that was raised by the hon. member for Bryanston and also the hon. member for Port Elizabeth Central, namely the old argument that the policies of this Government restrain free enterprise in this country. The hon. member for Bryanston said that the Group Areas Act as well as certain other laws placed great restraints upon the free enterprise system, and the hon. member for Port Elizabeth Central asked me whether it was possible for a truly free enterprise system to exist under the policies of this Government. I dealt with this argument in a previous debate.

*The fact is that the argument of the Opposition that the Government’s policies impede economic development in South Africa because they interfere with and inhibit the free market system is in my opinion a very questionable argument. The fact is that it is not honest of the hon. members of the Opposition to accuse this Government of interfering with the economy and laying down certain rules for the economy on the basis of specific political convictions, while the hon. members on that side of the House would interfere with the economy in a similar way in the light of their own political convictions if they ever came into power. The fact is—and this is the important point—that the hon. members of the PFP do not advocate a free play of economic forces.

Not on a racial basis.

With all due respect, it is hypocritical to suggest that this Government is forcing the specific political convictions upon the economy.

Specifically racial discrimination.

The fact is that the hon. members of the PFP are not in favour of a free unqualified market economy. The socialist aspects contained in their social-democratic philosophy also amount to interference with and distortion of the market economy, the things of which they accuse the Government. There are enough examples in socialist States in Europe of how social-economically orientated Government can interfere with the economy of the country and can even seriously restrict private initiative. The PFP would also interfere with the economic processes in South Africa in accordance with their political and economic views. The important point is that the economy in South Africa would not be any freer if the hon. members on that side of the House came into power.

Yes, it would.

It would not be any freer. The hon. member for Yeoville—unfortunately he is not here at the moment—would be prepared to interfere very drastically with the economy of South Africa in order to promote his social objectives. We can disagree with one another about our political premises, but we must not allege that the one interferes with the economy while the other would not.

Furthermore, I wish to point out to hon. members that although they condemn the NP Government, the South African economy under the NP Government has not only grown remarkably and broadened its base over the years, but has also succeeded in raising considerably the standards of living of all the people.

In spite of the Government!

In saying that, I am not suggesting that our policy is perfect and that it does not also need to be revised from time to time. The processes of constitutional reform in which we are engaged at the moment will also lead to certain economic reforms. There are certain measures, ordinances, regulations and so forth which regulate and in certain respects restrict the participation of people in the market-orientated economic system in the RSA. Many of these measures are related to separate freedoms and the concept of a family of States in Southern Africa and can be justified in the light of these concepts. However, there may also be measures which may have to be adjusted to a new constitutional dispensation.

For this reason, the Government is considering the desirability of recommending to the State President that he instruct the President’s Council to inquire into and make recommendations on measures which restrict the freedom of people to participate in the economic system.

In particular, hon. members of the Opposition must bear in mind that in our society, with its great disparities, there is justification for measures which restrict the free functioning of market forces, i.e. measures which interfere with the economy. The hon. member does not realize how many Coloured and Asian businessmen come to me and observe that measures labelled as restrictive and inhibiting by those hon. members in fact afford them the protection which has also enabled them to develop as an entrepreneurial class. Let us be responsible when we discuss these matters, therefore, and let us do so in a balanced way.

†The hon. member for Port Elizabeth Central has been long enough in this House to know that discussions regarding the Votes of departments of other Ministers take place when their Votes are considered. I should like to advise him to use the freedom of this House, as a full member of this House, to discuss these issues under the separate Votes when they come up for discussion.

Yes, he is always confused.

The fact is regarding the Riekert Commission that a White Paper has been tabled to explain the Government’s point of view.

But nothing has happened since then! [Interjections.]

A matter which has also been referred to by various speakers on this side of the House, and which I should like to touch on briefly, is the question of inflation and price increases. It is true, as the hon. member for Vasco indicated, that it is possible for the Government to intervene in a drastic way and to force down price increases to lower levels, but this can only be done at a price. It is not possible simply to curb inflation without any cost to the economy. In this connection there was a very interesting article in The Economist of 13 March 1982. I should like to quote from it—

†The hon. member for Amanzimtoti in a very constructive contribution on inflation also referred to some of these aspects. The reality remains that any Government can reduce inflation, but at a price. During 1981 the inflation rate as measured by the consumer price index accelerated to 15,2% on average for the year as a whole. During 1981 the South African economy reached the peak of an upswing which started in 1978. In this process the inflation rate accelerated from a low of 11,1% during the trough of the business cycle to the 15,2% during 1981. I think we are all in agreement that an inflation rate of 15,2% is unacceptably high. However, the appropriate monetary and fiscal policies of the Government should gradually begin to show an effect upon the inflation rate in the near future. It is important to note in this respect that the inflation rate accelerated by only four percentage points over the full business cycle, namely from 1978 to 1981.

I regard it as a great achievement on the part of the Government that it was able to exercise such remarkable control over inflation during the upswing of the business cycle.

It must be kept in mind that the restrictive monetary and fiscal policies announced earlier this year will have an effect in the remainder of this year. The position at present is that monetary demand is still too high in respect of productive resources and the measures announced by the hon. the Minister of Finance should have a contractionary effect on consumer finance and on the ability to spend towards the end of 1982. We can therefore expect the inflation rate to be contained towards the end of the year.

Regardless of inflation, a point which is very often overlooked remains, namely that real wages and salaries per capita in the non-agricultural sector in South Africa increased by 3,5% during 1980 and by a further 4,4% during the first nine months of 1981. These statistics show a material improvement in living standards in general. We must never forget that regardless of the unacceptably high inflation rate, the vast majority of people in this country have improved their positions over the past few years.

That certainly does not apply to the elderly.

I said the vast majority improved their position. I am not one who believes that a single factor can be identified as the cause of inflation. An hon. member referred earlier to budget financing. I have with me an article written by Prof. Robert Solo of the Massachusets Institute of Technology under the heading “All simple stories are wrong”. I quote from the article—

He then names the four and the first simple story about inflation is that its underlying cause is deficit spending by central Government. It has an element of truth, but it is in fact a more complicated matter. After listening to the speech of the hon. member for Amanzimtoti today, I must admit that apparently after he had read the Competition Board’s very meaty report he made a very good contribution to the debate on inflation this afternoon. The fact is that over a period of time certain structural changes took place which made society more susceptable to inflation. We have a high degree of built-in inflation in our economy. The economy over a period of time lost its flexibility and adaptability. The main reason for this has been the distortion of market forces through, to name but a few; bureaucratic interferences like price control and a host of subsidies; the lobbying of pressure groups; and particularly the collective escalation of demands made on the conomy by a society which is expecting the Government to take more responsibility in almost everything.

A well-known American economist, Alfred Kahn, commented on the permissiveness of modern economy, and I quote him—

*Reference has also been made this afternoon to competition. Competition is a basic prerequisite for the proper functioning of the price mechanism. In actual fact, it is only the discipline of competition which causes a free market orientated economy to function in a meaningful way and which also eventually contains excessive price increases to the great benefit of the consumer. South Africa has a relatively small economy, and because of the market structues, competition is not always what it should be. The problem is aggravated by a matter to which several speakers referred here this afternoon, namely the forming of bigger groups. The Government has on several occasions expressed concern about the large degree of concentration which exists in the South African economy. We are concerned about the forming of bigger groups and the weakening of competition which may result from this. For this reason, the Competition Board has been instructed to give specific attention to this matter, and I can assure hon. members that the Government will not hesitate to take action against any restriction of competition, within the powers conferred upon it by the Act. I have already had talks with the chairman of the Competition Board to consider amendments to the Act concerned so as to enable us to take even stronger action against the forming of an unnecessary concentration of power which could restrict competition. In a debate earlier this year, I appealed to big groups and organizations not to take the line of least resistance by resorting to take-overs when they are planning for expansion and further investment. I appealed to businesses to make a creative contribution by rather starting new enterprises from scratch. It would be of greater benefit to the economy if they would use their capital and management expertise in such a way. Such a course would inevitably promote competition.

I also wish to refer to the somewhat one-sided remarks, in my opinion, which have been made this afternoon about big business. The hon. member for Yeoville, who unfortunately is not here at the moment, delivered a tirade about consumer protection. I really want to say that the tone adopted by the hon. member for Yeoville this afternoon does not become a member with his knowledge and ability. I am afraid that the hon. member was not really concerned about consumer protection. The vague, imprecise terms in which he attacked big business in South Africa, without mentioning any specific examples, created the impression that the hon. member, who seems to be a socialist at heart, is so strongly opposed to big private enterprises that he actually tried to discredit them in an irresponsible way.

He hates Oppenheimer.

We must not only refer in vague terms to firms which make big profits. In what terms are those big profits expressed? We must look at the investments that are required and the return on those investments. The development in South Africa over many years, in the industrial field as well, is due to the fact that businesses were prepared to invest again and again. If we were to create a climate in which the incentive to the private sector to invest were gradually to disappear, we would be harming our economy in a way which would be to the detriment of us all.

Is it true that there have been only two determinations under the Act?

I shall come to that. If we want further development and growth in this country, we must encourage the private sector to invest more in order to create more job opportunities. Then, as the hon. member for Vasco said, profit should not be a swear word among us. The returns and profits of companies must be seen in perspective. The hon. member spoke about companies which made big profits. Companies have various off-shoots which may contribute to those profit figures, and when we discuss these matters, especially in this House, we must express a responsible opinion about companies, and not just refer vaguely to big profits that are made.

The cement industry, which was specifically mentioned by the hon. member, is an industry which has been properly investigated by the department and the Competition Board over a long period. It is our conviction that the necessary profits will also have to be made in this industry so that it may be encouraged to invest in the creation of further capacity in South Africa in a highly capital-intensive industry. However, by casting suspicion on big companies, as that hon. member has done, we are not promoting the well-being of the South African economy. That is why I say that we must be careful when we speak, even when we speak about take-overs, because a take-over often means that a company is actually beginning to go under, especially during a downturn in the economy, and is being saved, as it were, by a take-over. Not all take-overs must be condemned per se.

The hon. member for Port Elizabeth Central also referred to the curtailment of our export incentives. In this connection I want to tell the hon. member that we must act responsibily in the present circumstances of the South African economy. It has been necessary for all departments to cut back on expenditure with the greatest discipline. I can tell the hon. member that all contracts will be honoured, but we also had to reduce expenditure. We eventually decided to phase out the category C incentives. Although we were sorry to do this, hon. members must bear in mind that the exchange rate is strongly in favour of the exporters. At the FCI congress, which was held only last week, it was also made clear that exporters who could not make use of their opportunity and of their advantageous position to export in this climate should really examine the state of their affairs.

A final remark about inflation is related to productivity.

†I have referred to the complex problem of inflation and to the fact that it is so easy to blame the rise in prices and the extent of inflation on the Government. But people tend to forget, and I should therefore like to make a general appeal in this regard. People must remember that their wage and salary increases, if not supported by concomitant increases in productivity, are in no small way contributory to inflation. A study undertaken by the National Productivity Institute for the period 1975 to 1978 showed that at one stage an 18% increase in wages coincided with a 2% drop in labour productivity. This must have fueled inflation. One simply cannot give people more and more money to spend on goods and services if this is not met with an increased supply of goods and services. Inflation breeds inflation.

During 1981 the average labour cost per worker in manufacturing rose by 22%, while productivity per worker rose by only 6%. In a determined effort to live within its means and to slow down inflation, the Government has drastically curtailed expenditure and, as I have said, it hurts; it is painful. We in the department, for instance, had to terminate one of the programmes of export incentives that we would have liked to continue.

Monetary and fiscal policies were announced earlier this year that will certainly bite into inflation during the remainder of the year, and I therefore believe it is not unreasonable also to appeal for restraint in wage and salary demands.

The Economist in the article to which I referred earlier, makes a very true observation when it says—

I know that in their commitment—a very laudable commitment indeed—to close the wage gap, some South African companies are prepared to over-compensate the workforce for the inflationary pressures. However laudable the objective of closing the wage gap, it must be implemented in such a responsible way that it does not fuel inflation and reduce productivity to such an extent that the wellbeing of the South African economy is adversely affected to the detriment of the very people who receive the wage increases.

I hesitate to comment on salary increases to any particular group. However, regardless of the merits of a particular industry, it is staggering to read of salary increases of 40% to 100%. It causes concern to read of the magnitude of such increases, and one wonders whether we will ever be able to beat inflation if this practice becomes the pattern. In The Financial Mail of 30 April under the heading “Clothing Industry doubling up” one reads for instance the following—

*If employer and employee do not exercise greater discipline, the extent of inflation in this country will keep growing and it will become more and more painful and difficult to contain it eventually.

South Africa cannot afford large-scale unemployment, nor can we afford a low growth rate. The hon. member for Bryanston referred in his speech to the need for growth in the country to create the necessary job opportunities. The painfull effects of such a situation would be detrimental to us all, and therefore I wonder whether we cannot make it our guiding principle, and whether we cannot convey this principle to the public outside as a message from this House, that in the year that lies ahead, everyone in South Africa should refrain from taking more out of the economy than he or she is prepared to put back into it.

If we forget for a moment about complex economic theories, even about inflation, to speak in the language which everyone can understand, every person in this country can make a constructive contribution, together with the Government, towards containing inflation simply by working harder and demanding less for himself. Is it not possible that for the sake of the common benefits this would hold for us all, everyone in South African could unite in an attempt to create a climate in which it would be possible for us to undertake to work harder, to work more productively, and to demand less for ourselves? By means of a sacrifice which is now being called a gimmick by the Opposition, the Government has tried to set an example of what can be done if people are prepared to make a sacrifice and to give up their salary increases. Hon. members on this side of the House co-operated in a very laudable way to give momentum to this effort. I really find it regrettable that the hon. Opposition should dismiss it as a gimmick.

[Inaudible.]

If all of us in this House could set that example, I believe we would be in a better position to expect cooperation in South Africa.

The problem of productivity in the South African economy is one which is giving cause for great concern. In a speech in this House, the hon. member for Florida recently referred to the low levels of productivity maintained in this country. The extraordinary salary and wage increases, which are not accompanied by a corresponding improvement in productivity, are giving rise to serious alarm. The competitiveness of the South African economy, in this country as well as abroad, is being seriously affected by this. Therefore one is not surprised by the fact that the Board of Trade and Industries is continually being inundated with further requests for higher tariff protection. During the discussion of this Vote last year, I dealt at length with the Government’s protection policy and I pointed out that the policy was to give protection to industries in cases where this was justified, as long as that protection was applied moderately and selectively and did not place an undue burden on the total cost structure of the South African economy. In dealing with the requests for protection, several aspects are definitely taken into account. Attention is given to the contribution made by the industry to the national product, to its employment potential, its contribution to the development of experitse, etc. However, I am more and more convinced that the effectiveness with which industries utilize their resources, as well as their productivity, should be among the most important criteria in deciding about protection. The export potential of industries in South Africa is also being affected by excessive tariff protection which is granted in some cases.

The whole approach to the utilization of resources by industry requires serious consideration. The hon. member Dr. Marais referred to the need for an industrial strategy. He also referred to previous investigations in this connection, in connection with import replacement on the one hand and export promotion on the other. I can tell that hon. member that Dr. Klue, who for quite some time has been investigating industrial strategy—as that hon. member knows—has told me that he has completed his task. He has indicated that his project is now in the final stage of being processed, and we hope to receive the report in the course of this year.

In an industrial strategy, attention will also have to be given to the utilization of resources by industry in general. It appears from investigations that although industry has become the biggest single contributor to the national production, it has not yet caught up with the primary production sectors in respect of productivity of income creation—i.e. income created relative to the capital expended—and of their contribution to the balance of payments. Moreover, the employment capacity of industry is not yet greater than that of the primary production sector either. Up to now, the industrial sector has grown mainly by utilizing more sources in the production process and not so much by increasing its productivity. Therefore an urgent attempt will have to be made to improve the economic potential of the South African manufacturing industry.

It is essential that exports should play a bigger role in the South African economy than they have up to now. The hon. member Dr. Marais also referred to this. It is essential that more industrial products be exported so as to reduce South Africa’s dependence on gold mine production. Increased industrial exports could make an important contribution to the creation of more employment in South Africa, to the strengthening of the balance of payments and the many other benefits arising from this.

However, potential exporters often complain to us that because of the high cost of inputs, especially of raw materials, they cannot compete effectively on the international market. It is alleged that the Government’s protection policy is to a large extent responsible for increased input costs. This objection is also addressed to the Government by certain branches of agriculture. Although in most cases, and for good reasons, agricultural products enjoy full protection against foreign competition, sometimes to the detriment of the consumer in the short term, it is alleged that the high input costs resulting from the State’s protection policy have an adverse effect on their competitiveness abroad. The implication is that the competitiveness of the agricultural sector is being harmed by the protection policy of the Government, with the result that surplus agricultural products cannot be exported competitively to international markets. The competitiveness of agricultural products, in fact, the whole economic position of this sector, is influenced by various factors such as the cost of capital, price policy, productivity, etc.—matters which are at present being investigated by the Jacobs Committee. In order to examine the validity of the objections of industry as well as agriculture in respect of our protection policy, and to find out what effect it has on the cost of products on the domestic as well as the foreign markets, I have decided to instruct an outside agency to investigate this matter. Further particulars about its terms of reference will be furnished shortly.

For certain reasons, the cost structure of some South African industries is higher than that of overseas manufacturers. Our manufacturers then desire a measure of protection. As soon as the industries are faced with more competition from abroad, requests are made at higher levels for protection. Of course, import control and high tariffs on imported products with a view to protection are also factors which contribute to a high inflation rate. If we want to reduce the inflation rate in South Africa, we shall have to allow the discipline of the market to operate with regard to the industrialists as well. This will only be possible if they can also be exposed, on a reasonable basis, to competition with the imported product, so that they will also have to exercise more discipline with regard to their own cost structure. Of course, the South African industry must grow so that enough job opportunities may be created, but it will definitely be much better for this growth to take place in a situation where inflation is absent or at a low level. In our struggle against inflation, we shall have to ensure that South African industries do not receive undue protection.

Various matters have been raised by hon. members which I should like to discuss later. Since the hon. member for Yeoville has now joined us, I just wish to come back to one or two aspects to which he referred. I have already reacted to his tirade about consumer protection, so I am not going to discuss that again. However, the hon. member also spoke about a total lack of strategy; as if the Government were simply groping around in the dark, in the industrial sphere as well. However, a White Paper was tabled here a short while ago, at the beginning of April, in which a very clear industrial strategy is set out. Even this does not give the total picture. That I want to concede to the hon. member at once. It is only one aspect of a strategy which also involves several other intentions on the part of the Government, in the labour field and in other fields as well. It is true that there is room for further attention to be given to this matter, as the hon. member Dr. Marais rightly said. What the hon. member for Yeoville said, however, gave me the impression that he had not even opened the White Paper and acquainted himself with its particulars. [Interjections.]

[Inaudible.]

Yes, the hon. member gives the impression that the White Paper deals with industrial decentralization in very vague terms. There are very specific indications in the White Paper, by means of which clear guidelines are laid down for industrialists who are interested in further investments.

Allow me to react to only one of the arguments which the hon. member dragged in here by the hair. The hon. member said that it was time that something was done about a strategy for promoting labour-intensive industries as well. However, this is in fact one of the most important differences between this package of incentives and any previous package of its kind.

Do you not understand or do you not want to understand, Dawie?

Not only have the levels of incentive with regard to employment been considerably increased, but in the new dispensation, as from 1 April 1982, the emphasis is mainly on compensation for the creation of employment. I really want to advise the hon. member for Yeoville to study the White Paper so that we may on a future occasion have a meaningful discussion about its value and about the strategy contained in it, which I believe is going to make an important contribution to the promotion of industrial development in South Africa.

Perhaps, since I have the opportunity, I should tell hon. members that at its first meeting, the Decentralization Board identified a number of problem areas which are receiving urgent attention. Subcommittees have also been appointed to give attention to these matters. In order to enable the Decentralization Board properly to perform its co-ordinating function, the board must consist of knowledgeable people, who will be representative, in the first place, of the department and of bodies closely involved in the implementation of policy. In the second place, however, it must also have representatives of the private sector so that the private sector may also have the necessary say. Naturally, representatives of the private sector will not give attention to specific applications during the daily administration of the board, but will only deal with aspects of policy. Urgent attention is being given to this matter.

In the same way, the practical problems involved in finding an acceptable formula for the granting of aid to small industries and to the informal sector are being actively investigated. Certain proposals have already been made in this connection, and a subcommittee is working out the details of these.

Other matters which have received the attention of this board are those with regard to other industrial points and locality-bound industries. At some of those places, serious concern has been expressed about the fact that there are established undertakings at those industrial development points. However, since they no longer appear on the list of development points, industries can be enticed away from them. The chairman of the board, Mr. De Beer, intends to visit these areas shortly. These matters will then receive urgent and sympathetic attention. I am thinking in this connection of places such as Rustenburg, Heilbron, Phalaborwa, Stutterheim and Worcester—places which used to receive aid but which no longer appear on the list of development points.

Finally, I just want to point out that this new dispensation has been very well received, that the announcement was followed by a positive reaction from several quarters, from abroad as well. The Decentralization Board has been inundated with applications since April. I am told that more than 300 telephone calls and enquiries were received on one day. The chairman of the Decentralization Board, Mr. De Beer, whom I also want to congratulate and whom I want to wish every success in his great task, addresses various meetings and conducts interviews every day, and on all these occasions it is clear that industrialists are very much interested in the benefits which this dispensation will hold for them as well. I believe that this new decentralization package will do much to encourage a better distribution of economic activities in South Africa, which will also benefit those areas in South Africa that have lagged behind.

Mr. Chairman, this afternoon I want to associate myself with what the hon. the Minister and other hon. members had to say here this afternoon. The hon. the Minister gave a very detailed discussion of the importance of the principle of productivity which is part of the growth process of any industrialized country.

Without wishing to sound dramatic I want to suggest that South Africa is probably a country with a false sense of security. It was pointed out very clearly here this afternoon by the hon. the Minister and other hon. members that our growth, which was described a few years ago as one of the highest in the world—admittedly a fine achievement and not as the Opposition suggests in spite of the Government’s policy, but because of the Government’s sound policy and discipline in the economic field—was perhaps too closely correlated to minerals, the mass of production and price at which they can be exported, and not closely enough to our productivity in the manufacturing sector. After all, labour productivity remains one of our greater assets, because minerals are a dwindling asset, people are not. I know that comparisons can be very misleading, but surely one must have a yardstick against which to measure things. In pursuance of what has been said here this afternoon in connection with productivity, I want to indicate precisely how our productivity compares with that of other countries and what could perhaps be done to improve this position.

In the first place I want to refer to Taiwan, which like this country is a Second World, developing country, and single out certain facts which appeared in an article in Industrial Week of 6 April 1982 under the heading “Productivity shock for South African workers”. In this article a leading South African industrialist alleged that the productivity of one Taiwanese worker in the clothing and textile industry is equivalent to that of seven South African workers, which is a perturbing comparison. It is therefore no wonder that the comparative figures for the growth in the per capita GDP paints the following picture. During the period 1972 to 1980 South Africa’s annual growth rate was 0,28%. In contrast Taiwan’s annual growth rate was 6,83%. In the same article the same industrialist alleged that the annual labour turnover—and this is staggering—in the South African clothing and textile industry is 60% or more.

Taiwan is a country poor in natural resources. To a great extent it has to import its raw materials and minerals, process them and export them again; in other words, what it is actually selling is the labour capacity or productivity of its people. In spite of this its growth rate during the past few years has usually been equivalent to our inflation rate and their inflation rate corresponds to our growth-rate, which is an excellent state of affairs.

From the foregoing it is clear that we shall have to give very close attention to the question of productivity. According to experts some of the major reasons for our productivity problem—and I shall only refer to two of these—are inadequate training and the resultant lack of expertise, particularly at managerial level, and the almost total absence of an awareness of the need for productivity among a large section of our population and our workers.

As far as the training problem at managerial level is concerned, I can just mention that in South Africa there is a ratio of managerial staff to workers of 1:42. In the USA this ratio is 1:6. In addition, as a result of the tremendous demand for managerial staff, many people in that sector are not really equal to the task, but find themselves in that sector owing to the demand. We all know—no one can deny this—that management is the primary and sole determining factor in regard to an increase in productivity because they co-ordinate and control all the components of the production process.

In South Africa—to give a further example—200 engineers and 90 engineering technicians are trained per million of the population. In Taiwan the figures are 360 engineers and 580 engineering technicians. We know that this tremendous difference is to a great extent caused by the population structure in South Africa, but I am sure no one disputes the fact that we shall have to give a great deal of attention to this.

As far as the absence of an awareness of the need for productivity among a large sector of our population is concerned, we can say that this is probably the result of the rural background of a large sector of our labour force—particularly the coloured labour force—who as a result of their subsistance economy psychosis are unaware of the concept of productivity. This is probably also the result of a superabundance of production resources in South Africa, which in the past allowed the economy of South Africa to grow merely by consuming these production resources.

It has therefore become necessary in South Africa the concept of productivity to be explained and taught to our children, even at primary school level. Productivity should no longer be an interesting subject for debate, but our entire education system should be aimed at making our people more aware of productivity and making productivity a way of life in South Africa as is the case in such countries as Japan and Taiwan.

In addition there must be a campaign against the tremendous labour turnover in South Africa, which I have already mentioned is as high as 60% in certain industries, because a labour turnover on such an irresponsible and massive scale results in many of our workers never achieving their maximum potential, because maximum potential is only achieved if a person’s training is successfully linked to experience in the same work situation over a long period. In addition one finds that every time these workers change their work category they must in fact be retrained and this places ever increasing pressure on training staff and facilities in South Africa, which as a result of the tremendous demand are already overworked.

All things considered, there is also the fact, as I have indicated here, that in the past there was an incorrect ratio of remuneration to productivity. As a matter of fact, there were periods when we had negative productivity and escalating salary structures. We shall have to see how we can motivate our people to become stable and dedicated workers who will make a point of ensuring that their productivity keeps pace with their scales of remuneration. If we can do this we shall in the first place be combating inflation and we shall be in a position to be more competitive on the world market.

In conclusion I want to quote an excerpt from the report of the National Manpower Commission on High-level manpower, 1980. An expert, Mr. Holloman, is quoted—

If this is South Africa’s ideal and we realize it we shall be achieving a great deal and I am in fact making an appeal to the hon. the Minister in this connection. I know there is co-ordination between him and the other departments involved in training at all levels. I am appealing for better and more dynamic co-ordination and actions to motivate our people so that we can achieve these ideals.

Mr. Chairman, the hon. member for Sasolburg dealt most effectively with the problem of productivity in our country and suggested certain steps to overcome this problem. I think he discussed a very important matter and I want to agree with him that productivity and earnings are probably two of the most important factors in the entire inflation set-up. I think the hon. member touched on the crux of the matter.

Whereas hon. members discussed very important matters regarding the commercial and economic life of this country, I want to discuss a more practical matter and make representations in this connection. In a democratic country the economy and the business world are very important aspects and that is why the task of the hon. the Minister and his department is so important. We want to wish them every success in the tremendous task they must carry out in the interests of the country.

I should like to discuss the retail trade, because the hon. the Minister’s department is involved with licensing etc., of the trading sector in general and the retail trade in particular. I should like to refer to the retail trade in the Black and Coloured towns and suggest that trading in these areas is not progressing satisfactorily. It is important that well-planned and purposeful attention be given to this, because it is an indispensable facet of well-balanced urban development. On various occasions in this House we have heard how important it is that these towns and cities develop in a healthy and balanced way. I want to suggest that if trading activities in those towns are unsatisfactory their overall development cannot be satisfactory. In this connection the request I want to make is that where problems arise, for example where a trading area is not available, or where the necessary zoning for a trading area does not exist, this should receive active attention. This is also one of the most effective ways of solving the problem of congestion in White cities and towns. One frequently hears complaints of congestion at retail business undertakings and service points in White towns, and I believe we must approach this matter in a positive way by giving people of colour their own retail service points. In this connection I am not only thinking of the large metropolises; this also applies to our average-sized country towns. This problem is being experienced everywhere and I think it can be solved by developing trade in Black towns in particular. To develop an orderly trading pattern in Black towns a committee should be appointed to investigate the matter and find practical measures to ensure and promote the establishment of entrepreneurs. It may be argued that we have a committee to investigate virtually every matter we advocate, and that we have a multitude of committees of this kind. This may be true, but this matter should be investigated in a practical way and it should receive the necessary attention. I believe that if this committee were to consist of businessmen who have practical experience and members of Administration Boards, Black city councils and retail trade experts, something worthwhile could come from such an investigation.

In most Black towns there are at present no retail businesses which provide a proper or satisfactory service for the inhabitants of those towns on a competitive basis. In fact, it has been alleged that some of these business undertakings exploit their own people. The reason for this is that many of these people work elsewhere. They leave home early in the morning and they return late at night. They are sometimes forced to purchase certain items from those businesses and they are frequently exploited.

I also want to request that an investigation be undertaken into the liquor trade in Black towns. At present it is still the practice for the Administration Boards or the authorities to be responsible for this trade. I think an investigation should be undertaken to see whether the private sector could provide this service on a more satisfactory basis. It is general knowledge that there are certain malpractices in Black cities, owing to the fact that these people do not have the necessary services. I feel this is one way of finding a solution to the problem.

I think special measures will have to be adopted, particularly in the initial stages—although I do not want to suggest that this will solve the problem—to establish a trading pattern. I am referring to the large compounds built by the mining authorities. They give a dealer the right to trade there for ten years, for example. This person is given a sole right and the practice differs therefore from what happens in the Black cities. I am only citing this as an example. For ten years that person can trade there. He must construct the buildings at his own expense according to the specifications and plans of the mining authorities and at the end of that period he must hand the buildings over to them free of charge because it then becomes their property. There are various ways in which this matter could be promoted.

I do not want to suggest that it should be done in this way because I do not have the necessary information. What I do want to ask however, is that active steps be taken to establish the retail trade in our Black towns on a proper basis, for the reasons I have just given. I feel that it is not only in the interests of the people living in those Black towns but also in the interests of the residents of White towns, because we are faced with this problem every day. For people who do not have their own transport, it is very inconvenient to buy their provisions in the White city and then have to make use of public transport. I think it is only fair that these people should have service points in their own residential areas where they can buy their provisions.

Mr. Chairman, the hon. member for Welkom raised a very interesting and important point but, unfortunately, because of my limited time, I cannot go into it further.

One of the basic problems in regard to our retail trade is—if one looks at an area such as Johannesburg, for example—that the Black community works in Johannesburg and therefore tends to shop in Johannesburg. One has actually reached the stage now that if one were to suggest to the businessmen in the central business district of Johannesburg that the Blacks should not shop in Johannesburg but in Soweto, I think there would be an uproar because, to a large extent, their businesses have been built up on Black clientele. However, the question I should like to raise today is a somewhat different one and that is one that relates to the question of small businesses. A number of other hon. members have touched upon this subject, but what worries me is that we sometimes feel that if we say that small businesses are important we have in fact done sufficient to generate small business development. I particularly want to raise this matter because one of the unfortunate effects of the slowdown in the economy is that small businesses are the first to suffer. This is not unique to South Africa. When one looks at a country like the USA one sees that it is estimated that for every five new businesses that are formed four eventually disappear, three as a result of poor management. The problem is that if small businesses make one managerial mistake it is often fatal for them; often they cannot hold out against the vicissitudes of the economy. However, big businesses are fortunate because in the past years they have built up the fat to overcome their present problems, their misjudgments or happenings in the economy. Let me just refer to two examples. I read in Business Times, and I am sure the hon. the Deputy Minister has read it too, that at the present moment De Beers is borrowing R3 million per day to pay for its diamond stockpiles. How many companies are there that could stockpile at the rate of R3 million per day? We would eliminate half of South Africa’s business community. I should also like to refer to an organization such as Iscor. Look at the losses they incurred two or three years ago. There are few businesses that could survive that sort of loss. I think the disappearance of any small business is something to be regretted because I think small businesses are one of the best investments that any country can make in its economy. I want to motivate this in a number of ways.

Firstly, when one looks at those countries that have grown rapidly in the economic sense one notices that the small businesses have played a very prominent role. Let us take South Korea as an example. It is estimated that in 10 years’ time the gross domestic product of South Korea will be equivalent to that of France. When one considers where South Korea was 20 years ago, this is an incredible achievement. What is interesting is that in South Korea in 1970, for example, small enterprises received a quarter of all loans granted to private enterprise. By 1978 this had grown to over 40%.

Another country that is considered to be one of the economic miracles of the world, namely Japan, has 5 million small businesses. They get 47% of all money loaned by banks. These 5 million businesses employ 80% of all the workers in the private sector. I should like to contrast this with an economy like that of the United Kingdom where it is estimated that in the manufacturing sector small businesses have declined by more than 50% over the past 30 years. There small businesses get 13% of the money loaned by the banks. When one contrasts that with a dynamic economy such as that of Japan or South Korea I think the lesson is there that small businesses seem to go hand in hand with dynamic economic growth. I think that small businesses are particularly important in South Africa. One reason is that we need to create jobs. Another thing that concerns me is that when we talk of productivity there is a trade-off between productivity and job creation. South Africa could be mechanized and the productivity per employee would increase dramatically, but would the economy be better off? In South Africa we need to balance the need for productivity with the need to create jobs. I want to quote as an example what happened in the USA. Between 1969 and 1977, 9 million new jobs were created in the United States. One-third were created by the so-called State sector, i.e. the public sector. Of the remaining 6 million, which were created by the private sector, half a million were created by the top 1 000 companies in the USA. The balance of 5,5 million job opportunities were, in fact, created by the second-tier and smaller companies. If one just looks at what happens in business today, one knows this to be true. Big businesses are tending to mechanize and to computerize and, in fact, their labour complement either stays constant or is reduced.

I think there is a second fundamental reason why we should encourage small businesses in South Africa, and that is to spread wealth. I think that few have said it more eloquently than Anton Rupert when he said—

I think that in South Africa it is critically important that we not only tell the non-White community how good the free enterprise system is, but actually allow them to enjoy the wealth created by that system, in other words allow them to enjoy the benefits of that system. This I believe is critical as far as the long-term security of South Africa is concerned.

One can talk at the macro-level about how important small businesses are, but in a constituency like mine which is not a decentralized area but still has to compete with other areas in the region for business, it is the small businesses that keep the constituency going. If one closes, the income of the whole constituency is reduced and all suffer. If new small businesses come in, the income of the area is increased and we all benefit. It is the small businessmen who actually fix themselves their because it is not all that important to the big operations whether they should be in Edenvale, Benoni or Brakpan, but a small businessman who lives in Edenvale wants to work in Edenvale. My concern is that with bank credit at 20%, small businesses are going to suffer. I know that the Small Business Development Coporation has a capital of R150 million. That is a good thing, but I just want to place the matter in perspective. In Taiwan with a population of 17 million, the Small Business Guarantee Fund granted guarantees of R120 million in 1978 and R180 million in 1979. This is an average of R150 million per year. I just want us to bear this in mind, when we talk of what we are doing for small businesses in South Africa. We should realize the extent of the problem.

I do think that there is one thing we can do for small businesses. The hon. the Minister referred to this a little earlier. The problem relates to the web of bureaucratic and administrative measures that small businesses are subject to. I know that in my constituency there is one that is particularly annoying. I am referring to the question of employing labour, because the relevant rules and regulations hamper the small businessman when it comes to getting labour. I should just like to quote to the hon. the Minister, from a local newspaper, one of the comments made by businessmen. Firstly there is this one—

Then there is this comment from another businessman—

Here is a comment from another businessman—

By the time one has found hostel accommodation, have paid for beds and got the passes sorted out, one asks oneself whether it is all worth while. One wonders whether one should not take one’s money and just invest it at 17%or 18% without any of the hassles involved. We have to try to help small businessmen to sort out these problems so as to make it easier for them to operate. If we allow these sort of things to continue in South Africa, eventually all of us will suffer.

Mr. Chairman, the hon. member for Edenvale made a very interesting speech here this afternoon about the value of the small businessman in our economy. I have detected a great upsurge in the numbers of Black people entering the small-business field as they become more urbanized. They undoubtedly have a job-creating ability and I think we are doing as much as we can to assist the small businessman. I am sure that hon. member wll excuse me if I do not comment further on this speech.

*Mr. Chairman, it is very clear that the Government is fully aware of the necessity of a well distributed economic growth, particularly if cognizance is taken of the recent statement by the office of the Prime Minister with regard to a co-ordinated development policy. The announcement of a variety of incentive measures to lend support to the idea of principle of decentralization, is aimed at inter alia emphasizing the creation of work opportunities and involving the private sector in the promotion of industrial development to a greater extent.

The hon. the Prime Minister and the Government have already succeeded in establishing a partnership between the public and the private sectors, despite purposeful and sustained efforts on the part of some people to wreck this partnership. In my opinion, even the prophets of doom have to concede that a great deal of progress has already been made in this regard. This is a partnership in progress, and the hon. the Prime Minister has already expressed himself as follows in this regard—

The seriousness with which the Government regards this whole matter is apparent from the fact that the expenditure under this vote, specifically under the heading, “Industrial Decentralization”, has increased from R56 million to R106,5 million, with the main aim of financing the package of incentive measures that has been announced. This policy has been developed and consensus has been reached with our neighbouring States. Occasionally this demanded long, difficult and involved negotiations. The Government’s earnest desire to make this policy succeed, cannot therefore be over-emphasized.

The fact that the Eastern Province, the Ciskei and Transkei have been singled out as the highest priority in respect of development needs, is in complete agreement with reality. Initial indications showed that this region “D”, the area around East London, would be specially singled out for incentives, and I think that this means that there is a possibility that Port Elizabeth and Uitenhage, too, will be at an advantage should large-scale development take place in the East London area, as it is still in the sphere of influence of the two places mentioned.

The latest announcements have also indicated considerable incentives for Port Elizabeth and Uitenhage. These measures are aimed particularly at eliminating the settlement disadvantages of the most important industry in that region, viz. the motor industry. A standpoint which has long been held in this area has now been acknowledged, viz. that although the Port Elizabeth-Uitenhage region is regarded as one of the four metropolitan areas in the Republic, it should be dealt with entirely differently from the larger metropolitan areas as a result of the composition of its industrial basis, its situation and population, and the fact that it also has special and distinctive problems. Because these realities are now being acknowledged, there has been a very positive reaction from organized commerce and industry. For example, I refer to the headline in the Evening Post of 17 March, “Concessions for E.P area welcomed”, and in the 10 April issue, “Boost for E.P. hailed”. Apart from this, the Eastern Province Herald also placed a leader under the heading “A bail-out for PE and Uitenhage”. Unfortunately, the only negative noises resulting from this, were, of course, from the two hon. members of the PFP in our area. The headline of the Evening Post “Boost for E.P. area hailed”’ was followed by “Mixed response to incentives from the local M.P.”, and this was followed by the usual negative emphasis these hon. members place on announcements of this nature.

I also wish to quote what one of the prominent local industrial leaders, Mr. Peter Searle, had to say in a letter addressed to me—

The timing of this announcement was also very apt from a point of view of trust. This region is still struggling with a disturbingly high unemployment rate. Large-scale unemployment at a time when the chief industry in the area is experiencing unprecedented prosperity is, of course, cause for concern. It is to be hoped that the package of incentives will assist the factories not only to remain competitive with the PWV area, but also to carry out the extensions necessary for even greater possibilities of employment.

The authorities have therefore paved the way and will further be kept informed by a regional advisory committee which will make recommendations to the Government concerning future developmental issues on an ongoing basis. This will include commerce and agriculture. I agree wholeheartedly with the Government’s standpoint that not more than one committee should be appointed for a particular area within a development region. Initially there were calls for different committees for East London, Port Elizabeth and Uitenhage, but I think it is essential that the entire region consider their requirements together and convey these requirements to the Government as a region. It will definitely not be in the interests of the region if fragmentation takes place in this regard. The region will itself have to determine its priorities, on the basis of consensus.

The State has therefore duly done its duty. It is now for the private sector to co-ordinate these production factors within this framework in order to generate prosperity. One of the most important elements in this entire set-up is the role of the trade unions. All these incentives could be useless if this particular element does not ensure that a favourable climate for development is created in its sphere, a climate of peace, order, moderation and responsibility. There is no doubt that this region has had a tremendous setback as a result of last year’s labour unrest and labour problems, and that the stability of the labour force is now being questioned to a large extent. The great potential of this region, with maximum utilization of the incentives, will only be realized if the trade unions display levelheadedness. I should like to associate myself with some of the industrial leaders in that area who have called on the trade unions to moderate their demands and keep them within bounds.

†I think that the recent statement by one of the major industrial leaders should be carefully considered by the unions. Care should be taken that they do not in fact kill the goose that lay the golden egg. Sometimes their actions appear to indicate that they are not interested in either the goose or the golden egg.

Confidence in our region has to a very large extent been restored by the recent announcement. This confidence could be destroyed should our labour force again project an image of unrest and unsettlement. It has been proved many times before that unrealistic demands and claims by trade unions can so cripple an industry that it cannot play any effectual role in providing jobs and eventually moves to an area where the labour force is less militant and more stable. There can be no doubt that the motor industry in particular is a very fickle one. It tends to behave like a roller-coaster and it is extremely sensitive. Trade unions in the Eastern Cape should be aware of this and everything possible should be done to stabilize this area and its industrial base. It is of grave concern to me that the workers at certain Uitenhage plants seem to be totally irresponsible. Their behaviour and the wild-cat strikes that have taken place have done our town tremendous harm in the short term, but may cause irreparable harm to our long-term development and expansion should this behaviour recur. It is this fact which may push some industries over the brink and cause them to give effect to their often-made threat to move elsewhere, which would be calamitous to our area. A responsible workforce could assist in using the new incentives for the general good of all the people in the Port Elizabeth-Uitenhage area.

Mr. Chairman, it is a great privilege for me to speak after the hon. member for Uitenhage, not only because he comes from the Eastern Cape, but also because he made a very important contribution to this discussion. I agreed wholeheartedly with the hon. member when he said that these concessions to the Eastern Cape would vanish like mist before the morning sun if workers and trade unions in that area do not act in a responsible way. I also agreed with the hon. member when he said that organized commerce and industry in that region welcomed these concessions. We must realize that we have now gained something we never had before. That is why I am convinced that other minor matters will be dealt with properly by the regional advisory committee.

In the discussion of this Vote last year, I referred to certain aspects pertaining to the national building regulations. I tried to point out certain problems in the application of those regulations, and I want to thank the hon. the Deputy Minister for his positive reaction to this. I should now like to ask him to tell us if any progress has been made in the acceptance of these regulations by City Councils and other bodies responsible for applying them.

I should now like to refer briefly to the Industrial Development Corporation and I want to continue to discuss this matter in the same vein as the hon. member for Edenvale did. Until recently the Industrial Development Corporation was involved, inter alia, in the development of factory unit complexes. As this part of its activities has now been taken over by the Small Business Development Corporation, I cannot omit to pay tribute to the Industrial Development Corporation for the pioneering work which it did in this field. Through this process industrialists, irrespective of the scope of their activities, were allowed to develop their enterprises. These industrialists would otherwise never have had the opportunity to develop and to establish themselves as independent industrialists. It can now be asked which people received aid and what the main aim of the construction and the bringing into operation of these factory unit complexes was. The aim was to create facilities for small industrialists, who did not have enough capital to construct their own factories. Such industrialists usually also find it difficult to get a loan for this purpose because they have not yet had the opportunity to prove themselves. Owing to a lack of money and suitable premises these people are frequently compelled to start their businesses on inadequate temporary premises, under very difficult conditions. The availability of approved premises at a reasonable rent offers the beginner and the small industrialist the opportunity to develop their initiative and managerial talents.

These factory unit complexes can therefore be seen as practical training schools for new entrepreneurs. People who are successful in this respect can make a constructive contribution to the industrial development of the Republic of South Africa. I am of the opinion that most of these beginners have been successful and have thus far made a significant contribution. In this regard the IDC also played a significant role. If a small industrialist cannot make the grade owing to a lack of managerial ability he will soon drop out and be forced to make way for someone else who has the necessary talents and this takes place—and this is most important—without any loss of capital invested in land and buildings. It would be interesting to establish precisely what progress every small industrialist has made from the day the IDC began to help him up to the present. We may find that some of those industrialists fell by the wayside. However, I believe in many cases we shall find that the industrialist’s undertaking became too large for his factory unit and today he has his own premises.

Some of the largest industrialists in the Republic of South Africa today are people who started out in a small way. These are native sons of South Africa, who made their own way up the ladder of success and most of whom had to get started without any help at all. Do we realize that with a little aid we could help to start many large industries in the Republic of South Africa? Every new industry established in South Africa today, irrespective of its size, must create new employment opportunities. We have a tremendous shortage of trained manpower. Every small factory flats can make a contribution to training, even if only two or three workers are trained in each factory unit.

I now want to make an appeal to the hon. the Minister. Unfortunately my request is of a rather local nature. However, I feel it is important and I hope I shall be forgiven for raising the matter here. Unfortunately little attention was given in the past to the Port Elizabeth/Uitenhage area as far as these factory unit complexes are concerned. I do not know the reason for this. Possibly the IDC was not approached in the right way. Whatever the reason, I have found that in this region there are many people who have a sound knowledge of their specific fields and have the necessary initiative and drive to start their own businesses, but have insufficient capital to do so because the smaller factory premises in Port Elizabeth are prohibitively expensive.

In Port Elizabeth we have a unique piece of ground known as Missionvale. It is situated between Bethelsdorp and the main road to Uitenhage and is opposite the most central industrial area in Port Elizabeth, namely Struandale. The land is 248 ha in extent and is situated where there would be no transport problems for workers. On the contrary, many of the workers in the northern areas would be able to walk to that area.

In planning studies by the local authorities and the provincial administration this land is described as ideal for the development of light industries. I see the land in the first place, as ideal for the development of such factory unit complexes. However, the land is too large to use solely for this purpose. That is why I see the development as follows: More or less in the centre of this ground I see the development of an industrial park.

What I mean by this, is the building of small factory unit complexes, with open spaces between the buildings for the development of parks so that these small complexes will always have an attractive appearance. The land around the complexes can be used as premises, each measuring 2 000 sq metres, for light industrialists who have past the factory unit stage and would like to develop their own factories.

According to the local authority services such as water, electricity and sewerage can be provided at a reasonable cost. Because most of the land is already owned by the local authority, it can be made available at reasonable prices and because this land will be developed for light industries, no rail facilities will be needed.

I have already spoken tentatively to officials of the Small Business Development Corporation and they seem enthusiastic to undertake a feasibility study on factory unit complexes in Port Elizabeth. However, the land will have to be rezoned and that request will be sent to the hon. the Minister and other interested parties. I am therefore requesting that if such an application comes from Port Elizabeth, it will be considered favourably and sympathetically. I am convinced that we have a wonderful opportunity here to make a breakthrough for the beginner and the small industrialist in Port Elizabeth.

Mr. Chairman, it is a great pleasure to speak after the hon. member for Algoa and the hon. member who spoke before him. The two hon. members covered an area which is very close to my heart, because I think there is trememdous potential in the field of industry and also because I think that there is equally great potential in the field of tourism.

The hon. member for Algoa touched on a point which he raised last year as well, and in my opinion it is only right that I should announce in detail this evening exactly where we stand so that the bodies involved may know exactly what we envisage and when we envisage it. The matter involved is the national building regulations.

Since the national building regulations cover a very wide field, when they were originally drawn up the Bureau made use of ad hoc working groups with the necessary skills in respect of specific subjects. Subsequently, draft regulations were submitted to regional committees, who checked the technical content of the regulations and ensured that regional differences were taken into account.

These draft regulations were then published in the Gazette on 6 February 1981. On 16 October last year, the date on which the period for commentary expired, commentary comprising 1 072 pages had reached us from 140 different organizations and individuals. The processing of the commentary by the staff of the bureau, in co-operation with ad hoc working groups, was disposed of by April 1982. However, before the board can make a recommendation to the Minister of Industries, Commerce and Tourism in terms of the National Building Regulations and Building Standards Act of 1977 in this regard in connection with the acceptance of the regulations, it is necessary for the board to make sure that the commentary has been thoroughly studied and that the amendments it gives rise to are accepted by the majority of interested parties. To achieve this aim I decided to appoint a working group from representatives of organizations involved in the implementation of the national building regulations. These representatives must have senior status to enable them to take binding decisions on behalf of the organizations in the working group. The chairman of this working group will be Mr. A. A. “Pat” Middelcote of the SABS, one of their most senior staff members. The following bodies will also be represented on the working group: The Institute of Municipal Engineers, the Institute of Architects, the Property Owners’ Association, viz. Sapoa, the Institute of Civil Engineers, the Association of Consulting Engineers, the Building Industries Federation of South Africa, viz. Bifsa, the S.A. Bureau of Standards, the United Municipal Executive, the AHI, the FCI and Seifsa. To enable this working group to process the regulations together with the commentary and make recommendations, they will also be authorized to appoint specialist working groups to undertake special investigations. I expect that this working group will begin its activities by the end of June 1982. Letters in which the bodies concerned are invited to an initial meeting and to designate their representatives, have already been posted to them.

At this stage I want to repeat a few guidelines—as I did last year, too—which this working group must take into account when discussing these regulations. In the first place, provision must be made for flexibility in respect of all standards. Secondly, provision must be made for flexibility in respect of the implementation of these standards in specific communities and for flexibility in specific regions and districts. Despite the flexibility, however, there must be a degree of uniformity in regard to specific factors which may apply to all communities and regions, such as, for example, health and security aspects. It will be the task of the working group to identify these common factors. Provision must also be made for a variety of building techniques and building materials, without this resulting in a total lack of control. Building regulations must not be technical specifications, but the norms and standards of building regulations must consciously make provision for economic methods of construction. In other words, they must not give rise to an excessive increase in the cost of construction.

The hon. member for Sunnyside referred to standardization. If I have any time left I should like to react to that at a later stage.

The hon. member for Innesdal touched on a very interesting subject, viz. that of technology and research. When we consider technology and research we must always bear two aspects in mind. When we discuss research, we must discuss basic research and, in contrast, applied research. As far as basic research is concerned, I do not think that we in South Africa have the financial resources to carry this out on a large scale, and then the question of a ministry or secretariat of technology comes up. When we speak about applied research, we must necessarily carry out research in those fields where it will be applisd in practice, and therefore, in the nature of the matter, fragmentation is a practical consideration.

The hon. member for Innesdal referred in particular to the electronics industry. We are aware that this industry, which at the moment is based exclusively on military electronics, has a special problem. Specific bottlenecks which the electronics industry is experiencing at the moment have been pointed out to us from various quarters and by various bodies and we are already considering the matter. When we look at the problem of the electronics industry, we must confine our attention largely to three elements. The first element relates to the manufacture of electronic equipment that requires individual patterns of design and can therefore make use of standard components and custom made imported components. That is the one type of electronics industry.

Secondly, in the field of electronics it is pointless our having a manufacturing industry if we do not have a rationalized components industry, and this means a components industry for the manufacture of standard components and for the manufacture of custom-made local components. With regard to custom-made components, I refer in particular to the components industry for microelectronics.

The third point I wish to mention is that a distinctive, expert designing capacity must be built into this industry which can make maximum use of our own local standard components and of our own local custom made components. If we are unable to do this, then we are going to have an assembly industry which will hold out no future for our electronics industry.

All this is very intimately bound up with the co-ordination and, if necessary, the rationalization and standardization of the industries geared for commercial, strategic and professional products. I want to say that an advisory technical committee under my chairmanship is at present engaged in investigating and identifying the bottlenecks in the local development of the electronics industry, and advising the Government on guidelines to be followed to remove restrictions and find methods of effectively promoting the development of the industry.

Finally, Mr. Chairman, I just want to refer briefly to an aspect which has been broached here repeatedly, viz. the situation of the private company as against the public company. In this regard I want to mention the steps that have already been taken so that the people and the hon. members who raised the matter may take cognizance of them. The Registrar of Companies has already taken the initiative and identified this need. As hon. members have already been informed by the Registrar, the Standing Advisory Committee on Company Law is, of its own accord and on the recommendation of the private sector, giving attention to several aspects of company law in order to keep abreast of developments in the field of company law in other countries and in South Africa. Of the subjects that have already been identified by the committee in question, the following is of importance. I am only going to mention the first one; the others I shall leave aside. The first is the provision of a new legal formula to make it possible for the small businessman to enjoy the benefits of incorporation. Active attention is being given in the USA to a suitable legal formula to create small business enterprises. At the same time there is an urgent need in South Africa to make provision for this kind of legal formula. Over the past number of years a great deal has already been done to look after the interests of the small business enterprise and in this connection I refer to the founding of the Small Business Development Corporation, the Small Business Advisory Bureau and the Council for the Promotion of Small Businesses. It is expected that legislation to give effect to this new legal formula will be submitted to the Government during 1983.

I must just touch briefly on one further aspect by saying that the Standing Advisory Committee on Company Law has not yet had the opportunity to consider whether an audit, as in the case of the companies will be necessary and enforceable for small business enterprises. There will be consultation with the bodies concerned in this regard and at the same time it will be dealt with in the legislation.

Mr. Chairman, it is a great pleasure for me to speak after the hon. the Deputy Minister. He dealt with hon. members questions and contributions in a most enlightening way.

I believe this is a very appropriate time to bring this debate around to liquor matters. On this occasion I should like to touch on two matters connected with liquor, the liquor trade and the distribution of liquor. The first directly involves the restructuring of the liquor trade. I want to point out immediately that I am aware that this subject is receiving the attention of the Competition Board at the moment. For this reason I shall refrain from referring to controversial matters or putting questions which will of necessity be dealt with by the Competition Board.

To start with I should like to express my sincere thanks and appreciation to the hon. the Minister in connection with the Press statement he released on 15 October 1981. I want to quote the following from this Press statement—

After this Press statement by the hon. the Minister the KWV issued a Press statement on 19 October which I should like to quote virtually in full because it clearly states the standpoint of the wine industry with regard to this basically important standpoint concerning the separation of the interests of the wholesale and retail trades. The Press statement reads—

I should like to repeat the last part of this sentence, namely “dat die aantal uitlaatpunte wat deur een persoon gehou word, ook beperk word”—

Once again I wish to convey the thanks of all wine farmers to the hon. the Minister for this confirmation of a principle to which we attach great value, just as the wine farmer places a high premium on the limited say he has in the marketing of his own product through the establishment of Cape Wine.

The second matter concerns the distribution and availability of liquor in the metropolitan Black residential areas. The illegality of a significant proportion of the existing liquor sales in Black urban areas, and the obvious need in Black communities for suitable premises where liquor can be enjoyed in company, are two of the most important reasons why a new liquor distribution dispensation in Black residential areas had to be urgently investigated. This investigation was undertaken by members of the National Liquor Board, and subsequently certain recommendations were made. This led to the hon. the Minister of Justice announcing certain Cabinet decisions on 29 May 1980 which were described as drastic. These decisions were aimed at placing liquor sales and distribution in the metropolitan Black residential areas on a new footing in an attempt to overcome the problem situation. It is generally recognized that this is a complex problem which cannot be rectified overnight. We also realize that as directed, premises must be zoned in order to be licensed for trading purposes.

The untrammelled legal distribution of liquor to the Blacks in their residential areas in an orderly and responsible way, which does justice to their sense of decency and distinctive needs, will have positive results for all Government departments involved, and for race relations in general.

It is obvious that the present set-up of Government-controlled sales and a disregard of the customary liquor consumption habits of Black people, do not meet these requirements. That is why I feel it is in the public interest that a dispensation be established which will place the distribution of liquor in the Black urban residential areas on a decent, economical, legal and socially justifiable basis. I should therefore like to know from the hon. the Minister what progress has been made in this connection, and what problems are preventing us from achieving this aim.

Because the National Liquor Board now falls under the hon. the Minister’s department as a result of the rationalization of the Public Service, and excellent work is done by this board, I just want to put one further question to the hon. the Minister, namely, whether the problems existing at present could not be solved more easily if the licensing and distribution of liquor in Black residential areas were to fall directly under the National Liquor Board. I am afraid that a tangible start to the process of deconcentration of liquor distribution in Black residential areas cannot be postponed any longer.

Mr. Chairman, it is always a pleasure to speak after the hon. member for Ceres, as he is an expert in his field. The hon. member for Ceres also made a solid contribution earlier this afternoon during the discussion of the Agriculture and Fisheries Vote in the Senate Chamber. I cannot help thinking that it is as well that the Agriculture and Fisheries Vote and the Industries, Commerce and Tourism Vote are discussed on the same day, because they are so closely linked in South Africa. [Interjections.] Although the contribution of agriculture to the gross domestic product in a developing country such as South Africa is decreasing, and the industrial sector’s contribution to this gross domestic product is increasing, agriculture remains one of the cornerstones of the overall economy of South Africa. It could therefore be said that approximately one-third of South Africa’s manufacturing industry is linked to the agricultural sector, and that the weal and woe of the agricultural sector has a direct influence on the manufacturing industries.

I wish to refer very briefly to an industrial sector which falls partly under agriculture, and partly under industry. I refer to the textile industry. It is estimated that the textile industry in South Africa as a whole employs more than half a million people. Of these, 180 000 are employed in agriculture and in the processing of cotton, and 320 000 are employed in the industrial and manufacturing sector. To give hon. members an idea of the importance of this industry, I just want to mention that it employs 4,5% of all working South Africans. The clothing and textile industry employs 14% of all South Africans employed in the manufacturing sector. This industry has made a total investment of R5 000 million in South Africa and its sales amount to 8% of the total private consumer expenditure. I mention these figures to give an indication of the importance of the textile industry in South Africa.

This industry devotes a great deal of attention to the training of workers. For example, each year 12 500 people are trained up to the skilled labour level in the clothing industry, and the result of this can be seen in the fact that the productivity index of the people in this industry—and this is very important in our country where we have to deal with inflation and so on—has risen from 100 in 1976 to 132 in 1980. I think this is something of which this industry can rightly be proud.

In its secondary form, it is of the utmost importance to the Cape, and to the Western Cape in particular, and stable growth and continuity in work opportunities are therefore essential.

The hon. the Minister is aware of the fact that until recently, things were going very well for the industry, but the present economic downturn has also had an influence on this industry. The capacity utilization was approximately 93% in 1980. I think this is a fantastic figure for any industrial sector. However, over the past four months until March 1982, orders have decreased by 17% as against the same period last year, and undespatched orders have decreased by 31%. This is a clear indication that the economic downturn which has affected our entire country, is now also affecting this industry.

†South Africa’s 1981 per capita usage of all textile fibres in this subsector’s range of products represents a figure of approximately six kilograms. At a population growth rate of 2,4% and a per capita consumption increase of 3%, this figure will increase to approximately 9 kilograms by the year 2000. The equivalent figure for the United States, however, is 25 kilogram, and 20 kilogram for West Germany. It shows wonderful growth potential in this country if we are in practice able to protect this industry. This will also mean that in the next 20 years, a further R4 000 million will have to be invested in this industry. This level of investment, and the consequent provision of employment opportunities, is only possible if Government policy is clearly aimed at the prevention of disruptive foreign competition and the decline of the industry. It will always be necessary to allow for about 20% of imports but, as I have said, it is also necessary to protect the industry. In South Africa we have been fortunate to date in that industry as a whole and the clothing and textile industry in particular have been regarded by the authorities as an essential component of the country’s economic growth. Just as serious, however, is the fact that the policy setting out the methods—I emphasize “methods”—through which protection is afforded has been changed.

*In the debate on his Vote last year, the hon. the Minister devoted special attention to the clothing and textile industry and indicated that the Government was of the opinion that tariff measures were the appropriate method of protecting local manufacturers in this industry against imports. These measures are not prohibitive, but they are aimed at weighting the prices of imported goods in favour of the local product. It is true that in the past this industry has often been assisted by quantitative import control, which was really implemented to improve the position of the balance of payments. However, the whole trend now is to provide protection by means of import tariffs, rather than import control. After all, there can be no objection to this in principle, but then—and this is vital—it must be applied very realistically and flexibly. The 10% surcharge which was announced in the Little Budget has had a very healthy effect on the industry. There is no doubt about this.

That is a fiscal measure.

Yes, but it was a great help.

The fact is, that there is still concern in the industry, and not without reason. This concern pertains mainly to the external factors which the industry itself cannot do much about and in respect of which the industry is largely dependent on assistance from the Government. The background to this, is that it is a universal problem that the textile industry, which is a labour-intensive industry, is the ideal industry for a developing or under-developed country to establish. It has often happened that the European countries in particular have allowed their colonies to establish this kind of industry. As a result of cheaper raw materials and labour, these products have inundated the markets. The result has been that many of the European markets have once again had to be supported by their governments, and one of their methods has been to stimulate exports, which in turn has affected our country’s textile industry. This could also affect the producer.

The total cotton crop in South Africa is approximately 300 000 bales of 200 kg, but at a price which is higher than abroad. Therefore, if we are not able to utilize the entire crop domestically, we have a problem. I therefore wish to say that firstly, it is of the utmost importance that the industry be put in a position to grow consistently and to operate as near as possible to full capacity; secondly, that the half a million people in all sectors of the industry be retained in service as far as possible; and, thirdly—and with this I conclude—that the correct protective method be implemented in order to ensure that the South African textile industry does not experience the same problems as those experienced in Europe, where more than 2 million people lost their jobs as a result of completely incorrect planning and where, in many cases they now have to fall back on a quantitative system of measures such as import control.

Business suspended at 18h30 and resumed at 20h00.

Evening Sitting

Mr. Chairman, I am pleased to follow the hon. member for Paarl, who is a man after my own heart when he says that one-third of our industries is based on agriculture. I was indeed fortunate to take a degree in agriculture at the University of Pretoria, specializing in dairying, and subsequently a degree in economics, specializing in industrial administration, which provided me with the necessary background to participate in the very type of industry to which the hon. member for Paarl referred, and which also gave me the opportunity of entering the dairy manufacturing industry and of developing a national brand of cheese, marketed throughout the Republic.

I should like to speak tonight on monopolies, oligarchies and the Competition Board.

When the economic history of South Africa comes to be written, one glorious page will be written under the heading “The two good Fridays in the South African economy”. That will be because of these two Fridays, two judgments were delivered that were meant to have a profound effect on the future conduct of the economy in South Africa in “the maintenance and promotion of competition in the economy, and to this end, the control of restrictive practices and the monitoring of controlling interests in undertakings”.

On Friday, 23 April 1982, the Competition Board published its report No. 9 on its investigation into the possible restrictive practices in the supply and distribution of explosives and accessories in the Republic of South Africa. It was a brave and fearless report, which investigated the explosive industry in all its facets. Before I discuss the implications, may I, in all humility and on behalf of the small businessmen of South Africa and of myself, offer sincerest congratulations and respect for this brave and fearless report by the members of the Competition Board, i.e. Mr. D. J. Mouton, chairman, and Messrs. H. Goldberg, J. de V. Graaff, S. J. Kleu, A. J. Marais, S. J. Naudé and E. W. van Staden, for exposing the malpractices in this explosive industry in terms of the Maintenance and Promotion of Competition Act, 1979. Furthermore, my sincere congratulations to a brave and fearless Minister, Dr. Dawie de Villiers, and also to every member of the Department of Industries, Commerce and Tourism, for upholding the judgment of the Competition Board in declaring these practices unlawful and prohibiting their continuation.

Two comparatively small businessmen, J. A. Haak and Oliver Hill, challenged the business practices in an industry controlled directly and indirectly by the most powerful and wealthy business organizations in South Africa today, namely African Explosives and Chemical Industries, directly controlled by the Anglo American Corporation, as well as the Chamber of Mines, whose membership consists of 14 financial corporations, among whom are Anglo American, Barlow Rand, Anglo Vaal, Consolidated Goldfields, Federale Mynbou, General Corporation, Johannesburg Consolidated Investments, Goldfields and others who in turn control 46 gold mines, 41 coal mines and 14 other mines, including diamond mines. The main shareholders of African Explosives are De Beers Industrial Corporation, Imperial Chemical Industries, S.A. Mutual and African Explosive Holdings.

The Competition Board held that the restrictive practices between AECI and the Chamber of Mines, as well as the agreements for withholding supplies of nitrogenous materials, between AECI, Fedmis and Sasol, be declared unlawful.

African Explosives, in their annual report as signed by the chairman, as well as in their evidence, persist—

The Competition Board, in its case, states that—

In paragraph 7 of the Second Annual Report of the Competition Board attention is drawn to—

Yet the chairman of AECI states—

They want protection but at the same time they do not want anybody else to come into the industry. In the Rand Daily Mail of 24 April in defiance of a report that their practices were not in the public interests, AECI published a statement to the effect that—

This the Competition Board has found to be untrue and this to my mind represents contempt for the judgment against them. I trust that the hon. the Minister will take the necessary steps fearlessly and quickly and continue to act in the interests of the whole of the South African economy.

On Friday, 30 April 1982, the Rand Supreme Court of South Africa pronounced judgment on an urgent application by a small company, Dawnlaan Investments, holding non-voting shares in Greaterman’s Ltd., stating, according to newspaper reports in The Argus, that—

According to the Sunday Times of 2 May 1982—

In view of this, does the hon. the Minister in conjunction with the hon. the Minister of Finance want the JSE to lose what power it has left?

In paragraph 9 on page 2 of its report for 1981 the Competition Board says—

I want to conclude by saying that the Committee of the Johannesburg Stock Exchange must realize once and for all that it is not in the public interest to break the law but that it is equally not in the public interest to try to bend the law.

Mr. Chairman, the hon. member for Bezuidenhout referred to the investigation by the Competition Board into the explosives industry and into the breaking of the monopoly in that industry. The hon. member also congratulated the hon. the Minister, the board and the department on their actions. I can assure the hon. member that the hon. the Minister, the board and the department will act fearlessly on all such occasions in the future in the interests of all South Africans.

The hon. member also referred to the Johannesburg Stock Exchange decision that has been overruled by the Supreme Court and I want to say that this proves once again the freedom of anybody to come to our court if he feels aggrieved and that it also shows the high standard of our judiciary.

The hon. member for Yeoville said earlier today that the industrial plans are full of generalities. He went on to say that the important thing was that job creation was not being provided for. Obviously the hon. member has not carefully considered the report on industrial development that was tabled in this House on 31 March, 1982. Job creation is one of the features of this document and the concessions offered are designed to provide maximum job opportunity. If the hon. member will look at pages 26 to 30 he will find that they deal specifically with concessions such as, for example rail rebates, percentage of total wages bill, maximum amount in rand per worker per month, the training grant, rental and interest subsidy, housing subsidy, relocation allowances and price preference on tenders. All these concessions have been granted to certain regions to create job opportunities. These concessions came about as a result of in-depth study and representations from all quarters. The hon. member for Yeoville did not have one good word to say about the industrial plan. The hon. member for Yeoville had a wonderful opportunity to appeal to commerce and industry to take advantage of these concessions and to create job opportunities to many poverty-stricken areas. I want to say that not a single hon. member of the PFP had a good word to say about this plan. They are boycotting this plan like they have boycotted the President’s Council. The greater the need for jobs, the greater the concessions. This plan must be encouraged to provide job opportunities. The negative attitude of the hon. member and his party to this plan is most surprising as it seeks to help those who need the help most. All of us in South Africa must concentrate our efforts towards creating a favourable climate for industrial expansion and decentralization and for an increase in productivity. A climate of confidence is essential to attack both local and foreign capital. The political climate can never be the sole responsibility of the Government. There can be no political leader in this country who means it well with his people who cannot plead the cause of economic expansion and of prosperity. Those political leaders who have not yet grasped the nettle of responsibility now have the opportunity of showing where they stand in the economic and political development in South and Southern Africa. This country and this continent have an unlimited potential, provided all of us pull together and put the interests of our country before our own petty political fantasies. Constructive and positive attitudes by the media will help enormously in assisting to build up goodwill among all the race groups in the country. If all the media are up to facing the challenges of our times, then they have a terrific contribution to make.

The document on industrial development required an enormous amount of investigation. It is an in-depth investigation that required tactical foresight and vision for the future. The officials who were involved in it had an absolutely mammoth task. I know for a fact that they were inundated with detailed written and verbal representations. We are grateful to Dr. Brand and Mr. De Waal who came to the Port Elizabeth-Uitenhage region in 1980, met with all the interested parties and discussed the written and verbal representations. The hon. member for Uitenhage and the hon. member for Algoa made very constructive contributions this afternoon in that regard. On behalf of my colleagues in the NP, on parliamentary and provincial level, I should like to express my appreciation to all the people from the Port Elizabeth-Uitenhage region who assisted us in compiling a comprehensive book on our region for handing over to Dr. Brand and Mr. De Waal in 1980.

Who received the profits on that book?

I am pleased the hon. member for Port Elizabeth Central has interjected, because I want to say that I cannot compliment hon. members of the PFP because in 1980 in our region there was not a single PFP member of Parliament or of the provincial council and they made no contribution whatsoever to this book which was handed over. They can therefore not claim any kudos for the results that were obtained.

Did the profits from the book go to the NP?

In 1981 the Mayor of Port Elizabeth, the man who was diddled out of his seat by the hon. member for Port Elizabeth Central, and representatives of the business world presented, togehter with one of our colleagues, further representations based on the Heyl report and other facts. The hon. the Minister of Internal Affairs and the hon. the Minister of Industries, Commerce and Tourisim were inundated with representations from us.

Mr. Chairman, on a point of order: Is an hon. member permitted to say that another hon. member diddled somebody out of his seat?

The hon. member may proceed with his speech.

The preparations for the Carlton and Good Hope Conferences must have occupied an enormous amount of time and effort on the part of the hon. the Prime Minister, the Cabinet and the officials. All of them must be congratulated on this blue-print which they produced. With the Carlton and Good Hope Conferences together with the present concessions, the Government and the private sector have the opportunity of a lifetime of working together for upliftment and stability in South and Southern Africa.

A very important facet of this industrial document is that the four independent States, together with the Republic of South Africa, are parties to the Declaration to promote private investment in this area. This Declaration is an important document as it declares the basis of private investment for the Republic of South Africa and the sovereign independent States. There is faith amongst the people of this area in the future of this region and this country. The hon. the Minister’s department has set aside substantial amounts of money as a result of the report relating to the promotion of industrial development in South Africa. I think that this is an historical document. It has a declaration attached by five sovereign independent Governments which will serve as a basis for a blue-print for the development of industry in South and Southern Africa. Unemployment and the creation of job opportunities for the full development of the potential of South and Southern Africa is absolutely vital if we want stability, progress, prosperity and peace. I want to thank the Government for the concessions given to the Eastern Cape area. We appreciate the fact that Port Elizabeth, Uitenhage and also the Cape Peninsula were picked for certain positive incentives. I think it is most important that all the regions now do their utmost through positive action to develop their potential to the full. My colleagues and I have made the most exhaustive written and verbal representations, and we are pleased that our efforts have born fruit in this instance. Naturally, when a regional advisory committee is appointed it will be able to make other constructive suggestions to the Decentralization Board.

I notice on page 11 of the report that no acceptable deconcentration points have been identified in the Port Elizabeth/Uitenhage region. I believe that this is a matter that should be canvassed in future, and I should like to ask the hon. the Minister and the Decentralization Board to have a look at this matter. At this stage I should like to congratulate Mr. De Beer on his appointment as chairman of the Decentralization Board. I know that he and the other members of the board are going to do every good work in the interests of South Africa.

From a newspaper report it would appear as though the Escom concession is worth approximately R700 000 per month in Port Elizabeth. We are grateful for that. However, according to one of the foremost business leaders in Port Elizabeth, Port Elizabeth only has a limited benefit because they buy only 30% of their electricity from Escom. This business leader, who is very highly respected, feels that we should get a further benefit, such as a subsidy on coal for our region. That would make up for the benefits that Port Elizabeth does not get as a result of the fact that it only gets 30% of its electricity from Escom. [Time expired.]

Mr. Chairman, it just so happens that three of my colleagues from the Eastern Cape took part in this debate immediately before me. As we have come to expect of them, they all discussed very important matters which are of great interest to the Eastern Cape. They take up the cudgels for our part of the world and I want to thank them for doing so. I can only say that I associate myself with all their representations and I am sure that they will be favourably considered by the hon. the Minister.

I should like to draw the hon. the Minister’s attention to a few aspects of price control, or perhaps I should say the need for and lack of price control with regard to specific commodities, namely motor vehicle spares. They are one of 14 commodities in respect of which the hon. the Minister recently issued a directive to the Competition Board, published in the Government Gazette of 16 April 1982. The directive was that they should investigate whether or not there were specific circumstances present in the production and marketing of these commodities which make it undesirable for price control on these commodities to be lifted. Motor vehicles spares were one of these commodities.

Logically one could deduce from this that there is indeed control at present. The question is whether it must continue or whether it must be lifted. As I understand the position, strictly speaking, there is no formal control of the prices of spares at present; instead there is control in the form of informal agreements entered into with the sector concerned.

One can therefore say that at present there is no actual control. My request this evening is that in the light of the representations I received from dealers, farmers and other organisations in my constituency and elsewhere in the Eastern Cape, the question arises as to whether there is not a need and a justification for looking into the desirability for stricter control over the prices of these specific commodities. At the moment an effort is being made by way of these agreements to prevent prices from getting out of hand. The Board of Trade and Industries also published a voluminous report in 1979 containing very interesting facts in this connection. The facts submitted to me, which indicate that there may be good reason to reconsider whether there is a need for control, are of such a nature that I want to give a few examples. The first example is a part of the self-starter of a truck manufactured in South Africa. It is only a small part. It consists of a strip of tin threaded through a set of square flat plastic discs, is approximately 25 cm in length and weights 60 gm. The price asked for this in the trade is R80,14. In this specific case the buyer, after he had objected, succeeded in purchasing it for R40.

The second example concerns a small part of a mechanical shovel. It is described as an “aneroid valve fitted to an injection pump.” It is a metal cylinder approximately 8 cm in length, approximately 4 cm in diameter and weighing 190 gm. When a specific organization tried to purchase this part, the price quoted was so ridiculously high that they approached another body, where they eventually obtained it for R267. However, it is interesting to note that the agent’s price was no less than R784. Eventually they were fortunate enough to purchase it from a “pirate” dealer for R267. From the information at my disposal I can assure hon. members that these are not isolated cases. They are perhaps very good examples of what can go wrong, and I can assure hon. members that there are many such examples. It seems as if there is justification for the Competition Board to go into this matter again. In all fairness I must concede that to a certain extent there is justification for the high prices of such parts. In the trade and the industry there is a demand for these parts, and the trade must keep them in stock. Sometimes they are so-called “slow moving parts” they must have in stock, with the resultant capital investment. One must concede this in all fairness. There is also the unpredictable nature of the regularity and quantity of sales of such parts. I feel that in all fairness one should expect there to be a somewhat closer correlation between what could be regarded as the actual value and cost of an item on the one hand, and the price asked for it on the other. The organizations that gave me this information have adopted the attitude that even when these facts are taken into account, there is surely reason to expect that something will be done and that there ought to be a better set-up. I am not asking for strict control, but perhaps the system of agreements entered into with the trade can be revised so that somewhat more stringent steps can be taken with regard to the implementation of this method of control. There are cases where recognized or official agents are the dealers who sell these parts, and then there are also the so-called independent spares dealers. These people are known in the trade as “pirates”, and it is from them that people can purchase parts more cheaply. Of course, the agents adopt the attitude that the so-called pirate dealer does not sell parts of the same quality and that this could adversely affect the performance of the machine in question. However, I have been assured that experience has shown that this is not so, and that the so-called pirate parts function just as well as the parts offered by the agents. In this connection they refer to authentic and unauthentic parts. What apparently happens is that large quantities of the parts are manufactured by a specific manufacturer. He sells through his own agents, but the parts are also available from other dealers. Frequently the same part is merely painted another colour, or a different name or distinguishing mark is affixed to it, and then it is available from some dealers at a much lower price. As I have already mentioned, it has been emphasized that these parts are of the same quality and that there is therefore no reason for the tremendous difference in price. The fact remains, however, that one and the same item is available from one dealer at R784, whereas it can be purchased from another dealer at R267, which is still too high. I leave this matter in the hands of the hon. the Minister. I merely raised this matter because, in view of the directive to the Competition Board, it is now a topical matter. Perhaps it is as well that they should take cognizance of cases of this nature. I shall try to arrange for the organizations concerned to give evidence before the Competition Board, so that they can submit these facts and that there can also be an opportunity for the board to testify these allegations. I therefore merely mention this phenomenon so that the Competition Board can also take cognizance of it.

Mr. Chairman, I believe the hon. member for Sunday’s River has raised a very important and interesting subject. I sympathize entirely with him because I do believe that in many cases the suppliers of so-called genuine parts are out to rip off the public. The hon. member quoted instances where three or four times the price was paid for a so-called “pirate” part which was identical in every respect to the normal product except for the fact that it was painted a different colour and was wrapped in different paper. I would therefore support his appeal to the hon. the Minister to look into this matter. That does not mean that I support a call for price control, because I believe we should stimulate competition in an effort to discipline these people who are ripping off the public. The hon. member also referred to the Competition Board, and I want to quote from their report, item 4, paragraph 20, in regard to this very matter of price control. It says—

I repeat that this report has a wealth of meaty information and wisdom, and I think it will pay hon. members to read it.

One thing that I find encouraging about the debate on this Vote this year and also last year, is that hon. members are talking more often about the need for more competition, the need to support the free market and private enterprise systems, for the individual entrepreneur to be able to develop his own business and about the need for small businesses. I think the hon. member for Edenvale made an excellent speech in this regard, showing the importance of the small business man, and I believe this is a very good sign for South Africa’s future. I do, however, want to take the hon. the Minister to task about one or two things he said earlier this afternoon when he talked about the need for many employees to curb their aspirations and their demand, for example, for increased salaries and wages. I just want to point out to the hon. the Minister that he talked about calls for increased salaries and wages being coupled to increases in productivity. That is a very nice sort of cliché, but I am sure the hon. the Minister would concede that in many cases all the employee is asking for is to be able to hold his present line. He is only asking that his present purchasing power should be maintained. He is not asking for any more purchasing power. One might ask, for example, whether the point the hon. the Minister made is applicable to nurses or, for example, teachers. Let us take the translators working for Hansard as a further example. Should we go to them and say that in order to get their 15% increase in salary, in order to keep up with inflation, they have to produce 15% more translations? That is a ridiculous situation! [Interjections.] I am sure the hon. the Minister would concede as much.

This brings me to a point which is actually the gravamen of what I want to say to him tonight. Often, in the search for increased productivity, it is not the man who is actually doing the job that has to exercise his mind. It is management. This brings me back to what the hon. member for Innesdal had to say. We use modern technology to improve the output of employees and, in this way, increase their productivity so that they can enjoy a higher standard of living. The same applies to management skills.

The subject of management now brings me to something else I want to say to the hon. the Minister. First, let me ask him how the price control system in South Africa works. We have price control on food, building material, motor spares and so many other things. Earlier this session I put a number of questions to him about the cement and brick industry. I wanted to get some idea of what the changes in the industry were, because it has always been a price controlled industry. I asked the hon. the Minister what capital was invested in regard to each factory. I also asked how many factories were registered and what their output was. I was trying to assess, in my own mind, just what the productivity and the invested capital of these two industries was. This is the answer I got from the hon. the Minister (Questions: Thursday, 1 April 1982, col. 538)—

In the case of the amount of capital invested, it was also said that the information was not available. I therefore want to ask the hon. the Minister how one can determine prices for such a large industry if the Price Controller does not know, first of all, what the investment in the industry is, how many businesses there are and what the output of the factories is. I therefore want to know from the hon. the Minister whether his department is capable of operating effectively in the circumstances in which the department finds itself. Is that department simply sucking information out of its thumb? The hon. the Minister tells me that the department has all the information on, let us say, Tong Coro, which is a major brick manufacturing concern in South Africa, but I believe there are about 100 other firms that manufacture bricks. Surely the whole brick industry is not controlled in accordance with the figures from one company. I think there is something here that needs to be looked into.

I am personally very glad that price control has been dropped on certain items such as bricks and cement. This is something I have called for in the past. What I want to tell the hon. the Minister, however, is that what is required now is more competition, and that is why the Competition Board must now get going and try to break up these monopolies in certain building materials such as bricks, cement and timber, because I believe that it is these big monopolies, and the consequent lack of competition, that are contributing to inflation.

I think it was the hon. the Minister of Finance who listed the causes of inflation two years ago. One was the money supply—he listed about five or six of them—but another one was the lack of control of these huge monopolies that are simply pushing up prices. The hon. the Minister took me to task earlier today about this, and I concede that point to him. We also have to control that aspect.

Another point I want to raise with the hon. the Minister is that of import control. This is something he mentioned earlier on. I am very thankful for his very detailed explanation of how his department works. I shall study his Hansard in great detail later on as regards the various factors involved. However, I was most concerned to read in the Daily News of 29 April that “transport costs are set to soar”. This is because a firm called Karbochem is now going to start manufacturing synthetic rubber at a R200 million plant. It is very nice for South Africa that we are going to have a R200 million plant producing such an important strategic material as synthetic rubber, but the company is asking for 75% protection against imported rubber. In the report it is said that genuine rubber still has to be used. If this 75% protection is applied, it will therefore mean that on that component of tyres, etc., that is genuine rubber there is going to be an increase of 75%. What is this going to do to our transport costs? The report states further—

I believe that a lot of companies are going to the import controller and asking for protection to ensure that they have whacking big profits right from the start of their operations. I do not believe that this is in the best interests of South Africa as a whole.

The hon. the Minister mentioned the fact that there are lobby groups and pressure groups which he and his department’s officials have to contend with. I sympathize with this, but I want to refer back to what I said in connection with the Competition Board’s report, viz. that too much reliance is placed on officials. This whole system is open to abuse.

Another example is the textiles and clothing industries. They are calling for protection against so-called dumping, but I have reports here, which I do not have the time to go into, which indicate that the factories producing textiles and clothing in South Africa are operating at peak production at the present time. They are under pressure to produce, they cannot meet the demand; yet they are appealing for protection because the people need clothes and we can import clothes more cheaply.

Finally, I should like to say to the hon. the Minister that I do not believe that the amount of R304 000 that has been budgeted for the Competition Board is sufficient to provide his department with the experience and know-how in the fields of technology, finance, accountancy and so on in order to enable his department to deal effectively with all the investigations into monopolistic tendencies in South Africa. [Time expired.]

Mr. Chairman, I do not want to dwell on the speech by the hon. member for Amanzimtoti. All I want to say is that I agree with him that free competition and private initiative must become increasingly important. He should just continue his line of thought by adding that the word “profit” is not a dirty word in this country either. [Interjections.] I am sure the hon. the Minister will reply to all the matters he raised.

I should like to dwell for a moment on a Government project which, over the past four years, has had a fairly dark cloud of criticism hanging over it. I refer to the Atlantis diesel engine project. Last Thursday, exactly four years to the day after the project was launched, it was opened by the hon. the Prime Minister. Last year, too, we touched on the subject of the Atlantis diesel engines. The hon. the Minister cleared up certain matters and certain answers were provided, but unfortunately this cloud was fairly pervasive and hung in particular above the farm implement industry and the transport industry, with regard to what this project would mean for the Government and also for the industry. I should like to convey my congratulations to the Government, the hon. the Minister of Industries, Commerce and Tourism, the Board of Directors and also the workers, who began on a heap of sand and established that project and have today brought it to the point at which it is manufacturing engines.

At this point I also wish to pay tribute to the then Minister of Economic Affairs who, after he had announced this project, was faced with a considerable amount of criticism and was told what a bad project it was, how the Government was interfering in the system of private competition, etc. I should also like to pay tribute to him for the daring he displayed in continuing with the project. I also wish to point out that in his speech the hon. the Prime Minister dwelt at great length on the economic value of that project for the Western Cape in particular. Accordingly I shall focus on the economic value of the project for the total economy of the country from the point of view of transport.

For the most part, therefore, I should like to confine myself to the economy, and mainly to the criticism expressed, because there has been so much criticism of that project that one really has no option but to react to it. The question now arises, and quite rightly so, as to why there was so much criticism. We need only consider that this project represents an investment of R450 million, that it provides employment opportunities at the Atlantis diesel engine factory to 2 300 workers, that it provides employment to 2 500 people outside the industry, people whom ADE must supply with manufactured products. This figure only includes the people directly involved; not those employed at the foundries, etc.

In the fourth place, I ask why there is criticism of this project, since in 1985, when it is in full swing, this project will achieve a saving on South Africa’s balance of payments of R250 million. As I have already said, a great deal has been said about the project since it was announced. To a large extent, hostility to the project has been aroused. It is now possible to measure the practical results of this project, to consider the source of the criticism and assess whether it is well-founded. In my opinion, the criticism is largely based on the concept of cost increases. Hon. members are aware of the allegations that the prices of tractors would increase by 40% and that trucks would become up to 40% more expensive. However, let us see what has happened. After all, those engines are being used in trucks and tractors at the moment.

As far as technology is concerned, I just wish to refer to one point of criticism. It is that the technology we bought was allegedly second-rate technology. I contend that if Daimler-Benz and Perkins sold second-rate technology, I would prefer it to so-called first-rate technology. Those two enterprises together manufacture more than 40% of all diesel engines produced in the world. I therefore believe that the technology we purchased in that regard is of adequate standard.

Then, too, I want to convey my thanks to the two mother countries that were prepared to sell that technology to us. They are West Germany and Britain. What, then, is the source of the criticism? The criticism comes from those countries that were not prepared to sell that technology to the Republic of South Africa. I am not going to mention them by name, because hon. members know which countries they are. I also wish to state that this project, as it has manifested itself, has proved the contrary of what has been said. In this regard I want to quote one example in order to support what I said. I want to quote from the speech made there by the hon. the Prime Minister. As far as the cost aspect is concerned, the hon. the Prime Minister pointed out that the 22% price increase of one of the biggest tractor manufacturers …

That is Massey Ferguson, of course. Tell us it is Massey Ferguson! [Interjections.]

… for 1982 is comprised as follows: 14% due to the rate of exchange, 4% due to the cost increase in the Republic of South Africa due to labour, transport, etc., and only 4% due to the Atlantis diesel engine and its machining costs.

While I am mentioning these facts, I want to point out that it is a pity that there are not really many farmers in the House tonight, because they are present at the Select Committee on Agriculture in the Senate Hall.

What are you saying? [Interjections.]

The farmers are not really here this evening to hear the major criticism. I believe that the hon. the Minister of Transport Affairs will probably tell the Agricultural Union what the hon. the Prime Minister said at Atlantis.

Another point which must be noted in this regard is the following. Another manufacturer announced on 29 April … I really think I must mention names and say who the manufacturers are. On 29 April an announcement was made by the firm of Malcomess. That is not the hon. member for Port Elizabeth Central, the hon. windmill member. It is an entirely different Malcomess. It announced that the South African Atlantis diesel engine had made it possible for the increase in the price of their tractors to be a mere 10% this year, two-thirds of the inflation rate. This was the case due to the use of the Atlantis diesel engine. One can also find these practical examples when we look at the example of the road transport industry. When we take into account that the engine in a tractor is responsible for 25% of the final price, then surely we cannot say that the price of a truck will be increased by 40% if it has Atlantis components. Let us see why this is so. In my opinion the most important fact is that hostility to the project has been aroused by certain manufacturers, certain individuals and certain pressure groups. I think that the contrary has been proved in practice, and I therefore hope that the cloud of criticism that has hung over this project will now finally be dissipated and that this fine project will have a chance to serve the RSA. I also wish to say that this project has also endured further criticism to the effect that it is largely a Government project. I want to put an end to this criticism, too, this evening by saying that only 35% of the total engine will be manufactured by Atlantis itself, viz. the cylinder block, the cylinder head, the crankcase, the camshaft and the piston-rods. The remaining 65% will be purchased from the suppliers that are in private hands in the RSA and that must manufacture these products and supply then to ADE to enable them to perform the final assembly work. We see, therefore, that 65% comes from outside, while only 35% is processed locally at ADE.

This brings me to the problem of spare parts. This is a problem in regard to which considerable feeling is still being aroused at the moment. I want to request the hon. the Minister to ensure that spare parts will be distributed by those people who were the original “OEMs”—the original equipment manufacturers; they must be distributed by these people. There are enough original manufacturers in this country to ensure that competition will be adequate in proportion. As hon. members are aware, at one stage this country had 28 manufacturers of heavy vehicles. That is more than America, whose market is ten times larger than the market in this country. This unhealthy state of affairs cannot continue. [Time expired.]

Mr. Chairman, in the short space of time still available to me, I should like to reply to a few of the speakers. I should like to react to what the hon. member for Klerksdorp said this afternoon about the new decentralization benefits, as contained in the White Paper of the Government on regional development and industrial decentralization. The hon. member for Klerksdorp made a very constructive contribution and pointed out that in this sphere as well the private sector could co-operate with the public sector to bring about a better distribution of economic activities in South Africa.

The importance of this strategy appears from the fact that 85% of all industrial production and 34% of all employment in industry occurs in metropolitan areas. The socio-economic problems which stem from this are legion, and it was therefore in the interests of everyone in South Africa that a sound programme of industrial decentralization also had to be initiated.

I should like to congratulate the hon. member for Sunnyside for his positive approach in this debate. I appreciate his also having spelt out that this is a non-political debate and that the well-being of the economy in South Africa is surely in the interests of all of us. The hon. member also discussed standardization, and the note which I have in this connection is that with the changeover from the imperial to the metric system of mass and measuring units it was in fact decided to endeavour to achieve standardization as far as possible in respect of packaging. The standardization of packaging was not only done to facilitate the local marketing of products, but container sizes were also standardized to ensure these products access to international markets. It is only by way of great exception, as in the case of bulk measure products, that packaging in commerce was not standardized. As hon. members know, the Metrication Board accomplished its task and was dissolved. As a result of the standardization brought about by this board, the consumer is today able to compare alternative products if he wishes to buy judiciously.

I have already referred in the course of my speech to other aspects to which the hon. member for Sunnyside referred, such as the question of concentration, etc.

The hon. member for Innesdal made a very stimulating contribution on the rapidly changing world in which we are living, the face of which is constantly changing as a result of scientific and technological developments. In reality we are living in an artificial world, measured against the natural world. We are living in a world which is maintained by science and technology. One need only allow free rein to one’s imagination for a while to realize how, from the morning when we are woken up by a quartz alarm clock, we move through an artificial world until we lay our heads to rest at night on a foam-rubber pillow. In reality it is an artificial world which is maintained by science and technology. The astounding aspect is that the changes in the scientific and technological spheres have changed the world to such an extent that the changes which have occurred since the beginning of the century, during the past 82 years, are more than all those which occurred in the previous 1 900 years. All projections indicate that in future the world is going to change even more rapidly than has been the case up to now, during the past 82 years. Consequently it is important that we should develop our abilities to enable us to live and survive in this rapidly changing scientific-technological world, and that in the industrial sphere we shall have to remain in the forefront of this development.

Research has become an expensive and comprehensive undertaking today. One need only look at the large research institutes in the USA and Europe to realize how much capital is required to keep these institutes functioning in order to undertake scientific research which today only takes place in a team context. Despite our limited means an amazing amount is nevertheless being accomplished in South Africa and in many fields we are in the forefront as far as scientific developments are concerned. That is why we are indebted to our universities and institutions such as the CSIR and others as well, which undertake scientific research not only in respect of the theoretical but also in respect of the practical. I think the hon. the Deputy Minister has already dealt with this matter. With the limited means at our disposal, we shall try to meet the challenges in this connection. I am afraid that it will probably not be possible at the present juncture to establish a branch within the department. We liaise very closely with the CSIR, which also falls under the Department of Industry, Commerce and Tourism. However, the CSIR also does work for many other departments.

†Mr. Chairman, the hon. member for Amanzimtoti in his first speech made a good contribution, and I have already referred to the question of inflation and concentrations due to takeover. I will later come to the hon. member’s second contribution.

*I think I have already replied sufficiently to the hon. member Dr. Marais in respect of industrial strategy and the work which Dr. Klue has already completed, about which we shall soon be receiving more particulars.

†I notice the hon. member for Yeoville is back in the House and I must say, in all respect, that I do not think his speech this afternoon was a credit to his ability to understand the complexities of the economic system.

My goodness, look who is talking!

His speech certainly has left the impression that he is very much against free enterprise. I am not responsible for the frustration the hon. member is experiencing in his party, but he should not try to take it out on the House.

Dawie, if you can teach him something about rugby, he can teach you something about the economy.

He referred to exploitation by the private sector as if each and every company is now participating in exploiting the poor consumer.

But you know that is not what I said.

I have already replied to the hon. member and I do not want to enter into a further discussion on the matter. We must guard against the ugly face of capitalism. In that respect I am with the hon. member. We must guard against the ugly face of capitalism, but at the same time we must not create the impression that that is the only face of capitalism.

Are you a capitalist, Dawie?

I am not a socialist. If we want to destroy business confidence in this country and with that the advantages of growth and development which should be to the benefit of all in this country, we must continue to talk like the hon. member has done this afternoon.

[Inaudible.]

As far as the question of credit cards and the Trade Practices Act are concerned, the hon. member has written me a follow-up letter and I will reply to him in full in due course.

But whose job is it: Yours or that of the Department of Finance?

I have explained to the hon. member in my first letter that it falls under the Department of Finance, but I will come back and reply to the hon. member’s complaint.

I have already referred to some of the points raised by the hon. member for Port Elizabeth Central. He also asked that a deconcentration point should be created for Port Elizabeth. The intention with deconcentration points is to absorb the overflow of industrial congestion in the metropolitan areas.

Why give them such big incentives?

In this same speech the hon. member thanked the Government, albeit reluctantly, for the incentives given to the metropolitan region comprising Port Elizabeth and Uitenhage. The hon. member for Uitenhage has also referred to the incentives given to industries in that region. The fact that the Government decided to give incentives to industries in that region indicates that there is still industrial land available and that the Government feels that development should take place in the metropolitan areas of Port Elizabeth and Uitenhage. A deconcentration point is therefore certainly not needed somewhere outside Port Elizabeth and Uitenhage.

*The hon. member for Sasolburg made a very good contribution on the question of labour productivity. He spoke about productivity in general. Labour productivity is only one aspect of productivity.

†Increases in productivity is related to the utilization of the M’s; men, money, machines, materials and management. Of these management is the most important.

*Management is important, because good management has to co-ordinate and organize all the other factors. I liked the hon. member for Sasolburg’s approach that productivity should in fact become a way of life. It is in fact a characteristic of the Eastern countries, which are so frequently held up as an example to South Africa too, that productivity, more than anything else, has become a way of life among the people there. To the extent to which such an approach can be promoted at school, and even at a preschool stage, we shall be able to ensure in South Africa as well that work is done with greater dedication and that productivity is increased in all spheres of life. Such an approach should really have been inculcated at a pre-school stage, because I think the attitude to life which is established in the parental home is important when it comes to productivity. A matter in regard to which we should perhaps examine our own consciences is the fact that the youth of South Africa—and I am speaking in general and non-specific terms now—is perhaps still too inclined to display a lax attitude towards work and the obligations which go with it.

The hon. member for Welkom focused attention on the creation of a commercial pattern in Black towns. I think his remarks were very stimulating. This is of course a matter which is primarily the responsibility of the Department of Co-operation and Development, and one in which the Administration Boards, as well as the Black local authorities, have to play a role. In so far as the Department of Industries, Commerce and Tourism is in fact able to make a contribution, I shall gladly bring this matter to the attention of the hon. the Minister of Co-operation and Development. The fact of the matter is that the Small Business Development Corporation can play an important part in developing entrepreneurship in Black urban areas and in helping to establish the small industrialist in those areas as well. I have also taken cognizance of the hon. member’s remarks on the private sector which should be given a greater share in the distribution of liquor in Black residential areas.

†The hon. member for Edenvale made a very interesting and constructive speech on small businesses and the important role of small businesses in the creation of jobs. The part they play in creating employment is well known. I should like to quote to the hon. member only one sentence from an article in Time of 3 August 1981 dealing with small businesses. It states—

It is true that during a downswing or a recession smaller businesses usually find it more difficult to survive due to a lack of resources. I think the main purpose of the Small Business Development Corporation is not in the first place to provide the finance for small businesses, but also to provide the know-how and managerial skills to enable them to be viable enough to withstand even economic downswings. Therefore the supportive role of the Small Business Development Corporation might be even more important than the financial role. As quite a few hon. members referred to the Small Business Development Corporation and made constructive suggestions in this regard, I shall send the Hansard containing their remarks to the chairman of the Small Business Development Corporation.

*The hon. member for Uitenhage also discussed the policy of decentralization as a partnership in progress. This was also said in consequence of what the hon. member for Klerksdorp had said. He also referred to Port Elizabeth and to the incentives which have been made available to Port Elizabeth and Uitenhage as well. I want to congratulate the hon. members who represented the Port Elizabeth/Uitenhage region here. They have continued untiringly in their efforts to convince the Government of the pressing need for incentives to be granted in that region, in that particular area, as well. This has now been done, and I trust that the same inspiration will also emanate from them now to the private sector to avail itself of these opportunities and ensure that the manufacturing sector obtains a good foothold, so that development and progress will become a feature of that region too. I should also like to associate myself with the appeal which the hon. member made to the trade unions to display a greater measure of responsibility.

The hon. member for Algoa raised the question of factory unit complexes. The creation of factory unit complexes by the IDC was of course specifically aimed at the creation of industrial growth points. No factories were established in any metropolitan areas in South Africa. The intention was in fact for the factory unit complex to be used as a means of attracting smaller industrialists to the decentralized areas. Consequently this does not fall entirely into the category in which the IDC may operate. I just wish to express this idea: The Small Business Development Corporation is itself planning the establishment of industrial units and factory unit complexes. With the co-operation of local authorities and industrialists, it may be possible to arouse the interest of small business enterprises in this sphere as well. Above all, however, I believe that with the incentives which have now been granted to Port Elizabeth and Uitenhage it is certainly possible for the private sector to get to work and help to create facilities in those areas.

The hon. member for Ceres made an interesting contribution on the liquor industry. At this stage I can inform this House that we have received the report on the liquor industry from the Competition Board. This is a rather comprehensive report. As soon as the department has completed its investigation and has processed the report, I hope to be able to table it here before the end of this session. At this stage I still have friends, but subsequently I may not have any.

I took cognizance of the hon. member’s observations on the separation of the wholesale and retail sectors, and of the concern which he expressed in connection with possible concentration in the retail sector. However, I think the hon. member is perhaps unduly concerned about that aspect.

I am in full agreement with the hon. member that since the announcement made by the previous Minister of Justice in 1980 that liquor distribution in Black residential areas was going to be placed on a sound and legal basis, it has always been the intention of the Government to do so. The hon. member wanted to know what progress had been made in this connection. Unfortunately, I must say that the progress so far has not been satisfactory. There were practical problems and on various occasions representations were made. However, I believe that the matter will now be dealt with more quickly, and that the report of the Competition Board will serve as further stimulus to finalizing this matter as soon as possible.

The hon. member also referred to the licensing and distribution of liquor in Black areas, and suggested that it should faill under the Liquor Board. I take it that he was referring to the sorghum beer legislation, which actually falls under the Department of Co-operation and Development. These are matters which also receive attention in the Competition Board report, and we shall be able to conduct a further debate on them on a later occasion.

The hon. member for Paarl discussed the textile industry, which is in my opinion a very important branch of industry. The statistics which the hon. member quoted confirmed how important it was, not only as a provider of employment, but also as regards the contribution it makes to the national product. It is true that the industry is subject to marked fluctuations, but since 1979 the industry has in general been going through a good period. The high utilization of capacity to which the hon. member referred is a feature of the industry. However, we are also ware of the problems, particularly as far as cheap imported articles are concerned, and the Board of Trade and Industries recently announced further protective measures for this industry.

The hon. member referred, by way of a passing remark, to the 10% surcharge, which had come as a welcome relief. However, I want to warn those concerned that the industry should not regard the 10% as a further protective measure. The 10% surcharge is a fiscal measure which was instituted primarily because of balance of payments problems, and as far as the Department of Industries, Commerce and Tourism is concerned, we hope that for the Minister of Finance an opportunity for lifting this surcharge will present itself as soon as possible. If industries are now going to regard the 10% surcharge as a form of protection, they are going to be cruelly disillusioned when the surcharge is abolished. The fact of the matter is that the textile industry is sensitive to imports and is worried—owing to the spare capacity which exists in the world as a result of recessionary conditions in most Western countries—that South Africa could very easily become an area where a slump could occur. In this connection I should like to draw the attention of hon. members to the fact that not only have tariff measures been introduced to deal with normal imports, but that in the case of textiles there is in most, if not in all cases, a formula for the very purpose of keeping competition, which is conductive to disruption and is not related to costs, at bay.

As a further indication of the extent the Government was in earnest about this industry, which I announced in November 1981 that a committee was being appointed to institute an investigation into the textile and clothing industry. I do not want to take up the time of this House now by spelling out its terms of reference, but under the chairmanship of Prof. Steenkamp, with various interest groups represented on the committee, consideration is also being given to the whole of this important branch of South African industry. I believe, too, that important recommendations will be made by this committee.

†The hon. member for Bezuidenhout referred to the Competition Board’s report on explosives and congratulated the board for its fearless investigation. I must say that I think that the board does, in fact, deserve praise, not only for this report, but also for the excellent work it has done in most cases. I have upheld their findings, not only in this particular case, but in other cases as well. This is one way, I believe, in which we can promote competition, and I am glad to see more hon. members taking an interest in what is being done by the Competition Board. As I said earlier in my speech, I am prepared, if necessary, even to amend the law to give it more teeth so as to achieve this very objective. More competition is the only way in which we can, in the long run, avoid the problems that were referred to earlier on.

The hon. member also referred to the verdict of the court in JSE case. As the Johannesburg Stock Exchange falls under the hon. the Minister of Finance, I should not like to comment on this matter any further.

The hon. member Mr. Aronson spoke about the importance of the Government’s strategy for regional development and thanked all the officials who carried out the investigation and made the final report possible. He also requested a deconcentration point, but from my reply to the hon. member for Port Elizabeth Central I think he will realize that that was not the intention of deconcentration points.

*The hon. member for Algoa referred to price control, and specifically to the investigation into automobile spares. As the hon. member said, informal control does exist. The maximum profit margin on automobile spares is laid down in this way. The Competition Board investigation also indicated that there was keen competition between the various manufacturers, as well as between the manufacturers of spares. In particular the board investigated the question of the restrictions which are imposed on agency holders of the so-called genuine spare-parts, persons who were previously prohibited from obtaining spares from, other manufacturers. I think the eventual solution should be sought through the promotion of more competition in that industry rather by attempting to exercise control. Control results in problems of various kinds and it is frequently not easy to exercise control over such a complex branch of industry. If one is certain that there are no restrictive practices, and that the necessary competition exists, such a branch of industry will in a more beneficial way in my opinion, be able to set its own house in order.

The hon. member also pointed out that there were specific reasons why costs sometimes appeared to be abnormally high. He referred to the costs entailed by keeping spares in stock. The fact of the matter is that many of the smaller spares are imported as units. The components are at this stage not yet being manufactured to such an extent in South Africa that local manufacturers are able to make smaller components available. Consequently spares are frequently imported as parts of larger units, and this means that the units as such have to be offered for sales. I can say that complaints are being received from time to time. The department deals with these complains, in an administrative way as well. If the hon. member would therefore be so kind as to furnish me with the particulars, I shall go into the matter further.

†I am quite delighted to see that the hon. member for Amazimtoti also discovered the good work done by the Competition Board. He referred to my point this afternoon that we must all try to make a contribution and not in terms of salary increases demand more from the economy than what we are prepared to put into it. He said that, when the work-force asked for increases in wages and salaries, they were not asking for more but they were only asking to be compensated for inflation, rising costs, etc. The fact is that, unless we ask for less, we are not going to beat inflation. I should like to quote to the hon. member from The Economist of 27 March. This is in regard to a point the hon. member made earlier in this debate when he said inflation was down in the USA to 7% or perhaps 8%. Why is that so?

Because they cut taxes.

The reason is that the work-force, the unions, were prepared to settle for less.

The unions are not the only people.

Let me quote the following—

This kind of sacrifice is needed if we want to beat inflation.

The Government must sacrifice first by cutting taxes.

The hon. member also referred to bricks and the information that is not available in that regard. Unfortunately we do not keep statistics on all manufacturers. The increases in the price of bricks in the past were only in respect of one major manufacturer. Therefore, if the hon. member asked for more information concerning the one manufacturer, we might have been able to furnish him with the information he requested, but he asked about all manufacturers and they were not all under price control. It was only in respect of one manufacturer. The hon. member quite rightly said that what is needed is more competition. We must not, however, expect of the Competition Board to create more competition. The Competition Board can do its utmost to identify restrictive practices and in that way encourage competition, but it cannot create companies to compete in the market. I have, however, asked the IDC if they could not encourage people to go into those areas where competition is lacking and regarding brick manufacturing they replied that some of the people approached were not interested because it is a capital-intensive venture. I am not referring to a small brick-yard in a smaller place where fewer restrictions apply. I am talking about putting up a modern brick factory. That is capital intensive. One reason for removing price control was to encourage investors in cement and bricks to create the kind of capacity we will need when the next upswing occurs, which we hope will be in the very near future. He also referred to Karbochem and to the manufacture of synthetic poly-isoprene rubber. I should like to point out that an application of 70% was submitted to the board. That does not mean—it would in fact be pure speculation—that a protective duty of 70% would be granted to Karbochem. The matter is being investigated at the moment, and I should not like to comment any further on it now.

In conclusion the hon. member also referred to the desirability of more funds for the department. I thank him for that. I shall certainly convey his plea when we approach the hon. the Minister of Finance for more funds. We can certainly put it to good use. The hon. member is, however, also aware of the many problems in that respect. He also knows, I believe, that all Government departments must unfortunately economize and that, as a result of that, they have had to reduce expenditure.

*The hon. member Dr. Welgemoed discussed the ADE, and explained to us in a excellent way the benefits of ADE. He pointed out that the critics were now having to eat their words. I was privileged to attend the opening ceremony last Thursday, and I should like to issue an invitation to the hon. members of this House to pay a visit to this very excellent undertaking. On behalf of the board of ADE I should also like to issue such an invitation to the Opposition parties. We can arrange a time and organize such a visit. The ADE is really an undertaking of which everyone may be proud. The problems previously foreseen have to a great extent been eliminated, and the achievements that have been accomplished there by a corps of workers, who two and a half years ago knew absolutely nothing about the motor industry, are indeed quite exceptional.

The engines which are being manufactured at Atlantis are considered by the two skilled partners to be of the best quality and comparable with the standards of the products of any other plant of theirs elsewhere in the world. This is a credit and a compliment not only to the management of Atlantis, but to the employees there as well.

The hon. member referred to the distribution of spares. The object in this respect is to keep competition as keen as possible. We shall therefore give attention to the particular problem to which he referred.

In conclusion I should like to thank all hon. members who participated in the debate for having done so. I am really of the opinion that, in general, we conducted the debate on a very high level, something which is greatly to the credit of everyone. On this occasion I should also like to thank the hon. the Deputy Minister for his cordial co-operation and for the support which I received from him. Furthermore, I wish to express my thanks to Dr. Du Plessis and his senior officials, the chairman of the Liquor Board, the Competition Board and the Board of Trade and Industries, and then, too, I wish to avail myself of this opportunity of thanking the chairman of the boards of directors of corporations for the good work they and their boards are doing. Frequently, without receiving the necessary recognition, they are sacrificing a great deal of their own time in the interests of the economic development and progres of South Africa.

Mr. Chairman, I should like to thank the hon. the Minister for the invitation extended to hon. members on this side of the House to visit the Atlantis diesel engine project. Some of us were fortunate enough to do so last year, and I must say that we found it very interesting. We were very impressed with a great deal of what we saw there and that was before they were on full stream.

I am going to talk on tourism, but I should like to comment on a remark made by the hon. the Minister today to the hon. member for Yeoville that we should be careful, when talking about exploitation, that we do not harm business confidence. In this regard I want to refer to what the hon. the Minister said in the early part of his speech about the need to recognize the fact that we are living in a world which is changing fast. I believe it is important for us to realize that it is not only in the scientific and technological fields that this is happening and that when it comes to business confidence in South Africa it is as important to recognize other fast-changing aspects of our country.

Mr. Chairman, to come to the question of tourism, the subject I wish to discuss this evening, I want to say that unfortunately in South Africa there remains a lack of understanding and appreciation of the importance and magnitude of tourism. These are not my words but the words of the hon. the Minister himself which he used when addressing the Asata conference in Athens during August last year. Unfortunately, I believe that this Government is as much at fault in this respect as anybody else.

The low priority accorded the tourist industry is clear for all to see. Let us consider, for example, the question of reports. We have had no new reports relating to tourism since our debate on the subject in September of last year. As far as the department itself is concerned—I realize, of course, that the Departments of Industries and Tourism were not previously combined—the most recent information we have is for the calendar year 1979. As far as Satour is concerned, we have a report for 1980. The report of the Hotel Board is for 1980 as well. Against this background we must bear in mind the fact that we are now conducting a debate on tourism a third of the way through 1982. I think it is a disgrace that we have no more recent reports from the Department of Tourism than the report for 1979. No self-respecting organization would attempt to budget on the basis of information that is nearly two and a half years out of date.

I want now to discuss the 1982-’83 budget as it affects the programme on tourism. The budget is up by 17,8% which at first glance would appear to be a healthy increase. However, when one analyzes it more deeply, one finds that in reality it is, in financial terms, a retrogressive budget. The key element of the budget is, as it always has been, the grant-in-aid made to Satour to promote tourism to South Africa from foreign countries. That is up by 14,6% to R9,1 million. However, in real terms, this represents a substantial decline in respect of the work that Satour is going to be able to do because of inflation and, more important this year, because of the depreciating rand. I believe it will have a severely adverse effect in Europe and in North America on the ability of Satour to promote South Africa effectively as a tourist destination.

The largest percentage increases in this budget are the contribution to Sartoc which is up 56,3% and in respect of the section for the promotion of domestic tourism where administration is up by 420% and publicity aids by 86%. I should like to ask the hon. the Deputy Minister who I presume will be replying in respect of this section of the department’s activities for further details in this regard. I should like him to explain particularly the startling increase from R53 000 to R222 700 in the administration of the domestic tourism promotion programme. That is an absolutely amazing increase and I should certainly like an explanation for it.

The period of eight months that has elapsed since the last debate on this Vote took place has been characterized by a great deal of talk but very little action. In August last year the hon. the Minister said in Athens that the Commission for Administration was undertaking a “function-centred investigation” into tourism.

In the debate in this Committee in September last year the hon. the Deputy Minister said that he liked the idea of a conference on tourism to develop a total tourism strategy. Speaking in Athens, the hon. the Minister said that the Travel Agents and Travel Agencies Bill would be introduced in Parliament early in 1982, while in September of last year a commission of inquiry was appointed to investigate the problems that tourist operators experience in South Africa—that is, in relation to road transportation services for tourists. The hon. the Minister has also had a report from the Competition Board on Asata for eight months. We are waiting to hear what has happened in respect of all these matters. Many aspects of tourism are in a state of suspense as a result of these investigations. I hope the hon. the Deputy Minister will this evening report fully on what is happening in regard to each of these items. It certainly is an unsatisfactory state of affairs under which we are presently operating.

Looking at 1981, and based on information which I have managed to obtain by way of questions, not based on any reports we have received, there was a small increase of 2,4% in the number of visitors to South Africa, bringing the total number to 719 000. Those on holiday though, increased by only 0,8% in other words a virtually static position. The small increase overall was caused, primarily, by a 10% decrease in visitors from Africa. However, there were many encouraging figures.

The figures for Europe were up by 13,7%, those for Asia, which includes Israel, up by 17,1%, and those for the USA up by 17,5%. Excluding Africa, we have, I would suggest, satisfactory growth. The decrease in respect of Africa is due to a drop in the number of visitors from all neighbouring territories, and I think we should ask why this is so. I think this trend is disturbing, not only as far as tourism is concerned but also as far as economic and political factors are concerned.

The number of South African residents departing temporarily in the period January to November dropped by 33% compared to the figure for the previous year, and I hope this is an encouraging sign of the greater recognition by South Africans of the enormous variety of exciting vacation opportunities within their own country.

A great deal needs to be done but I wish to mention just two aspects. The first aspect is the Blue Train, which over the past three years has been more than 90% booked on 83% of its journeys and fully booked on more than half its journeys. In the busiest time of the year it is fully booked 11 months prior to the date of departure. The Blue Train is world renowned as a major tourist attraction. I should like to suggest to the hon. the Deputy Minister that he consults with his hon. colleagues about the feasibility of introducing a second Blue Train to cater for the enormous demand which already exists.

The second aspect I wish to mention is the question of environmental conservation. A survey has shown that 77% of foreign tourists to South Africa choose this country because of its natural beauty. It is imperative that this beauty be preserved, but one gains the impression that some planners and developers are blissfully—and often selfishly—unconcerned about the harm they could be causing to our tourist industry. A good example of this is the proposed kaolin mine in the Noordhoek Valley near the renowned Chapman’s Peak Drive.

We should consider drawing up a list or register of places of considerable interest to tourists. Such a register would then be available to decision-makers and could play a role in preventing the degradation of our environment. Wherever possible we should try to avoid red tape and bureaucratic delays, but we cannot just sit back and allow our natural heritage, and in the process our tourist industry, to be spoilt piecemeal.

The natural beauty of the Cape Peninsula is already on the decline as unscrupulous developers are allowed to make inroads into environmentally sensitive areas, and I call upon the the hon. the Deputy Minister to act urgently before it is too late in the Cape Peninsula and other environmentally sensitive areas all over the country.

Mr. Chairman, the hon. member who has just resumed his seat, emphasized the importance of tourism, and I agree with his views. The hon. member brought other aspects, too, to the hon. the Deputy Minister’s attention, and I shall therefore not react to them. The hon. member will forgive me if I do not react to his remarks in connection with local circumstances.

I think we are all agreed that tourism has become one of the world’s largest industries. It is estimated that tourism will overtake the oil industry by the end of the century, by which time there will be about 600 million international tourists a year. This represents a growth of more than 100% within a mere 18 years. Such rapid growth will also give rise to its share of problems and challenges. Tariffs and services will have to be created or expanded to meet the demands of the tourist. It is therefore essential that there be constant planning in order to meet these challenges. Those persons in the Government and in the private sector who are involved with tourism must, therefore, identify the problems timeously and try to find solutions for them. Everyone is agreed that tourism is a tremendous earner of foreign exchange. In 1980 we passed the 700 000 mark as far as tourists are concerned, and we earned over R520 million from overseas tourists. It is expected that when the other information becomes available, this figure will be even higher for 1981 and 1982. Most tourists came from Britain i.e. 173 000. This was followed by Zimbabwe with 105 700 tourists. A total of 343 125 tourists came from Europe and 234 944 from Africa. The number of tourists from Asia showed a welcome improvement, viz. 30 657, and over 80 000 came from the USA. Australia and New Zealand provided the fewest tourists with a mere 19 000. As far as world tourism is concerned, it is interesting to note that tourism to South Africa is growing more rapidly than world tourism in general. During the 10 years from 1966 to 1976 world tourism increased by 76%, whereas during the same period tourism to South Africa increased by 148%.

I should like to discuss inland tourism for a moment. I read in Die Burger of 30 April of this year that the national revenue from tourism last year totalled R1 300 million, approximately one-third of which was spent by overseas tourists in South Africa. Once again this emphasizes the contribution which tourism makes to our country’s economy. 30% of this enormous sum is spent on accommodation, to mention but one aspect. It is calculated that R140 million is earned from tourism in the Western Cape every year. This can be compared with the total revenue from the wine industry. I do not think we quite realize what tourism means to our country. Gold, coal, diamonds, uranium and other minerals we export are not replaceable. Once we have mined it all, it is gone. These are diminishing assets. In contrast, our earnings from tourism are an inexhaustible source as long as we look after our natural assets and protect them from a base. Tourism not only earns foreign exchange, it also stimulates the economy and employs thousands of people, over and above this important role, tourism also builds bridges between countries and people. Every tourist who comes to South Africa is in actual fact an unpaid ambassador for our country. In this respect a tremendous responsibility rests on the shoulders of everyone involved in tourism; the hotel managements, touring companies, bus drivers and tour guides. They must all be friendly and expert people.

Surveys show that tourists visiting South Africa rate the country as a tourist destination as follows: 39% of those questioned said South Africa was an excellent tourist country; 43% said South Africa was good and 11% said South Africa was reasonable. They added to this that South Africa’s climate and its hospitality were the main reasons why they rated South Africa so highly. There is little we can do about the climate, but friendliness and hospitality are things we can all do something about.

This brings me to a second point. I feel the tourist industry cannot feel satisfied—and in this regard I agree with the views of the previous speaker—with the meagre R10,6 million voted for it in the present budget out of a total budget of over R18 billion. I am grateful for the higher appropriation, but when the rise in the total appropriation is taken into consideration, this increase is inadequate. Our publicity campaigns abroad are drastically hampered by a lack of funds. Even in 1975 countries were spending $23,7 million in the USA to publicize their tourist attractions. Canada spent $4,7 million. The Bahamas spent $2,7 million there. The State of New York has a publicity budget of $4,3 million. Hongkong has a budget of $8 million to promote tourism there. A country like America, with its millions of inhabitants, has tremendous tourist potential for us. It is estimated that if we reach a mere 0,1% of Americans this will bring 212 800 tourists to South Africa, which will mean an additional R88 million in foreign exchange. The USA is therefore a large potential market for us. I want to pay tribute to the small and motivated Satour organizations, that canvass this large country successfully. I want to congratulate the department and all its staff on their achievements in this field in spite of the meagre funds. In the light of all I have said I shall support the hon. Minister and the hon. the Deputy Minister if they request more funds in the future.

In the third place, in addition to overseas and local tourists, there is another category of holiday-makers that is increasing in volume and offering an enormous market potential, i.e. the non-Whites. Everything indicates that people of colour are not only travelling more, but that real tourism is also gathering momentum among them. Thus the entire population is now involved in tourism, whereas previously it was aimed virtually exclusively at Whites. This not only makes new and greater demands on the tourism infrastructure, but also offers new challenges to the entrepreneur. Careful attention will have to be given to the tourist facilities already available, the facilities which must be created, where the greatest need for further facilities exists and what the nature of these facilities ought to be. In this regard, the private sector has a tremendous responsibility to ensure that the needs in this field are met.

There are also two other problems I should very much like to identify. The first are the so-called trough period. South Africa’s trough period with regard to tourists is from May to October, our winter, when it is summer in the Northern Hemisphere. The task of filling this trough period must be undertaken by all sectors. During this period our tourist infrastructure has spare capacity, and this harms the trade. A possible solution would be to offer tours to South Africa at attractive reduced rates during this period. In this way empty seats on overseas flights from and to South Africa could be filled. If a campaign of this nature could be successfully launched, thousands of extra tourists could be lured to South Africa, with obvious benefits. I am convinced that the department and the South African Airways should give serious consideration to this. If the flow of tourism can be distributed more evenly we can also ensure a better service for our tourists.

Order! The hon. member’s time has expired.

Mr. Chairman, I rise merely to afford the hon. member the opportunity to continue his speech.

Mr. Chairman, I thank the hon. member for the opportunity.

The second problem linked to this is the problem of rising costs. South Africa is a distant destination, which makes it relatively expensive to come here. This is a problem that we are saddled with. I therefore want to make an earnest appeal to the industry to handle price increases with the greatest circumspection. If our prices become too high, we shall price ourselves out of the market. We must guard against exploiting the tourist. A satisfied tourist returns and encourages others to come here. As far as our local tourist market is concerned, too, we have not yet succeeded in distributing our holidays in such a way as to eliminate congestion at holiday resorts. In spite of many pleas over the years our provinces have not yet got around to this.

Other problems are the necessity for local authorities to concentrate on tourism in their own areas. In this respect a great deal can be done, inter alia, by providing good roads—and I particularly emphasize the necessity for clear road signs—tidy public facilities, accommodation and sport and recreation facilities. In addition, every local authority ought to market its unique natural attractions, and if there are none, create them.

Another problem bothering me is something which is occurring to an increasing extent, namely the “skollie” element who pester our people and tourists at hotels. Begging has become an everyday phenomenon in our cities and these beggars earn quite a sizeable sum. However, every now and then one reads of robberies and assaults involving tourists, and this creates the wrong impression of South Africa. We cannot afford this, either, and for this reason I want to make a special appeal to our hotel industry to ensure, in co-operation with the Police, that this element is eliminated, because I am convinced that this can be done if we only give the matter special attention.

I want to conclude by drawing attention briefly to the excellent work done abroad by the South African Tourist Corporation. Satour markets South Africa as an important tourist destination in more than 35 countries, and independent surveys in the overseas tourist industry confirm that this organization plays an important role in countries supplying tourists for South Africa. Satour actively promotes the South African tourist industry with its overseas marketing and also co-operates closely with the South African Airways and other international airlines serving South Africa.

The corporation’s marketing activities are planned and based on intensive market surveys and research. However, one problem Satour is saddled with that its funds are being swallowed up by the rising service costs in overseas countries. Up to 70% of the corporation’s annual income is spent abroad where the cost of living is much higher than in South Africa.

I want to congratulate Satour on the beautiful brochures they publish. The organization has also made a number of films of excellent quality, and the film unit that produces these films is to be congratulated. Everyone who has seen the film “A world in one country”—to mention but one—will agree that it is of excellent quality. The tragic death of the film director, Mr. John Da Silva, who distinguished himself as a leading travel film director, was a severe blow to Satour.

The corporation’s active visitor’s programme aimed at bringing selected tour operators and travel agents to South Africa, is largely responsible for the increasing popularity of the Republic of South Africa as a tourist destination.

In conclusion I want to draw the hon. the Minister’s attention to Satour’s representatives abroad. In 1980 I had the opportunity of travelling through the USA and Canada, and I visited some of our offices. There I came to realize that top calibre officials represent us abroad. This small group of South Africans deserves our thanks and appreciation for the important work they do abroad, representing the Republic of South Africa. We thank these people for what they are doing, and I feel that the department must take another look at the circumstances of these people. Their salaries and working conditions do not always compare favourably with those of other overseas representatives and officials at ambassies. Nevertheless the marketing activities of Satour through their overseas representatives have undoubtedly succeeded in placing South Africa on the world market.

Mr. Chairman, the Tourism Vote is of course pre-eminently a Vote into which one does not introduce a political note. Accordingly, I have been sitting listening to how the various political parties have been conversing so peacefully, and therefore it is true that in this House, brothers can live together in peace. That is of course a very fine idea.

What about your political tour?

I should like to associate myself with what the hon. member for Kempton Park said, because in my opinion everything he said was true. In the same breath and in the same spirit I also wish to advocate more tourism.

This evening I want to emphasize the fact that we in South Africa must realize that winter is a very good time for tourism. In 1980 there were more than 703 000 foreign tourists in South Africa. They spent an average of 18 days in this country, and provided South Africa with a total of R476 million in foreign exchange. Recently an extensive and reliable survey of tourists and their visits to South Africa was carried out, and the marketing organization tackled major projects. One was a survey of the number of tourists that visited South Africa from December to April, while the other project covered the period June to September. It is interesting to see what tourists were involved. There were tourists from our most important marketing regions—all overseas countries—such as the United Kingdom, West Germany, France, Switzerland, Italy, Portugal, Netherlands, Australia, the USA, Canada and Israel. This survey covered people from those countries. The aim of the project was to provide a total picture of tourism in South Africa. Attention was focused on the preferences of those tourists while they were touring here, the times they chose to visit the country, the kind of tours they undertook, the places visited and their evaluation of the services and facilities offered to them in South Africa. There was also an evaluation of the Republic of South Africa as a destination for tourists during the winter months. Virtually half of the visitors had already paid one or more visits to South Africa. 11% of the tourists had already been to South Africa eight or more times. Therefore, virtually all were overseas visitors who had already been in South Africa and enjoyed this country so much that they had come back one or more times. The number of first visits in the winter months was even higher than in the summer months, viz. 52,5%. Therefore tourists from abroad very much like to spend their holidays in South Africa during the winter months. This is an important factor and we must therefore consider it. We must try to adapt our holiday season periods, because during the period 1 June to 31 July 1980, 53% of the visitors were holiday-makers, while 47% were here on business. During the period 1 August to 15 September 1980, 70% of the visitors were holiday-makers, while only 30% were here on business. In other words, from May to July, business visits were high on the list, but after August, business visits dropped drastically, while holiday visits increased rapidly. It is very interesting to note that short holidays of eight to 14 days were far more popular in the winter months than in the summer months.

There is another aspect, too, which we must certainly consider. We must take note of those places which are most popular among the tourists. Pride of place, of course, goes to the game reserves. The popularity of the game reserves remained more or less constant during the two holiday periods. The most important part was, of course, the Eastern and South-Eastern Transvaal, with a figure of 24,5% for the winter season. This was followed by the Cape Peninsula, with a figure of 23,4%. Durban and the Natal South Coast came third with a figure of 16,3%, Johannesburg had 12,5%, Pretoria 7,1% and the Garden Route 5,5%. More than 82% of the visitors rated South Africa “good” or “outstanding” as a holiday centre, while 11% said that it was reasonable, and fewer than 2% said that it was poor. These figures indicate that the results are outstanding.

In lighter vein I want to say that one can see that the Transvaal bushveld is also a very good place for holidays. I understand that there are about ten MPs who are having a vacation up there at the moment. I do not know whether they are dowsing fires, grilling meat or being grilled, but apparently there is quite an exodus to the bushveld.

The question occurs as to what we in the Republic of South Africa are doing to promote winter holiday resorts. I feel that it is important, as far as winter holiday resorts are concerned to attract overseas visitors who are accustomed to a cold climate. Accordingly I wish to make an earnest appeal for the holding of a tourist congress or meeting there, when it suits the department, the hon. the Minister and the hon. the Deputy Minister, a meeting at which the State, Satour, the S.A. Transport Services, the hotel industry and everyone in South Africa who is concerned with tourism will be represented and where in-depth discussions of this matter can take place. The amount being budgeted is a little more than R10 million, and when we consider what we get for this R10 million, we can definitely spend a little more money on tourism because it is probably the best investment in the entire budget, because in this way we attract many visitors to South Africa.

One asks oneself what tourism means to South Africa. As the hon. member for Kempton Park said, all the people who come here from overseas are good ambassadors for South Africa. Just think how many people who have visited South Africa praise our country as a tourist destination. When I was overseas in 1973, I met a prominent man in the USA—I think he was third in charge of the biggest rail network in America—and he had a very wide circle of friends. He came to visit us in South Africa and after he had left, he sent me a small four-to six-page periodical every month. When he was here we took some trouble. He ate with us in the House of Assembly, he met Ministers, etc. He devoted four full pages of that little journal of his to South Africa. Not one of us in this House could make finer propaganda for South Africa than that friend of ours did in his little journal in America. That journal is sent to approximately 1 500 people. I mention this merely as an example. He really appreciated the fact that he, as an ordinary visitor, had the opportunity to speak to our Ministers and the then Speaker. He had never expected anything of the kind. This is the kind of thing we can exploit and can use to good effect.

I want to address a few words to the hon. the Minister in connection with our hotels. I shall come back to tourism in a moment. There is another matter I want to raise in that regard, but my time is running out. Last year legislation was passed here which gave the hotel owners the option to open their premises to members of all races. I want to make a friendly request for insignias to be displayed at those hotels, similar to those indicating whether a hotel is a one, three or five-star hotel. This is in the interests of all race groups in South Africa. It is in the interests of the Whites, who would know when they took guests there whether it was an international hotel or not. It is in the interests of the Coloureds, the Indians and everyone else. He may think that he is allowed in a certain hotel and be told: “No, I do not want you here.” However, if it is indicated whether the hotel is an open hotel in terms of the Act, then this could not cause embarrassment to anyone. This is not racism, but will prevent friction, embarrassment, etc. [Time expired.]

Mr. Chairman, unfortunately time does not allow me to react in detail to the speech by the hon. member for Sunnyside. However, I am sure that the hon. the Deputy Minister will furnish him with comprehensive replies to the ideas he advanced.

In the short time at my disposal I just want to exchange a few ideas in connection with tourism. Before doing so, however, I just wish to associate myself with the thanks conveyed to the Government and all involved by my Eastern Cape colleagues for the regional development benefits that the Border is to enjoy, benefits which, as hon. members are aware, are not only the most substantial in the Republic, but also the most substantial such aid in the world. In spite of the economic recession, there are already indications that development is going to take place in East London and that the region will develop to its maximum potential.

†I may add incidentally that all these good things have happened to East London since the hon. member for Port Elizabeth Central left us. He must therefore qualify as the best export we have ever undertaken. [Interjections.] Regrettably, however, our gain appears to be Port Elizabeth’s loss, as we most certainly will not take him back. [Interjections.]

*I believe one would be justified in saying that in spite of outstanding work done by organizations like Satour, not enough has been done to bring tourism in South Africa up to a satisfactory level, and something positive will have to be done to expand it. Particularly in view of the unfavourable international climate in which visitors have to be canvassed abroad, a far bigger and more purposeful effort will have to be tackled, involving both the public and the private sector. I believe that the State ought to take the initiative in this regard by, firstly, making more funds and means available to the existing organizations that receive their funds from the State to enable them to expand their activities.

In the second place I believe that Government support in the form of a Government development plan, similar to the industrial development plan which came into operation on 1 April this year relating to the development of industries, must be drawn up and set in operation. In terms of this plan, there must be support, based on a central fund, for the private sector involved in tourism—in this instance, tourism in the broadest sense of the word. Then, too, the State must act as co-ordinator to ensure that the two sectors supplement one another and that each facet of the industry receives the necessary attention. This must be done in close co-operation with the national States, more specifically those national States which have already progressed to independence.

I realize that the lack of international recognition of these States could cause problems, particularly in cases where our other neighbouring States are involved, neighbouring States which at present belong to the Southern African Organization. However, in view of the historic political links and the economic inter-dependence of South Africa and these States, I believe that our first priority lies with Transkei, Bophuthatswana, Venda and Ciskei, and that our development must be on a regional basis to include these countries as well. A structure in which they could be acommodated must therefor be created even if this leads—unfortunate as that could be—to the exclusion of the other neighbouring States which are at present involved with us in this regard.

Such tourism, based on regions rather than state borders, could provide these States not only with an important source of revenue but also with an important source of international recognition.

By way of such a regional development scheme the private sector could be stimulated so as to enable it to become involved to an even greater extent in the tourism industry, and to develop it further. In this way, unexploited markets and new areas can be entered more purposefully, to the benefit of the industry as a whole.

The benefits of tourism go much further than merely the major financial benefit it involves. The value of the good relations and the understanding that is built up in this way cannot be measured in terms of money. Each of us can and must play our part in this regard.

Mr. Chairman, I found it most interesting to listen to what the hon. member for East London City had to say in connection with the need to consider the independent States in the process of planning our own overall strategy to attract tourists to South Africa and to Southern Africa. I think this is a very important factor that the hon. member has raised because, as other hon. members have already said, tourism can be an extremely important income earner for some countries—in fact, it is for most countries—because such countries do not have natural resources or industrial development which can be utilized to improve the lifestyle or welfare of the people of those countries. Therefore, tourism in newly independent States, for example, can prove to be a very valuable asset indeed. I am particularly pleased that the hon. member raised the question of the independent States because when I was considering what to discuss this evening, that was one subject that did not come to mind. Having spoken to some people who have recently travelled through one of the independent States I think what I am going to say now will also apply to these independent States.

I have three pet beefs tonight which I want to put to the hon. the Minister. I am sure that most hon. members here have travelled extensively, if not overseas then at least throughout South Africa. On our visits throughout the world, we gain certain impressions and we know the expression that first impressions are lasting impressions. This is one of the matters I wish to discuss tonight, first impressions, the impressions people gain when they travel. I know that what I am about to say may not fall under any particular section of the hon. the Minister’s Vote but I also know that through the Hotel Board, the various travel organizations and the travel and tourist industry the department is possibly in the position to pass on the word of “Bartlett’s beefs” in this particular regard.

The first impression I wish to discuss is that of politeness. During the discussion of the Transport Vote, the hon. member for Berea told the hon. the Minister of Transport Affairs about the experience of an overseas visitor on arrival at Jan Smuts Airport. This is recorded in Hansard. I believe that the matter raised by the hon. member was a very important one. When a tourist arrives at Jan Smuts Airport, he comes into contact with the airline employees, the S.A. Police, the Department of Immigration, the Department of Customs and Excise and so forth. I have flown into South Africa on international flights on many occasions and some of these have been very long flights at the end of which people are tired and irritable and all they want to do is get to their hotels for a bath or a shower. There is nothing worse than having a public servant or an official starting to throw his weight around with a visiting tourist, particularly under these circumstances. This creates a very bad impression indeed and my appeal tonight is that we have somehow to get through to all the people in both the private sector and the public sector who deal with overseas visitors to make a special effort in this regard. In this I include tour guides, hotel staff, bus drivers, taxi drivers and so forth all of whom need to undergo a short course in public relations. There is an old saying that if everything else fails in dealing with a tourist, one should smile. It is quite surprising how effective a smile can be in calming a person’s frayed nerves and so getting them off to a happy start on their trip through this country. I want to leave this point with the hon. the Minister. I believe we should recognize tourists, we should acknowledge that they are tourists and we should make sure that our services to and dealing with these people should be of the highest order. In this regard I believe we can take a leaf out of the book of certain firms in the private sector. There is a famous car hire firm whose motto is: “We try harder”. Another company says: “Come and fly with us”. One gets really first class service because these firms are in a competitive business. We as a nation are in competition with other countries as far as international tourism is concerned and we should give serious consideration to this matter.

The second beef I have is in regard to the condition of many of our towns, our cities and our public places in regard to litter and filth. I have travelled very extensively in recent years and, no names no pack drill, last year I did a very extensive tour of North and South America. I travelled through cities where the garbage was lying thick in the streets. There was one city in South America which I visited in which it was almost unbearable to walk down a certain street, a street which is one of the most beautiful scenic streets in the world but which needed badly to be cleaned. However, people had allowed their dogs to mess the sidewalks. There were little shops selling vegetables and fruit and they threw their garbage into the gutters and one could smell that rotten garbage. The temperature, may I say, was 40° Celsius, and this will give hon. members some idea of where I was.

I have in the past travelled to various countries where the first impression hit me so that I would never forget it. I flew into Perth, Australia, late one night, went into a spotless airport, was put into a spotless hotel and woke up the next morning and saw a spotless city. That was the city of Perth in Australia. In 1980 my wife and I were in Taipei and I was amazed to see how clean the streets of Taipei were. Bath in England is also a beautiful city and the people have gone out of their way to make sure that the city is clean and attractive to tourists.

What about the position at home? One need only ask hon. members what Parliament Street outside the House looks like when the southeaster is blowing. I think the garbage man who comes to collect the newspapers is the cause of the street being littered with newspapers flying around in the dirt. I have experienced it this session. Why does it have to happen? It should not happen.

There was a big campaign in Durban recently to keep the city clean. There was a photograph in the newspaper showing a White councillor washing down a sidewalk. I think he did a very admirable thing, I have seen shopkeepers in England washing down their sidewalks early in the morning because they have such pride in their businesses. I am sure the hon. the Minister will appreciate what I am saying. The small businessman has pride in his business, pride in his appearance and pride in the sidewalk outside his shop, and so he washes it down himself in order to keep it clean. This is the sort of thing which I think we should try to get across to our people.

That is beginning to happen in Sea Point.

My hon. colleague says that Sea Point is starting to become like some of the cities overseas. People of Sea Point should be forced to take their “poop-scoop” along when they take their dogs for a walk on a leash to make sure that they do not foul the sidewalk.

The third beef I have, is in respect of indigenous arts and crafts. There is nothing worse than to go to a foreign country, for instance the United States, and to buy something which one feels is indigenous—it may be a little doll or something which represents the country—but when one picks it up and studies it, one finds that it has been manufactured in Taiwan or Hong Kong and not in San Francisco.

My time is up, and I want to conclude by saying that I believe that our tourist potential has to be properly presented so that people from overseas will really appreciate it.

Mr. Chairman, the hon. member for Amanzimtoti will understand if I do not react to his arguments, because I should like to touch on another aspect. I want to speak about a subdivision of tourism and recreation, the mountains of our country. Hon. members will pardon me if I confine myself to the blue, blue mountains of the Boland.

That this section of our tourism and recreation is becoming increasingly important is proved by statistics. In the year 1979-’80 the then Department of Water Affairs, Forestry and Environmental Conservation issued 99 824 permits through the Forestry Directorate, and in the subsequent year, 1980-’81, 122 267 permits were issued. This also gives us some idea of how many people go to relax in natural surroundings and in our mountains without permits. The Western Cape is blessed with exceptional natural beauty. At Cape Hangklip, where this mountain range rises from the sea, there are more different species of plant in one square kilometre than can be found in the entire European Continent. This God-given asset places an obligation to us to preserve it and hand it over to our descendants in at least the same condition as we received it. In the past the departments of Forestry and of Water Affairs did a great deal of exercise control by way of proper management, but the growing number of visitors shows that this has become almost impossible. On the other hand, there is a growing need among our urban dwellers, the people in the concrete jungles, to relax in natural surroundings. The sea with its beach resorts is not the only form of recreation. Our mountains, too, offer a form of recreation. It is precisely here that problems arise, because management cannot keep pace. The mountains of the Boland are the most important water source of the Western Cape, and with this large number of people camping, picnicking, hiking and climbing in the mountains, water pollution may occur.

Mr. Chairman, an investigation in Du Toit’s Kloof last year showed that the E.Coli count, viz. the dangerous organism in the human excreta, has risen as high as 37 per 100 ml water in the Molenaars River, as against a safe factor of four in unchlorinated water. It is so bad that no-one may or can swim in that water any more.

After the Christmas and New Year weekends last year, 15 tons of rubbish was picked up and removed between the Molenaars River bridge and the motel at the bottom of the pass next to the river alone. It is calculated that during weekends, an average of 1 183 people visit that same pass for recreation purposes without permits, and they do so without any control or any facilities whatsoever. The need for facilities exists; the numbers prove it. What, then, are we going to do about the situation, which is worsening? My plea this evening is that we seek co-operation—I could have made this speech just as well under the Environment Vote—with the Department of Environment Affairs, the Department of Tourism, local authorities, mountain climbing clubs and people from the “Keep South Africa Clean” organization. I ask that we get these people together and try to leave behind what we have inherited in as good or even a better condition. I do not want to go into this in detail, but I call for every urgent action so that we can preserve these mountains of ours and can leave these fine mountain passes of ours unscarred for those who come after us. This can be done by providing decent facilities so that the people who like to relax in natural surroundings over the weekends and on other days can be accommodated.

Mr. Chairman, in the last few minutes of this debate today I would like to refer to only a few points made by the hon. member for Cape Town Gardens and the hon. member for Amanzimtoti.

I think the hon. member for Cape Town Gardens made a very important point when he referred to the fact that 1979 was the last year for which this department had produced a report. I undertake to look into this matter very seriously to see what we can do to rectify it for the future. I personally think that if we regard tourism as one of the most important industries in this country, it is also important to report on the matters affecting tourism. It is important to report upon what we have done in the past year and what we intend doing in the year ahead of us. Therefore I personally think that it is very important that we should produce a report regularly, at least once a year. I agree with the hon. member’s criticism as far as that aspect is concerned.

Secondly, the hon. member for Cape Town Gardens referred to the Blue Train. I think all of us must agree that it is probably one of the most pleasant experiences that one can have to travel on the Blue Train from Cape Town to Johannesburg or from Johannesburg to Cape Town. It is always fully booked and mostly by foreign visitors, so much so that we have had complaints lately. I have had the complaint on many occasions now that South Africans who wish to travel to Cape Town or Johannesburg by Blue Train at fairly short notice, cannot do so because they cannot be accommodated. There is an absolute lack of accommodation on the Blue Train and I think the hon. the Minister will agree with me that we should talk to the hon. the Minister of Transport Affairs to see whether more accommodation cannot be made available on the Blue Train. I think the Blue Train is an asset that South Africa has that no other country in the world has on a comparable basis. I wish to support the hon. member on that point and I should also like to commend him on making it.

The third point that the hon. member made was that one of South Africa’s biggest assets as far as tourism is concerned, is probably our environment. I do not think that this can be emphasized enough. We should do everything in our power to preserve our environment because I think that our environment is one of the biggest tourist assets that we have in this country. I think it will be a shame and a sin if we allow our natural environment to be destroyed and polluted. I also wish to support the hon. member as far as that point is concerned.

The first point made by the hon. member for Amanzimtoti was that first impressions are lasting impressions. I fully agree with him and I think all of us in this House agree with him. That is very valid and true. The hon. member also referred to the fact that we should do everything in our power to be polite to people visiting South Africa. I do not think that we can disagree with the hon. member on the matter of politeness. I think it is very important that one should be polite. I must also admit that in all my travels around the world to receive politeness at airports and at hotels was always a very welcome experience, especially where one is a stranger and where the language that is being spoken in that country is foreign and new to one. On such occasions it is very nice to look at the face of a smiling man. Then one immediately feels comfortable and at home.

The next point the hon. member referred to was the question of cleanliness, neatness and tidiness in our cities. I think our city fathers should take note of this because this is a very important matter. If on walking out through the front door of an hotel one has to wend one’s way among buckets and plastic bags of rubbish it is not a pleasant experience and it does not make a good impression upon the visitors. I should also like to support the hon. member as far as that matter is concerned.

As far as indigenous arts and crafts are concerned, I shall never forget my first visit to Holland when I wanted to buy some genuine Delftware. There was a very beautiful Delft piece on the shelf of a shop and I decided to buy it. However, before buying it I thought I should check on who had made it. On turning this beautiful piece around I found that it had been made in Japan. As hon. members can imagine, I did not buy it. Therefore I do agree with the hon. member that if one provides indigenous arts and crafts in a country they must originate in that country and they must be manufactured in that country. Then those arts and crafts have some value. If they do not originate in that country they have no value.

*Tomorrow I should like to reply in detail to most of the hon. members, including the hon. member for Cape Town Gardens, who made certain remarks. However, I think that one general remark I could make is that all hon. members have made exceptionally good speeches. I think that we on this side of the House want to thank them for the very high standard, the praiseworthy presentation and the excellent ideas and proposals that have been made in this debate this evening. I should just like to single out two of them. In the first place, there is hardly a single member who did not say that tourism was getting too little money. However, I have a major problem here because on the one hand I have asked for more money for tourism, but on the other I have asked that their expenditure be curbed. However, I must honestly say—and here, I believe, the hon. the Minister can support me—that as far as tourism is concerned, I together with the hon. the Minister have approached the Minister of Finance for more funds for tourism, but I must also admit that the two of us were on the losing side. However, if we really want to promote and develop tourism in South Africa as it should be done, then in my opinion it is essential that we should obtain more funds for this purpose, and the money we do get for this will have to be utilized to a greater extent for the development of tourism in South Africa. This is a theme which was stressed in virtually all the speeches and I believe that we must take special cognizance of this if we want to make a success of tourism in South Africa.

A second point in this regard is that many of us, and the public in South Africa in particular, fail to grasp the fact that tourism is probably one of the biggest industries South Africa could have. Tourism can be developed, not only in order to boost the gross national product domestically but also to be an earner of scarce foreign exchange for South Africa. These two aspects ought to provide considerable motivation to do everything in our power not only to attract foreign tourists to South Africa, but also to stimulate and promote internal tourism as much as possible. A statement was made here in connection with the troughs and the peaks, but I believe that our officials involved in the promotion of tourism are fully aware of the fact that in certain regions in particular, there are very deep troughs and also very high peaks in tourism. Therefore, in the years that lie ahead we shall have to make a real effort to determine ways and means whereby to level out these troughs and peaks as far as possible, so that we can distribute the tourist industry in South Africa more equitably. Among other things, this would mean that in the peak periods in particular we should cause less pressure on the transport organization, whereas in the downswings we could ensure additional use of our transport. With regard to housing, too, we should be able to ensure a more balanced distribution of the utilization of hotel and other facilities. I therefore consider it important that in the years ahead we give careful attention to these aspects.

Business interrupted in accordance with Standing Order No. 22.