as Chairman, presented the Second Report of the Standing Select Committee on Trade and Industry, dated 12 August 1987, as follows:

Bill to be read a second time.

as Chairman, presented the Fourth Report of the Standing Select Committee on Agriculture and Water Affairs, dated 12 August 1987, as follows:

Bill to be read a second time.

Order! Before I call upon the first speaker of the day, there is another matter which has to be disposed of first. The hon member for Umfolozi requested me to afford him an opportunity to make a brief statement. I now afford him that opportunity.

Mr Chairman, during the debate on the Vote under discussion yesterday evening, I made use of an inappropriate word by way of an interjection. I withdraw the word in question and apologise for using it.

Order! That also disposes of the point of order raised by the hon member for Brakpan yesterday evening.

Mr Chairman, in the time at my disposal, I should like to express a few thoughts today with regard to the informal sector and the development of small business on the one hand, and deregulation on the other. I want to do so not only because it is of major economic importance to South Africa, but in particular also because its successful implementation is becoming an increasingly important component of South Africa’s struggle against a dragging socialism on the one hand, and because it is the most effective way of stimulating the free market system in this country and marketing and establishing it amongst all population groups on the other.

I cannot allow this opportunity of thanking the Government for the White Paper on Privatisation and Deregulation which was tabled in this House to pass. Its favourable reception by the private sector is proof that there has been a long-felt need to organise a definite programme of action to settle these matters.

Secondly, I want to thank the Small Business Development Corporation for the tremendous work the corporation is doing for the development of small business. The success of this organisation is the best proof that efficiency is improved when the public and private sectors join forces to bring about development projects. It is a pity that a shortage of money is impeding the more rapid development of small businesses. I therefore want to appeal to the institutions concerned to investigate every method of making money available to the Small Business Development Corporation. The successes that have been achieved thus far must not be a reason for scaling down our active participation in the decentralisation of our economy; on the contrary; they must in fact motivate us to work at it with greater dedication and purposefulness. In the first place I want to refer to a few factors that are having a hampering effect on economic activities in South Africa.

Firstly, we shall have to address the existing communication problem very quickly and effectively. The over-regulation of our society is causing misapprehension about what the Government really means when it refers to maintaining a free market system. The fact that as a result of restrictive regulations, the prospective entrepreneur has over many years come up against the interpretation of the concept as it is experienced in South Africa, often leads to sympathy for foreign systems which are detrimental to South Africa’s future development in the economic and constitutional fields. We must never lose sight of the fact that we must address a First World problem in an idiom which has to create opportunities for participation and development for a Third World component of our population as well.

Secondly, we are dealing with an information problem. It cuts across all boundaries, and is more often the result of involvement in the same matter, of a large number of Government institutions with divergent functions, and very often with conflicting regulations. Prospective entrepreneurs are often sent from one institution to another; often there are long intervals between the time of application and the time when approval for those applications is obtained for the creation of small business development. When prospective entrepreneurs make use of professional services, those costs could amount to several thousands of rands.

In the third instance, I believe we have a problem in regard to the provision of services in this respect. Although the Small Business Development Corporation is doing commendable work in providing advisory services to prospective entrepreneurs, I think there is a need for an independent advisory body under the chairmanship of an expert in the legal sphere or the private sector, on which representatives from the private, as well as the public sector should serve. As its primary task this advisory body should make a thorough survey of conflicting regulations amongst various Government institutions which could hamper small business development. Secondly, this advisory body should advise the Government on the elimination of unnecessary regulations and make recommendations about those measures which place unnecessary impediments in the way of small business development. A third function of such a body could be to give advice to prospective entrepreneurs and to deal with applications on their behalf.

In conclusion, I want to take up the cudgels for the informal sector in South Africa this afternoon. Taking into account the interests of the community, those measures that make this kind of economic activity almost impossible must be relaxed. Hon members must take note, however, that I say “taking into account the interests of the community”. There are certain interests of the community that have to be taken into account before we summarily and unreservedly permit business undertakings in back yards and elsewhere. The role of the informal sector in the prosperity of South Africa is being underestimated completely because it is not mentioned in the national estimates and therefore goes unnoticed.

According to the estimates of experts in this field, between 30% and 40% of all economic activity in Black areas is of an informal nature. Those undertakings provide work for thousands of people who would otherwise be unemployed. This stimulates purchasing power, and in so doing, the free market system as well, because it stimulates the supply and demand mechanism. This lets something concrete come into being in the form of an own undertaking that is worth defending, and consequently leads to stability.

The informal sector could have a healthy effect on the development of small business, in that the successful and viable undertakings could be encouraged, with the right guidance and advice, to enter the formal sector where they can qualify for increased assistance and can therefore enter the market on a much broader base. This could assist in reducing the risks attached to financial assistance to prospective small business entrepreneurs because the risk factors are already eliminated in the informal sector.

Economists estimate that at this stage work is being provided for more than half of South Africa’s labour force by the approximately 500 000 to 700 000 small business undertakings in the formal and informal sectors. When one looks at the rate of our population growth, and takes into account the capacity for employment opportunities that could be created in the large formal sector in the next two decades, one realises how essential it is to free the economy from unnatural restrictive factors.

Perhaps we have more time to bring privatisation to fruition, but I want to plead in all earnestness this afternoon that we cannot allow the process of deregulation to extend over many years. The people of this country need to earn today and tomorrow in order to live.

Our aim should be to strive in the short term to restore confidence in the free market system. Inherent in this is not only the economic prosperity of South Africa but the opportunities that still exist to keep this country and all its people on the side of the free world, with everything that that implies.

It is a fact that when we talk about the economic realities of South Africa, we cannot grant the opportunities that have to be created to only one section of our population. Nor can we solve South Africa’s economic problems by, to an increasing extent, allowing creeping socialism in this country. [Time expired.]

Mr Chairman, a few days ago there was a major item in the newspapers to the effect that a family man in Johannesburg, a certain Mr Dowling, had wiped out his whole family with a crossbow, set fire to his house and then committed suicide. The point I should like to make is that I believe that behind that family tragedy there lies a gap in the legislation which falls under this hon Minister.

Similarly, there was a case in Cape Town last year where it was discovered that a motordealer had sold a whole range of expensive cars to a number of people in good faith. Subsequently it was discovered that the HPs of the previous owners of those cars had not been settled.

A large number of people therefore lost a great deal of money because the cars had not been fully transferred into the names of the new owners, even though they had in good faith paid the money and—so they thought—assumed ownership.

At the heart of both of those stories is the problem of the potential double discounting of motorcars.

Order! There is too much conversation in the Committee at the moment. We cannot allow that. The hon member may proceed.

At present, the bona fide buyer of a motorcar in particular must accept in good faith that the money he has paid is passed on to the previous owner and any finance house that has an interest in that car. Unfortunately, because the law does not protect the buyer in that situation, the temptation to unscrupulous operators to exploit the good faith of the buyer at the latter’s expense is extremely high and is rising in view of the very high cost of motorcars these days.

At present the law operates under the presumption of caveat emptor—the buyer must beware—but I believe that it is not acceptable to apply such a laissez-faire principle in respect of such highly priced goods as motorcars. This does not apply in respect of houses, for example. If one buys a fixed property, there is a deeds office where anyone who holds a bond over the property has their interest registered, and where a new buyer can establish that all the previous commitments against that property have been settled. He can then take full, unencumbered ownership of the property as the new owner. This does not, however, apply in respect of motorcars, even though, at present market rates, a motorcar is perhaps the second biggest item that any person will purchase in his lifetime.

It therefore seems to me that we need to create a central register of interest in hire-purchase contracts in respect of motor vehicles, so that finance houses, motor dealers and buyers in particular can all know exactly where they stand in respect of who owns title to a given motor vehicle. The system operates perfectly effectively in the case of fixed property, and I see no reason why the same principle and a similar system cannot obtain in the case of motor vehicles.

I have done some research on this matter and can advise the Committee that in at least one other Western country this matter has been addressed and solved. I refer to the Registration of Interest in Goods Act, No 37 of 1986, of the State of New South Wales in Australia. This Act must be read together with the New South Wales Consumer Protection Act of 1969 which has the effect that any prescribed goods, which in their case means a motor vehicle or any other goods prescribed by regulation, should be subject to being recorded by a commissioner in a register of interest in goods, which then has the effect of creating a permanent record of interest. This provides absolute protection for bona fide buyers in the same way that one is protected by the deeds office when one buys a fixed property. I appeal to the hon the Minister to fill that gap in our legislation along the same lines as has been done in Australia.

The second issue I want to raise, is the question of the exemption from GST of sales to tourists. There should be a revision of the present system. It was criticised by the Cape Town Chamber of Commerce recently as causing increasing frustration among tourists and store-owners. It seems that a negative effect on tourism is arising, because tourists are left with the impression that they are being called upon to pay tax in certain circumstances when they believe no tax is payable by tourists. There is confusion surrounding the present system and so the frustration and sometimes antagonism can be understood.

At present there are only three legitimate methods of selling tax-free goods to tourists. The first of these relates to the ad valorem excise duty in respect of certain articles when the retailer is the holder of what is called a VSJ licence. Provided that certain procedures are followed, sales of jewellery and articles of furskin to tourists are exempt from the ad valorem excise duty.

The second legitimate procedure is that a similar exception applies—also only with regard to VSJ licence holders—in respect of GST on sales of those articles to tourists.

The third procedure whereby an exemption from GST applies is if the cumbersome procedure of not permitting the purchaser, the tourist, to leave the store with the goods is followed, and the goods are sent directly from the store to the home address overseas as a direct export.

The problem is that there are signs put up in some shops where the owner is a VSJ certificate holder, which advise the tourist that he need not pay tax. However, in shops where the owner does not hold a VSJ certificate, the situation is not the same. This causes confusion because it is a feature of international tourism in most countries that tourists do not pay VAT or any other form of tax. In this respect confusion arises, and I would appeal to the hon the Minister to put this right so that we follow a system similar to that which operates in other countries where all tourists are exempt from paying GST or any other form of tax. By so doing we will put ourselves on the same footing tourism-wise with other countries overseas.

Mr Chairman, it is my privilege to react to the speeches made by certain hon members since yesterday. The hon the Minister will react on a later occasion.

In connection with consumer protection, I fully explained the Government’s approach to this yesterday and shall therefore not react any further to the hon member Comdt Derby-Lewis’ speech. The same applies to the hon member for Yeoville who also broached the matter.

In the first place, I want to react fully to the speech made by the hon member for Uitenhage in which he referred to my visit to the Eastern Cape. I also want to avail myself of the opportunity to thank the hon members who are members of Parliament in the Uitenhage and Port Elizabeth regions for the trouble they took to arrange a comprehensive tour there for me and the Deputy Director-General as well as for everything they did to make our trip pleasant and informative, so that I could get to know the Eastern Cape area a little better.

In my opinion the leadership in a specific region will contribute a great deal to the development of that region. One cannot simply sit back and wait for the Government to develop a region. The Government can take only certain macro-economic measures, but the leadership of a region—I shall come back to this point later—can make a great contribution to the planning and development in such a region.

The hon member for Uitenhage spoke about the motor industry and put certain questions. The Government is well aware that the private sector has a need for certainty about the long-term availability of export incentives. Naturally the development of export markets is a long-term process and certainty about the availability of export incentives is essential; we appreciate that. The Board of Trade and Industry is investigating the whole question of export incentives at the moment. This matter, viz of assuring exporters of the availability of export incentives over a period of years to come, is high on the list of priorities.

The hon member for Primrose spoke specifically about the electronics industry, with reference to the Board of Trade and Industry’s investigation into the industry, and put a few questions that I want to react to.

In the first place the Advisory Council for Technology was asked to study the report of the Board of Trade and Industry on the electronics industry and to make recommendations to the Government for the development of the industry. A committee will take the matter further for this purpose. The Board of Trade and Industry has already begun investigations into certain aspects with a view to making specific recommendations to the Government, since the first report was a very general one.

Secondly, as far as business equipment is concerned, the Board of Trade and Industry is drawing up a strategic development plan for that industry, of all the electronic equipment used by business firms. The plan will be considered by the Board of Trade and Industry within the next two months. This industry includes micro-computers as well as personal computers.

In the third place there is the programme for the development of a standardised television receiver base, to which reference has been made in the debate, and which will also serve as a stimulus. In the fourth place I want to emphasise that the Government gives preference to the local electronics industry by way of purchases by the State. There is a Standing Committee for Electronics, the so-called SCE, which co-ordinates Government purchases. In the fifth place I want to tell the hon member that audio equipment is at present being investigated by the Board of Trade and Industry.

The hon member for Middelburg referred to what had been done in Middelburg on the local level to make plots available cheaply. I think this is a good example of what can be done in a specific area to encourage development if leadership emerges in that area. Once again I want to say the Government can take macro-economic measures to stimulate and influence the economy in general, but it is the task of the people in a specific town or region to identify the potential, the problems and the opportunities of that region, and to come forward with recommendations and plans.

†The hon member for Umbilo referred among other matters to the possibility of establishing free trading zones. In this respect I simply wish to have it noted that this matter is at present forming the subject of an investigation by the Department of Development Planning. It would therefore be inappropriate for me to preempt the outcome of that investigation.

The hon member for Germiston raised several issues one of which relates to the question of licensing in terms of the Patents Act and the Copyright Act. I should point out, however, that South Africa has always strictly adhered to its international treaty obligations. Any deviation from this policy would not be in the long-term interests of this country. However, for the information of hon members, I could perhaps add that the Copyright Act of 1978 is nevertheless currently being reviewed to bring it into line with changed circumstances.

*Quite a number of hon members spoke about various matters concerning the real economy, about growth, the development of the economy, import replacement, export promotion, and so on. I am referring to the hon members for East London City, Sunnyside, Germiston and Stellenbosch, and want to react to these hon members’ speeches in general.

Import replacement and internal industrialisation have been Government policy in this country since 1922. In order to accomplish this, a policy was formulated by the Board of Trade and Industry, and adapted over the years, to protect local industries against foreign competition. The main instrument in protecting our industries is the customs tariff on imports. Various kinds of protection are available, such as protection against normal foreign competition and protection against dumping and other forms of disruptive competition. There is interim protection in extremely urgent cases and advance assurance of protection for proposed new industries.

Tariff relief can also assist an industry in certain cases, for example when a raw material is imported, and the tariff on it increases the industrialist’s costs to such an extent that he cannot compete with imported final products. Another example is a case in which raw materials are imported for the manufacture of a product which is then to be exported again. In such cases the customs duty can be reduced upon the recommendation of the Board of Trade and Industry.

It is essential that any institution that intends to manufacture or assemble a product in South Africa or in other parts of the South African customs area, and requires protection against foreign competition or any other adjustment of the customs tariff for this purpose, should apply to the Board of Trade and Industry beforehand in order to determine whether or not the desired adjustment can be justified in the general economic interests. This kind of action will prevent losses which result if an industry which cannot exist without protection is established although the protection of the industry cannot be economically justified.

With reference to the customs tariff, I want to add that it is chiefly the task of the board to investigate adjustments in a scientific way in order to determine whether or not the desired adjustment is justified in the general interests. Aspects such as the contribution the industry makes to the national product, the employment potential, effectiveness in the use of resources, the qualitative contribution to the development of expertise, the net contribution to the current account of the balance of payments, and other factors of this nature, are taken into account. In this connection it must be emphasised that the industrial protection policy is not aimed only at the development of protected industries or only at the development of the manufacturing industry, but that in principle it is directed at the promotion of the general economic development to which hon members referred.

Tariff protection should be moderate so as not to increase the cost structure in the country too much. The Board of Trade and Industry prefers not to grant protection of more than 10% on raw materials, 20% to 25% on intermediary products and 30% to 35% on final products. There are a number of cases, however, in which the protection is greater than that laid down by the guidelines, particularly in cases in which dumping or other forms of disruptive competition occur, when the tariffs can be much higher.

In a case in which a local industry is dominated by a monopoly or in which only a few companies, which probably will not compete aggressively with one another, take part in it, the Board of Trade and Industry prefers to determine the tariff protection in such a way that a degree of importation can take place—this could be up to approximately 20% of the total domestic market, for example—to provide competition, in this case against foreign countries.

It is sometimes claimed that customs tariff protection contributes significantly to inflation. This claim cannot be true, because during the past few years there was no question of a general increase in protective tariffs.

In addition the Board of Trade and Industry is fully aware that a lack of competition can contribute to price increases. For that reason it is ensured that the recommended tariff protection does not eliminate competition of imported products, and customs duties are revised from time to time to ensure that there is healthy competition in the country.

An example of this is the exercise in respect of agricultural inputs which is in progress at present. There are really only three departments that deal with the real economy, viz Agriculture, Trade and Industry, and Mineral and Energy Affairs. Of course agriculture is an important producer and a very big employer, and we must take exceptionally good care of agriculture and its interests.

The Board of Trade and Industry has found that the pressure of import duties on agricultural inputs is minimal. In the case of chemicals it varies from almost 0% to approximately 3% of the value of agricultural products. There is no tariff protection on fertiliser, except in the case of urea and superphosphate. Import duties have no real effect on other agricultural inputs either. The board is aware of the general position of the agricultural industry and takes this into account when it considers applications that affect agriculture.

The Government prefers high tariffs to import control as a protective measure for the following reasons: In the first place, tariffs do not distort the market as import control does; secondly, tariffs are not arbitrary as import control sometimes is; thirdly, tariffs normally have a less cost-increasing effect than import control; fourthly, tariffs do not prevent new entry to an industry, which may be the case with import control; and fifthly, import control as a protective measure is in conflict with the rules of the General Agreement on Tariffs and Trade.

The Government is not ideologically opposed to import control. The Government standpoint is that import control can be used only in exceptional cases for protective purposes, and must be based on the same kind of thorough investigation undertaken by the Board of Trade and Industry in cases of applications for tariff protection.

The Government believes that industrial development in the country should create a large part of the employment opportunities that will be necessary in future. That is why the Board of Trade and Industry is constantly considering measures and methods of stimulating and restructuring industry in a sound and competitive way. Investigations by the Board of Trade and Industry into industries such as electronics, television, motor vehicles, shipbuilding, textiles and clothing, computers and other electronic office equipment and jewellery, as well as many other industries, either have been completed recently, are still in progress or are being envisaged.

In the successful countries in the East the retailer, who has fewer than 100 employees in his service, plays a greater part in the industrial sector than is the case in the RSA. The reasons for this and what can and should be done about it, will emerge from an investigation the Board of Trade and Industry is conducting.

I also want to react briefly to what hon members said about exports, by pointing out that the board is examining our export possibilities. The RS A cannot rely only on import replacement and internal industrialisation, but of necessity we must also become a major exporter of industrial products. It is necessary to be able to pay for our essential imports, to create more employment opportunities than will be possible only on the strength of local markets, to attain greater economic growth and to be able to redeem our foreign loans. For this reason a committee of the Board for Trade and Industry was established to investigate the effectiveness of the present export promotion measures and to make recommendations about possible improvements in this respect to the Government.

I have raised only certain matters which the Government is involved in in the economic sphere at the moment. I did so by way of reaction to hon members’ speeches and in order to indicate what the Government is doing in respect of imports, as well as in connection with domestic development and exports. Unfortunately my time has expired now, however, and I shall have to stop here.

Mr Chairman, as my contribution to this debate I should just like to say a few words about the beneficiation of South Africa’s mineral resources. I know this is a very complex subject and that it will be impossible to deal with it thoroughly in the few minutes at my disposal. I should, however, like to refer merely to one or two aspects of adding value to our raw materials, particularly to those we export, which I regard as important.

I am taking my cue from an interesting little book which some of us have seen as a video show and talk. It was written by Mr Clem Sunter, who was recently appointed to the main board of the Anglo American Corporation. The title of this little book is The World and South Africa in the 1990s. In it Mr Sunter depicts an international scenario of what he terms winning and losing nations. Then he sets out to show how South Africa could become a winning nation in the 1990s and further into the future.

I must say that while I think his formulation of the international scene and the economic scene have many very valid points about them, I am less sure about his political scenario. [Interjections.] For instance, Sir, in dealing with the economic aspects he states that the winning nations of the world, the USA, West Germany and Japan, have become economically powerful not by being rich in mineral resources but by exporting the products of their little grey cells; in other words by conceiving and manufacturing products with a high technology input. He says, and I should like to quote:

The implication of this is that for a country dependent on mining we must beneficiate or bust from the 1990s onwards.

It would seem, however, that not all of South Africa’s business leaders in the minerals field are in entire agreement with this—even within the Anglo American Corporation itself. Mr Peter Gush, head of the Anglo Gold and Uranium Division, and also a director of the main board of Anglo American, in his outgoing address as President of the Chamber of Mines in June this year, was very luke warm. He said that the industry had to weigh up the potential profitability against the vertical integration of operations that are traditionally the preserve of South Africa’s customers for these minerals. He warned against us competing with these customers, and he concludes as follows:

This statement reflects the present but it ignores the possibilities and the necessities of the future, which our Government cannot afford to do.

Mr Chairman, I think that the approach expressed by Mr Gush is just not good enough. Interestingly enough, it appears to differ in emphasis from that expressed by Mr Clem Sunter, fellow board member.

During the past year the Government has called for a much more serious look at beneficiation and a much more positive approach to development in the field of added value for the sake of our industrial development. The hon the Deputy Minister of Economic Affairs and Technology, Dr Theo Alant, who has just spoken, put the point crisply when he said earlier this year that South Africa stood at the crossroads on this issue. He called relying on the export of megatons of unbeneficiated and irreplaceable raw materials, which amounted to R29 billion in value last year, as taking the easy option. It was an option, he said, which left South Africa with a hole in the ground, and that was all. The Government has become serious about the beneficiation of our minerals, because unquestionably, South Africa’s potential industrial growth—which is basically the only way we are going to become a winning nation—lies in enhancing the value of our strategic minerals in economic terms, locally and internationally, by exploiting our comparative advantage. It appears that there is no other way.

The fact is that we have to get the private sector to become more enthusiastic about beneficiation. By way of an example, I should like to refer to an area where adding value could be effectively applied, and that is the jewellery industry—a subject, as they say, which is close to a girl’s heart but unfortunately mostly out of her reach.

Earnings from gold-mining operations do completely dominate South Africa’s earnings from minerals, and gold accounts for half of our foreign exchange earnings, but its production, as we all know, will inevitably decline. A gold jewellery industry, however, could substantially enhance earnings in this sector. It does not seem logical that while we produce more than half of the world’s gold, Italy, which produces no gold at all, is the world’s largest processor of gold into jewellery. I could say a lot in similar vein about a girl’s best friend, but time does not permit me to do so.

That is CP policy.

When one considers the so-called winning nations, I ask whether, if they had our gold, they would produce less than point one per cent of the world’s gold jewellery, as we do. After all, we do produce 92% of the world’s platinum, 40% of gem diamonds and 50% of the world’s gold—all components of gold jewellery. We should be in a position to dominate the world’s jewellery industry. In fact, Johannesburg could become the jewellery centre of the world; and think of the implications this would have outside the jewellery industry itself. If South Africa produced only 10% of the world’s gold jewellery, which in the nature of the case includes diamonds and platinum, it could mean as much as R3 billion per annum in foreign exchange accruing to this country.

I submit that the traditional reservations offered by the mining houses to the effect that we cannot compete with our customers and that the customers are reluctant to invest in local manufacturing ventures, are not really valid when it comes to the jewellery business. I understand that there are potential investors from abroad eager to get into jewellery manufacturing locally. The fact is that we can produce much more cheaply, and modern communications make it unimportant that customers are far away from the site of production.

I think Government also has a part to play here. It may well be that present constraints by way of heavy excise duties—they have already been mentioned—on finished articles of jewellery, and complex requirements for certification and registration, are indeed anachronistic. They have, I think, clearly been an inhibiting factor in the development of a large gold jewellery industry in South Africa, or a large jewellery industry generally. Perhaps there could be a reassessment as to whether the right climate could be established in the private sector.

We must make it easier for jewellery manufacturers to make their products, and possibly to supply raw materials to factories on more favourable terms. As you are probably aware, the jewellery industry is currently under investigation by Mintek and the IDC as well as the Board of Trade and Industry. I think their report is awaited with anticipation.

In conclusion, Mr Chairman, I should just like to say that if beneficiation of our mineral resources is the only avenue available to South Africa to achieve the industrial growth necessary to make this a winning nation, then surely what we need is a national commitment to this goal.

Why do you not put this into operation?

In the long term, South Africa would be a much more exciting and substantial trading partner for our customers if we could realise our potential for industrial growth and, as I have said, the very basis for this is the increased beneficiation of our minerals. We cannot allow this opportunity for optimising the exploitation of our resources to slip away.

Mr Chairman, unlike the hon member for Rosettenville I found Clem Sunter’s political scenario a particularly interesting one because it represents both a challenge and an exciting future for us. I think he also made it clear, however, that in terms of a winning nation scenario we shall first have to put our political house in order. [Interjections.]

I should like to return to the White Paper on Privatisation and Deregulation. I wish to record that this report has stressed, among other things, that:

It also notes that:

I believe such objectives make sound economic sense and that very few people will disagree with the concept of a reduction in the red tape and bureaucratic interference in the free operation of the market system. For this reason I welcome the recommendations in the White Paper and look forward to their practical implementation.

However, the situation in our country is not normal. As a result of apartheid legislation and practices communities have become polarised and equality of opportunity has not existed in our country. We have an increasing gulf between the “haves” and the “have-nots” with race having been and still remaining the determining factor.

In addition to political solutions, we are obviously going to have to find economic solutions in order to survive. Free enterprise as an economic system is extremely attractive to those who are free to compete unhindered by any restrictions, particularly those of race. The vast majority of South Africans do not have such freedom and are therefore, as we well know, considering alternative economic systems. They are questioning whether free enterprise holds out opportunities for them.

Here I want to comment on a remark made by the hon member for Germiston yesterday which I found particularly insensitive. He said:

Scandalous!

In the circumstances I find that extremely insensitive.

It is against this background that we have to examine these recommendations in the White Paper. They may be seen partly as a removal of restrictions to normal economic activity—which is to be welcomed—and partly as a removal of racial discrimination in the economic sector, discrimination that has unashamedly favoured the White minority at the expense of the Black majority. Equal, unfettered opportunity is necessary to redress this imbalance.

I believe these observations will become clearer when one examines Annexure B to the White Paper which lists some 13 steps that have already been taken in regard to deregulation. However, of those 13 steps six deal specifically with apartheid laws which have had the effect of discriminating against people in the market-place. Let me read out those six steps viz the removal of influx control; the issue of uniform ID documents; the opening of central business districts; the abolition of job reservation; the institution of property ownership rights for Blacks; and quicker procedures for the establishment of urban areas for Blacks. All these deal with restrictive legislation previously introduced by this Government which has had the effect of hindering economic growth in our country.

We have had property rights for Blacks in this country for years. You are talking absolute nonsense!

Removal of such laws must be welcomed but we cannot ignore the deep-seated resentment and bitterness caused by these laws in the first place. The time has now come for every vestige of apartheid to be removed and uprooted including the Group Areas Act which is still a highly sensitive issue causing a great deal of unhappiness to many people. Every individual needs and deserves an equal opportunity to survive and prosper. I must emphasise, however, that we must recognise and understand the anger and frustration of those who have suffered because of these laws.

Mr Chairman, the hon member for Pinelands must forgive me if I do not react to what he said, because I want to touch on some other things, particularly with regard to tourism.

*When one returns from abroad and lands at Jan Smuts, one is given a little booklet on behalf of the chairman of the Tourism Board, Mr Danie Hough. This is truly a commendable effort, and I should like to congratulate Mr Hough, his board and the officials on this booklet. I think it is a valuable piece of information to everyone who comes to this country, and even to me.

In looking at this booklet as a particular source of information, one begins to realise that although foreign tourism is extremely valuable to one’s country, as far as promoting one’s country and also as far as foreign exchange earnings are concerned, the other aspect of tourism, viz domestic tourism also emerges strongly. These two forms of tourism merge when the emphasis is on things a country, a region or a town can and wants to offer people, things that are different from the ordinary. It is a well-known fact that no one becomes excited about high buildings or streets or power-lines and ordinary things like that anymore. Show anyone a well-kept nature reserve, a sea with golden beaches, a diamond mine or anything similar, and everyone in the world is interested.

What about a grapetree?

There is no such thing as a grape-tree; it is a grapevine. [Interjections.]

Tourism is the most important industry in the world, but in South Africa it is third in fine after mining and agriculture. I think we should do our utmost to put tourism in South Africa at the top of the list. In my opinion we were not as knowledgable about tourism 15 or 20 years ago as we are today. We did not realise the tourist potential of the beautiful things in our country. I am thinking of our country as a whole, the beauty of the Eastern Transvaal, the sunset in the Karoo, our own Garden Route where the bushes smell so good, the interesting features of the Boland and in the final instance, what we are going to see one of these days—who can ever forget Namaqualand in flower?

Fortunately we have changed our point of view rapidly during the past few years. I should like to use the Boland as an example in this connection. In my opinion, apart from the known places such as Cape Town with its mountain and its sea, its antiques and some old buildings, the wine industry here in the Boland was the first to become aware of foreign tourism, but also in particular of domestic tourism. One need only think back to a few years ago when a few enterprising farmers in Stellenbosch established the wine routes. Tens of thousands of people now visit these wine routes every year, because the other regions have seen that this works and they have been quick to follow suit.

I want to give a few figures. During the summer season one wine estate such as Backsberg attracts 17 000 visitors. Simonsig attracts 20 000. In the region of the hon member for Worcester, we have the Roodezand cellar which attracts 3 000 tourists in December alone. Simonsvlei attracts 3 600 and the KWV, 8 000. We can continue in this way. [Interjections.]

What about …

Hon members can go and do their tasting there as well; they are very welcome everywhere. [Interjections.] One must merely know when to stop.

In addition there are the young wine shows in the winelands and a wine festival in Paarl which attracts 20 000 visitors. Wine-houses are scattered all over the Boland area. Food and wine festivals—where one can enjoy oneself with the Bolanders—are held at Worcester, Robertson, Paarl and Stellenbosch. The one at Stellenbosch alone attracted 13 500 visitors last year.

In all honesty we must admit that these were mainíy local visitors but they are tourists as well. I should like to emphasise that it is a fact that foreign tourism is based to a great extent on a successful local tourism industry which in turn is based on the enthusiastic efforts of local communities.

This enthusiasm increases as people see that it works. People are beginning to realise that there is money in tourism and more and more ideas are emerging. I think agriculture plays an important part in this connection, especially in this area, but also elsewhere—the hon member for Witbank referred to this yesterday—when we think of exclusive farm holidays and hunting expeditions or simply an ordinary but pleasant rest on a farm somewhere far away from a telephone. This kind of thing is becoming more and more important to our people in the cities with the pressures and stresses of day-to-day living, and also to foreigners.

When we consider all these things and all the exciting possibilities, with enthusiastic people who want to promote the cause of tourism, I want to issue a serious word of warning here today concerning exploitation. When big money beckons, people begin to reason: “I can exploit this man, because I shall never see him again; in fact, South Africa may never see him again.” In this way we are exploiting tourists in a disgraceful way. There is no more certain way of killing both domestic and foreign tourism than this kind of conduct. I want to add that this is really a form of betrayal of this country.

We are seeing the first signs of this. There are ordinary tourist hotels that are beginning to charge tariffs comparable with tariffs abroad. Here in South Africa restaurants and hotels are charging R12 to R15 for a bottle of wine, for the contents of which the farmer receives less than 44 cents. Surely it is the contents that is important, not the bottle. Added to this, poor service, poor food and a devil-may-care attitude are emerging as well. I admit that this is not very prevalent yet, fortunately, but I do want to issue a timeous warning that one cannot develop tourism with this kind of view and an attitude of “let me take advantage of the man while I can”. I believe exploitation to be the most serious disease ever to attack any tourism industry, and that is why it is my plea that we guard carefully against this trend and act now to bring offenders to book. [Interjections.]

Mr Chairman, we have come to the end of what was, as far as I am concerned, a most interesting debate. I should like to express my thanks and appreciation to all the hon members who participated for the very high standard of their speeches. Here and there a discordant note was struck which had nothing to do with the economy. A sound and stable economy remains an important prerequisite for the solution of our political problems. I think in this kind of debate we should concentrate on trying to keep our economy sound, to maintain our growth potential, and to extend the economy as quickly as possible over as wide a spectrum of the population as possible.

I think I referred in my speech to the question of internal industrialisation, and I should like to tell the hon members who discussed deregulation—actually it no longer falls under my portfolio—that we made our view on internal industrialisation very clear. It is very high on our list of priorities but with this I want to make an appeal—I think the hon member for Middelburg referred to this, too—that when we begin our deregulation programmes and seek to make internal industrialisation possible, the local authorities will co-operate with us and not place obstacles in our path. I should very much like to appeal to people involved in the local authorities to join hands with us when we begin the internal industrialisation programmes, with which we have already made a great deal of progress.

I want to convey my sincere thanks to all the hon members who participated in the debate.

I want to say right at the outset that if I do not react now to some of the arguments hon members raised in their speeches; I can assure them that the members of the department will take the hon members’ Hansards and work through them thoroughly, and if we have neglected to refer to certain aspects, we shall get in touch with the hon members concerned and pursue the arguments by correspondence.

I want to thank the hon member for East London City most sincerely for a good speech. The hon member referred by way of introduction to the beneficiation of metals.

†I think that was also the theme of the speech of the hon member for Rosettenville. I want to thank her for an excellent speech. In my reply to the speech of the hon member for East London City I will also reply to the points that she made in that excellent speech of hers. I thank her for it.

*The hon member referred to beneficiation. For us in South Africa this matter enjoys a very high priority. As long ago as 1974, we established a beneficiation committee under the direction of the Department of Trade and Industry. This committee is responsible for some fine monuments in the country in respect of beneficiation processes. As hon members will see in our budget for this year, we have made R106 million available for beneficiation purposes. I think this is an indication of the value the Government attaches to beneficiation.

However, I just want to say a few things. Hon members should realise one thing. When we are involved with beneficiation programmes, we are also going to be involved with vested interests. These vested interests are not always in favour of beneficiation. We shall therefore have to work very hard on this. We have already made a great deal of progress, and in my opinion my friend Mr Peter Gush has already changed his mind. We speak to each other regularly, being good friends, and in time we shall solve the problem.

I want to mention a few points with regard to beneficiation. Hon members will forgive me if I give a little attention to this matter because I think it is of cardinal importance to everyone in this Committee that we follow that path.

As far as beneficiation is concerned, a few factors of the utmost importance are concerned. The first factor is that one has to have a partner who is an expert in this process. If one does not, one will struggle a great deal. There is a great deal of expertise in the mining and extraction industries, but in all these years we have never acquired sufficient expertise in the beneficiation industry. I could mention several examples to hon members but I do not think I should monopolise the Committee’s time now.

The second point we should make is that one has to have a marketing partner. There is no point in refining a product if one is unable to market it. One must have a marketing partner.

Refining processes are also very expensive. One should therefore also be sure of one’s financial resources. One should therefore also consider one’s financial resources. What I also regard as of cardinal importance is that if one is going to put this process into operation and one has a partner who is a technical expert, a marketing partner, and the necessary financial resources, one should also really make sure of having the expertise in the long run to be able to carry out these processes. When I say “expertise”, I am referring to the other kind of expertise, namely the kind that trained people have; in other words, one should also be able to train one’s own people to be able to carry out that process.

I believe we have already made considerable progress regarding certain of the beneficiation projects which have already been identified by the Advisory Council for Technology, and I hope that before the end of the year, if all goes well, hon members will see very important developments in this direction, which will be of inestimable value to South Africa and its mineral industry.

I also want to deal with the speech by the hon member for Rosettenville which was concerned with the jewellery industry. We discussed the jewellery industry recently, and only a few hours ago again, on a very high level, and we are making rapid progress regarding a jewellery industry in South Africa. I am not talking about a diamond cutting industry only; I am also talking about a fully-fledged jewellery industry which includes gold, silver, platinum and, of course, our precious stones. We had very positive discussions on this matter, and made considerable progress. We have already identified our partners who are technical experts and our marketing partners, the financing problems have solved, and once we have tied up the few remaining loose ends, I feel we shall make very good progress in this sphere, too, particularly after this morning’s discussion. I want to thank hon members who discussed refining most sincerely for their very valuable contributions. We note their support with appreciation.

The hon member for East London City also referred to the possibility of a development fund or corporation for the tourist industry, or to put it briefly, a tourism bank. The hon member has made a very interesting observation. I believe it has very great potential. The Tourism Board has already been instructed to investigate the possibility of establishing such a development fund or bank for the tourist industry, and I have asked them to settle this matter as quickly as possible.

Several hon members discussed the tourist industry, among them the hon member for East London City, the hon member for Witbank—he made a very fine speech on tourism—and the hon member for Umbilo. I cannot blame him for not being here now because he offered his apologies. I shall certainly get in touch with him. The hon member for Wellington also discussed tourism.

I see two sides to the tourist industry. I regard it as one of our most important industries in its contribution to the gross national product. We should therefore be doing everything in our power to develop it. The local authorities and the communities, however, could play a very important role here. I believe the important role these people are already playing in this regard is greatly appreciated.

The hon member for Witbank—I hope the hon member for East London City will forgive me—also referred to the role the farming community could play as regards tourism, and I agree with him wholeheartedly. I have not yet done so but I intend to instruct the Tourism Board to take a serious and attentive look at the roadside stalls of our farming community from a tourist industry perspective. I believe the roadside stalls in certain areas—I am thinking now particularly of the Eastern Transvaal, the Boland and certain parts of Natal—could play an extremely important role in the tourist industry. They should be attractive to the motorist and compel him not to rush on for five hours at a stretch, but to stop for a while every hour. I think we shall issue these instructions and have a look at the roadside stalls. I want to thank the hon member most sincerely for the idea of the development bank.

The hon member for Umbilo complained that not enough was said about Durban in the video. I do not believe we did this intentionally. The time factor governing our work meant that we could not give the same amount of attention to each area. However, I did ask the hon member why he did not ensure that the rickshaws returned to Durban. I remember that in my youth they are among the greatest attractions in Durban, and I feel they should do something about bringing them back. At the same time the Zulus would then also have more work. [Interjections.]

We are talking about domestic tourism now, not foreign tourism.

No, we are talking about both kinds of tourism domestic and foreign.

I believe the hon member for Wellington made an important point when he said that foreign tourism must follow in the tracks of domestic tourism. No foreigner will visit an area if the people inside the country are not interested in it. Domestic tourism is of cardinal importance and I thank the hon member for his observation in this regard.

The hon member for East London City also referred to consumer protection. In the same breath I shall now reply to the hon member for Yeoville, too. I believe the Government is doing a great deal. The hon member for Yeoville told the Committee that the Government had good legislation. Backbenchers should please just excuse him because this is the same speech he makes every year. He always discusses consumer protection and says the Government is doing nothing in that regard. I believe the hon the Deputy Minister gave him a full answer and I am not going to discuss consumer protection any further now.

†I want to thank the hon member Comdt Derby-Lewis for the kind words directed towards myself and also at the department and the Director-General. I also thank him for supporting the policy measures that we are taking to promote the real economy and consumer affairs. Unfortunately, most of the matters raised by the hon member have nothing to do with my department, but I will refer his speech to my colleague the hon the Minister of Finance. He will be able to react to the points made by the hon member.

The hon member referred to the increase in our Vote, specifically to the expenditure on export promotion. I think the amount is something like R433 million. I am not going to repeat the reasons for this, but I think if one looks at page 3, paragraph (f)(vii) of the explanatory memorandum which came out with this document, one will find a very detailed explanation of what it is intended for and why it is so high this particular year.

The hon member Comdt Derby-Lewis also remarked on overconcentration and said that we should be aware of cartels which actually involve price collusion. I think that became illegal on 2 May 1986. Like all other forms of collusion price-fixing is now—in accordance with that Act—a criminal offence. To avoid harmful disruption this policy is being phased out and I want to refer the hon member to the relevant report of the Competition Board. I think that he will find pages 12 and 23 excellent reading and I think our intention is explained very carefully. I think this has proved to be a particularly cost-effective way of promoting competition in South Africa. I want to assure the hon member that it will be vigorously reinforced if we find anybody offending against the regulations.

The Government is concerned about the increasing power concentration in the economy. However, rash action which fails to take into account the complexity of concentration and particularly of its causes is bound to be harmful.

There is little wisdom in an attack on symptoms which leaves the causes undisturbed. I think the hon member will agree with me. For these reasons I instructed the Competition Board in November 1986 to investigate concentration in the financial sector and the practical and policy implications thereof. Most of the large financial institutions are integrated with conglomerates which include mining houses and industrial holding companies. Widely divergent views on this matter are to be expected and we have already experienced this. Those who wish therefore to convey their opinions to the board, now have the opportunity of doing so. I just want to end by saying that we do not see this as a witch-hunt, but we are concerned and for that reason we are having this investigation.

The hon member for Constantia in his last speech raised an important matter, and I want to thank him for doing so. As far as the possibility of double discounting is concerned I think we are already at the present moment, together with the CSIR, investigating the possibility of a register of hire-purchase or credit transactions. I therefore want to thank the hon member for raising that point; we are already working on the matter.

The second point he raised was in connection with tourists as far as the discounting of excise duties and GST is concerned. I think we will take up that matter and see what we can do about it. In other parts of the world there are ample examples of how it could be done. We will have a look at that and also discuss it with my colleague, the hon the Minister of Finance.

He also referred to disinvestment and we appreciate his views on that subject. We fully agree with him as far as that is concerned. He also referred to the Sullivan principles. What I wish to say in this regard is that this code has been overtaken by the evolutionary changes already in force in the RSA and could therefore as far as our department is concerned be regarded as outdated. I think more attention could also be given in the USA to honouring the principles contained in the code. As far as we are concerned it is a bad export product for any country.

As regards the alleged confusion regarding the revision of the Liquor Act I want to make something very clear. I think there may have been a printing error in the published document, because on the one side it says 1988 and on the other side it refers to 1987. At the moment we have a document which we will pass on to the legal advisers and that will be published for comment. It only has to be ready for next year’s session.

As far as the hon member’s comment on Majuba is concerned I will deal with that during the debate on the next Vote because that falls under the Department of Mineral and Energy Affairs.

*The hon member for Stellenbosch delivered an excellent speech and I want to thank him very much for it. I believe most of the matters he raised have already been dealt with by the hon the Deputy Minister.

I have already referred to the hon member for Middelburg. He made an interesting point about the cost at which serviced plots are made available to the public. He referred here to an amount of R12 500. I have a fair amount of experience in providing services in townships and I want to make an appeal through the hon member, who is an expert in respect of local government, to local authorities not to make the standards they prescribe with regard to services unreasonably high. I have learned through experience that this amount of R12 500 does not cover even the cost of the services for a township based on the standards of most local authorities.

I think we should compliment Middelburg, for they have accomplished a great deal with the land and the services. We do not know, of course, exactly what is included in this amount of R12 500—whether the land prices and the finance charges and the services from the municipal treasury are included. If this is indeed the case, I think we should, through this, send a message to other local authorities to stop them from making unreasonable demands in respect of the standards and the quality of services in a township. We should like to convey this message.

†The hon member for Pinelands spoke about further wealth creation, and I agree with him. We should create wealth, because the more wealth we can create in this country the higher will be the living standards in this country and the more successful our economy will be. I think that hon member and the hon member for Yeoville made the same mistake. He referred to our privatisation actions and compared them with what had happened in the United Kingdom. However, I do not think they are comparable because in the UK the privatisation action was started from a basis of nationalisation, which has never been the case in South Africa. [Interjections.] Never ever! There is a big difference—a colossal difference—and if the hon member would like to visit my office I shall explain to him what it is, because I think I could give him a lesson in that regard. That also goes for the hon member for Yeoville. I was quite surprised that a man with his experience and knowledge should take that point. I think it is totally invalid and I will therefore not refer to it any further.

As far as privatisation and deregulation are concerned, I would also suggest that the hon members repeat their speeches under the Vote of the hon the Minister in the State President’s Office because that is his responsibility and not my responsibility any longer.

*The hon member for Sunnyside referred to the SBDC. I shall return to the SBDC in a moment. I think the hon the Deputy Minister has already reacted to his other points.

I have already referred to the speech made by the hon member for Witbank, and to the question of tourism in particular. I think the last point the hon member made was interesting and I should like to repeat it: We should not only be marketing tourism, but operating it, too. I think this is an important point which I should like to stress.

†I think I have already dealt with the speech of the hon member for Umbilo. He made one very important point, namely the value that international conferences can have for tourism in South Africa. He is not here today, but I think it is important to place this on record. I think the programme on international conferences which we had in South Africa last year was proof of that. People who came for the conference only, spent another two to three weeks in South Africa after the conference. I think that is of utmost importance, and I would like to say that our departments would like to attract as many international conferences as possible to South Africa, because that also introduces newcomers to South African conditions—to see for themselves what is happening in South Africa and how it is happening. They usually go back as very good ambassadors for South Africa.

Mr Chairman, the hon member for Yeoville really surprised me.

I always surprise you!

He reminded me of a very nervous butterfly, flitting from point to point without touching any one of them. He started by taking the SAA to task about the problem of charter flights to South Africa. I think that in principle I support him. However, I think there is more to it than asking: “Why can’t the SAA have charter flights to South Africa?” We are working on that. However, from this dizzy height of the SAA he made a soft landing on the poor Granny Bonds! My goodness, Mr Chairman! Why does he raise the question of the Granny Bonds under my portfolio, while knowing very well—he has been in Parliament for 12 years—that it has nothing to do with me but is the responsibility of the hon the Minister of Finance.

I was talking about inflation.

No, Mr Chairman, he criticised the Granny Bonds—I am at present referring to his criticism of the Granny Bonds. He knows very well that the Granny Bonds were a great success, and that was why my colleague had to take specific steps. [Interjections.] My colleague will reply to him in great detail.

Then he did another amazing thing. [Interjections.] He took a dip with my colleague Mr Hendrickse, swam across and landed on the bandwagon of nationalisation. He made a big issue of that, despite the fact that it was I who said in the course of my speech that we were not in favour of nationalisation. He then made a very big announcement to the effect that the PFP was not in favour of nationalisation. Why is the hon member so nervous about nationalisation? [Interjections.] I can tell you why. It is because I think that is the next faction fight looming within their circles. [Interjections.] Mark my words, Sir!

I want to deal with the hon member’s remarks about the IDC. All of a sudden came down heavily on the IDC and asked a few questions on the subject. All of a sudden he wants to know—if I am wrong, I shall apologise—why the IDC does not sell all its shares.

That is not true; I never said that.

The hon member states that that is not true. That is fine. Then I am quite happy with the hon member’s …

I never said that. I asked whether …

Order!

May I ask the hon the Minister a question?

No, the hon member has had enough time. [Interjections.]

I want to suggest that the hon member study the reports of the Industrial Development Corporation.

I never said that. You must read my Hansard.

Fine, I accept that.

I then want to recommend that the hon member study the annual reports of the IDC—not read, but study—for he will then see that the IDC regularly sells its shares. But, Sir, this is after all not so easy.

How can a man tell such untruths?

Of course it sells its shares regularly.

The hon the Minister is misquoting me; that is what I am saying.

The hon member is still just as thin-skinned now; give me a chance to reply …

Order! I appeal to the hon member for Yeoville to contain himself. The hon the Minister may continue.

Since the fifties the IDC has been financially a completely autonomous, independent institution. Because it is their task to promote industrial development in South Africa, they obviously have to have funds. They no longer obtain their funds from the State and from the Treasury. They are independent. Where do they find their resources? Their resources come from shares that they sell. The IDC does not speculate in shares on the Stock Exchange, either. They are not a speculative organisation. Therefore when they buy shares, they first have to make sure they can make a profit on those shares. This is, after all, one of their sources of finance.

Their second source of income comprises dividends from their investments. The third source is their earnings on interest on loans and investments. I believe if there is one organisation that does not need criticism, it is indeed the IDC, which has built up the most magnificent record of achievements with regard to the establishment of industry and expertise in South Africa. In industry—in the private sector—there are hundreds of monuments to the work the IDC has performed. Some of these have already been sold off, whereas the corporation retains a direct or indirect interest in others. These are all enterprises that were established by the IDC, and I feel that we, as the House of Assembly, should take note of the great task they are undertaking.

However, the hon member is asking me a further question. The hon member for Yeoville was terribly apprehensive yesterday because initially he was not going to enter the debate. Suddenly, however, he decided to do so. Of course, I know why he entered the debate. I can guess. If I guess incorrectly, I shall simply apologise once again to the hon member. He was not satisfied with the way the hon member for Pinelands was putting the IDC’s case to me. He then simply had to put it once again. Then, right at the end, he comes to light with a question …

[Inaudible.]

Oh, Sir. We know the hon member for Yeoville well by now. He always shakes his head about whatever he has said. He is now asking how the IDC will be financing its involvement at Mossel Bay. I ask you, Sir. [Interjections.] I ask you. You know, Mr Chairman, such a question simply astounds me.

You are talking such a lot of rubbish!

I am not talking rubbish. I think the hon member for Yeoville is asking nonsensical questions. [Interjections.] Mr Chairman, the hon member for Yeoville is asking nonsensical questions and now, when I answer them he says I am talking rubbish. The hon member should just reflect on the questions he is asking here. [Interjections.] Did the hon member ask where the IDC was going to obtain the money to finance their involvement at Mossel Bay?

I want to know how they are going to finance this. From what sources?

Oh, the hon member did in fact ask this question. What a stupid question to ask! [Interjections.]

Order!

Could any one think for one moment that the IDC would make such an announcement without knowing its sources?

Now where are these sources?

We shall tell you! Just be patient! The IDC itself will tell you! I need not do so.

You are not answering my question! [Interjections.]

Mr Chairman, I should like to venture a prediction here. This issue of the IDC is simply a new so-called “hardy annual” which was born of this debate. Those backbenchers on the other side will raise this issue every year from now on. This is exactly what happens in the case of the consumer story. We shall have to listen to it every year. However, I want to leave the hon member for Yeoville at that. My whips have indicated that my time has almost expired.

Next I want to address my attention briefly to the hon member for Germiston.

The racist!

I want to thank the hon member for his contribution. We will study his speech and let him have our reply in writing.

*The hon member for Durbanville referred to the SBDC and to the White Paper. He actually referred more to the effect of the White Paper, particularly to the fact that it could have a specific effect on the South African economy. This is of course quite true. †I think I have already replied to the two points made by the hon member for Constantia. I want to thank him again for his contribution. I have also replied to the hon member for Rosettenville.

*I also want to thank the hon member for Wellington once again most sincerely for his speech. At the end of our debate, Mr Chairman, I want to say once again that I am very, very grateful for several very good speeches. The debate was conducted on a very high level and if we can keep the promotion of the South African economy on this level, the economy of this country has a fine and rosy future. Once again, thank you very much.

Vote agreed to.

Vote No 19—“Mineral and Energy Affairs”:

Mr Chairman, at the outset I should like to make use of this opportunity to thank all the officials of my Department of Mineral and Energy Affairs for their sustained hard work during the past year. They are not in the Chamber yet, but …

You do not have a department yet.

I do not have a department yet; I shall therefore convey my thanks to them later. Their support and loyalty are sincerely appreciated.

The investigations into the functions of departments have been concluded, as far as the Department of Mineral and Energy Affairs is concerned. The aim was to evaluate the functions currently performed by the department and to decide if, in the present circumstances, they should continue to be performed in this way. We have made good progress in this regard; in fact, I believe we are one of the departments which have made the most progress. I wish to thank the officials of the department sincerely for the hard, unstinting work they have done to finalise this function-readjustment investigation and make recommendations. The Director General and I have already approved the recommendations and the department is now working on the details. I should like to convey my sincere thanks and those of my two Deputy Ministers to these officials for the wonderful support we have received from them.

I regard this as the right occasion, on behalf of the Government and Parliament, to have our gratitude and appreciation to Dr Louw Alberts who retired as Director-General of Mineral and Energy Affairs on 30 June this year placed on record. We all know that not only is he a scientist of stature but he has also promoted the image of the department in various fields. We are also aware that as president of Mintek he has played a very important role in the development of the South African mineral and mining industries. I personally held the view that Dr Alberts could have stayed on a while longer, but it is one of his delightful qualities to stand aside when he is convinced that someone else can play an equally significant role in the national interest. We should like to wish him and his wife and family everything of the best in the days ahead.

We have found the kind of person we had in mind in Mr Engelbrecht, our new Director-General, who took over the reins from Dr Alberts on 1 July 1987. Allow me, Sir, to extend to Mr Engelbrecht a sincere welcome on behalf of the House of Assembly, Parliament as well as the Government. He has an excellent grounding in departmental activities. He is not only well qualified, but also very suitably equipped indeed for the task. Apart from the fact that he has been an official of the department since 1949—in other words, for approximately 38 years—and has represented the department on a wide range of bodies and societies and served in a variety of postings—these included eight years in South West Africa—he holds BSc and MSc degrees in geology as well as an MBA degree, which naturally stands him in extremely good stead in his present managerial role. It has also been our experience that he has a fine instinct for public administration. We are most proud to have been able to appoint a person of this calibre as departmental head from the ranks of the department itself. We trust that his term of office as departmental head will be pleasant and filled with challenges.

Mr Chairman, I request the privilege of the half-hour.

Order! I am informed that both half-hours under this portfolio have already been utilised.

I was under the impression that this was a new Vote, but an hon member opposite will have to accommodate mg.

Order! There are two half-hours per portfolio. The hon member may proceed.

Mr Chairman, on behalf of the Official Opposition I wish to associate myself with the friendly words conveyed by the hon the Minister to his officials, his farewell to Dr Louw Alberts and the accession to the important post of Director-General of the oldest department of the State, by Mr Engelbrecht. We, too, wish Dr Alberts, his wife and family everything of the best on their retirement. We want to wish Mr Engelbrecht, who is now to take on this new and important post, every success in his new task. Apart from that we want to add that it is a pleasure to enter into a debate of this nature with the hon the Minister. He is a civilised and sympathetic person who is serious-minded and without acrimony. We wish to thank him for that.

This State department, which is the oldest and no doubt one of the most venerable of departments, again boasts an outstanding annual report. The value of mineral sales has increased by 13,9%, representing record earnings for the fourth successive year. Gold sales were responsible for an additional 86,7% of the export services.

This adds to the concern we feel about the strikes in progress on our gold mines at the moment. The amendment of the Mines and Works Act is also cause for grave concern and is giving rise to anxiety among the White mineworkers of South Africa. We trust that this very responsible hon Minister will, in his customary sympathetic fashion, also look after the interests of the White mineworkers in the gold mines of South Africa.

It is also a pleasure for us to welcome Dr Aidan Edwards as Chief: Technological Planning in the office of the hon the Minister. We have read that he is going to undertake a dynamic examination of the issue of beneficiation, and it would perhaps be as well if he were to read the speeches on beneficiation made in the debate on the previous Vote.

It was my privilege to visit Sasol II and III this year and to visit Koeberg together with the standing committee. What monuments they are to far-sightedness and technological initiative above purely economic considerations! Permit me to state at this point, for the sake of those who are still concerned about the safety of Koeberg, that safety, security and constant watchfulness are the watchwords there. The men who are working there are dedicated and actively operational. South Africa can be proud of the quality of the service rendered there and the standard of safety prevailing there. It is a pity that hon members of the PFP did not accompany the tour.

Shame!

[Inaudible.]

We also have the phenomenon in this department that it is a cause for concern that there is underemployment. It is evident that in the department as a whole there is a staff shortage of approximately 20%. In the department of the State Mining Engineer it is approximately 10%, in Geological Surveys it is 14% and in the Energy branch 27 posts out of 46 are vacant. While one is aware that specialist knowledge is required here, it is nevertheless cause for concern that at a time of unemployment 170 posts out of 942 are vacant.

A gratifying phenomenon mentioned in the annual report is that the R835,85 million devoted to the search for oil thus far has yielded excellent results at Mossel Bay and we shall be able to begin earning dividends from this enormous investment in the medium term.

Fairly extensive reference is made to overseas representation in the report. I just wish to say that in this regard, too, our men—our counsellors and our consuls—are ambassadors for South Africa, and they handled the Kinross affair, for example, extremely well. However, there are too few of them as well. The counsellor accredited in Bonn serves Austria, Finland, the German Federal Republic, Norway, Sweden and Switzerland. The representatives in London, Paris and Tokyo also have to serve several countries.

I referred to the bad publicity surrounding the Kinross mine. As far as I know this matter has not yet been finalised, but criticism has been levelled at the mine safety regulations, and it would perhaps be as well if the Minister would reply reassuringly in regard to this aspect. Apart from this disaster, however, we have had a death rate on our mines of a mere 1,02 and an accident rate of 16,3 per thousand.

I now wish to turn to a different subject. We read that according to the demographers, we shall have 80 million people in South Africa by the year 2000. This is the maximum number of people that this country, with its limited water and agricultural resources, will be able to support. We must bear in mind that our mineral and raw material resources are being exhausted and that pollution and poverty are on the increase. If we look at the role of minerals in the existence of our State, history teaches us that we have received many blessings from them, but that we also bear the heavy burden that this wealth under the earth entails. We have paid a heavy price for its gold and diamonds. It has cost the lives and liberty of men, women and children.

Let us once again take a very sober look at the carefully thought out orchestration of the balance of power in the world. It becomes clear once again that the mineral wealth of the RSA is still the central issue in the persistent onslaught that is being made on this country in an effort to occupy and dominate it. [Interjections.]

In 1984 the RSA produced more than 60 different minerals from 883 mines including 83 gold mines, 98 coal mines and 62 diamond mines. Mineral commodities were exported to 87 countries. We shall perhaps discuss the energy minerals in more depth when we debate the new Energy Bill. All that needs to be said here is that the White Paper on the Energy Policy of the Republic of South Africa and the legislation to be debated really represent a milestone in the fine history of the department, as the report indicates.

Energy minerals constitute the heartbeat of the economy of the First World, and with our identified coal reserves of more than 50 000 metric tons it will be necessary to act with the utmost responsibility and circumspection. As a result it is necessary to take into account that unless large new coal fields are discovered and exploited, or the exploitation of coal at the mines is drastically improved, or the rate of growth in the demand for electricity declines drastically, or the export of coal is stopped—that we cannot do—then some alternative form of generation of electricity will have to be implemented to meet the estimated energy needs of the RSA.

At present the RSA is the third biggest producer of uranium in the world, with 14% of the world’s reserves. I was informed during my visit to Koeberg the day before yesterday that the life of U235 is 450 000 million years. I think that by that time we should have gotten rid of the NP. [Interjections.]

It had better be a little quicker!

I really hope so. In fact it will happen within the next two years.

Ninety seven per cent of South Africa’s production is available for export. Besides Canada and the USA, the RSA is the biggest exporter of uranium. Therefore we shall to an increasing extent have to build additional power stations and eventually, breeder reactors. In my opinion the State is obliged to stimulate and intensify its nuclear energy research programme. If this does not happen the RSA will become like a farmer who makes porridge of the maize that he should keep to sow in the subsequent year.

As far as coal is concerned, our dependence on oil has declined from approximately 22% of the energy requirements of the RSA in 1973 to 14% in 1984. This has taken place largely as a result of the establishment of Sasol II and Sasol III. With the exception of Koeberg, the RSA is virtually entirely dependent on coal as far as its energy requirements are concerned. As the CP predicted, nothing came of the Cahora Bassa Scheme.

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

Mr Chairman, I am rising merely to afford the hon member the opportunity to complete his speech.

I thank the hon member.

It is to be hoped that the time will come when it will be possible for this great project to be utilised to the benefit of a large part of Southern Africa, because it is tragic and frustrating for the planners and builders that this entire monumental construction should go to rack and ruin as a result of disuse.

We should always bear in mind that the generation of power from coal creates tremendous pollution problems. A power station like Tutuka alone emits six tons of coal ash per day from its smoke stacks. That is 2 190 tons per annum. Just think of the pollution that causes!

Good fertiliser!

It is not all used as fertiliser. We heard that the pollution in the Black residential areas in the urban areas of South Africa would disappear once the smoke-free stoves were put into use there, but that did not happen.

Against this background of mineral wealth and technology it is not surprising that the USA and Russia are eager to establish their influence in South Africa in one way or another. If they are unable to succeed, the repercussions for the USA are far more serious than for Russia. Russia has sufficient mineral deposits to meet its own current needs, but America does not have such deposits.

Owing to restrictive government regulations, the effect of leftist-radical environmental consciousness and low cost foreign competition that undermines its industries, America is overly dependent on strategic minerals from potentially unstable governments. It is therefore dependent on mineral resources from abroad. The Russians, in contrast, have completed a 3 000-kilometre-long railway line, the Boukal-Amir railway line, in the place of the Trans-Siberian railway line to convey its minerals to the heart of its manufacturing and industrial complexes. We read further that 438 000 Americans could lose their jobs if the embargo on uranium and chrome from South Africa is not lifted.

The USA is dependent on overseas sources for 50% of its requirements in respect of 23 to 40 critical minerals that are essential to the national security of the USA, while the Soviet Union is totally independent of foreign sources for 35% of the same critical materials. If South Africa can be eliminated from the world market, Russia will become the dominant world supplier of chrome, manganese, vanadium, titanium, zirkonium and the PGM metals.

The Journal of Commerce states that it is impossible for the USA to construct turbines, cars, oil refineries or nuclear or conventional power-stations without access to South Africa’s mineral wealth. It is well-known that Brezhnev said that the key to Soviet world domination was the isolation of the mineral reserves of the Middle East and the isolation of South Africa from the West.

The conclusions that may be drawn are that it is inevitable at this stage that co-operative projects similar to Iscor, Sasol and Foskor will have to be tackled to provide for the beneficiation of minerals before export and for the secondary processing of the refined products. It is equally important that the USA is dependent on the importation of minerals. Is it really acceptable and tolerable that we should be blackmailed to such an extent by that country and that we should be so obsequious towards them? [Interjections.] After all, we have many good trump cards in our hand with which to make our contract—the hon the Minister is himself a bridge player—or did the hon the Minister of Foreign Affairs call “no trumps” while he was sitting with only 11 spades in his hand?

Mr Chairman, we thank the hon member for Brakpan. He spelled out the importance of the department and of minerals in a responsible and calm manner.

After his visit there, he is also full of praise for Koeberg. I assume, now that he has so much praise for Koeberg, that they may reconsider the borders of their Coloured homeland, because I do not think they will allow the Koeberg power-station to be in the Coloured homeland. [Interjections.]

What nonsense you are talking now!

We will send you to the Coloured homeland.

Ask Jan Hoon! [Interjections.]

We on this side of the Committee also want to express our thanks to Dr Louw Alberts, the retiring Director-General. Dr Louw Alberts was well-known in scientific circles. He undertook mammoth research work for South Africa at national and international level, and we wish him everything of the best.

I also want to express my thanks to my predecessor, the hon the Deputy Minister of National Education, who was the chairman of our study group before he became Deputy Minister, for the guidance he gave us in the study group.

Further I want to welcome Mr Engelbrecht, the new Director-General, and wish him everything of the best. I also want to congratulate the hon member for Amanzimtoti on his appointment as Deputy Minister. Last Monday in his handling of legislation we saw that he was a real right-hand man to the hon the Minister. We wish him everything of the best too.

The Department of Mineral and Energy Affairs is a large department. If one wants to discuss this department in detail, several hours would be too little time. The department includes mining, Eskom, the Central Energy Fund, oil affairs, Soekor, Sasol, the Atomic Energy Corporation, Mintek and the Mossel Bay Project, and other matters in its responsibilities.

The importance and extent of the activities of the department is apparent from the annual report. In this regard we can extend our thanks to the department and the Director-General for an excellent publication which not only states the energy policy, but from which it is also apparent that the department is successfully implementing and dealing with the task entrusted to it.

We on this side of the Committee want to emphasise various activities of the department this evening and deal with their successes in the department. This evening I should like to concentrate on one of the aspects of the department, namely mining. I want to point out the importance of our mineral wealth for South Africa and the world.

It is a pity that South Africa’s riches have become a political football, particularly among Western countries. In many respects South Africa dominates the exploitation of raw materials, and therefore the raw materials themselves, of the world. Although South Africa covers less than 1% of the world’s land mass, it has the largest known deposits of gold, chromium, platinum, manganese, ferro-chrome and vermiculite. In 1986 South Africa’s mineral industry achieved a record earning, and the value of its minerals totalled R29,468 billion. Our export earnings totalled more than R25 million, which represents 85% of the total mineral sales. This in turn represents approximately 62% of our total foreign earnings.

In monetary terms gold remains South Africa’s most important export commodity, and South Africa is also the largest producer of gold in the world. In the field of mining technology South Africa is also a world leader, and internationally we have a proud record. South Africa’s mineral wealth serves as a catalyst for the economic development of the whole of Southern Africa and for the prosperity and development of millions of people of all races on the sub-continent.

The South African mining industry is a direct provider of employment to approximately 210 000 foreign workers from across our borders. Approximately 750 000 workers are directly involved in the industries and undertakings with which the Department of Mineral and Energy Affairs and its various branches are involved. Money earned here by foreign workers is sent back to their countries of origin and in this way those economies are also stimulated. Mining technology services are made available to other countries which do not yet have that experience in mining. Electrical power generated from our coal in South Africa is exported to our neighbouring countries.

As a provider of employment the mining industry also plays an important role. I have already mentioned that approximately three quarters of a million workers are involved in the mining industry. The Department of Mineral and Energy Affairs is indirectly responsible for a further 1,8 million workers accommodated by industries which provide services and material for the mines, and it is also involved in the commercial sector which utilises the buying power of the mineworker.

South Africa is known as a reliable supplier in the countries which buy its minerals. We meet the specifications and deliver of our consignments regularly and in good time. The reason for this is that most minerals are mined by private companies which are in competition with one another, and in addition there is an effective transport network which conveys coal, iron ore, chromium and manganese in bulk from the mines to the harbours. This infrastructure was created by the Government, and I should like to draw the attention of hon members to the Sishen-Saldanha railway line, as well as the railway line used to convey coal from the Eastern Transvaal to Richard’s Bay.

I also mentioned that it was a pity that our minerals had become the football of the Western World. Last year America introduced measures to boycott our minerals and not allow them into their country, but according to a report in yesterday’s Die Burger it now appears that there are politicians in America who are very concerned about this state of affairs, because it would seem that since the boycott America has imported as much as 15% more minerals from Russia. Their politicians cannot believe this and they are asking whether South Africa is really so bad, compared with Russia, that it should be treated in this way. We hope that the eyes of the West, of America will open, and that they will see that they have a real friend in South Africa as regards our mineral wealth and its delivery.

Mr Chairman, I would like to join the hon member for Brakpan in his good wishes to the new Director-General of this department, but I would like to take issue with the hon member very briefly for taking a cheap shot at this party, saying that there was nobody interested enough to go on the Koeberg visit.

I did not say that!

The hon member said there was nobody there. He implied there was no interest. In fact, that is not correct.

I said it was a pity that you were not there.

I will accept it in that spirit. It sounded like a cheap shot when the hon member mentioned it, because there were apologies and there is interest in the matter. If another opportunity arises we will be there.

I would like this evening to raise two important matters affecting this department. The first is to refer to the Central Energy Fund issue, which was raised earlier this year by my colleague, the hon member for Port Elizabeth Central. He queried the fact that R1,2 billion had found its way out of the Central Energy Fund into Coloured housing. This created some controversy at the time. The Chair ruled the description “bribe” out of order, but the best one can say about this is that it was an unorthodox method of financing housing, and I regret to say that at this stage we are not satisfied with the replies we have had to date. There are a number of unanswered questions which remains.

Firstly, there is the fact that the Central Energy Fund is funded from a levy on each litre of fuel bought by the motorist. The fund is statutorily bound to be applied to energy-related development activities. Housing thus bears absolutely no relation to the purpose of the Central Energy Fund.

Secondly, in June 1987, according to the reply to a question put in this House, R3,1 billion was the balance in the fund, which is R2,9 billion less than the amount in the fund as at 31 March 1986 which was a year earlier. The first fact that is clear is that the R2,9 billion reduction is more than the R1,2 billion that was applied to housing. Furthermore, the fund should and must have grown by approximately a further R1 billion since March 1986 from further levies and interest flowing into the fund in the normal course. This means that by the middle of this year there should have been, if no withdrawals had taken place from the Central Energy Fund, some R7 billion in round figures in the fund. In fact there was only R3,1 billion which means that approximately R4 billion must be accounted for.

These financial wizards!

We now know that R1,2 billion went to Coloured housing, but what about the balance? This is a question that I believe must be clarified.

Secondly, what have the Central Energy Fund and the motorists received in return for the outflow of funds? Thirdly, is there any point in having a Central Energy Fund if it is simply used for any purpose which might take the Government’s fancy such as housing? We do not argue that housing is not a priority but it should not be financed from the Central Energy Fund. The fourth question is: Is this not another example of off-balance-sheet financing? If so, it is a further slide away from the democratic concept of accountability to the public.

Another matter that I wish to raise is the question of the mining leases which were owned by Rustenburg Platinum and were transferred by the department to a company called Lefkochrysos Platinum Mine—currently referred to on the Stock Exchange as Lefko. There was a very sudden and controversial change of policy which stripped the JCI subsidiary Rustenburg Platinum Mines of valuable prospecting rights near Brits and allocated them to this new company founded by Mr Loucas Pouroulis.

The background is that in 1984 Rusplats bought a company from the US-based Texas Gulf Incorporated for R6,9 million. Texas Gulf held a prospecting lease over a farm near Brits. Rusplats applied for the lease to be extended in the normal course of events last year. This renewal had hitherto been regarded in the mining industry as a matter of routine. However, they were summarily advised by the department that Mr Pouroulis and his company Celine had applied for it. They were later told that the prospecting lease previously owned completely by Rusplats—having bought the company—had been split and that all the rights to the areas below 1 000 metres had been taken away from Rusplats and given to Mr Pouroulis’s company Salene.

Apparently this occurred in terms of section 13 of the Mining Rights Act. This has aroused considerable controversy. The decision to strip a major mining house of its lease for which it has paid a considerable amount of money marks the departure from accepted practice. The JCI chairman at the time is quoted as describing this step as “neither fair nor equitable”. The MD of Rusplats went much further and described it as “appalling”. There are rumours—we must take note of these—of pending court action to challenge the decision and reclaim the previous rights held by Rusplats.

The Department of Mineral and Energy Affairs has been reported in the Press as saying that all applications are treated strictly on merit. The question is: What were the merits? On what basis was this decision taken which overturned an established precedent and a tradition existing over many decades?

This is apparently the first time in South African mining history that a major mining house has been stripped of its rights in this fashion. This has massive implications for the orderly development of our mining industry. There needs to be a public debate on a major policy shift of this nature. It cannot be allowed to happen secretly behind closed doors with no satisfactory public explanation.

Worse than that, what gives the whole affair a disturbing and potentially sinister twist is that there is a report in the business Press that a very senior official of the department—who left the department at the end of June—has, since he left, become a director of Lefko which is the benefiting company. According to the reports he became a director on 1 August—one month after leaving the service of the Department of Mineral and Energy Affairs. As such, in his capacity as director, he was allocated 10 000 shares at an issue price of R5, which shares are currently being offered in the marketplace at R13. That is immediately a net capital gain of R80 000. I want to ask the hon the Minister if that official—and he knows very well to whom I am referring—was in any way involved in the decision to transfer the lease from JCI to Lefko. From reports it appears—and to my knowledge this has not been denied—that he was very much involved. He was on the committee—if not the chairman of the committee—that took the decision to transfer the rights. I believe that the hon the Minister was on that committee or at least party to the decision. The hon the Minister is also reported to have been the officiating main speaker or guest at the opening of the Lefko mine. [Interjections.] I have no axe to grind with the hon the Minister. I am questioning the role of the official. My question is: What was the official’s role in this matter and what does the hon the Minister have to say about the situation?

Another very important question which arises is whether any negotiations were entered into with JCI or Rusplats to the effect that a policy change was in the offing. We have seen what the department has been quoted as saying by way of explanation for this change, but was JCI given warning that a change might be in the offing? Were they given an opportunity to remedy the situation? Can one expect expensive mining rights to be summarily taken away without giving the opportunity to the previous holders to remedy any problems and to protect their interests? I believe the hon the Minister owes us a public explanation on these matters in this debate. [Time expired.]

Mr Chairman, I am going to leave the hon member for Constantia in the capable hands of my colleague from Springs and in the capable hands of the hon the Minister.

*I should like to make a few comments on what the hon member for Brakpan said. I see he is not in the House at the moment. He appealed to the hon the Minister to hold back the Mines and Works Amendment Bill which was passed by the House a few days ago. The reason he requested this was that there were strikes in the mining industry. I want to avail myself of this opportunity tonight to say something about those strikes. I want to tell the hon member that strikes in the mining industry are not unique to South Africa. If he had read the Citizen of 11 August, he would have seen:

The report continues:

Strikes are not unique to South Africa, therefore. They also take place in Korea.

The second thing I want to tell the hon member is that he is making the same mistake he made when we discussed this legislation. Because a certain segment of the Black mineworkers are on strike, he wants to judge everyone by the same yardstick. The hon member for Brakpan is making a basic mistake. The other hon members of the Official Opposition do this as well. There are thousands of Black mineworkers who are not on strike; in fact, there are mines where work is carrying on as usual, just as was the case before the strike.

Not Harry’s mines.

Those people are working precisely because they are getting the opportunity to do so and because they can see that they too have a future in the mining industry. They can make progress now. This legislation gives them the opportunity to do so. I want to appeal to the hon the Minister, therefore, to appoint that committee that was provided for in the legislation as quickly as possible. It can start functioning as soon as possible and start making submissions to the hon the Ministers. [Interjections.]

I do want to congratulate the hon member for Brakpan, however. He spoke about Koeberg and other fine monuments in this country, which attest to far-sightedness. It is wonderful to hear him singing the praises of the NP Government! After all, Koeberg is there today as a result of the NP Government’s far-sightedness and as a result of what we did.

That was before your time.

If he thinks the NP lost its far-sightedness when hon members of the CP left, he need only keep an eye on Mossel Bay. He will see another great monument arising there.

I should like to come back to the hon member for Carletonville. I want to be very friendly to him tonight, because this is such a fine department; one does not really want to fight. [Interjections.] The hon member made a few statements a few days ago and in one of them he said: “So min van iets weet soos ’n aap van godsdiens” (know as little about something as the man in the moon). I want to tell him that if he is hiding behind a bush, he must not think everyone else is as well. I want to add that he should be very careful in making such claims. He should know that the hon member for Overvaal can get very excited about this kind of reference. [Interjections.] He can be grateful that the hon member for Overvaal was not in the House the other day.

It is also clear to me that the hon member for Carletonville—I am in an extremely friendly mood tonight; I do not want to fight—sometimes sits and sleeps open-eyed. I want to tell him he should take the Labour Relations Act to someone who knows a little more as far as the legal aspects are concerned, so that this person can explain the question of indemnification to him. He should also be careful about saying that I said trade unions should be prosecuted if they go on strike legally. That was not what I said. He can go and read my Hansard. I never advocated that. I was talking about illegal strikes and even used the expression “wildcat strikes” to make sure the hon member understood what I was saying.

I want to come back to the strikes in the mining industry which are in progress at present. [Interjections.] This is something I find very disturbing. I have nothing against a legal strike. I want to repeat tonight that it does not matter who the trade union is. Nor do I have anything against a legal strike if the employer is acting in an unjust way. I have nothing against a strike if the trade union is reasonable in its approach.

But we must tell trade unions and employers tonight that the present mining strikes can create a problem situation for our mining industry. Hon members may say that this is a matter which should really be discussed under the Manpower Vote, hut the legislation we have dealt with concerning the abolition of scheduled persons was dealt with under the Mines and Works Act and not under labour laws. That is why I am discussing this matter under this specific Vote.

There are two facets of this strike that I find particularly disturbing. The first is the fact that I saw in the Press that the International Union of Mineworkers wants to send money to this country to assist our strikers. My advice to those people is that they should rather keep the money there. If they want to use it to good purpose, they must either send it to Korea where people are striking in the mines, or to Chad. I want to tell them, however, that both they and their money are very unwelcome in our country. It is tainted. They need not send it here to us; we do not need their pathological interference.

The second thing that bothers me is intimidation. We need only look at the reports that have appeared in the Press. I quote from the Citizen of 11 August:

In one serious incident at a mine six miners wanting to go on shift were injured—two of them seriously—in a clash with strikers who intimidated and prevented them from going underground.

That is why I told the hon member for Brakpan a moment ago that not all the Black mineworkers were on strike. I continue:

This is what the Press says about intimidation. I think we should make it very clear to these people tonight that we cannot allow hooliganism, assaults and intimidation to run riot in our mining industry, not even when there is a legal strike. The National Union of Mineworkers themselves admitted that there was intimidation on their part. The Citizen of 11 August stated it very clearly:

Earlier NUM said two of its officials had been arrested at the mine, the only one of the JCI group thus far affected by the strike.

Even NUM admits that its people are involved in intimidation.

Even Lesotho is concerned about this mining strike. A spokesman of the Lesotho Government was reported in the Citizen of 12 August as follows:

Lesotho has thousands of workers in the mines and they provide the main source of revenue for that country.

It is important that we tell NUM once again that they must be extremely careful what they do, because many people could get hurt.

I think we should appeal to both the employers and the employees to proceed with the utmost circumspection during this present strike. I think the sooner we can resolve this strike, the better it will be for employers, employees and South Africa as a whole. Things cannot continue in this way for long; we must appeal to those people to get away from the emotive aspect and to go back to work so that negotiations can take place in a scientific, sober and practical way. That is why it is my opinion that if this strike carries on for too long, we must appeal to the hon the Minister to go to them and ask whether we cannot ultimately act as a mediator. [Time expired.]

Mr Chairman, I beg your indulgence, as I am not going to react to the hon member for Stilfontein. There are others on this side of the Committee who will do so later.

He reminds me so much of the man who spent all his money at the horse races and then only took a loaf of bread home to his children that afternoon. Then he said to them: “ You must not feel bad; we have a loaf of bread, but the man next door spent more money and he was only able to buy half a loaf of bread for his children. ”

This afternoon I want to speak about energy. We realise that the Government has waived certain fuel levies for the farming, marine and transport industries. It amounts to approximately 25 cents per litre. This has caused people in other industries to abuse the three industries mentioned by obtaining diesel cheaply. The abuse in this connection are such that an amount of R40 million was even mentioned which did not go to the Treasury as a result of this abuse.

Certain countries in Europe have tried to stop abuses in connection with fuel by colouring it, but the resourceful thieves discovered that they could change the colour of the fuel back to the original colour. To prevent those who evade lawful State revenue from doing so, there had to be legislation. No one objects to there being legislation to deal with offenders. That is why the CP supported the present legislation on 24 June. However, innocent people are also suffering under this law now. Being far-sighted, the CP, through the hon member for Delmas, warned that there would be dissatisfaction, and that the farmers in particular would not be happy with the state of affairs being forced on them.

The CP said that innocent people were being taxed by the additional burden of bookkeeping and by placing an additional interest burden on farmers. The method of levying and repayment has not yet been properly refined by the department, and the result is going to have a detrimental effect on the farmers. From 1 July 1987, the farmer has also had to pay the full price for diesel. He had to register at the Department of Customs and Excise, and after a registration number had been allocated to him, he could start sending the claims to get back the levy, which would be paid to the farmer, so the department said, not later than 21 days after receipt by the department. The diesel first had to be used, however, before the claim form could be sent in.

In practice, the following is going to happen. Many farmers are going to mislay their claim forms as a result of the busy schedule they have, for example, in the maize-planting season. It is a busy season, which takes up a great deal of the farmer’s time. He has to see that the crop is planted. This proposed system is going to make it very difficult for the farmer. The other evening I heard a prominent farmer saying on television …

Order! The fact that the hon member who is speaking has a resonant voice is no justification for other hon members to converse aloud.

The other evening I heard a prominent farmer saying on television, and rightly so, that farmers were not auditors, but farmers. It would appear that approximately two months are going to lapse between the purchase of the diesel and the repayment of the levy by the department. To obtain the diesel could possibly require an additional amount of R40 million from the farmers—just as bridging capital until repayment takes place. The farmers are already in a dreadful financial dilemma. We therefore want to ask the hon the Minister please to speak to his colleagues and see whether is there is not another answer to this situation in which the farmers find themselves.

On Monday evening in a television interview the hon the Deputy Minister of Agriculture even spoke of an amount of 55 cents more per ha which it is going to cost the farmer for diesel. For the maize farmers, this means an additional cost of R2 million to plant and harvest their 4 million ha of maize. Calculated in terms of input costs, this is equal to the cost of fertilizer for approximately 20 000 ha. Then I have not even mentioned the irrigation farmers or the other grain farmers. The tragedy is that this money does not go to the farmer or the State, but to the money lenders, for example, the banks.

Of course, we on this side of the Committee expected there would be a great deal of dissatisfaction amongst the farmers. And a chorus of dissatisfaction has in fact been heard from all over. Without politicising the matter, I want to say that there are also many Nationalists who are dissatisfied about this. The chairman of the SA Agricultural Union spoke of the “irritating actions of the State”. It is a pity that the Government is only waking up now and is only appointing a working group now. According to the hon member for Fauresmith, the working group will set to work “immediately”. I place this word in quotation marks. Now I hope that that “immediately” was already in the past, so that that matter has already been taken care of.

Mr Chairman, I want to make a plea in the interests of our farmers here today. I wish to make a plea for men who produce sufficient food for this country every year under difficult circumstances. I want to ask that this levy, which they have to bear for a short while, but which nevertheless places a heavy burden on their shoulders, be studied closely. It is causing them tremendous trouble and also requires a great deal of extra time from them. I want to ask the working group to look into this urgently and speedily, and go to the Government as soon as possible with what they have at their disposal to determine to what extent they can make it easier for the farmers so that it will not be necessary for them to go and borrow this extra money somewhere temporarily, so that the farmers can, in fact, cut costs.

Another important aspect of the cost of fuel is the enormous difference between fuel prices at the coast and inland. For petrol with an octane content of 87, the difference in price is 71/2 cents, and for diesel the difference is 6,2 cents per litre. We are aware that the department has introduced a new zoning structure. This affects the farmers in the Lowveld and the Northern Transvaal in particular. Earlier petrol was imported via Maputo, but now it is imported through Durban. The difference in price is apparently due to the transport costs from the coast inland. Since a large proportion of our petrol and diesel is already produced inland, the price difference for diesel as well as petrol should not increase, but rather decrease. We realise that there are cetain reasons why the State cannot disclose how much fuel is produced by the Sasols, nor what percentage of the total consumption in the country it constitutes. Possibly the Sasols already manufacture 60% of the total consumption.

We request that the Sasol project should also be regarded as a harbour. In this way there will be a percentage discount on the price of diesel. I want to ask the hon the Minister whether he would not consider this as well. He could even speak to his colleagues in the Cabinet. This could perhaps result in an inland harbour, of which they could also determine the price. Then it would no longer be necessary for us who live inland to absorb the present big difference in the price of diesel.

Mr Chairman, it was a pleasure for me to participate in this debate. I also appreciate the hon the Minister reacting so favourably to our recommendations.

Mr Chairman, the hon member for Witbank will forgive me for not reacting to his argument. I have a few other matters which I should like to raise, however. I also have a bone to pick with the hon the Minister about the fact that there were certain questions he avoided instead of replying to them.

Before I get to that, however, I want to raise another matter with the hon the Minister.

†You see, Mr Chairman, in the very short time which one has available one has to deal very briefly with issues and try to get a reaction from the hon the Minister. If that, Sir, is being a butterfly, I should rather be a butterfly than a moth, because this hon Minister is a moth. He is moth-eaten, Sir, and his reaction is moth-eaten, too, since he is fascinated by a funny little flame that is going to burn him. [Interjections.]

You are very friendly today, Harry!

I want to tell you, Sir, that the hon the Minister has been rather unfair today. He has been quite unfair, Sir. In the first place he would not answer the questions on the IDC. In the second place, Sir, he misquotes people.

This hon Minister has been in this House long enough to know that one receives an unrevised Hansard and that one can check on people’s words. He should know one does not misquote people in the way in which he has done today. I believe he should know better. He should also, I believe, have the grace to get up and to apologise formally for what he has done in this House today by misquoting people.

Let us come back to the issue of the IDC, however. I listened to the hon the Minister on the radio this morning. On the radio he said that IDC investments could either be by way of shares or by way of equity.

Was that what he said? The hon the Minister is nodding his head. What is the difference between shares and equity? Are shares not equity? Or does he now mean preference shares, or perhaps something else? The reality is that I am asking the hon the Minister about this because this is what the Vote we are dealing with is about, ie energy and the IDC is going to invest in an energy project. I know you are watching me, Mr Chairman.

Order! I am listening very carefully.

I want to know from the hon the Minister what percentage is going to be taken and how it is going to be financed. Those are legitimate questions, but the most important point in this regard is that his statement that this is an act of privatisation is absolute and utter nonsense, because the IDC is 100% owned by the Government. How, therefore, it can be said that one privatises by letting a State corporation take shares in a matter is beyond the comprehension of normal human beings. It is utterly beyond anyone’s comprehension. After all, this is the very point that we are talking about.

When he talks about nationalisation he says that we do not know what nationalisation means, and that it means something different here to what it means in the United Kingdom. Let him go and look at the companies that have been privatised. I ask a very simple question: What does it matter, as regards a company which is owned by the State now, whether such a company was previously nationalised or whether it was always owned by the State? Let him look, and let him see that he is going to have to eat his words if he looks at the prospectuses that have been issued. Yesterday I offered to let him have a look at the prospectus of British Airport Authorities, and maybe he should do so. He should also take a look at British Telecom. If he does so, he will see what this is all about.

How one can say, however, that one is encouraging privatisation by having a public corporation take shares, whether preference or otherwise—or to use his own words, equity or shares—is beyond anyone’s comprehension. I think he owes us an explanation in this regard.

Then he has the impertinence to ask: How can one ask how the IDC is going to finance this? He says that I should go and look at the accounts of the IDC. You see, Sir, he himself does not look at the accounts of a corporation for which he is responsible. Had he done so, he would have seen that the cash resources of the IDC were, at the last accounting, R397 million. He would have seen that in fact there was a very real reason why the IDC wished to finance—in their words—“private sector ventures”. They say:

If one were to take away the whole of that R397 million, what is left for the financing of private ventures, unless one is prepared to sell something? Moreover, if that is the case, we ask the hon the Minister what he intends to sell.

Let me deal with one other important matter in regard to which I should like to get an answer, since I have to try to deal with other matters as well in the very short time at my disposal. I refer to the jewellery industry and the exporting from South Africa of gold and other precious metals. Representations have repeatedly been made in an effort to get the jewellery industry onto a proper footing in South Africa. His department is part of an enquiry which has been dragging on and on, and the hon the Minister of Finance as well as the hon the Deputy Minister is involved in this regard. We are waiting for answers to see whether it would in fact be possible to get the benefit of this for South Africa. We know that one of the major reasons is the nature and the impact of the tax involved. However, we wait and wait, and in the meantime South Africa is losing foreign exchange while the exchequer is losing tax.

Perhaps you will permit me to mention just in passing, Sir, when we talk about the tax implications in this regard, that even the IDC is engaged in tax avoidance and gets involved in the use of lessor trusts, while the hon the Minister of Finance has to close loopholes. So, Sir, while the hon the Minister of Finance is watching people to see how they are avoiding tax, that hon Minister, with corporations under his control, is allowing people to indulge in the same thing that private sector people have done. That is not right.

In that same report on which he is so well-informed, it says, in fact, that these things have to be done away with; and yet they are doing it themselves! That is not the way in which a Minister should handle a department.

Mr Chairman, the hon member for Yeoville has raised a subject which I will leave to the hon the Minister to deal with. [Interjections.] I am sure the hon the Minister will be able to handle the hon member’s questions about the IDC and Mossel Bay quite adequately.

With regard to the jewellery industry I want to tell the hon member that we in these benches are just as concerned about it as he is.

Well, do something about it.

The hon member says we must do something about it. I think the hon the Minister earlier today mentioned what had been done and perhaps later on he might like to tell the hon member what more is being done. I shall leave that to the hon the Minister to deal with.

I would like to respond to the hon member for Witbank—I do not know whether he is here. Before I do so, however, I should like to make an announcement here tonight regarding the possible blending of ethanol with petroleum products. I am sure hon members are aware that this is a subject that has been discussed many times in this House over the years. In fact, I believe way back in 1978 there was a private member’s motion on this very subject. We had a very interesting debate at the time. I think it is very opportune that this subject should be debated again now because there has been quite a lot of speculation on this particular matter in the Press of late.

I should like to report that during the second half of last year the sugar industry completed a viability study on the production of ethanol from sugar cane and molasses in Natal. On 5 December last year representatives of the sugar industry had discussions with me to enquire about the Government’s policy on such a programme. At that stage I advised the sugar industry that although the Government was sympathetic towards such a programme, the possible distribution of such fuel still had to be resolved by them with the oil industry as a private sector matter.

In May 1987 it transpired that consensus could not be reached by the two parties as far as the price which the oil companies had to pay for ethanol was concerned. The main problem seems to be the effect of ethanol on the octane number of the blended product. The sugar industry argues that ethanol increases both the research octane number, often referred to as ron as well as the motor octane number, which is referred to as mon. This implies that a substantial credit could be passed on to the ethanol producer. On the other hand the oil industry argues that the motor octane number only increases slightly and in certain cases even reflects a negative reaction.

The reason for the conflicting viewpoints stems, I believe, from the fact that the two parties use overseas results which may not necessarily hold for the type and composition of the product used in the RSA.

The hon the Minister of Economic Affairs and Technology as well as my colleague, the hon the Deputy Minister, accompanied me on an official visit to Natal last week. I might just say that we were very well received by the sugar industry. After touring the industry and looking at their problems as well as their potential, I have decided to appoint a working group to investigate and report on the possible introduction of a blended fuel. The working group will be composed of officials of the Department of Mineral and Energy Affairs, the oil industry and the sugar industry, the South African Bureau of Standards and other experts in the research and technical fields of liquid fuel. I hope this group will get under way very soon because I intend that they should submit their report to me within a period of three months.

The Government has therefore taken the decision to look at this problem and to bring the various parties together in order to see whether there is in fact a place for an ethanol-petroleum blend in the Province of Natal using a locally produced energy source derived from an agricultural product.

As far as the hon member for Witbank is concerned, I should firstly like to thank him and his party for having supported the Government earlier on when it reported on the need to change the pricing structure and the method of payment for diesel by farmers. I am quite sure the hon member understands the reasons why this was introduced. Unfortunately there were certain people who had been abusing the existing rebated fuel price structure. When certain loopholes are left in certain pricing structures or otherwise, there are unfortunately always certain people who are prepared to take advantage of that fact, even if it means breaking the law.

This new method of payment for diesel by farmers had to be introduced. Under the old method not only were Customs and Excise being deprived of a legitimate form of income, but it also meant that those people who were acting in an honest manner, who were paying the correct price for fuel for their transport and other purposes, were, in fact, having to put up with unfair competition from people who were illegally using the rebated fuel normally sold to farmers and the fishing industry.

I want to say to the hon member for Witbank that I am now speaking as a practising farmer. I want to ask the hon member whether he is a farmer.

[Inaudible.]

The hon member will find that when he comes to this House and still tries to give attention to his farming duties, he will have far less time to attend to these than he would normally have, because he is now serving in this House. I want to say to him in all honesty that I have looked at this matter closely as a farmer who—because I believe in keeping track of my money—still signs every cheque that is drawn against the banking account for my farm.

I want to say to the hon member that this bookkeeping that he talks about is not going to place a big burden upon the farmer. I say that, Sir, because if a farmer does not pay close attention to a normal account, ie the invoices, statements, etc, he will not be a farmer for very long because he is not attending to his finances. I honestly believe that this argument that it is going to involve the farmer in a lot of extra bookkeeping is not a valid one because it is no more onerous than handling an averaged size monthly account.

What about the waiting?

Yes, there is the question of waiting. The farmer will have to pay the rebate on his fuel ahead of time, and then will have to wait for between three weeks and three months, according to the Department of Customs and Excise, according to what others say before he receives his rebates. If one looks at this, however, one will find that the interest incurred on the amount of extra capital that he may have to put up himself or borrow, is not a large amount of money for the average farmer. We worked it out and it may amount to R20 or R30 per month. One has to bear in mind that the price of diesel to the farmer, with the exception of the far North-Eastern Transvaal, has declined by 1 cent to 1½ cents per litre generally throughout the country. The farmer is therefore picking up some savings in that regard.

I believe the repayment of the rebate is a matter for the Department of Customs and Excise to attend to and, by the time that Vote comes up for debate in this House, there may perhaps be some better idea of how long the delay will be. Perhaps the matter can be raised again at that time.

I make an appeal to hon members to check their figures very carefully before they criticise this new system. I want them to check whether the amounts of money being talked about that the farmers are going to have to put up and that they will lose are indeed correct. I ask them sincerely as farmers to check their figures again and to make sure that what people are saying it is going to cost the farmer, is actually correct. I personally do not believe that it is going to amount to the large sums talked about by some people.

The other matter raised by the hon member was that of Sasolburg and Secunda. Both Natref and the Secunda refineries are situated in the interior and recover the full transport costs reflected in the price of fuel. Sasol owns a substantial part of Natref which is a normal crude oil refinery, and the price zones do not benefit products from Natref. Sasol has a net transport cost benefit on the products from the Secunda project although it also incurs transport costs in respect of destinations in the various price zones within the supply area. This benefit will accrue to any other producer of synthetic fuel based on indigenous resources, as it is an import substitute which saves the country millions in foreign exchange and competes with local oil refineries.

The main point, however, is the following. Due consideration was given to withdrawing this overrecovery profit after this possibility had been investigated. Any change to this system would only result in some other or more complicated and costlier system. I want to tell the hon member that this matter has been looked at in great detail, and we will continue to do so. If we find that we can make adjustments to the zoning structure, we will do so.

I know that the people in the North-Eastern Transvaal have suffered because their diesel prices have increased due to the new zoning structures. I should like to tell hon members from that region that, up till last month, the diesel users in the other parts of the country were, in fact, subsidising those people be cause of the transport costs. What we have tried to do now is to eliminate this cross-subsidisation of the North-Eastern Transvaal by the rest of South Africa.

*I want to say a few words about the domestic coal prices. Further deregulation of the Government’s involvement in the coal sector was effected upon the recommendations of the Coal Advisory Committee in that price control on pit-head prices was abolished on 1 April 1987.

In consequence of the deregulation of coal prices and distribution matters, producers have been determining even their sale price of coal in the interior since 1 April 1987. As the most significant marketer of coal, the TCOA—that is the Transvaal Coal-owners’ Association—informed the department about the price increases which amounted to an average of 15%, which is below the inflation rate.

The price gap between the various grades of coal, which vary from Grade A to Grade D, has once again been increased as in the past so as to create a greater demand for the poorer grades of coal. The price increases for the different grades vary between 12,5% and 22,5%, and those of coal dust between 5% and 17,5%. The consumer can still select the grade that best serves his requirements on the basis of energy content and energy cost. The object of this price differentiation is to promote the sale of low-grade coal and to make better use of the RSA’s coal resources in this way.

Although there have been a few complaints about the price increases, it appears on the basis of the available information that the deregulation campaign has not yet resulted in undesirable price or market manipulation.

Complaints have also been received in respect of the transport cost of coal which makes up a large component in prices in certain regions such as Cape Town in particular.

†I thought I would just mention this to give hon members some background to the recent deregulation of the coal prices.

There has also been an investigation into and an assessment of the national coal resources and reserves in South Africa and extractable coal reserve figures are dynamic. They vary depending on the changing prices of coal, so depending on what the prices and the cost of extraction are, the reserves are dynamic. Higher prices and improved technology tend to increase the extractable reserves. Inflation leading to higher costs of power, water, labour and transport in turn tend to decrease extractable reserves. It is therefore essential that our reserve estimates be appraised periodically.

In 1986 the hon the Minister ordered that an in-depth investigation of the South African coal reserves to be undertaken within two years by the Department of Mineral and Energy Affairs in close co-operation with Eskom and the coal mining industry. The working group has been established with its main objective to specifically estimate the Republic’s coal reserves with emphasis on identifying blocks of coal reserves which are suitable for future 3 600 megawatt Eskom power stations with estimated life expectancies of 30 years.

This investigation differs substantially from previous similar attempts, because the premise is to furnish an end result that will be adaptable to make interpretations of any foreseeable planning scenario possible. For the first time use is also being made of an internationally accepted resource classification and terminology system to allow for comparisons internationally. Similarly, sophisticated computer apparatus is used for reserves calculations and coal characterisation purposes. The quantity and nature of coal being rendered unexploitable by the construction of towns, roads, railway lines and dams will for the first time be quantified on a national basis for purposes of policy re-appraisal in regard to undermining.

I have pleasure in announcing that by 31 December 1987 the first two phases of the investigation which encompasses the in situ exploitable resources classified according to geological certainty and classifiable according to mineability and end-users with appropriate demand forecast, will be completed. Phase two will be completed by the end of February next year and comprises the evaluation in terms of the availability of water and reserve blocks suitable for power generation. It is planned that the comprehensive report will be finalised in June 1988 and publication will commence as soon as possible thereafter.

In the last two minutes before the adjournment I would like to say a few words about the strike which is occurring on various mines at the present time. I have received figures indicating the number of strikers who were out on strike as at 10 o’clock this morning. There are 209 000 workers on strike at the gold mines and 26 600 at the coal mines which brings the total to 235 600 strikers which is more or less the same as it was the same time yesterday. I would just like to point out that there are 781 621 mineworkers employed on the mines in South Africa, so at the present time approximately one third of the miners are on strike.

Might I say on this matter that strikes of this nature—as the hon member for Stilfontein said—are not unique to South Africa. They do occur elsewhere. I believe this is part of the new reforms which have been introduced over the past few years, and it is to be expected that, as we broaden democracy and reform the labour legislation, this sort of thing will happen from time to time. [Interjections.] I can only appeal to the various parties concerned to look at this matter in a very responsible manner. If the workers have a legitimate grievance, I believe it is over to the bargaining system to ensure that these grievances are resolved.

It is most regrettable that a miner was found dead in his bed this morning. We do not know the cause of his death as yet, but we sincerely hope that it was not because of the strike. Some people are speculating that it was due to the strike, but we sincerely hope that all the miners, their leaders, management and all concerned will act in a very responsible manner in this particular affair in South Africa today.

Business suspended at 18h30 and resumed at 20h00.

Evening Sitting

Mr Chairman, the hon the Deputy Minister who addressed the Committee just before business was suspended had already had his maiden engagement when the Mines and Works Amendment Bill was being dealt with. He did extremely well then, and he has followed suit tonight. I think the matter he raised with regard to the blending of ethanol is of vital importance to this country.

*The hon the Deputy Minister also gave figures in connection with the mining strike. Allow me just a very short comment on the subject. No one disputes the fact that this is a legal strike, but I think one should see this matter in perspective. It is a fact that this year was singled out for the specific purpose—I know this is a controversial statement, but this year was singled out for that purpose—of making this country ungovernable in the labour sphere. Whether there are trade unions or not, that is a fact. I do not believe that one should see Cosatu and even the ANC as innocent parties in this strike. I feel that thorough consideration should be given to this aspect in dealing with the strike situation.

What about the UDF?

You negotiate with the UDF, do you not? [Interjections.]

Sir, I want to associate myself with remarks made earlier by saying that the Department of Mineral and Energy Affairs’ annual report is an excellent one. I should like to congratulate the department on a fine piece of work.

In my opinion there is one aspect that should receive greater priority, however, and that is the exploitation of the sun as an alternative source of energy. A specific recommendation was made in the report in respect of solar ponds; it was recommended that no further research and demonstration projects be undertaken until significant international cost breakthroughs had taken place. I hope this recommendation has reference only to a specific technology in respect of solar energy, and not solar energy and research on solar energy as such.

I say this, because it is a phenomenon worldwide that countries such as Saudi Arabia and the United States in particular are turning more and more to the sun as an alternative source of energy, and because I believe South Africa should do this too. In 1980, for example, the USA spent R550 million in respect of this matter, as opposed to the R500 000 South Africa spent for the same purpose that year. I do not know what the latest figures are; I should be pleased if we could get information about this.

It is my opinion that as far as this matter is concerned, South Africa should not depend only on research done overseas. South Africa has become a leader in the sphere of manufacturing fuel from coal, and in my opinion the country has the potential to become a leader in the sphere of exploiting the sun as an alternative source of energy.

South Africa’s climate is eminently suited to making us leaders in this sphere. The average sunshine in a city like Cape Town is 67, expressed as a percentage of the total possible sunshine, although one might be inclined to dispute this figure after the past few days. In Kimberley it is 78%, in Bloemfontein 78% and in Pretoria 74%. These figures compare favourably with those in other world cities, because in London the average sunshine is 33%; in Paris, 48%; and in Hamburg, 36%. This merely proves once again that the climate is suitable, and that we have the potential to become a leader in this sphere.

The reasons are obvious. Solar energy has a tremendous potential as a source of energy. It is claimed that only one day’s sunshine would be necessary to supply the whole world with electricity for 10 years if it were possible to convert the rays of the sun falling on the total area of the earth into electricity by means of our present technology.

All other energy sources can be exhausted, including the source of energy to which the hon member for Brakpan referred, even if it takes millions of years, but in my opinion the sun is an inexhaustible source of energy.

In addition there is no monopoly on the sun. Thanks to a bountiful providence, the sun shines on all people and all places and the chances of ensuing boycotts are almost nil. It is a source of energy which will remain available for as long as the sun shines, and even if it does not, one can rely on stored solar energy.

The sun as a source of energy is also pollution-free. We have paid a heavy price in our efforts to generate essential electricity. The sun is a safe source of energy. As long as the sun remains in place, no Chernobyl is possible, and if it does not, we shall no longer need energy in any case.

Perhaps the utilisation of solar energy is disqualified at the moment because of the expense involved. I understand that it is expensive, but figures indicate that this process becomes cheaper and in some cases it may even become competitive. In the ’sixties it cost R1 200 to generate the top-watt power of the sun—that is the power one generates when the sun is at its hottest, at noon. At the moment it costs considerably less—only R8. One must also take into consideration that solar technology—I assume there would be a solar power station—has maintenance costs, but no operating costs.

The utilisation of solar energy can also be cheaper in areas which do not have a power grid. What is most important, however, is that the effective utilisation of solar energy can make a great contribution to savings in private households. Half of the electricity consumption of all private households involves the heating of water, and it is already possible for solar energy to supply 70% of this demand.

I know South Africa has large supplies of natural resources, but I do want to make a plea for greater priority to be given to solar energy as an alternative source of energy than is the case at present. I think the public can do a great deal to relieve the pressure on national electricity supply by purchasing solar heating systems, and I have no financial interests in any of those systems. [Interjections.]

Mr Chairman, I appreciate the opinion of the hon member Dr Geldenhuys on solar energy, and I should like to support him in his plea. I think it is indeed a source of energy that has been utilised very little until now, but which contains tremendous possibilities. I trust that the department will have sufficient funds available for such a research programme.

However, I want to come back to the question of the price of supplying of fuel to the inland areas, a matter which was also raised by my colleague, the hon member for Witbank. I want to tell the hon the Deputy Minister that we are not satisfied with the reply he gave. We are satisfied that cross-subsidisation in certain areas has to be eliminated, but if we have to pay 11 cents more per litre in Pietersburg, for example, than we pay here in Cape Town for the same petrol, we up there feel that we are at least quite close to the harbour that provides the petrol, viz Secunda and Sasol, and that we should get the benefit of that location. [Interjections.]

Apart from the merits of the fact that one is closer to the source, the place where the petrol is manufactured, there is the question of the border farmers who live in remote areas of the country and now have to pay the most for petrol. Those people are there as a buffer for all city dwellers. They are our front line, they guard our borders against terrorism, and I think we owe it to them to make it possible for them to remain there. If everything in the cities becomes cheaper as a result of the greater concentration there, and there is no subsidisation of our border areas, there will be an increasing depopulation of those areas. I think that for that reason everyone who lives in the interior or in the cities should be happy to contribute to the subsidisation of these people in the more remote areas of our country.

I now want to discuss the question of the rehabilitation of mining areas. I am pleased to see that the department has in fact drawn up a rehabilitation programme, and that control regulations have been promulgated which even make it compulsory to submit a rehabilitation programme, in some cases even before excavations may be proceeded with. However, the fact of the matter is that there is no guarantee that it could eventually be implemented, except the check that one could perhaps interfere with the mining operations. One finds that strip mining or open-cast mining will be proceeded with in good faith. When the time comes for rehabilitation, the mining company has made its profits, has already consumed them, and then it perhaps becomes insolvent. Either the department or the land-owner is saddled with the problem of how the rehabilitation should ultimately be carried out.

This problem could be tackled at different levels. A fund could possibly be established, security could be demanded from the mining company, or it could even be done through an insurance scheme so that there is security and there will be no financial problems when the rehabilitation has to take place.

However, I want to speak about another aspect related to this open-cast mining and the strip-mining method. I want to refer to the hanging wall method, which, as the hon the Minister probably knows, has led to subsidences on farms in the Ogies area where this method was used. I am not intimating for a moment that mining is not in the interests of the country. However, one has the conflicting interests of the owner of the surface land and the owner of the underground rights. These rights lead to conflict between the two people, and one has to try to solve this in as fair a way as possible.

Earlier the surface landowner was entitled to support. The land could not be mined out, and it had to be supported in such a way that it would not lead to subsidence. Nowadays, however, with the hanging wall method, the land is mined in such a way that eventually subsidence does take place because these pillars are mined away. This in fact makes the land useless. In one specific case, a pan of approximately 15 to 20 ha was formed on someone’s farm. At this stage that land is completely useless, whether it be for agricultural purposes, in the sense of the cultivation of crops, or for grazing, because it is under water for part of the year. I want to ask the hon the Minister to consider some form of compensation in such a case, since it is not clear whether the Act makes provision for this as well, although it does provide for compensation in the case of strip-mining and possibly also the open-cast methods.

Since the Act makes provision for this compensation, it provides that the Minister can decide whether the land will be expropriated by the State, and then the Expropriation Act applies, or whether the mining group and the owner should negotiate in order to determine compensation. The idea has also been investigated now that the landowner need not necessarily give up his land, but he can keep it and compensation can be granted if the Minister is of the opinion that the mining activities are interfering with the agricultural methods.

Compensation must be paid, but there is a problem when it comes to determining this compensation. Is such a person compensated for the profits denied him because he is unable to plant crops on this property? Is it a non-recurring allocation? Is it in any way connected to increasing profit margins in the farming industry, or must he merely be satisfied to receive compensation at a given time, on the basis of a small profit margin being experienced in the farming industry, for the useless section of his land—it could possibly be a third of his farm—and in 10 years’ time it becomes clear that the farmer could have carried on a highly profitable farming industry on that land at this later juncture? In such a case he is then committed for 20 or 30 years to the non-recurring compensation he received.

I therefore want to plead that a new method of compensation be investigated apart from the methods of compensation introduced by the Expropriation Act, and that that compensation be reviewed periodically, according to changing circumstances. I think the agricultural sector would be satisfied with that, and in that way one could solve the difficult problem of satisfying everyone and bring about a method of negotiation which could lead to a fairer compensation in future.

We have the problem—I think the hon the Minister will understand—that every farmer who becomes involved in an expropriation case against the State or a powerful mining company, to a large extent has his hands tied by the cost factor. In addition, those two bodies against which this fight is taken up have experts who can give evidence in various spheres while that person has to obtain expert evidence to refute it. We are aware that expert evidence is one of the most cost-loading factors in court cases nowadays.

In conclusion, I just want to refer to a report which the hon the Minister has probably read. [Time expired.]

Mr Chairman, if you were now to ask me what the prevailing mood in Mossel Bay is concerning the proposed Mosgas undertaking I should like to reply as follows. Firstly there is a prevailing spirit of excitement, expectation and optimism. After all, we are dealing here with an undertaking for which an expenditure of approximately R5 000 million is envisaged. This is an enormous undertaking under any circumstances. In fact this undertaking has been referred to as being the eighth largest undertaking of this kind at the moment in the world. This undertaking promises to create approximately 5 000 to 6 000 local employment opportunities. It should therefore surely not surprise anyone if I say that the community of Mossel Bay is excited, full of expectation and optimistic about the future. When one adds to this the possible processing possibilities and industries which could develop as a result of this undertaking, as well as the consequential development and expansion of services in Mossel Bay, hon members would surely agree with me that Mossel Bay will never be the same again.

When these positive sentiments have been mentioned it is unfortunately the case that other sentiments also exist in the community of Mossel Bay. There is a feeling of disappointment and impatience at the fact that after two years of planning, preparation and announcements there are still no visible physical indications or signs of the envisaged development. In the meantime many people have established themselves in Mossel Bay, invested there, and have started enterprises with a view to the growth which is expected in Mossel Bay and surrounding areas. Since this development has not come into existence in a physical sense, considerable financial losses have been suffered. It can be argued that these people have burnt their own fingers by being over-optimistic, but the reality is that the people are there, they have invested their money there and established enterprises while the development that has to come is still being awaited. [Interjections.]

An influx of labourers has taken place—people who have come to Mossel Bay in search of the employment opportunities which to date do not yet exist. I do not have to elaborate on the fact that this is creating a tremendous problem. Presently there is a large corps of labourers in Mossel Bay and environs for whom there are no employment opportunities at present. Consequently there is a feeling of disappointment and impatience that this project has not got off the ground yet, to put it like that.

Another sentiment which one often encounters there is the feeling of concern and scepticism. More and more people are wondering whether the envisaged development is going to be realised. I do not want to politicise this debate, but unfortunately it is the case that our political opposition, the CP would of course like to make these people believe that it is merely another plan which is not going to bring any results.

You said it yourself.

The reason for this scepticism can to a great extent be attributed to the situation at the nuclear research centre at Gourikwa. This development was launched a few years ago with great expectations. Considerable amounts of money were spent on it; technical and other personnel were established on the site and in the surrounding area. Buildings were erected and roads were constructed to give access to this research centre. Now it appears that all activities at the centre have come to a halt. Personnel were withdrawn and buildings are standing apparently unutilised.

Surely that is typical of the NP!

The reason for this is apparently a lack of the necessary financial means. The community of Mossel Bay and the surrounding area find it extremely difficult to understand and to accept that R5 000 million is available for the Mosgas project but no money is available for the continuation of the nuclear research centre at Gourikwa. I personally am fully aware of the latest developments—the hon the Minister informed me personally—and I try to the best of my ability to explain the position to my voters. I should nevertheless appreciate it if the hon the Minister would avail himself of this opportunity.

To come to your aid!

… to furnish the voters and all those involved in this enterprise with the relevant facts. [Interjections.]

Order!

The events at Gourikwa cast a shadow of doubt over the realisation of the Mosgas development.

There is also a spirit of concern, concern about the possible detrimental affect on the other sources of revenue, for example the holiday industry, tourism and the fishing industry. I myself have no doubt about this, but it is always easier—and the hon members of the Official Opposition will now know precisely what I am talking about—to make people doubt than to make them believe.

The NP knows about that!

It is always easier to sow doubt among people than to instil confidence. [Interjections.] I am saying this so that the hon the Minister can have the opportunity to refute the arguments of the Official Opposition, the CP, once again.

Is that an argument?

There is concern about the financial advantages which the local community will derive from the exploitation of local professional and other services, as well as labour. [Time expired.]

Mr Chairman, the hon member for Mossel Bay will not mind if I do not react to his speech.

I want to join the hon member for Brakpan in congratulating Mr Engelbrecht upon his appointment. However, I also want to congratulate the hon the Minister upon Mr Engelbrecht’s appointment. The reason for this is that it has now become fashionable to appoint some academic or another to an executive position, someone who did not start his career or continued it in the Public Service. Mr Engelbrecht on the other hand, however, was in the Public Service for 38 years. He began as a junior geologist and has now advanced to the position of Director-General of that department. He has the experience, and I am quite certain that he will make a success of it. I hope the other hon Ministers will follow this example and do likewise in future.

This evening a great deal has been said about the beneficiation of our minerals and metals. I am not going to say much about it. I merely want to make a few observations. South Africa produces 70% of the world’s gold, 80% of its platinum, 70% of the world’s vanadium and in addition to a third of the world’s chrome.

My, but you are clever, Arrie!

Just listen! Perhaps you will learn something tonight!

If we were to process these metals in South Africa what would the consequences be? If we were to process chrome, we could earn R100 million in that way. If we were to process it into ferrochrome we could earn R1 000 million. If only half of that ferrochrome were to be used to manufacture stainless steel we would earn a further R6 000 million.

Mention has also been made of jewellery. If we were to manufacture only 10% of the jewellery which is used in South Africa we would earn R240 million for South Africa.

Order! There is a constant drone of voices in this House which we cannot allow. I now appeal to hon members not to converse so loudly. [Interjections.] Order! When the Chair is giving a ruling, it is not necessary for hon members to converse among themselves.

Thank you, Mr Chairman. I in fact want to agree with the hon the Minister of the Budget that every Wednesday after dinner we have this kind of meeting over which there is no control. [Interjections.] Most of the noise always comes from the Government side. [Interjections.]

A tenth of our diamonds are sold inside South Africa, and in that regard diamond cutters pay R400 million. Ninety percent of our diamonds are exported to Israel, for which they pay us a mere R400 million. They then come back to us, and we pay very dearly for them. They make a big profit on the diamonds which are exported. We provide them with our diamonds. We are making the Israelis rich. If we were to process them here the money could be used in South Africa.

Let us go a step further. Lately a great deal has been said about unemployment. If we process all those minerals and so on ourselves, surely we immediately would be creating employment for the people of South Africa. We have taken cognisance of how much money has recently been spent on the training of people; the training of people even to pull weeds out of the pavements. It cost us R600 million. If that money had rather been used to establish a factory, permanent employment opportunities would be created for those people and we could even have expanded.

What kind of factory?

A weed factory? [Interjections.]

We are not talking about the Nationalists now! [Interjections.]

It would save us a lot of money and would also have generated additional income.

It has previously been suggested many times that we should not be afraid to use our minerals as an instrument to counteract foreign blackmail; that we should use our minerals as a weapon against those who want to apply boycotts against South Africa. After all we do have the minerals, and I want to suggest that this hon Minister in his capacity as Minister of Mineral and Energy Affairs could bring this matter to the attention of the hon the Minister of Foreign Affairs. We derive no benefit from standing hat in hand, abjectly enduring the blows meted out to us. Sooner or later we shall have to stand on our own two feet …

You are strong, aren’t you?

I will show you. Just allow me to try. [Interjections.] Sooner or later we must stand on our own two feet (agterpote) and show the world that South Africa is no longer going to be shoved and pushed around. [Interjections.]

The Nats do not have hind legs (agterpote)! [Interjections.]

Order!

We must prove that we can hold our own against the outside world. [Interjections.]

Mr Chairman, furthermore I want to deal with another matter. For the past few years, since mechanisation of the industry was embarked upon, problems have been experienced with dust. All that is happening that the mines are making an ever-increasing profit. The situation of the people who have to work in that dust—I am now talking about diggers in the gold and coal mines—does not change however. We have been trying for a long time already to combat dust in gold and coal mines in this country. We are simply not making any progress in that regard. Factories manufacture heavy machinery and soft-soap the mining industry into purchasing that machinery. The only thing that machinery can do, however, is produce. No attention is given to the health aspects.

While that machinery is in operation experiments are being carried out to devise methods to combat this problem of dust. World records are being established in the coalmining industry. These are loudly acclaimed in all the newspapers and elsewhere. Everyone must know about the record tonnage that was mined during a specific month. But it is those same mines with their heavy machinery that are ruining the health of their workers. As far as I am concerned a person’s health is worth far more than any amount of money. This problem must definitely receive attention. The day when that miner is gasping for breath at home, the mining magnate for whom he worked is not even aware of him any more. I request the hon the Minister to direct his department which does very good work, to ensure that the machinery used underground is in proper working order.

At one of our gold mines we had a case …

Order! I am afraid that I have to interrupt the hon member. His time has expired.

Mr Chairman, I am merely rising to give the hon member for Carletonville an opportunity to complete his speech.

Mr Chairman, I thank the hon NP Whip for the opportunity he is giving me to complete my speech.

We had a case of a person who at the age of 39, was already suffering from second-degree pneumoconiosis. He worked in underground conditions in which there was no dust control. I want to appeal to the hon the Minister to have his department institute an investigation into whether the time has not come for air quality control officers to be appointed in the office of every chief inspector, so that they can be on the spot when an inspection has to be carried out. At present they are situated in Johannesburg and we feel that if these people were stationed in each inspectorate, they could go out to the exact location immediately when they receive complaints to investigate the complaints and try to rectify matters.

I now want to refer to the hon member for Stilfontein. [Interjections.] He referred here to the strike. I want to agree with him that there was a report in Business Day of 12 August in which an appeal was made for funds to help the Blacks in South Africa. It came from abroad. After the Wiehahn Commission Report appeared, the former Minister of Manpower announced with a flourish that we must register and control. He said that we would ensure that those Blacks did not receive funds from abroad and that it would be halted. I now want to make an appeal to the hon the Minister of Economic Affairs and Technology to discuss this with his colleague and to tell him that legislation should now be introduced to put an end to it.

The hon member also referred to the speech which I made the other day. I am not going to reply to it except to tell the hon member that it has taken him relatively long to wake up and to come and speak about it. Did he take that long to think? I think and talk at the same time. I do not wait three or four days before I say something. [Interjections.]

I also want to question the figures with which the hon the Deputy Minister of Economic Affairs and Technology furnished us here. I am referring to his statement that only a third of the workers in the mining industry are out on strike. Let us put the matter into its correct perspective. In the first place no Whites at any mine are striking. There are many mines at which a vote to go on strike has not been held and at which there is no dispute. The dispute lies in the gold and coal mines. When one analyses those figures one sees that more than 40% of those Blacks are on strike. We must merely see it in the correct light, and not try to do as we have done with respect to prices in the past by increasing prices and then making people believe that prices abroad were higher.

Hear, hear!

As far as the Blacks in the mining industry are concerned, I hope and trust that the problem will be resolved as soon as possible. It is in the interests of South Africa that that should happen. What I find very strange about what the hon member for Stilfontein said is that he told us that it was a legal strike. Apparently Gavin Relly phoned him again today and said: “Listen, please make an appeal in the House of Assembly today so that this strike can end.” I feel that this is a matter which must take its course and that it must be left alone so that the employer and the employee can agree to reach a settlement.

Mr Chairman, Mr Gavin Relly may have telephoned my hon benchfellow to give him certain figures, but I wonder who telephoned the hon member for Carletonville.

Not the ANC!

I do not know whether it was the ANC, but the man who telephoned him cannot even add two and two together. This hon member’s reasoning on the entire matter is at the same level as the CP’s politics; they are one and the same thing. Wonderful things are said but they are all up in the air. The hon member said that they would refine minerals like mad. They would manufacture 6 000 tons of vanadium steel and then they would make a lot of money. Is the hon member aware that we cannot find a market for our steel abroad? Does he know that we must curtail our steel production because we cannot get our steel sold abroad. Where is the hon member going to find a market for his 6 000 tons of steel? [Interjections.]

The hon member went on to say that we should have used the funds which the hon the Minister of Manpower and Public Works used to create employment opportunities to build a factory. What size factory can one build and how many people can one privide with work? The hon the Minister provided 60 million man-hours of work. Thanks to those funds a further 300 000 people are now working. How large is the factory in which the hon member wants to provide work. How many people is he going to employ? [Interjections.]

The hon member for Brakpan implied that he was a formidable bridge player. He said that when one had trumps one had to play them. I just want to say that party thinks that they are playing trumps whereas they do not have any trumps in their hand. That is their trouble. [Interjections.]

I should like to say a few words about the country’s oil problem. As a result of pressure from abroad and boycotts a very sensitive situation has developed around our oil production and our total provision of energy. In order to overcome these problems the Government took certain steps in the past which were very effective. For example it established two funds. The one is the Equalisation Fund to which contributions are made so that when the price of imported crude oil rises, the consumer price at the pump need not constantly fluctuate. This fund later acquired an additional function, namely to take care of fire-fighting and security at our oil storage depots. I should like to say a few words about this later on.

There is, however, also a second fund, namely the Central Energy Fund. Its task is to look after all aspects of energy in this country. It is responsible for research, acquisition, exploration, manufacture, marketing and distribution as regards energy. The Equalisation Fund also performs these functions in respect of petroleum. Both funds get their money from levies on petroleum products. The Central Energy Fund also gets money from levies on coal mined but this only amounts to approximately R6 million.

I want to ask the hon the Minister whether he will not give consideration to changing the function of the Equalisation Fund so that in future it will only do what its name indicates, namely to keep the consumer price steady. Let us transfer that part of the Equalisation Fund which is being used for the security and safeguarding of and fire-fighting services at storage depots to the Central Energy Fund. I can put forward arguments to motivate this.

In the first place the Central Energy Fund already performs certain functions in connection with petroleum products. From the contribution of 4c which is made to the Equalisation Fund, 3,725c is used for the development of new synthetic fuel products, inter alia, the development of Mosgas. In addition there are storage costs which total 0,22c, as well as the fire-fighting function which totals approximately 0,055c per litre. In other words the Central Energy Fund already performs functions pertaining to petroleum products. That is why I believe that this is not unreasonable, and that it is in actual fact logical for the fire-fighting function and the security function to be transferred to the Central Energy Fund.

I have already indicated that the objectives of the Central Energy Fund and the Equalisation Fund overlap. Both are aimed at ensuring ways of acquiring and supplying energy in the country, and the functions of the Equalisation Fund are already incorporated in the functions of the Central Energy Fund.

Another reason for my argument is that the contribution to the Equalisation fund of 13,9c per litre has dropped to 5,7c per litre. The buffer between the trade and the increase in prices to the consumer has in other words become far smaller because the levy for the Equalisation Fund has become far smaller. For that reason I am of the opinion that the additional function of the Equalisation Fund should be transferred back to the Central Energy Fund.

It is also a fact that the statements of the Equalisation Fund are not published, whereas those of the Central Energy Fund are. It is a fact that when statements are not published, it is in the best interests of the population that as few functions as possible are contained in those returns. For that reason it would be a good thing if this function, which is not sensitive as regards the nature of the information which can be supplied to the enemy, were to be transferred to the Central Energy Fund.

The cost of safeguarding our storage depots and their insurance against fire is a function which at first was almost non-existent and is now growing tremendously. Last year R12 million was used for this function. This year the plan is to use R95 million and I am of the opinion that this figure will be considerably higher in future. This is another reason why I am of the opinion that one should remove these functions from the Equalisation Fund and transfer them to the Central Energy Fund.

In conclusion, as regards this argument I feel it is very important to note that when we must motivate consumers to contribute to the Equalisation Fund, one finds that people are very willing to contribute because they feel that the money they are contributing now ensures that they will not have to pay more for fuel in future and that they have already made their contribution. They are under the impression that the prices will have to rise excessively before they will have to make an additional contribution. It is therefore very easy to motivate an increase in the Equalisation Fund, provided one explains to the public that it will be used to their personal advantage and not only to the advantage of the State. For that reason I am asking the hon the Minister whether he would be prepared to give attention to this matter, because I am sure that this would be the logical approach.

Mr Chairman, I am in agreement with my engineering colleague, the hon member for Heilbron, that at the moment the protection industry is the only industry in South Africa which is growing. This becomes apparent from the way in which the situation is developing and the pressure from all quarters is increasing.

Like overseas tourism.

This evening I want to hold a discussion with the hon the Minister on his contribution to the combating of erosion. I want to tell the hon the Minister that at one stage I went camping on the banks of the Tugela River and there I came across a researcher. He was testing silt from the Tugela River. In this way he determined the soil erosion higher up in the catchment area. [Interjections.]

The hon the Minister of Constitutional Development and Planning must keep quiet.

This also falls under the department of that hon Minister who has just had something to say, because he is the Minister of everything and would be well advised to listen. [Interjections.]

The researcher told me that according to his silt samples, erosion had decreased during the past few years, and he assumed that very good soil erosion projects were in progress in the catchment area. But having been to the upper reaches oneself, one could inform this fellow that there is no more top soil that can be washed away. It has all been washed away already. This is the hon the Minister’s contribution.

What happened there was that the hon the Minister of Economic Affairs and Technology did not contribute much to the energy consumption of the people in the remote areas. Seventy per cent of the people in South Africa rely on wood as a source of energy. Here we have a department for energy, we spend large sums of money and we have enormous power stations etc, but 70% of the people in South Africa are still not getting much help from this department.

How do you arrive at that 70%?

There are two energy cycles. The one is human energy; people must eat food and the animals they consume eat grass and in this way people get energy. The other is the heat energy needed by the same people. For heat energy they must go out and chop down trees for fuel. [Interjections.] If one travels in the rural areas of Natal one sees that there are large areas that have been completely deforested by people who have to walk increasingly long distances to get to the last few pieces of firewood. Now we want to know what the department is going to do about this.

I have here the English copy of the department’s annual report, and I should like to quote a paragraph from it which deals with alternative energy:

This is the National Programme for Energy Research:

Here we have a problem of enormous dimensions, and we find that the department says that it is still in the research phase. We are only now determining the requirements, whereas the matter was raised years ago. In the second speech I made in this House in 1982, I asked the then Minister of Mineral and Energy Affairs to start taking the energy needs of the Third World seriously. We are still in the process of determining the requirements. When are we going to swing into action? When are we going to arrive at conclusions? Then we shall get to the planning stage and then to the draft stage. Only then can we start thinking. This is a very lengthy programme and I am therefore asking the hon the Minister what he is going to do in the meantime.

While all this energy research is in progress according to the annual report there are 22 million people in South Africa who are dependent on wood for their energy requirements. At the same time we are exporting tons of coal, and then people still ask why so many people want to go to the cities. There all one need do is flick a switch when one wants fight and turn a knob for heat, whereas 22 million people in the rural areas have to walk for kilometres to gather the last few pieces of firewood on the land. I am therefore asking that we again look seriously at the energy needs of the Third World population of South Africa. [Interjections.]

Mr Chairman, in the course of my speech I should like to react further to what the hon member for Constantia said and take a look at the way in which the PFP uses figures. Here we have another example of how they work with figures, because where do the 22 million people in the rural areas come from?

That is what it says in the annual report. [Interjections.]

The question is whether those 22 million people are all Third World people. I think next year, when he reminds us of his previous speeches—no one else is going to remind us of them—he should perhaps tell us how erosion in the South African rural areas compares with erosion in places like Dakar and the rest of Africa, because it seems to me as if those journeys are having a particularly eroding effect on support for the PFP. [Interjections.]

I should like to deal with a topic to which the hon member for Constantia referred, namely the Central Energy Fund.

What became of the blond spy?

I should like to react to that hon member’s interjection about the blond spy by quoting two expressions or idioms to him. The one is “the truth will out”—this has been proved—and the other is “jealousy will get you nowhere”. [Interjections.]

Is that where you get your information from, Piet?

If one looks at what the hon member for Constantia said about the Central Energy Fund, one does not need to have much knowledge of accounting to see how ridiculous their calculations are; as a matter of fact, a little logic is enough.

Last year the hon member for Constantia asked here in the House what the total assets of the Central Energy Fund were, and he received a reply. He followed this up earlier this year with another question on how much cash there was in the Central Energy Fund. Then he compared these two amounts and announced that there was money missing. Available cash and total assets are two totally different things, and cannot be set off against one another.

Obviously not. Just tell us where it has been invested.

The question is how one can have a meaningful debate with people who do not even understand the most basic principles of arithmetic. [Interjections.] Either they have no interest in the actual facts or they have no respect for them—probably both.

What was the money used for? Come on, tell us. [Interjections.]

We shall get around to that. The hon member for Yeoville must just be patient. [Interjections.]

Order! A discussion is in progress here which is unnecessary and is not contributing to the debate. The hon member may proceed.

To insinuate that there is something wrong with the fund or that finances from the Central Energy Fund have been used in an improper manner or for illegal purposes, is nothing less than a reflection on the integrity of the Auditor-General. [Interjections.] The PFP and the hon member for Constantia—I shall get to the other point he made in a moment—know that the returns of the Central Energy Fund are audited by the Auditor-General and that those returns are tabled here in Parliament. The question is whether they do not trust the Auditor-General. The efforts to insinuate that last year’s withdrawal of funds from the Central Energy Fund for the hon the Minister of Finance’s incentive package was an irregularity, or that this should not have happened, is in the first place wilful, and in the second place inconsistent with the facts.

I should like to know from the hon member for Constantia whether the National Housing Trust, to which approximately R1,2 million has been channelled, is not a deserving cause, and whether he wants to argue that the expenditure in this regard is not in the national interest.

That is not the point at all.

Yes. The actual question which the hon member put was whether the Government’s action in withdrawing funds from the Central Energy Fund and using them for the incentive package, ie for purposes other than those of the Central Energy Fund, was justified. [Interjections.]

Yet again they do not have the facts right, because they completely ignored the history of the Central Energy Fund.

But what about the Act? [Interjections.]

The forerunner … [Interjections.] Hon members must just be patient; they will get the answers. The forerunner of the Central Energy Fund was the Strategic Oil Fund, which was established in approximately 1960. That fund was established with the assistance of appropriations voted by this Parliament, in the form of interest free loans which had to be paid back at some stage or other. That is all that has happened here. [Interjections.]

That is not what Barend said!

That’s a new story! [Interjections.]

To suggest that the motorist’s money is being used for the incentive package, is simply inconsistent with the truth.

Are you the Minister of Finance? Are you an aspirant? That’s not his story. [Interjections.]

Sir, basically all that has happened is that funds which had been borrowed from the Government over a period of almost a quarter of a century, have now been taken back and used for other priorities. [Interjections.] The funds were used in the best national interest. [Interjections.]

I feel that the Central Energy Fund should in fact be congratulated on the way in which they utilised the funds to provide oil, and prevent the economy in the country from being disrupted. This fund is now strong enough to stand on its own feet, and we want to say: Keep it up!

Mr Chairman, permit me at the outset to thank all hon members for their participation in the debate on this Vote. I also want to thank them for the quality of the speeches in general.

Allow me to congratulate the hon member for Alberton as well on his appointment as chairman of the group and chief spokesman on Mineral and Energy Affairs. I wish to thank him sincerely for his supportive speech and that he emphasised and conveyed quite a number of aspects occupying this department to the Committee. We convey our grateful thanks to him and we look forward to pleasant co-operation with him in the years ahead.

I am not sure whether I have congratulated the hon member for Brakpan already; I think I have congratulated the hon member for Constantia but not him. Heartiest congratulations and thank you very much for the gracious words to the department and the Director-General. I also thank the hon member for the resumé he gave on the safety aspect of Koeberg. I consider it important that we receive support in this respect because we shall undoubtedly have to continue to use nuclear energy in future, as I said on a previous occasion.

I may add that we have already directed an investigation to be undertaken to establish the exact balance in our energy programme, that means first of all to determine the quantity of coal available for use in power stations in South Africa for generating power. Secondly, what need will there be for power stations over the following say 40 years? The parameters which have been accepted are extremely conservative and I think the hon member for Brakpan in particular will approve of those parameters when he sees them. We have finalised that programme.

The investigation into what resources will still be available to South Africa, in view of modern mining techniques, will be completed in January and I think we shall be able upon its completion to announce shortly afterwards how the future nuclear energy programmes will compare with the coal energy programmes for South Africa and how we intend implementing and controlling them so that the South African user of energy may be aware of our long-term programmes. I can tell hon members that the programme I looked at this morning is of a high technological quality. There is hardly a factor in our entire energy spectrum, especially as regards electricity, which has not been taken into consideration. We hope to present it one of these days.

The hon member also referred to beneficiation processes and I want to reply to the hon member for Carletonville at the same time. I elaborated on beneficiation in the discussion of the previous Vote and I do not believe it is necessary to repeat this. We may possibly be able to counteract sanctions by means of the beneficiation of our metals. A little more than two years ago we instructed Mintek—Dr Edwards is in the officials’ bay here—to draw up a programme for the beneficiation of each of our metals. There is a long-term and a ten-year beneficiation programme for every metal mined in South Africa. We know the exact state of affairs in regard to each mineral and we know what deficiencies exist in South Africa. We also know what steps we shall have to take in the beneficiation process, just as we are aware which private institutions already have the expertise. Consequently a beneficiation programme exists for every mineral in South Africa. One need not juggle with figures here; we have made our calculations in the greatest detail.

The hon member for Carletonville said with justification that the added values of metals represented a great asset to South Africa; they are an incredibly great one. We have no argument with the hon member. It cannot become operative overnight, however; one has to work hard at it and we are working as hard as possible in co-operation with the private sector and the mining industry to see whether we cannot progress with that programme, but we can honestly not embark on them all simultaneously. Certain metals first have to be selected and are accorded a higher priority than others. We have done this already too. We know which metals should be accorded the highest priority—those which are of the greatest benefit and the greatest financial value to us.

Programmes for earning foreign currency have already been compiled and if the hon member for Brakpan wishes to take the trouble of having tea with me one morning I can show them to him, but they cannot be published. The hon member plays bridge; surely we would be showing our hand if we published them and our opponents then peeped over our shoulders, saw our plans and knew how many aces and how many kings we held. We are playing bridge with our minerals; we hold the trumps and we know we shall win. [Interjections.]

I come now to the use of minerals as a countermeasure or as a means of getting at other people. We carried out a further exercise, and this must have been one of the most intensive investigations ever conducted in South Africa into our minerals. We did not carry it out in respect of all minerals but only those of strategic importance. We did not take the decision lightly but came to the conclusion that the greatest contribution to the suicide of our mineral industry would be to use our minerals as a sanctions weapon. Again, if the hon member wishes to take the trouble to visit my office, I shall show him exactly on what it is based; it is founded on worldwide facts and statistics—not merely those of South Africa. It is very easy to evaluate its results.

We cannot simply make this information public, however, because hon members should bear in mind that alternative resources exist. There are alternative metals for specific applications. This is a course we really have to follow with great responsibility and technical expertise and I think we have done this under the guidance of Dr Edwards at Mintek. The Cabinet decided and the Government has already declared—I am repeating this tonight—that we are not prepared to use minerals as a countermeasure to sanctions carried out against us.

The hon member also referred to the pollution caused by power stations. We have already spent a great deal of money and there is hardly a power station being designed at present in which dust will not be controlled.

One should also have a little humour in life. We received serious complaints about coal dust pollution from farmers in the vicinity. This is a difficult one and we are not even talking about other forms of pollution now. We have already spent millions of rands at certain power stations, mostly in order to remove dust. Then it was a treat to see the letters pouring in from farmers complaining that they had to fertilise their lands again since the dust had been removed. Such a farmer was not speaking on behalf of the ladies and housekeepers, however, who have to protect their curtains and linen against the dust. We intend proceeding with our programme to keep dust pollution by power stations as low as possible. I think we are succeeding in this, but I want to tell the Committee that it costs literally millions of rands.

The greatest danger, however, is not coal dust but sulphur pollution or acid rain. To extract this SO2 from coal gas is not simple; it is incredibly difficult. I want to assure the hon member we are devoting intensive attention to the entire Eskom pollution programme. Eskom is spending millions of rands on this and I believe the incidence of pollution will be increasingly rare at our new power stations.

The hon member also referred to the new legislation on the removal of the question of the scheduled person. The hon member said we were not to neglect White miners. I want to assure the hon member we shall not do so. This is not necessary because White mineworkers play an enormously important role in the mining industry and in South Africa and it would consequently be wrong to neglect them. As regards the Government standpoint on the White miner, I should like hon members to read the Government decision on the recommendations of the Wiehahn Report in Chapter VI. It has been recorded in the White Paper concerned and the Government has not withdrawn it nor does it intend to deviate from it.

The hon member for Carletonville made an interesting comment. He said the question of strikes should be left to the employer and employee. Am I right? Did the hon member say that?

Yes, I said that.

I am afraid to quote incorrectly again because then I shall receive a drubbing and also be insulted into the bargain. [Interjections.]

The Government said exactly the same about scheduled persons. This is a matter between employer and employee. I now want the hon member as my colleague—he is no longer the secretary of the trade union—to rise to his feet one day here in Parliament and describe the contribution he made to negotiations between employer and employee in this entire process. I think we should accord him the opportunity of telling Parliament to what degree he bargained on the interests of the employer and employee in this process.

I accept the challenge.

I shall listen to it with pleasure. [Interjections.]

I shall address the hon member for Constantia in Afrikaans and I shall use the same language to the hon member for Yeoville in a while. [Interjections.] I owe the hon member for Constantia a reply and I shall give it to him now or else I shall be accused of not replying. Hon members should bear in mind we also have limited time and I have only about 20 minutes left.

The hon member referred to Majuba Pass and the accident involving uranium oxide. I should like to reply to him in the form of a “statement”. This is factual, tested and first-hand information—not Press reports. Sixty drums of uranium oxide overturned, apparently when the truck burst a tyre on a bend in the pass at 12h30 on Sunday 26 July. Approximately a ton of uranium oxide was spilt on the road when three drums were damaged in the process. Although uranium oxide as such does not present great danger to humans from a radiological angle—this means it is not sufficiently radioactive to hold any danger to man—it is a toxic material if a person comes into contact with it. A total of 91 vehicles—I do not know where the hon member obtained the figure of 1 500 …

It was in a Press report. [Interjections.]

I am being fair to the hon member now and furnishing him with facts.

A total of 91 vehicles which had used the road before the traffic was halted were all traced and examined by the AEC. Traces of uranium were found on only two of them and presented no danger whatever to the occupants or the public in general. All persons involved in cleaning up the uranium were also examined by the AEC laboratory and no uranium contamination found.

The next morning I issued written instructions to Dr De Villiers of the Atomic Energy Corporation which he accepted and he agreed with me that we should investigate the whole matter as regards packaging. The manufacturers of uranium oxide—these are mining people from the private sector—use the standards of the International Atomic Energy Agency, which are international, in the packaging of their product. In spite of this I requested him to investigate the entire matter. He agreed and has almost completed his examination. This includes the transport, the method of transport, the standards of packaging, whether an escort is required and where it is packed. The entire process will be investigated and he will submit a comprehensive report to me. I hope to make a statement on that occasion or make the relevant information available if necessary.

†I think the hon member for Springs dealt with the transfer of money from the Central Energy Fund to the Treasury in detail. All I have to add is that this money was budgeted for by the department controlling the National Supplies Procurement Fund—that is the Department of Trade and Industry—and it was passed over in the form of a loan to the then Strategic Oil Fund for the purchase of strategic crude stocks. The amount involved was R1 269 553 387,97. Is the hon member happy now? This is an audited figure. It was decided, after the stimulation package had been decided on, that the CEF should return this money and repay this loan to the National Supplies Procurement Fund. Up to now an amount of R1,012 billion has been repaid. There is still an amount outstanding and, when we look at the latest figures which are being audited at the moment, we see that the amount outstanding is shown in the accounts to be R257 553 388. That is the factual story behind this matter which can be checked because the audit was carried out by the Auditor-General. Then the National Supplies Procurement Fund repaid this money to the Treasury. What the Treasury did with it I think my colleague, the hon the Minister of Finance, has already on a previous occasion explained in great detail. I am therefore not going to elaborate on that any more.

Mr Chairman, may I ask the hon the Minister whether he will assure the House that that was the only money that flowed out of the CEF for use by the hon the Minister of Finance and general revenue?

It was not paid over for the use of specific purposes. It was the repayment of a loan and was the only money that was paid to the National Supplies Procurement Fund. No other money was repaid. We still have approximately another R257 million outstanding which has to be repaid. What the Treasury is going to do with that I do not know. It is a budgetary action.

So, no other money has left the fund?

No, of course not. There is an Act which prohibits that.

*I think the hon member for Springs replied very clearly on the argument relating to the questions put by the hon member for Port Elizabeth Central. I think there is a minor arithmetical difference here, and the entire matter presents no problem. It is a pity hon members of the Opposition always try to make a little political capital out of facts which are readily available if they would only ask for them. I shall discuss this quickly. The point at issue was cash versus assets. There is patently a vast difference between what one holds in cash and in assets. The hon member asked where it had been invested. I have the statements here but they are too long to read at the moment as I lack the time, yet they make it obvious that every cent of the R7 000 million was invested. The audit was carried out by the Auditor-General.

I want to get to the question of cash versus assets. I shall furnish the figures for March 1985,1986 and 1987 in this respect, which are very close to those for May, which I supplied to the hon member for Port Elizabeth. Cash investments in 1985 amounted to R1,156 billion; total assets to R5,4 billion. In March 1986 cash investments totalled R2,165 billion with total assets at R6,029 billion. In March 1987 cash investments ran to R2,939 billion and total assets to R7,495 billion. All these figures appear on the statements; if the hon member wishes to take the trouble to examine them, I shall be able to explain them to him in detail.

I think I have replied to all the points raised by the hon member for Constantia.

What about the JCI issue?

Oh, the JCI affair. If I interpret Press reports correctly—we have all the information; I can table it immediately if necessary—and if I interpret the information at my disposal correctly—I do not seem to understand so well anymore nowadays and I apologise if I fail to understand very well—there is a threat that they intend taking this case to court. According to advice I have received, it would be very unwise of me to make any statement on the matter at this stage; that is why I am not prepared to make any such statements at the moment.

I will make one comment, however, which is that it is totally untrue that Rustenburg Platinum did not have advance knowledge. It was discussed with them months before the time; they were even informed in writing. To my knowledge we received no objection from them. Nevertheless there is something behind this affair and I want to object most strenuously against insinuations—if the hon member did not regard them as such, I withdraw my words—concerning the former senior official of this department. I wish to express myself most strongly against them and I should like it placed on record that I think them uncalled for and totally untrue and I think those insinuations do the hon member no credit.

Are the facts true or not?

What facts?

Are the facts I mentioned true or not?

I am not discussing facts but the insinuation behind them. [Interjections.] I am not discussing facts but the insinuation embodied in the statement that he was compensated for the allocation at issue here. That was the insinuation. Am I right? Now the hon member is mute. I lodge the strongest possible objection against that insinuation.

Go to Dakar; tell them there. [Interjections.]

Order!

I want to thank the hon member for Stilfontein for his clear explanation of the strikes. The hon member for Carletonville tried to query the statistics again. One is able to juggle with figures. I think the message the hon member tried to convey was that the strike was widespread, that we were worried about the strikes and that we would like to see the employer and the employee doing everything in their power to end the strikes. I think that was his message and it is a pity the hon member for Carletonville viewed it differently.

The hon member for Witbank spoke on energy and the question of fuel prices. He also said Sasol should be regarded as a harbour. The hon member is new to Parliament and I wish to assure him that nobody in this country is more sympathetic toward the users of fuel—whether he is a farmer, a tourist or a haulier—than this department.

Or whether he belongs to the CP.

Or whether he is a member of the CP or a Prog or an Independent or whether he is my friend Ralph, the hon member for Mooi River, at the back there. There is no department more sympathethic toward the users of fuel than this one. I shall mention only one fact as an example. I fully realise that we had no choice but to rectify the disparity which had existed in those areas for nearly 10 years as regards the other users of energy in South Africa. If we can improve the position in future, we shall not hesitate a moment to do so. Let me tell hon members what we did. We kept the price of fuel stable for almost two years in spite of the fact that during that time the exchange rate experienced greater fluctuations than ever before—its turning point was 38 cents. Do hon members know what we paid for our fuel at that time? Although the exchange rate had never fluctuated as drastically as during that period, we succeeded in keeping the fuel price to the consumer constant over all that time and we are still keeping it constant. All that is taking place now is that we are making a correction to eliminate cross-subsidisation in the first place and in the second to eliminate the disparity between users of diesel and petrol in South Africa. Previously users of diesel in South Africa—the hon member for Heilbron referred to this—contributed in excess of 13c a litre to the Equalisation Fund as against the 1,9c per litre by users of petrol. We reduced the diesel users’ contribution from 13,2c per litre to 5,67c per litre and increased the petrol users’ contribution from 1,9c per litre to 5,7c per litre. Everyone who now has a litre of fuel put into the tank of his car is paying the same levy as regards this Equalisation Fund.

I think this new system by which we have removed the tax-upon-tax has produced an excellent levy.

The hon the Deputy Minister of Agriculture has announced a work group to examine the repayment mechanism—that of rebates. We are represented there together with the people from agriculture and I think we should leave the matter to them.

Mr Chairman, time seems to have caught up with me. I shall be in contact with the hon member for Mossel Bay on the Mossel Bay gas project. In a few quick words I can tell him a start will be made on the water project—the building of the dam—in September 1987 which is in a few months’ time. October 1987 will see the beginning of the provision of a power supply of 7 mWh. A start is to be made on the construction of the Mossel Bay harbour in the third quarter of 1988. The training centre at Mossel Bay will become operative in January 1988; it is already being planned and tenders are being invited. That at Oudtshoorn has already been operating since May 1987. People are unnecessarily pessimistic; we are working on the Mossel Bay project.

I cannot overlook the hon member for Yeoville, Mr Chairman. [Interjections.] I have never insulted the hon member for Yeoville in my life but I want new hon members of the House to hear how sensitive this hon member is when one pulls his leg a little. [Interjections.] Yes, I want them to realise how sensitive he really is. I also predicted that these IDC affairs would become a hardy annual in future. On only the second occasion of participation in this debate the hon member for Yeoville actually discussed them again. [Interjections.] In addition he dragged in all kinds of other matters. Then again he was like a butterfly; flitting from flower to flower. If time permits, I should like to reply to a few of his statements; I should have liked to reply to them all.

Mr Chairman, throughout my life I have never hesitated to admit having been in the wrong. Some of my colleagues sitting here are aware of this. I am always prepared to admit being in the wrong. Surely it is no disgrace for a man to admit he has made a mistake. Only people who do nothing never make mistakes.

Now you are talking about Harry! [Interjections.]

Fortunately or unfortunately I did not hear my speech on the radio this morning. If I actually said in that speech that the IDC investment in the Mossel Bay project was to take place by means of equity or shares, I admit it was a mistake. I have been in this industry long enough to know that there is no difference between the two. I concede that to the hon member. What I actually should have said was “equity and loans”. The hon member is quite right; he has caught me out but I shall do the same to him at some time or other.

No big deal!

Just let us finish with this aspect entirely now.

Which is it to be—shares or equity?

Negotiations between the CEF management and that of the IDC will decide the amounts to be invested in shares and loans, respectively. This will not all happen overnight either; these investments will probably take place over a period of three to four years. But now the hon member for Yeoville creates an enormous fuss, refers to the report and says the balance sheet indicates only a cash amount of R397 million, and then he wants to know where they are to obtain money for other investments. This R397 million represents accumulated profits and cash on hand upon conclusion of all investment obligations. On the very next page of the report—that is page 18—their profit is stated to be R132 million. They plan to make almost the same profit in the years ahead. If the project lasts until 1992, that is five years from now, we are speaking of almost R600 million plus R300 million; R900 million therefore.

Now the hon member—if I am wrong, he must correct me immediately, but I am not wrong; this time it is on record if the hon member says I am wrong—has apparently already began to calculate in his mind the amount he thinks the IDC should invest.

The IDC will decide on this themselves; they have not told us yet. They have informed us that they do intend investing but they have not disclosed the amount or at what stages; this all still forms part of a negotiating process. The fact remains, however, that they do intend investing. They will invest in the Mossel Bay gas project whether the hon member likes it or not. [Interjections.]

Mr Chairman, may I ask the hon the Minister whether it is not important for the public to know what percentage of the shares will belong to a State organisation? The second facet of the question is whether it is actually a case of privatisation.

Mr Chairman, I am getting to that. It is important for the public to know and this will happen as soon as a decision has been taken, but the hon member wants me to decide for the IDC. They are indisputably one of the most competent investment industries in South Africa; nobody in the country is more knowledgeable on investment risks than the IDC.

Not even Harry.

I challenge anyone to refute this because they finance what normal financial institutions do not wish to finance. That is why I say they will definitely decide. It will not remain a secret once they have decided. Everybody will know the amount invested by the IDC and how it was done, whether in the form of shares or loans.

The hon member then arrived at privatisation. I stand by the statement I made. Surely I am not as stupid as to make such a statement in the full knowledge that the IDC is an institution financed with public money. What has our objective been from the start regarding Mossel Bay? It is to inject private capital into the Mossel Bay project as soon as possible. After the rumours that the IDC would participate had become public, the reputation of the IDC as an absolute, I can almost say perfect, evaluator of investments filtered through to the private sector and the private sector has already indicated—one body has already published it in its annual accounts—that it intends investing money in the Mossel Bay project. If we can therefore use IDC involvement as a catalyst to bring in the private sector, it will be one of the most splendid privatisation efforts we have ever seen in this country. The hon member must stop arguing with me now; he need only read the White Paper on privatisation and he will see that one way of privatising is a partnership between the private sector and the State. [Interjections.] That is one of the methods identified and if we involve the private sector here from the start—not as in the case of Sasol where the State initially had to provide all the finance—in venturing risk capital in partnership with the Government sector, and the IDC contribution can act as a catalyst to involve them, we are left with the finest form of privatisation possible. [Interjections.]

I wonder what that hon member is referring to now. He must be referring to the matter he came up with so suddenly here—that of lessor trusts. [Interjections.] Now he is referring to paragraph 5 but at the time he did not refer to it; he merely waved the book around. He then said with a great fanfare that the IDC was opposed to lessor trust tax avoidance. He also insinuated that the IDC participated in this on a large scale. I want to make a statement now to avoid hearing afterwards that I made an inaccurate assertion.

†The IDC has only participated in one lessor trust establishment and that was in 1983. This was a special case to assist a strategic industry which experienced severe financial difficulties at the time. The participation was done in full consultation with the then Minister of Trade and Industry as well as the Commissioner for Inland Revenue. That was the only time.

How much?

I am not going to tell the hon member how much because I do not think it is necessary.

*That hon member is never satisfied with putting only one question; he flits from one question to another like a butterfly. He is never satisfied with an answer either; we have known that hon member for years. As soon as one has him in a corner, he puts a further question and will keep on in this way until the cows come home. I think I have devoted enough time to the hon member now.

I have been informed that my time has expired so I shall examine the speeches of the hon members for Greytown, Carletonville, Bethal, the hon member Dr Geldenhuys and the hon members for Mossel Bay and Heilbron and reply to them in writing.

Vote agreed to.

Chairman directed to report progress and ask leave to sit again.

House Resumed:

Progress reported and leave granted to sit again.

Mr Chairman, I move:

Hon members will remember that in my speech at the Second Reading of the Electricity Bill, 1987, I referred to the fact that the Electricity Act, 1958, had already been amended on several occasions to give effect to the recommendations of the Commission of Inquiry into Electricity Supply, the so-called De Villiers Commission.

I also said that previous legislation had paved the way to creating a modernised and rationalised financial structure for Eskom during the 1987 legislative programme, and also to replace and consolidate the Electricity Act, 1958, as a whole. With this objective in mind, two Bills have been prepared. The first one, the Electricity Bill, deals with the supply of electricity in South Africa in general. It also consolidates the relevant provisions in the present Electricity Act. The second Bill, the Eskom Bill, which we are dealing with now, is to a great extent also a consolidation of existing provisions of the Electricity Act, 1958, as amended, relating to Eskom, but also creating—as I have promised—a modernised financial structure for Escom. The two Bills together not only consolidate the existing electricity legislation in a streamlined and rationalised way, but also complete the task I have undertaken, as approved by the Cabinet, to implement the recommendations of the De Villiers Commission of Inquiry.

The Electricity Bill, 1987, refers in the English and Afrikaans text to Eskom as the new name for Escom/Evkom. The name has been suggested by the Electricity Council to avoid confusion with the Electricity Supply Commission which has ceased to exist. It is also intended to project the image of Eskom as a unified organisation which is efficiently and professionally managed. There are certain practical considerations as well, related inter alia to documentation, which necessitate this change. The Eskom Bill therefore also makes provision for consequential amendments resulting from the change of name.

*A major change to Eskom is being effected by the abolition of the controversial Capital Development Fund as well as the Reserve Fund, with the attendant consequential amendments. In addition, provision is being made for a simplified procedure with sound control measures to enable Eskom to borrow money and to finance its activities.

†Last year’s amended legislation enabled Eskom to determine electricity prices in order to ensure a sound financial structure. The present schedule of standard prices which establishes Eskom’s tariff structure is being retained, but Eskom may amend its prices above or below the standard prices in special circumstances.

Eskom, however, remains committed, when it adjusts its standard tariffs, to increase or decrease such tariffs in equal proportion for its different classes of consumers. In this way price-subsidising is avoided. If it becomes necessary for Eskom to amend the structure of its schedule of standard prices, the existing procedure is maintained in terms of which the Electricity Control Board is obliged to hear consumer objections, as well as Eskom’s reasons for such amendment in public, after which it will confirm, set aside or amend such amendments of the schedule of standard prices.

I also wish to remind hon members of something I said in Parliament last year, viz that Eskom is committed to keeping tariff adjustments below the rate of inflation for the foreseeable future. This Eskom has indeed done so far.

In terms of the existing legislation, Eskom has presented its affairs to Parliament, its consumers, the public of South Africa, as well as the international concerns it has dealings with, in its latest annual report. This has been done in a way that reflects an image of professionalism and efficiency. I want to congratulate Eskom and particularly Mr John Maree, Chairman of the Electricity Council, as well as Mr Ian McRae and other members of the Management Board, on an excellent and well-prepared annual report. I am sure that hon members will join me in wishing Eskom well for the future.

I wish, in conclusion, to reiterate my gratitude and appreciation for the support of the various interested parties in the drafting and preparation of this Bill. Once again I express my appreciation to the members of the Standing Committee on Manpower and the Standing Committee on Mineral and Energy Affairs for their co-operation in dealing so efficiently with this legislation.

Second Reading resumed

Mr Chairman, the CP supports this amending legislation. It simply comprises a consolidation of the recommendations of the De Villiers Commission. The only problem we have is with the name. The English and Afrikaans names of the undertaking are now being combined so that it will be known in future as Eskom. We believe it was completely wrong to do this.

Apart from that, the capital development fund is being abolished and procedures created which will enable Eskom to borrow money and arrange its own operating finances. In other words, Eskom will in future be run on more of a business basis. We therefore support this Bill with pleasure.

Mr Chairman, It is a pleasure to thank the CP for supporting this Bill, especially as it was the hon member for Carletonville who expressed that support. I thank him. I find it significant …

Then the legislation is going to fail.

No, wait a moment! Give me a chance!

One gets the impression that the CP is in the process of becoming an enlightened party, because this Bill, the Eskom Bill, is concerned with lighting and illumination. [Interjections.]

As far as this Bill is concerned, some of its clauses agree word for word with the 1985 Act. Others have merely been grammatically improved or reformulated more concisely. Some new clauses make provision for certain aspects such as the appointment of subcommittees as provided for in clause 8 and clause 12, which has been included in order to bring the Bill in line with the existing Companies Act. Clause 28 makes provision for certain powers of delegation. I support this Bill unreservedly.

Mr Chairman, this is a consolidation measure and, as such, one can hardly object to it. We supported the previous measures that led up to the introduction of this Bill. We should, however, particularly like to welcome the major change whereby the controversial capital development fund is to be scrapped. Hon members will remember the controversy associated with that fund, and the present amendment is therefore to be welcomed.

During the course of the discussions in the standing committee a number of matters were raised and dealt with to our satisfaction. I should like to take this opportunity, however, to refer to one clause which caused me some difficulty in the standing committee, namely clause 15(1)(a) which provides that:

On the face of it, it struck me that this might open the door to special trading and the advantaging of certain big consumers of electricity. I am, however, grateful to the department and in particular to Mr Oosthuizen and other officials who furnished me with a full and satisfactory reply in regard to this matter. I am satisfied, having studied the documentation given to me, that this is not a problem, that there are adequate checks and balances applicable to clause 15(1)(a) and that in practice proper procedures would have to be followed before any deviation was agreed to.

On the basis of all that and of the fact that this legislation has been seen by all the relevant important bodies, we are happy to support the Bill.

Mr Chairman, I should like to thank hon members sincerely for supporting this measure. However, I want to rectify one small point, even though I do not think the hon member meant it that way. The hon member for Carletonville said the Bill made provision for the borrowing of money by Eskom. That is not so. The Bill makes provision for facilitating the negotiation of loans by Eskom, so that in future Eskom will not have to follow the long, cumbersome route to the Director-General, to me, to the hon the State President, to the hon the Minister of Finance and back again. It was a zig-zag route. Now Eskom will simply approach me, and then the hon the Minister of Finance, and the job will be done. We have simply streamlined the process a little.

Regarding the point raised by the hon member for Constantia, one cannot summarily withdraw rights granted to large organisations with respect to this deviation from the standard fee. In this case there are five deviations, namely those in respect of the Johannesburg, Pretoria, Cape Town, Port Elizabeth and Bloemfontein municipalities. There are very good reasons for doing so, and one should entrust those powers to Eskom in a responsible manner.

I should like to add that there is in any case another Bill which we are going to discuss in a moment and in terms of which a measure of control could be exercised if, for instance, this matter were to get out of hand. I think the hon member should have confidence in the extremely competent management of Eskom. I thank the hon member for supporting the legislation and also the hon member for Bloemfontein North for his support and the survey he gave us.

Question agreed to.

Bill read a second time.

Mr Chairman, I move:

As hon members will recall, the Electricity Act, 1958 (Act 40 of 1958) was amended considerably in 1985 and last year by means of Acts Nos 50 of 1985 and 54 of 1986.

The 1985 amendment gave effect to the recommendations of the De Villiers Commission of Inquiry into the establishment of a new control structure for Eskom. This mainly involved the creation of a control and policy-making body, the Electricity Council, consisting of representatives of interested and consumer groups in the private and public sectors as well as the creation of a management board appointed by the Electricity Council and responsible for the management of Eskom.

The 1986 amendment of the Act was the penultimate step in the execution of the recommendations of the De Villiers Commission of Inquiry. By means of this amendment the numbers of the members of the Electricity Council as well as the Electricity Control Board were increased by two each; certain administrative improvements were effected; power was given to the Electricity Control Board to add to conditions pertaining to existing licences, permits and permissions, and the operating principle of Escom of “no profit and no loss” was abolished.

Mr Chairman, in my introductory speech on last year’s Bill I indicated that that Bill would clear the way for the preparation of legislation for the 1987 legislative programme with a view to the establishment of a modernised and rationalised financial structure for Eskom and for the substitution and consolidation of the Electricity Act as a whole.

*With these objectives in mind, we prepared two Bills. One Bill deals exclusively with Eskom and is being dealt with separately. The other one, which is the Electricity Bill now under discussion, relates to the Electricity Control Board and its powers in establishing and maintaining order in the electricity supply industry as well as to general matters dealt with in the present Act. Jointly these two Bills are a consolidation of the existing Act together with the further amendment and refinements promised.

†The most important new aspect of the Electricity Bill is that the distinction between licences, permits and permissions—the latter are issued to local authorities—is being done away with. These three instruments, by which authority was granted up to the present by the Electricity Control Board to undertakers for the generation, supply and distribution of electricity, have always caused confusion as to what each implied. These instruments were in any event commonly referred to as “licences” irrespective of which instrument was meant.

Provision is also being made for the simplification of the procedures in dealing with applications for the issuing of licences while the Electricity Control Board is being allowed a certain amount of discretion in the procedures to be followed in this regard.

Another innovation is the distinction now being made between the terms “supply”, “provision” and “distribution”. In the existing Act only the term “supply” is used. Where the areas of supply of two undertakings overlap, it is invariably the position that one undertaking supplies in bulk in that area while the other does the distribution in the same area. Since they are both authorised to “supply” in that area, it means legally that both of them may supply in bulk as well as distribute, which is not what was intended when the licences were issued. The distinction now being made will eliminate this confusion.

The main objective of the Electricity Control Board is to establish and maintain order in the generation and supply of electricity (vide clause 3 of the Bill). To enable the board to reach its objective so much more effectively, provision is made unequivocally that the transfer of supply rights from one undertaker to another can only be effected with the prior approval of the board, except in the case of an undertaker who obtained his right of supply in terms of an agreement with a local authority in respect of an area inside the area of jurisdiction of that local authority.

It is generally accepted that electricity is not traded in with a view to making profits. It would be equally wrong if an undertaker, on the transfer of his supply rights to another undertaker in terms of a legal provision or a legal action of the Electricity Control Board, were to make a profit on the transfer of the assets. Express directions are, therefore, being laid down in the Bill for the determination of compensation payable by the undertaker who takes over the assets to the undertaker who transfers the assets. The most important objective of this direction is to prevent consumers again being burdened with the redemption of the costs of assets that have previously been redeemed either partially or completely.

The existing Act determines that a local authority requires the approval of the Administrator of its province before it may erect an undertaking or before it may increase its existing undertaking by more than ten per cent within a period of twelve months. These powers of an Administrator should in preference vest in the Electricity Control Board and the relevant provisions are being amended accordingly. Nevertheless, where the existing provisions relate to the entire undertaking of a local authority, the proposed new provisions have bearing on power stations only because there is no sense anymore in exercising control over the erection or extension of networks by local authorities within their areas of jurisdiction. As was the case in the past with an Administrator, the Electricity Control Board will also first ask for a report from Eskom before it may consider the application from a local authority. Besides matters in the existing Act in respect of which the Minister may make regulations, provision is now also being made that he may make regulations in respect of:

1. (1) the obligation that rests on an undertaker to supply electricity to a consumer and the circumstances under which the obligation may be regarded as having been lifted;
2. (2) the conditions under which electricity that is being supplied on premises may be resold to another person;
3. (3) the penalties for offences referred to in the Bill, and
4. (4) the appointment of staff to the Electricity Control Board.

Finally provision is also being made for the delegation of the powers of the Electricity Control Board, subject to the Minister’s approval, to the chairman or a member or an employee of that board.

Mr Chairman, in both the English and Afrikaans texts of the Bill and in my speech reference is made to Eskom—spelt E-S-K-O-M. The new name, which is the same in English and Afrikaans, covering the existing names Escom and Evkom, will be dealt with by me during the debate on the Second Reading of the Eskom Bill.

Please permit me to express my thanks and appreciation for the support of various interested parties in the drafting and preparation of this Bill. In this regard I wish to mention Eskom, the United Municipal Executive of South Africa, the Association of Municipal Electricity Undertakings of South Africa, the South African Transport Services and the Electricity Control Board.

I wish to thank the members of the Standing Committee on Mineral and Energy Affairs in particular for their excellent co-operation in dealing with this legislation.

Second Reading resumed

Mr Chairman, this measure is chiefly a consolidating measure and largely comprises existing provisions in rewritten form. We have no objection to this Bill and we shall therefore support its Second Reading.

It is a good thing that provision is made for representation of the interests of consumer groups on the controlling body so that the consumer can have a say in the control of this most important commodity.

One of the most important new aspects of this Electricity Bill, as was indicated in the Second Reading speech, is that the distinction between licences, permits and permissions is done away with. Provision is also made for the simplification of the procedure by which applications for and the issuing of licences are dealt with, while the Electricity Control Board is granted a certain measure of discretion in respect of the procedures which have to be followed in this regard.

The explanatory memorandum accompanying this Bill indicates the aims thereof very clearly, and we on this side have no objection to the Bill’s Second Reading.

Mr Chairman, I am pleased the hon member for Brakpan supports this Bill. The Electricity Bill relates to the Electricity Control Board and its powers. This Bill does away with the distinction between licences, permits and permissions. These methods of empowering undertakers to generate, supply and distribute electricity have created a great deal of confusion. In practice all three were referred to as “licences”. The procedure involved in the processing of licence applications and the issuing of licences has now also been simplified. Furthermore, a clear distinction is drawn in this Bill between the concepts of “supply”, “provision” and “distribution”.

It also provides that the transfer of the right of supply of one undertaker to another may only be done with the approval of the board, except in the case of an undertaker who has obtained his right of supply in terms of agreement with a local authority in respect of an area within the area of jurisdiction of that local authority.

The compensation that has to be paid, by the undertaker who takes over the assets, to the undertaker who transfers them, is also clearly stipulated in this piece of legislation. These provisions will ensure that consumers are not burdened once again with the redemption of the cost of assets which have already been paid for.

The approval which must be granted by the Administrator before a local authority may establish an undertaking, or if the existing undertaking exceeds 10% of the already calculated development capacity within 12 months, is now vested in the Electricity Control Board, where it belongs.

In terms of this Bill the Minister may make regulations relating to the obligation an undertaker has to supply electricity to a consumer, the circumstances in which the obligation may be regarded as having been lifted, the conditions upon which electricity may be resold to another person, the fines payable for certain contraventions, and the appointment of the personnel of the Electricity Board.

I am pleased to support this Bill.

Mr Chairman, in supporting the legislation I should just like to say that in a certain sense it is a good thing that the Eskom legislation and the Electricity Act are being separated at last, because this makes it clear that electricity is available from sources other than Eskom. I think my constituency has one of the last few private electricity generators. It is a family undertaking, which is more that a hundred years old. It is the Albert Falls Electric Company, a small hydro-electric power station which provides a faithful service to the remaining 25 farms. As a back-up there is a small pine plantation with a boiler, and when the water from the Umgeni River happens to be cut off, they have to run out quickly, fetch a few pine logs and stoke the boiler. This enables them to carry on.

It is probably in that tradition that we have deemed it necessary to have an Electricity Act as well as Eskom legislation. We on this side of the House support the Bill, therefore.

Order! I am not quite sure whether the hon member for Greytown was referring to a boiler (stoomketel) or a still (stookketel).

Mr Chairman, I sincerely thank the hon members for Brakpan, Greytown and Maraisburg for supporting the legislation. I think those hon members stressed the important aspects embodied in this legislation. It was the hon member for Greytown, in particular, who pointed out the important fact that these two Acts were now being separated from each other. I believe we shall come to realise the importance of this in the future. In my opinion, this is one of the most important aspects of the legislation.

I am amazed that the hon member for Greytown should have said earlier that we ought to provide the Third World with energy, whilst I now hear that they are burning up the Third World’s energy in their boilers! [Interjections.] I think the hon member should look into that. They must not burn up the Third World’s energy in their First World boilers. I think that is wrong. [Interjections.]

Question agreed to.

Bill read a second time.

Mr Chairman, I move:

Traditionally, Government fulfils a particular role in energy regulation and is responsible for national energy policy formulation. In our economic system, the private sector is the largest consumer and the major supplier of energy in its primary form, and has an equally important role to play in the determination of an overall energy policy. It is therefore of the utmost importance that this partnership between the Government and the private sector be enhanced and that suitable and adequate organisational structures be created with sufficient and appropriately trained personnel to ensure the successful performance of the energy function at all levels of government. Energy is of universal importance and fundamentally affects the existence of all the inhabitants of South Africa. It is thus important that energy policy formulation serves the interests of everyone, and that is one of the main objectives of this Bill.

Clause 2 of the Bill makes provision for a high level consultation forum through the establishment of a National Energy Council on which representation will be given to all interested sectors over the entire energy spectrum.

Clause 3 defines the objectives of the National Energy Council in order to provide guidelines for the continuous and complex task of policy formulation and the establishment of flexible and dynamic energy strategies to keep in line with the ever-changing energy situation and priorities.

Although clauses 4 to 12 define related administrative matters I should like to explain the proposed functioning of the council further.

†The White Paper on the energy policy of the Republic of South Africa states that the objective of the energy policy is to ensure, by means of an appropriate energy management plan, both the adequate and uninterrupted provision of energy and its efficient utilisation in order to promote the economic and social development of the Republic of South Africa in particular, and of all the countries in Southern Africa in general.

The National Energy Council will advise the Minister of Economic Affairs and Technology on planning for the future energy supply, the evolution of the overall energy management plan and formulating individual energy strategies. A rationalised national research and advisory committee system will, in turn, advise the National Energy Council concerning technological and non-technological projects and priorities in order to effect centralised and co-ordinated decision-making and action in the country’s energy affairs. The work incidental to the functions of the National Energy Council will be performed by an executive officer and staff appointed for this purpose by the Minister of Economic Affairs and Technology.

Clause 13 of the Bill provides that the personnel may also be Government officials as well as employees of the Scientific Research Council seconded for this purpose to augment specialist knowledge available to the National Energy Council.

Funds for the financing of the functions of the National Energy Council will, in terms of clause 14, be voted by Parliament and provided from the Central Energy Fund or other sources. Provision is also made for auditing by the Auditor-General and reporting to Parliament.

The remaining clauses are to a large extent of a consequential nature in order to enable the National Energy Council to fulfil its functions and to report on its activities, which report must also be tabled in Parliament.

Second Reading resumed

Mr Chairman, the CP also supports this Bill. In the future we shall become increasingly dependent on energy for all the work we have to do. This Bill provides for the establishment of a National Energy Council, which will take over certain functions We think such a council is essential and we therefore support this Bill.

Mr Chairman, the Energy Policy Committee drew up a draft White Paper on a proposed energy policy for South Africa, at the request of the hon the Minister and in co-operation with the energy branch of the department, and distributed it to approximately 2 000 bodies in the private and public sectors for comment. After due consideration, the feedback received was included in the White Paper on the Energy Policy of the Republic of South Africa. It recommends that it is essential for the private sector to be meaningfully involved in the formulation and implementation of an energy strategy through the establishment of an energy advisory council.

This Energy Bill was the product of the White Paper. The object of this legislation is the establishment of a structure for the formulation of energy policy by the Government and the private sector.

(Firstly, this Bill provides for the establishment of a National Energy Council to exploit and utilise the energy resources of South Africa to the fullest possible advantage of energy consumers, which also includes research; to advise the Government in achieving the abovementioned objectives; and to carry out the instructions of the Government in regard to the regulation of matters relating to energy. Provision is made for personnel to perform the functions necessary to achieve the objectives of the Bill.

The Bill furthermore provides for the financing of the functions of the National Energy Council with money provided by Parliament and the Central Energy Fund or other sources. Provision is also made for the auditing of an annual financial statement by the Auditor-General and reporting to Parliament. This side of the House will therefore support this Bill.

Mr Chairman, there is one thing that worries me about this Bill and that is that the financing of this body is going to make another demand upon the Central Energy Fund’s money, although that is not such a serious matter. We obviously support the concept; the Bill has been through the standing committee and it is in line with the thinking expressed in the Government White Paper.

We do hope, though, that the National Energy Council, as envisaged here, will pay special attention to the development of a national strategy in respect of alternative energy. I really do think that South Africa has underdeveloped her alternative energy sources. We have had a long energy debate today. One or two hon members referred to solar energy, and other sources of energy have been documented and discussed. I really do hope that the National Energy Council takes that matter up very seriously, which will include also the concerns expressed by my colleague, the hon member for Greytown. On that note the PFP support this Bill too.

Mr Chairman, I thank the hon members for Brakpan and Albany for supporting the legislation.

(I also thank the hon member for Constantia and I should like to assure him that the alternative sources of energy will receive attention and will be looked at very carefully, because it is important that this be done.

*I want to thank hon members once again for having supported the Bill.

Question agreed to.

Bill read a second time.

Mr Speaker, I move:

The objects of the Nuclear Energy Amendment Bill are multiple. Some are of a consequential nature and only replace inapplicable or obsolete references to, for example, the House of Assembly and the provincial councils, whilst others are intended to rectify the appellation of State departments, and therefore require no further elaboration.

The most important amendments bear, on the one hand, upon the objects of the corporation and, on the other, upon the managerial structure thereof. It has always been one of the objects of the AEC to research nuclear energy and to develop nuclear technology in order to support the local nuclear energy programme and in general to apply nuclear energy in the Republic.

In accordance with the Government’s policy of preserving and promoting the application by industry of sophisticated and specialised technology and expertise developed in the Republic with South African capital by South African scientists and engineers, it was decided to clarify the objects of the corporation, as presently contained in section 1 of the Nuclear Energy Act, 1982. It should be clearly stated that nuclear and other related technology developed by the AEC should also be made available for the benefit of South African industry as a whole. This object will be achieved, for instance, by the privatisation of certain undertakings of the AEC as and when this would be in the interests of the State and advantageous to the AEC and the private industry. Clause 2 of the Bill is proposed against this background.

Regarding the changes effected in the managerial structure of the corporation, it became apparent shortly after the inception of the AEC on 1 July 1982, that the objects of the State-funded nuclear organisations in the Republic of South Africa could be more efficiently achieved, especially from a financial point of view, by the institution of a centrally controlled, rationalised body. The activities of the former subsidiary corporations of the AEC, namely Ucor and Nucor, were consolidated in one such single structure. The financial requirements of the AEC were thus considerably reduced, as the present Budget will indicate. In this regard I should like to refer hon members to the fact that in the 1986-87 financial year a saving of approximately R100 million was achieved. Good progress has already been made with the achievement of a much more streamlined organisation with a resultant increase in efficiency and productivity.

*In accordance with Government policy it was thought necessary during the rationalisation process to separate the position of the executive chairman from that of the chief executive officer, both of which are extremely demanding. On the recommendation of the corporation’s board of directors, the Nuclear Energy Act was amended in 1985 in that the provision which required that the chairman of the corporation be a full-time chairman, was deleted from the Statute.

The result of this was that the chairman was not necessarily required to be the chief executive officer as well. Notwithstanding, Dr Wynand de Villiers was reappointed to execute the duties of the executive chairman and those of the chief executive officer of the corporation. In this capacity he then also served on the board of directors.

†At this stage I wish to express my appreciation for the work of Dr De Villiers. We thank him for the very great task which he has done in these two capacities.

During November 1985 it was decided to release Dr De Villiers from his responsibilities as executive chairman of the corporation, in order to allow him to direct his undivided attention to the executive tasks of the corporation. A new chairman without executive powers was appointed on a part-time basis. At the same time the managerial structure of the AEC was changed to provide for a management board under the chairmanship of the chief executive officer, similar to the Escom structure. Mr John Maree was appointed as part-time chairman with effect from 1 January 1986, whilst Dr De Villiers, as has been mentioned, remained responsible for the executive functions of the corporation.

It is desirable that the chief executive officer should in that capacity have access to the board of directors, and consequently the proposed amendment to section 5 of the principal Act takes care of this. As a result of the separation of the two positions mentioned earlier, consequential amendments to the principal Act were necessary.

The proposed amendment to section 42 of the principal Act has the effect of expediting control measures which are required to be taken with regard to an accident, and of reducing delays which would otherwise have occurred. This action again has a streamlining effect and eliminates a great deal of red tape.

I would like to draw the attention of hon members to the fact that the proposed amendment has no influence on and cannot prejudice the rights of persons who have suffered any injury, to institute claims for compensation. The provisions of section 42(4) of the principal Act in this regard are abundantly clear in that the defining of any area or period or the failure to record the name of any person in terms of section 42(3) of the principal Act shall not prejudice the claimant’s rights to claim compensation from the licensee.

As regards nuclear safety I need to mention that the Republic is a member of the International Atomic Energy Agency, and the operating codes of that agency are stringently applied.

The proposed amendments to section 46 of the principal Act are not aimed at increasing or widening the scope of the powers which inspectors already have. The purpose of this amendment is to avoid administrative delays by permitting the inspectors themselves to decide during an inspection in loco which information is, under particular circumstances, required, without first having to obtain the permission of the corporation in that respect.

The authority to control radio-active nuclides was assigned to the Minister of National Health and Population Development on 1 June 1986. It is however desirable that control of radio-active nuclides within a nuclear installation be excluded from such control. Clause 11 of the Bill is therefore devised to rectify this situation.

I referred earlier to the rationalisation process whereby Ucor and Nucor became consolidated with the AEC. Certain assets, liabilities and employees were, with the consent and on the authority of the boards of Ucor and Nucor, transferred to the AEC. The proposed amendment in clause 12 of the Bill is therefore required in order to obtain Parliament’s approval for these arrangements.

Hon members will agree with me that the few amendments which are being proposed will make a contribution to streamlining the nuclear energy industry in the Republic and making it more safe and effective.

Please afford me the opportunity of thanking the two nuclear bodies in the country, the AEC and the Council for Nuclear Safety, their controlling bodies and personnel, not only for their contribution to these amendments, but also for the excellent service which each of them has rendered in this most important industry. Furthermore, I wish to extend a word of gratitude to members of the Standing Committees on Manpower and on Mineral and Energy Affairs for the thorough work which they did in regard to this Bill.

Second Reading resumed

Mr Chairman, the CP also supports this legislation. There are just a few aspects to which I want to refer, some of which were also raised in the Standing Committee. One of these is that clause 2 is being substituted for section 3 of the principal Act. It deals with the objects of the corporation, and the following is stated in clause 2, which is to become the new section 3:

In the Second Reading speech—and, I believe, in the explanatory memorandum as well—it was stated that this expertise would be made available to industry. I therefore do not believe it is quite correct merely to use the words “make available”, because it must be made available to someone. Perhaps this could be given some attention in the future.

I also have a dislike for the description “a member of Parliament”, which appears in clause 3 on page 4. It is stated that certain persons may not become members of the board of directors and such persons include “a member of Parliament”. That is an argument based on a legal technicality.

My attention has been drawn to the fact that the Constitution provides, in the definition of a member of Parliament, that a person who is a member of any of the three constituent bodies of Parliament is also a member of Parliament. Mr Chairman, you, who are a legal man yourself, will agree with me that members of Parliament comprise the members of the three Houses as a whole, and that it is incorrect to speak in the 1983 Constitution of a member of this House as being a member of Parliament. We are not MPs; we are members of one of the components of Parliament. There are only three components of Parliament, aside from the hon the State President, and they are the House of Assembly, the House of Representatives and the House of Delegates. That is not this hon Minister’s problem, but that of the hon the State President and the hon the Minister of Constitutional Development and Planning. It is a legal technicality which will have to be rectified at some stage or other.

A third point I want to make is that the following is stated in paragraph (e) of the memorandum:

The answer given to us by Dr De Villiers was that the purpose of this was to prevent confusion and to define each body’s obligations and responsibilities in regard to a particular activity. We accept his explanation and are satisfied with it. From our side, we wish Dr De Villiers and his people in that exceptionally sensitive and important organisation everything of the best in the interests of South Africa. We therefore support the Bill.

Mr Chairman, this Bill firstly offers us an opportunity to thank the department for a very profitable visit to Koeberg recently. We really learned a great deal. I also believe we are privileged to have someone like Dr de Villiers at the helm in our nuclear industry. He is not only held in very high esteem locally, but he also enjoys recognition in many overseas countries.

The objects of this Bill were very clearly stated during the second reading speech. I believe I would be failing in my duty, however, if I did not make a very brief reference this evening to the chief medical officer of the Cape Town municipality, Dr Coogan. He is like an animal continually butting its head against a brick wall, resting only briefly before charging forward again. He really and truly has a mania about nuclear power, the threat of explosions, and the effect of nuclear energy on Cape Town.

What is most interesting is that this very same Dr Coogan has been invited time and again to attend committee discussions on nuclear energy at Koeberg. Although he has not once been there, he is the one who is ranting and raving about the dangers of nuclear radiation, but he does not have the courage to go there and to talk to scientists in the field of nuclear physics. I do want to appeal to Dr Coogan to drop this vendetta of his. He is not achieving anything by it. I think he is making a fool of himself in the process.

I shall just mention one absurd example to hon members. When one walks into the water-purification area at Koeberg, one sees a notice which reads: “Do not eat fish—they may be poisonous”. Someone has actually taken a photograph of that sign and said to the world at large: “Do you see the dangers inherent in Koeberg? Fish are being poisoned through radiation”. In reality, the notice is there to point out that fish which get into those sieves should not be eaten, because they may have been lying there for a few days and could consequently be harmful to humans. This is how information about Koeberg and about nuclear energy is being distorted in our country. I want to tell hon members this evening, however, that it is the energy source of the future. [Interjections.] I support this legislation on behalf of this side of the House.

Mr Chairman, I think the hon member for Stilfontein struck a discordant note this evening after a long debate on energy matters. I do not understand why he chose this particular occasion to launch an attack on Dr Coogan. I do not think that is fitting in this debate and I certainly do not intend to follow him along that line. [Interjections.] Dr Coogan is quite capable of defending himself against anything the hon member for Stilfontein may have to say.

The hon member for Stilfontein also launched into a great defence of nuclear energy and it almost looked as though he was opening a debate on the pros and cons of nuclear energy. I do not think that was called for either on this occasion.

We have had a debate on the Vote. If he really wants a big debate on nuclear energy there are many things that can be said and have been said, but I think it is inappropriate on this occasion in respect of this Bill which covers a fairly narrow field. We will save a full discussion on nuclear energy for another occasion.

I would like to say one thing to the officials of the department who organised the trip to Koeberg. It was with regret that members of this party were not able to be part of that trip. We would like to have been there but we had other duties that kept us away for which we made our apologies. If another occasion arises we will be very pleased to take the opportunity to take part in the visit. If it is perhaps possible to join another group going out there those of us in Cape Town may be able to do that.

Since the hon member for Stilfontein brought in something not fully related to this Bill I would also like to take this opportunity to say to the hon the Minister and to the department that it would appear that their reaction to the Majuba Pass incident is entirely appropriate and I was glad to hear the explanation given earlier by the hon the Minister. I do think that since the packages broke as a result of a burst tyre there is something wrong with the regulations and something will have to be done to prevent that from happening again. However, it would appear that he has matters well in hand and for that I want to thank the hon the Minister and the relevant officials.

The question of extending the objectives of the Atomic Energy Corporation is something positive. The possibility of the peaceful uses of nuclear energy and nuclear technology being shared within the industrial and commercial community of the country is to me something positive and I welcome and support it. I am also pleased that there is no longer any division of responsibility over the inspection of nuclear matters inside a power station and that this responsibility now falls under one authority. That does remove the possibility of the ball of responsibility bouncing backwards and forwards between two separate authorities in the case of an accident or mishap. To that extent we welcome that change.

Having referred to these points we support this Bill.

Mr Chairman, I want to thank hon members for supporting this measure.

I want to thank the hon member for Brakpan very sincerely for the kind words he addressed to the heads of departments. Before I react to the remarks made by certain hon members, I also want to avail myself of the opportunity to tell Dr Wynand de Villiers, on behalf of Parliament, that we very greatly appreciate the extremely efficient manner in which he, as both chairman and executive head of the Atomic Energy Corporation, has occupied these two posts for many years now. In my opinion he handled the merger of the other two corporations with exceptional competence. At present, this has not yet been finalised, but we want to thank him for performing such a major task and for his zeal in doing so. We on this side of the House greatly appreciate this, and I believe I may also say on behalf of the Cabinet that we greatly appreciate his very expert contribution to one of the most complex technological industries in South Africa.

As to clause 2, which seeks to amend section 3, I have noted what my hon colleague said about making expertise available to industries. However, there are a few aspects which trouble me in this regard. The moment one talks about an industry, one has to define it. How, then, does one define an industry? One may reach the stage of wanting to transfer operations to the CSIR, which is not an industry, and then one would have problems because the CSIR could also make use of that technology. It is not only a matter of nuclear technology, but also of mechanical and plating technology; a series of skills and facilities have been built up in the process, which we now want to make available to the South African technological industry on a wider front. The body in question could also be a university, and if the word “industry” were to be incorporated in the Bill, we would have a problem, because then the university would not be able to avail itself of this expertise. I think the phrasing of this clause covers a wide spectrum, and I would be pleased if my hon colleague would accept this as being so. This clause was not only intended for industries, but also for research institutions—research institutions other than the AEC. That is the important point I should like to make.

In relation to clause 3, which seeks to amend section 5 and which deals with the question of a member of Parliament, I want to say that in my view we have no choice; we shall simply have to abide by that, and furthermore, I believe that is what the hon member intended.

The last point that was raised, dealt basically with radio isotopes. The hon member for Constantia also referred to this. Mention was made of the fact that there was no possibility of a dual responsibility within a nuclear installation. I think those were the important points raised. I also thank the hon member for Stilfontein for his contribution.

I want to conclude by thanking the hon member for Stilfontein, who is the chairman of the standing committee, and all the members of the standing committee for the good work they have done in relation to these four pieces of legislation, legislation we have dispatched in record time this evening. I thank them for their support in that standing committee.

Question agreed to.

Bill read a second time.

Mr Chairman, I move:

Agreed to.