I wish to make a brief statement in regard to the use of the official languages in debates in the House of Assembly.

In pursuance of a resolution adopted by the Committee on Standing Rules and Orders last session, I and the other presiding officers will in future permit members to make use of both official languages in the same speech.

†In the past the practice has been that only the Minister or member in charge of the business before the House, or a Minister replying to a debate on behalf of the Government, was permitted to use both official languages when addressing the House. The Committee on Standing Rules and Orders felt, however, that bilingualism in the House has now reached a standard which makes it practical to permit members generally, when addressing the House or any committee thereof, to change from one official language to the other, should they so desire.

*I trust that I may nevertheless rely upon members not to change over from one language to the other too often in the same speech, not to use both languages in the same sentence, and to make sure that what they say makes sense, otherwise this will hamper the work of the Hansard staff considerably.

I also wish to draw the attention of hon. members to the provisions of Standing Order No. 33, viz.:

Subject to these Standing Orders, the consideration of an order of the day shall be set down for the next sitting day unless the member in charge appoints some other future day.

It will, therefore, no longer be necessary for the presiding officer to ask the member in charge of an order of the day on which the debate has been adjourned, when the debate thereon is to be resumed, or on what day the next stage of a bill is to be taken. It will be set down on the Order Paper for the next sitting day.

If the member in charge wishes to appoint some other future day, he may rise in his place at the appropriate time and indicate the day in the customary manner.

As this Bill is a hybrid measure, it will now in terms of the provisions of Rule 29 of the Rules relating to Hybrid Bills be referred to the examiners for report.

Mr. Speaker, I move—

That, in terms of Standing Order No. 71, the Apportionment of Damages Amendment Bill [AB. 49—’70], which lapsed last session by reason of the prorogation of Parliament, be proceeded with during the present Session at the particular stage which it reached in Select Committee during last session.

Agreed to.

I now move—

That the Select Committee on the subject of the Bill be re-appointed, the Committee to have power to take evidence and call for papers, and to have leave to bring up an amended Bill.

Agreed to.

Mr. Speaker, in the last important debate of last Session—that on the third reading of the Appropriation Bill—I was constrained to remark that the provincial elections would be decided almost entirely on national issues. To this the hon. the Prime Minister interjected that he was prepared to meet me on that field. He will therefore, I know, not take exception to the claim that our progress against him in the provincial elections was progress at the national level. We not only held all the seats which we had taken from the Government in the general election in April, in the Cape and Transvaal, but we held them in every case with greatly increased majorities. And, Sir, in the Transvaal we won four more seats from the Government. In Natal it is not easy to make comparisons between the general election and the provincial election because the seats are differently delimited. But I do not think there will be any dispute about the suggestion that the winning of five provincial council seats from the Nationalist Party in Natal was an even better performance than taking three parliamentary seats off them in the general election.

Sir, what was particularly noteworthy was the continued improvement in the fortunes of the Opposition in the short period between April and October last year, an improvement which to my mind was clear evidence of the fact that dissatisfaction with the Government during that period was growing at a faster rate than in the period between 1966 and April of last year. And, Sir, I believe it is growing even faster at the present time.

Sir, I believe the reasons are not far to seek. In the first place the Government is obviously losing the support of the young people of South Africa, the new voters. Sir, that is not surprising because it has nothing to offer them. It has no message with which to inspire them. Its own press recognizes it but hon. gentlemen opposite still seem to be ignorant of this fact; they still seem unaware of it. Secondly, Sir, despite all the Prime Minister’s promises of “opknapping” in his administration after the general election there have been no indications at all of any improvement whatever. The people are still dissatisfied with the performance of the Government and they are growing more so day by day. Thirdly, Sir, I believe there are fewer and fewer people today who feel that this Government has the answers to our problem. There is too much double talk; there are too many broken promises; there is too great and too often, a discrepancy between theory and practice and in fact at the moment even the theories are becoming discredited.

In all these circumstances, Sir, I am faced with an embarrassment of riches. There is a whole host of grounds upon which one can move a motion of no-confidence in the Government; each one of them alone could sustain such a motion.

Firstly, there is the political behaviour of the hon. the Prime Minister himself. There are various examples of the political behaviour of the hon. gentleman. Less than a year ago in this House I raised with him the question of listening in to other people’s telephone conversations, and I received a categorical denial from him that it was authorized or, as I understood him to imply, that it was taking place at all. I said at the time that I found it difficult to accept because I believed there was hardly a civilized country in the world where it was not taking place in some form or other. Now what has happened, Sir? Now we have had a judgment from the Appeal Court in the case in which a former member of this House, Mr. Jaap Marais, was convicted on a criminal charge, a conviction against which he appealed successfully to the Appeal Court. In the course of that judgment the Appeal Court judge referred to evidence given at the trial—a trial held in camera—by none other than Gen. Van den Bergh, head of the Bureau of State Security and Security Adviser to the hon. the Prime Minister. According to the judgment the General referred to methods made use of by the Security Police to obtain information, and two of those methods, Mr. Speaker, were “afluistering” and “die onderskepping van pos”. Now, Sir, whom are we to believe? The hon. the Prime Minister or his security adviser, whose evidence, incidentally, is supported by statements made by Dr. Albert Hertzog, the former Minister of Posts and Telegraphs. They cannot all be correct, Sir, and this sort of thing shakes the confidence of the people in any government and any prime minister.

There is a second example, Sir, of the political behaviour of the hon. the Prime Minister, and that concerns the attitude he took up towards two hon. members on this side of the House last session, the hon. member for Newton Park and the hon. member for Kensington. The hon. gentleman, Sir, virtually accused those two hon. members of being guilty of perjury, and when it appeared that he had overlooked certain important passages in the evidence given by them before the Galgut Commission, there was no withdrawal; there was no apology; the matter was just left hanging in the air. Since then the Prime Minister has been challenged by both of these hon. members to prosecute them if he stands by his charges. But, Sir, there has not been a chirp out of the hon. the Prime Minister. Can a Prime Minister really retain the confidence of his people when he behaves like that? Does he deserve to retain their confidence?

Then there is a third example, Sir, and that is the tardiness the hon. gentleman has evinced in making available to the public the reports of certain important commissions, which are of great national importance, a tardiness which is in very sharp contrast to the speed with which the reports of commissions were made available which were of political importance to the Government, as in the case of the Kolver Commission and the interim report of the Potgieter Commission on the activities of Boss in respect of certain allegations made by Dr. Albert Hertzog and others as to the cost of running Boss. The reports to which I refer are first of all, the Potgieter Commission’s report on the Bureau of State Security and, inter alia, into the effect of Section 29 of the General Law Amendment Act. The other commission is the commission enquiring into the Agliotti affair. The hon. the Prime Minister originally said in reply to a question during the session before last that he would table the Boss Commission’s report as soon as he received it. Subsequently— that was last session when he was questioned on the matter—he said that he had received the report and was waiting for it to be translated and printed. That was three months ago. As you know, Sir, translation is not a prerequisite of making a report available for release, as we saw in the cases of the Sharpeville and Langa commissions’ reports and in fact Mr. Justice Snyman’s report on the Paarl riots. There was no question of waiting for translation or anything of that sort. This commission’s report. Sir, has to do not only with nationally important security and intelligence matters but also with the most important matter of the freedom of the individual and his rights before the courts in so far as they are affected by Section 29 of the General Law Amendment Act. This is a matter, Sir, which gave rise to unfavourable comment from the Bench, from the Bar and from the Side Bar all over South Africa and to criticism from leading academicians and eminent men throughout the country. I think, Sir, there is every reason for the findings of this commission to be made available speedily to the country generally, in so far as they can be made available for security reasons. I appreciate that certain portions cannot perhaps be made available.

Then, Sir, there is this commission into the Agliotti affair. This commission—we have this on the authority of the Prime Minister himself—must provide the answer, inter alia, to the riddle of how it came about that R7 million of public money was paid out by the State without a single Minister having known about it or having authorized it. Sir, what has happened once can happen again, unless the loopholes which apparently existed are found and properly closed. I can assure the hon. the Prime Minister that the heavily burdened taxpayers of South Africa are most interested in ensuring that their money does not slip away in this manner again. I believe that that report should be made available at once.

Sir, there is another ground on which one could bring a motion of no-confidence and that is the manner in which this Government has allowed our fishing industry on the west coast to be ruined, and the dangerous situation that it has allowed to develop in respect of the South West-African fishing industry. It is a sad story this, Sir; it is a sad story particularly to me because my maiden speech in this House some 23 years ago was on the question of the necessity of protecting our fishing industry on the west coast. I referred then to the disaster that had overtaken the industry in California and called for the taking of protective measures. Now this story of the destruction of a mighty industry and the effect it will have on the thousands of people dependent on it for a living is so important that it deserves special treatment. I want to warn the Government that it will be dealt with in due course in the course of this debate from this side of the House, as indeed will the Immorality Act in the light of the chaotic situation which has arisen in respect of its administration since the events in Excelsior.

There is a third ground on which a motion of no confidence could be brought, and that concerns the failure of the Minister of Railways to plan for the development of our railway system to keep pace with the transport needs of a growing South Africa. I want to refer to only one example because there will be ample time to debate this issue later. Hon. members know that one of our major problems for years has been that of increasing our exports and as long ago as 10 years ago even Ministers of the Cabinet were talking of the importance of building up South Africa’s balance on current account through the export of raw and semi-processed minerals. Today we can get orders for millions of rands worth of coal, ore and anthracite and things of that sort, but repeated railway bottlenecks are not only taking away this new business from us but in some cases even lead to the cancellation of existing orders. Not only that, but the absence of the necessary ports and port facilities and delay and confusion over the siting of new ones puts off into the dim and distant future our chances of grasping at what might be a vital lifeline for South Africa.

There are other matters which justify a lack of confidence in this Government, but I think the election results have shown one thing, and that is that it is the middle income breadwinner and his family that are turning against the Government at the moment, and turning against it with very good reason. That middle income breadwinner is suffering at the present time. There are increased and intolerable burdens which the ordinary man in the street is being called upon to bear as the result of the incompetence of this Government and its obstinate persistence in a non-European policy which has already failed. This afternoon, Sir, I want to warn the people of South Africa that as long as they keep in power this Government which does not understand the disastrous course upon which it is steering South Africa, our troubles will grow and our miseries will multiply.

Without doubt the most dramatic event of the past few months has been the explosion in the cost of living. What is more, it is the flashpoint of a highly inflammatory situation that, as we have repeatedly warned, has been building up for years. The victim is, as usual, the ordinary citizen, the man who enjoys very little of the guilt of the boom and is always expected to sweep up the mess when it comes to a recession. We must just listen to the callous attitude of the hon. the Minister of Economic Affairs. The Minister says: “High salaries and spending are softening the underbelly of the nation as a whole”. I wonder, Sir, if the hon. gentleman has any experience of a young family about to set up a home of their own? I wonder, Sir, if he has observed any softening of the underbelly of the nation, as they struggle to find R1,000 to furnish a small flat or R20,000 to buy and furnish a home?

That is nonsense, and you know it.

No one knows anything about housing development in South Africa except the Minister of Community Development! [Interjections.] Mr. Speaker, perhaps other speakers will reveal what it cost the hon. the Minister to do up the flat in which he lives at the present moment. That is why I wonder in what company the hon. the Minister of Economic Affairs was when he came across that “disinclination to work harder, a readiness to live beyond their means and the corrosion of economic stability”, which he referred to as signs of the softening underbelly of the nation. I wonder whether he found that amongst the Railway workers who were working so much overtime or whether he found it amongst the Post Office workers, so many of whom have gone for years without leave? I wonder whether he found it amongst the ordinary men in the street, struggling to make ends meet as spiralling costs eat into whatever increases they have been able to get in their pay packets?

The hon. gentleman demands that the people whom he helps to govern—or is it misgovern?—must work harder, spend less and save more. I would like to know how they can save more, when simple car repairs cost R30, R40 or R50; when a holiday at a moderate hotel for a family of four can cost as much as R200 a week; when men’s suits cost R60 a time; when rent for a four-roomed house in Johannesburg is as much as R250 a month; and when you cannot expect much if you spend R300 on buying a bedroom suite? I do not think the hon. Ministers know what they are talking about.

I think it is time we stopped talking nonsense about this so-called “high living”. It may exist for the few, yes, but for the many certainly not. Look at the first report of the inquiry into Fiscal and Monetary Policy in South Africa, the Franzsen Commission’s report. It tells us that only 8 per cent of South Africa’s population pays income tax. In other words, Sir, only 8 per cent of our population earns enough to pay income tax at all. Does that sound like “high living”?Most South Africans are not rich. The affluent suburbs are diminutive specks on the map of South Africa. The rest of the people have incomes which make it difficult to make ends meet and amongst them are thousands of civil and social pensioners and thousands of others who must somehow succeed in living on small fixed incomes. Across the colour line, where the position is even more difficult, income and expenditure very seldom meet.

Let us stop this nonsense once and for all of thinking of South Africa as an affluent society. A few are indeed well-to-do, but our major problem is not to resist the extravagance of this few but to provide more jobs, more goods and services for the many. I believe that when Cabinet Ministers talk about “high salaries” and “big spending” and the Transvaler’s headlines proclaim: “Bevolking leef hoog”, we must get the matter in its proper perspective. Let us also keep in proper perspective the implications of a rapid rise in the cost of living, which is forecast for this year by the economists in the country. Let us keep those implications in view, for a country in which the vast majority of families have an income below the poverty datum line, which is regarded as R63 per month in a place like Johannesburg with only a very small minority in the affluent class. Here I am not only talking about the poor people in the non-White classes but about poor people amongst the Whites as well. There are 13,000 employees on the South African Railways of the hon. the Minister of Transport who earn less than R100 per month. Furthermore he has 64,000 in his employ who earned less than R200 per month before the recent increases. But, Sir, even those increases could not have moved those people into the affluent class; they are still poor people.

You have been very badly treated.

I remember the hon. the Minister’s answers to the questions here put by the hon. member for Durban Point.

Sir, by far the commonest size for an “erf” in South Africa is not an acre, but one-eighth of an acre. In most of the big cities people are living in the townships with something like eight families to an acre. It is these people, the hard working little-leisured group of eight families to an acre who are affected by rises in the cost of living. The majority of those people are White. Of course, we cannot ignore the fact that rises in the cost of living have a very serious effect on non-Whites as well and particularly the Bantu group. These people buy their goods at the same prices paid by everybody else. In spite of the tremendous gap between White and non-White wages, they buy their washing powders, meat, vegetables, clothes, furniture, radios and bread at exactly the same prices as Europeans and they pay the same sales tax as well. I know their standards of living are rising. However, we would be foolish to ignore the very real poverty of a very large section of our non-White population. Higher wages for them, however small, have created greater expectations which are being nullified by ever-rising costs. That nullification is causing them great misery and great frustration. So I say, let us talk less about curbing extravagance and saving more and let us talk more about ways and means of keeping costs down, creating more jobs and producing more goods efficiently with the purpose of improving the living standards of all our people.

I know in advance what I am going to hear from the other side. I am going to be told that they are watching prices carefully even if they are doing nothing about them. I will be told that inflation is a world-wide phenomenon and what we are suffering from is imported inflation. We had it from the hon. the Minister of Economic Affairs the other day when he said:

Vanweë heersende wêreldtoestande is prysstygings vir sekere verbruiksware onvermydelik, maar die Regering doen alles in sy vermoë om stygings tot ’n absolute minimum te beperk en waar moontlik selfs te voorkom.

I wonder why the hon. gentleman did not study his brief and look at the figures before he started speaking. Do honourable members know what he would have found? He would have found that the price index of imported goods rose from 100.4 in 1961 to 118.1 in April 1970. During the same period the index for South African goods rose from 100.7 to 124.2. In other words, it was rising far faster in South Africa than overseas. Judging from figures for the period April, 1970, to October, 1970, the last period for which we have figures, it is still clear that inflation in South Africa is taking place at a higher rate than the countries from which we were importing. Does this look like imported inflation against which the Government has no defence? But if the hon. the Minister still insists, as I suspect he may, that we are the victim of overseas inflation, perhaps he would like to tell us why he and his Government have seen fit to allow South Africa’s imports at these so-called high prices to reach the staggering figure of R2,542.5 million while our exports are stagnating at roundabout R1,543.5 million, thus leaving us with a trade gap of just over R1,000,000,000 for the year? If imported inflation is the fly in the ointment, why has the Government left us so dependent on imported goods?

The truth is that members of this Government are prone to talk a lot of muddle-headed nonsense because there is no other way of maintaining the mirage that their economic policies were working. There was a time when many South Africans—not necessarily supporters of the Government—were prepared to give this Government a chance. Our circumstances were such that their ability to govern was not overtaxed, but today, with the very real problems, which have been piled upon us because of their policies, they are failing more and more abjectly every day. Very few people are prepared to give them a chance today. They are becoming impatient with them. They feel that this Government have proved themselves, and particularly over the past few years, to be the most inefficient Government South Africa has ever known. It is not only inefficient, but it seems to be absolutely helpless in the face of difficulties and the blundering and disarray in this Cabinet would be hard to beat anywhere else in the world.

Under the present circumstances, that is to say, given the present Government with its particular policies and the present Government in power, undoubtedly inflation is one of the gravest threats to not only our economy, but to every single citizen in South Africa. The Government is aware of this, but I have no hesitation in saying that almost every step this Government has taken in recent months has contributed either to increasing the rate of inflation or to increasing the financial burdens upon the people. It is not only that, but in their efforts to curb the demand for goods they cannot produce, because of their own policies, they have shown themselves to be utterly uninformed, reckless and incompetent.

To prove what I am saying, I want to give some examples Let us start by looking at this hire purchase affair. Hon. members all know what happened. A few months before the Christmas season, a day or two after the Provincial elections, and when all firms were geared for heavy seasonal orders with maximum staff and money tied up in goods, this brilliant Government chose to crack down on hire purchase terms in the motor vehicle and consumer durables markets and on credit dealings generally. They did it without even consulting commerce at all. I suppose they did not consult commerce because they might have let the cat out of the bag during the election period and the public might have heard what was going to be done. It might have affected the vote. How did they do it? Minimum deposits were raised to 45 per cent with a maximum repayment period of 12 months on a wide range of goods including radios and photographic equipment. For motor cars minimum deposits were raised to 40 per cent and 18 months were given to pay the full amount. Then there was the 15 per cent deposit and 21 months to pay on furniture. The latter was a particularly hard crack, because furniture and appliance dealers had been operating on a negligible deposit and two or three years to pay. I wonder what the effect would have been if these steps had been announced before the 26th October, before the provincial election. Our Government keeps a very wary eye on election dates even if they do not, like Hitler when he was a dictator, carefully consult astrologers before taking action. We have had the announcement of that R60 million increase in Railway wages the night before the by-election in Langlaagte.

Two nights.

The Minister wanted to give it time to sink in. Then we had these hire purchase restrictions announced two days after the results of the Provincial elections had been announced.

Mr. Speaker, does it not strike you as the height of cynicism when this Government gives salary increases left and right before elections and then stamp on spending with credit curbs, higher prices and the threat of increased taxation immediately the elections are over. They want it both ways. They want credit for granting higher salaries and wages before an election and they want the right to condemn the people for spending those increases after the election. How cynical can you be? The public of South Africa are beginning to realize this. What happened after the introduction of these hire purchase terms? In less than a week manufacturing workers were being laid off. In some firms as many as 75 per cent were laid off. Hire purchase contracts were cancelled by the thousand and salesmen were left in disarray with the prospect of a very thin Christmas pay packet. However, the disappointed public licked their wounds, and some of them who were more patriotic were consoled by the statement by the Government that this was absolutely essential if the economy was to be saved from galloping inflation. What was the effect? The effect was to curb the output of durable goods at the manufacturer’s end while the consumer, in all probability, spent his money anyway, and also very possibly on imported goods. And what happened then? Twenty-seven days later, namely on the 27th November, the Minister announced certain relaxations of those hire purchase controls he had considered so absolutely essential to save the economy a few weeks previously. Of course, some traders were relieved at this relaxation. But the Minister did not give up. He kept on trying by introducing more controls at the same time. Do you know what he brought in then? He brought in control over the sale of tents. Can you believe it? One tent manufacturer had orders cancelled to the value of R92,000 just before Christmas. Tents were not subject to any price control before, nor were they included in the first hire purchase proclamation. Now all of a sudden they are subject to a 40 per cent deposit and repayment over 18 months. But caravans, the more expensive type of camping equipment, are not included. Now who uses a tent? Surely it is the man who goes on holiday with his family and who cannot afford to stay in a boarding house or an hotel and who cannot afford a caravan. These are not the people who can be accused of wasteful spending. Are these the people to whom the hon. the Minister of Finance appealed when he said: “For the first time since the War years, South Africa is beset by serious economic problems, and the man in the street will now have to help.”? Obviously he will have to help himself since this Government seems incapable of helping.

This hire purchase affair is just another example of impulsive decision-taking without examining the matter in depth and going into the consequences properly or consulting the people most concerned, in this case the traders and manufacturers. These hit and run tactics just will not work. They are a far cry from getting to the root causes of inflation which lie in the critical shortages of goods and services which, in turn, are a reflection of the shortage of labour in South Africa.

Let us take a few more examples of how this Government is fighting inflation, how it is doing “alles in sy vermoë om stygings tot ’n absolute minimum te beperk en waar moontlik te voorkom”. Let us look at the Post Office. In the beginning of December increases in tariffs amounting to R40 million were announced which would come into operation this year. The public will be paying that extra R40 million, nobody else. Traders, manufacturers and businessmen generally will be paying the bulk and they will pass the increases on to the public. They will pass the increases on to the public as part of their increasing cost structure generally. I know that efforts are being made to improve matters in the Post Office, but how will this R40 million be used when the Post Office, like every other employer of labour, is faced with a shortage of employees and workers? How many men are there in the Post Office today who have been without leave for four or more years? How many already work all the overtime that a man is capable of working? Can the Post Office expect an increase in services to compensate for the rise in costs? If it is going to spend this money internally, without a very appreciable increase in services, the effect must then be inflationary. Look what is happening. One large company expects its Post Office accounts to go up by R30,000 per year. Department stores estimate that their phone costs will rise by 20 per cent and postal charges by 33 per cent. The Handelsinstituut was amongst those who reacted immediately and averred that the increase in Post Office tariffs would contribute to further rises in the cost structure of the private sector and would speed up inflation. This is how we combat inflation !

Let us have a look at another brick on the tower of inflation, namely the changeover to metrication. Was there any attempts on the part of the Government to plan ahead in such a way that this change-over was to be made as painless as possible to the public? We read that a Metrication Board spokesman has “strongly hinted” that price control will introduced if there is sufficient public protest about unfair metrication prices. Would it not have been more sensible and less costly all round to have given the guide lines beforehand, to have consulted with manufacturers and traders more fully and to have made it clear, even by passing prior legislation where necessary, that there would be prosecution for anyone who did not abide by the rules of the game? I do not for a moment suggest commerce is out to rook the public, but this change-over to metrication is a very complicated affair for everybody, and only the fullest consultation over many months and proper preparation in advance could have avoided the snags that are being run into here and the inflationary effect of what has been happening. There have already been reports in the Press that half a litre of milk, or 88 per cent of a pint, is being sold for the same price as a pint was sold before, although it is 12 per cent less. Half a litre of oil is being sold in some garages for 25 cents, where the price for a pint was 20 cents before. In spite of this forecast by the Metrication Board spokesman, the Price Control Board says that it is powerless to stop traders from exploiting the public if and when this occurs. It has no control over a range of basic foods including milk, butter, cheese, etc., maize produce and motor oil. The Board states that many items have prices controlled by various produce boards and that complaints should be made to them. Complaints were made to the Milk Board, and they replied that they had no powers and could do nothing about it. Perhaps the Dairy Industry Control Board should have stepped in this regard.

The Government has always prided itself on being the champion of the small man and has never hesitated to introduce Draconian measures to interfere with the most intimate affairs of the businessman, even down to the question whether he can have a single extra Bantu employee. It has even come out strongly on the side of the café owner, in defence of the small trader, when it came to competitive reductions as regards bread prices. But it apparently never entered its head to plan for metrication in advance so that its own Price Control Board is now in the position that it is powerless to act in defence of the consumer months after metrication had been introduced.

I want to give a third example of how we are fighting inflation. I want you to look with me at the question of motoring in South Africa, not just for private use, but as a factor in business, the costs of which are passed on to the consumer because of the delivery of goods. Now what is happening? First of all, the third phase of the local content programme came into operation on the 1st of January this year. Without doubt that is going to put up the cost of all cars. We have already heard from the Ford Company that increases will be from R90 to R250 on the various models. Would it not have been wise to wait, in view of the danger of inflation at the present time? Secondly, there is an increase in car insurance rates. There was an increase of 20 per cent in Johannesburg and a rise in other centres, although not exactly similar. There was a second rise in one year. There was a rise of 10 per cent less than a year ago. Running costs are going up everywhere. What has the Government done to ensure that that rise was justified? They know very well that the tariff companies fix their rates of insurance by mutual agreement. Has the Government looked into the question to decide whether that was justified? The insurance people say that these rises are due to the ever-increasing cost of car repairs due to the shortage of labour in the motorcar industry. Well, there is no doubt about there being a labour shortage. Everybody who has anything to do with the motorcar industry are up against that labour shortage every day of their lives. What is being done about it? Undoubtedly there is going to be a further increase in running costs which again will affect the ordinary man in the street through almost everything that is delivered by means of motor transport. Already we have heard about representations for an increase in the price of petrol, although one does not know what is happening to those representations.

What is the next link in the chain with this inflation, with these rising prices going to be? The next link in the chain that is going to strangle our economy is going to be another wave of wage demands, and off we shall go again with increases in the cost of repairs, spares, insurance and of everything we eat, wear or use—without one step having been taken by this Government to get to the root causes of the problems with which we are faced in South Africa, namely the shortage of labour artificially induced by the Government.

Why is there this price explosion in South Africa? And why has it taken this particular form? I believe there are four reasons for that, four rather interesting reasons, four factors which make heavy demands upon the supply of manpower available.

First of all there was the policy of the Government in regard to import replacement; then the manner in which it used exchange and import control; and then the high level of Government spending.

Import replacement, as hon. members know, means to manufacture at home what was formerly imported—in this instance essential commodities and strategic materials. Import control meant cutting off the purchase of a wide range of products from overseas, products that local manufacturers were quick to try to produce locally where they could, to which end they were encouraged by the Government. It has been made easy for them and it means easy money following on restrictions on the outflow of funds out of the country and under conditions where they got very real encouragement from the Government itself.

Then, the Government went on a lavish spending spree and this, together with these other factors resulted in an unprecedented demand on our local resources of men and material. At no stage, however, did the Government give adequate thought to how it is going to meet this demand for labour. I say “adequate thought” because its Department of Planning year after year produced economic development programmes that forecast White labour shortages and the increasing use that would have to be made of non-White labour if production targets were to be met. But where in its political thinking or practical planning did the Government ever really take note of this, except the Minister of Transport? He sent people round to see how he could regrade the White men into different jobs and to use non-Whites for the work those Whites were doing before. Sir, the Government was far too busy blue-printing separate development to get down and go into this matter at all. It forgot, for instance, that the factories to produce the all South-African motor-car had to be staffed with men with a specialist know-how; they forgot that South African spares would have to be available for the all-South-African car and that garages would need staff to keep that all-South-African car on the road. As we know, you cannot put a garage in a border area just because it would suit Government Bantu policy to do so. They forgot that as the population grows and demand increases, we need engineers, technicians and mechanics coming forward at a rate required to meet the demands of those people. So, what happened? Buildings were put up and factories were constructed; there was an awful lot of talk about greater local production, but the Government forgot the need for the men and women to do the work. Competition for staff, especially for White staff, speeded up at an unprecedented rate. The limited number of White workers went into the attractive jobs. Young people could get well paid work with very little training indeed. As a matter of fact, we reaped our human corn while it was still green on the fields. Soon we started suffering from a shortage of teachers, railwaymen, post office employees, of police and of various other employees in the Civil Service, because they were offered more lucrative employment elsewhere. Many of them were attracted by better paid jobs and as a result the shortage of workers has begun to reach crisis proportions. It is no use blaming the man who changes his job for a better paid one. Even if he stays on in his job it does not mean a single extra worker in employment in South Africa. The result has been a colossal spiralling of wages without putting into production a single extra man. Spiralling wages have meant spiralling costs but still the Government obstinately refuses to take the only remedy, i.e. to use non-White labour in more productive work. Instead of doing that, the Government deals the manufacturer a hefty blow on the jaw with the Physical Planning Act and limits the amount of Bantu labour available to him. We now have the crazy position that the manufacturer can get more Black labour but then he must go to a border area, and the building of new factories in a border area, the making of roads, water reticulation, the supply of electricity and other essential services require more manpower, the very commodity that is in shortest supply at the moment. So the spiral goes on: a greater strain on our labour supplies, greater competition for the limited available labour, greater expense, higher costs, more inflation, more prices rising and a greater burden on that small band of taxpayers—the 8 per cent of whom I talked earlier. Bantustan and border development is an expensive item. Who has to pay? It is the White taxpayer who has to pay because while the non-White is not doing more productive work he cannot be a very real contributor towards the tax burden in South Africa.

In this atmosphere of uncertainty which the Government has created, created by its own arbitrary interference in the lives of businessmen for ideological reasons, South Africa’s entrepreneurs have not been so eager to produce or to invest in the manufacturing industry. The result is that a lower physical volume of goods is being produced than that which could have been produced had there not been that interference.

What is the next chapter in the story?— the easing of import control to meet high consumer demand for scarce goods and also because GATT disapproved of import control when our balance of payments did not make it necessary. The result has been a soaring bill for imports with the dream of self-sufficiency just a fantasy. Worse than that, our exports are, as a result of local inflation and rising costs, in many cases being priced out of world markets and we face the prospect that our relative income from exports will stagnate indefinitely unless there is a radical change in internal policy. I believe this picture is frightening. Our economy is heavily overhung with the burden of galloping costs and prices and all we have to support our economy in these difficult circumstances is this small band of skilled White men and women, far too few for the jobs that are available and nearly all of them having to work far too hard, having to work overtime, and many of them being pushed into jobs for which they are not properly trained or which are unsuitable for them. I know there are some White workers who see advantages in the shortage of labour because it means they can earn higher salaries. But these advantages are shortlived because inflation is such that what they can buy with those higher salaries is declining day by day. The result is that they are no better off then they were before. And this Government, shackled and crippled with its own ideological policies, is quite incapable of finding the solution. It is being forced to try to tackle this problem by forcing down our standards of living, by trying to curb our spending, by taxing us more heavily, by limiting our credit, instead of applying the one remedy that really could cure our ills, i.e. the better use of the labour resources available to it. You see. Sir, it has to live in a situation where high salaries and good wages are whittled away and the savings of the people are threatened by an ever-increasing decline in the value of our money. I believe that if South Africa is to be saved from an economic disaster it has got to take the first essential step, and this is to get rid of this Government! We have got to give our economy hope. As things are there is no hope for relief from increasing inflation except perhaps if we have a recession or an economic collapse, something none of us would like to see. Sir, it is not as though the Government have not been warned. We on this side of the House foresaw what was going to happen. There are thousands of words recorded in Hansard of our warnings to this Government as to what was going to happen. Now, Sir, we are joined in our view by economists of every political persuasion in South Africa. We have recently been vindicated by the Reserve Bank itself. In its latest report the Reserve Bank unequivocally admits that labour shortages continue to be the prime cause of South Africa’s high level of inflation. While the Government wants to tax us and restrict us and deprive us of the fruits of our industry the labour shortage continues to grow. Recent surveys by the Federated Chamber of Industries and by Assocom have shown that industry and commerce are short of over 100,000 employees at the present time. That is their shortage of labour. Add to that the shortage in the professions, in the civil service, in the construction industries and in mining and you will get some idea as to how serious this crisis can become.

Sir, employers are not only short of workers but they are worried about the productivity of their workers. There is a decline in the performance of their workers through no fault of their own. Employers talk to you about the time wasted in disentangling the red tape to get employees, particularly Bantu employees. They complain of the time and energy that senior staff and management have to devote to the solution of manpower difficulties. They complain, Sir, about loss of production because of the worries that non-White staff have about medical and educational costs. They tell us of the losses they suffer because of inadequate transport facilities for their staff and for their workers in many areas of South Africa. Sir, all responsible entrepreneurs are now joining us in calling upon the Government to change its outlook. The Afrikaanse Handelsinstituut is demanding that the Government should take effective steps to come to grips with the country’s labour shortage and they see only one solution: Greater use of non-White workers to overcome the White labour shortage.

What does the hon. member for South Coast say about that?

Dr. Jan Hupkes, manager of Federale Volksbeleggings, tells the Government that job opportunities have to be created for non-Whites because the White labour force cannot sustain our growth even with 30,000 immigrants a year. Then you have the Bureau of Economic Research at Stellenbosch University which warns us that were it not that job reservation was being circumvented on a large scale, conditions in the building industry, for example, would be even more critical than they are. It is only because South African industry is being forced into dishonest practices and into subterfuges to break the law that production is not being brought to a standstill. Everywhere job reservation laws and conventions are being flouted and the Government seems powerless to act. But the result is that young White people are not encouraged to go into jobs which are reserved for them but which at the moment are being done illegally by non-Whites at wages on which the Whites could never hope to compete. Only in December of last year, Sir, we read the judgment of a Germiston magistrate who convicted a company and its directors in a test case of great importance to the Industrial Council. There a Rand steel firm and its directors were convicted for using non-Whites as moulders, jobs which they were not allowed to do as they could not be members of a trade union. Sir, what did he do? He was obviously unhappy but he had to apply the law. He spoke of the sociological and economic aspects of the problem which had to be considered. He warned that the company employed more than 300 men, most of whom had families and he spoke of the sociological effects of the business having to close down owing to a shortage of labour and pointed out what the results would be. He then imposed the extraordinary light fine of R50 on the company and cautioned and discharged the director. Sir, I do not think that I am exaggerating when I say that there must be a thousand factories in South Africa today that would have to close down tomorrow and put their White and non-White staff out of employment if their illegally employed Black workers were removed from them. That is the situation in our manufacturing industry in South Africa at the present time.

These are the problems we face, and these are the problems in respect of which we want an answer from this Cabinet. But, Sir, if we listen to hon. gentlemen opposite, they seem blissfully unaware of what is going on. They give the impression of being visitors from some distant planet …

They should go back there.

They have no idea of what is going on in South Africa; they are totally ignorant of our day-to-day problems and how to keep South Africa running in such a way that its people can enjoy life under conditions of economic security, knowing that as the country prospers, so their standards will rise. In these circumstances, what do we get? We get an announcement from the Deputy Minister of Bantu Administration and Development in a pre-election speech in October, that the Government would follow policies that would make Black labour scarce in South Africa. Sir, in this day and age this is the policy of the hon. gentleman—to make Black labour scarce in South Africa, artificially scarce. It is not that that labour is not there and available. No, Sir, it is going to be made scarce by the policies of this Government.

We all know that the Bantu homelands have to be developed, but what must we think of the irresponsible relish with which this Minister of the Cabinet talks about the growing shortage of Bantu labour in the economy of this country. For whom are they talking, Sir? Are they talking for the men and women whose factories will be brought to a standstill if Bantu labour becomes scarce and is not available? What do they think is going to happen to the economic development of the country? I have said before, Sir, that these problems call for an answer and the Cabinet must give the answer. But no sooner does one Minister open his mouth than he is contradicted by another Minister. The Minister of Finance had the experience last year when he suggested a dialogue with industrialists in order to try to find a solution to their labour problem. In no time he was jumped on by the Minister of Bantu Administration and Development and the Minister of Labour. What has happened to this dialogue; how far have we got? Then, Sir, you get some Ministers who say, “Don’t ask me; I have not been here long and cannot be expected to know”, as the Minister of Coloured Affairs did when he was questioned on policy last year.

Sir, this Government managed to govern South Africa when things went well, before the consequences of their policies began to be felt and began to hit the country. They got along quite happily until their own ideology started hitting the people of South Africa. They may have scored great success in seeking to sustain the bitterness of the Boer War and the events of past history, but when it comes to running the most modern, fastest developing industrial state in Africa, they are abject failures. Even a cursory examination of the racial constitution of our labour force reveals that the tide is running against this Government at an ever increasing rate in so far as their efforts to limit the use of non-white labour are concerned. Take the last 10-year period. What is revealed by the figures? First of all, the number of Whites in employment has increased by 30 per cent, but in the same period the number of non-Whites increased by 45 per cent. Do you realize, Sir, that in the last 10 years the increase of non-Whites in employment—the increase alone—equals the total number of Whites who are in employment? In the manufacturing industry generally—that is all manufacturing industries in South Africa—over the last 10 years there has been an increase of 67,000 Whites, but do you know what the increase was in the number of non-Whites? It was 450,000 in the same period. Clearly the Government has not been making any progress towards achieving its admitted objectives.

No, what the Government has achieved is something quite different. It has hindered the development of the country with its red tape, with its impossible regulations and with its delaying tactics. It has created a state of uncertainty as to the availability of labour and the work for which it can be used, which has made planning ahead a nightmare for the financier and the industrialist. It has stifled proper training courses and systems for almost two-thirds of our employees in South Africa because of the job insecurity that exists. It has done even more than that. It has ensured that our labour force will never be able to achieve that standard of efficiency which is necessary for us to compete in world markets and it has created a labour shortage which is purely artificial.

In fact, today the whole of our economy seems to be based on exemptions and evasions of the existing laws, exemptions which are contrary to Government policy and evasions which are all too often a result of connivance with industrialists to evade the Government’s own laws. Sir, the whole thing smells of political dishonesty and spells disaster for the South African economy. It is obvious that while this sort of thing goes on we will never be able to achieve our full economic potential or the maximum growth rate of which we are capable and everything that goes with that. We shall always be battling against a rate of inflation which we, of all countries in the world, are best able to contain because of our untapped labour supplies in this country.

Sir. I know there are those who are afraid of high growth rates, but I would remind them that it is upon our growth rate that our future security depends and it is upon our growth rate also that our advance to a more compassionate society and the realization of our common destiny will depend. I want to say here and now that this is not just the usual conventional no-confidence motion. I believe the people of South Africa have had enough of the consequences of mismanagement and of arrogant bungling on the part of this Government and the chase after false gods, which is one of the causes of it. Some years ago when this Government was still puffed up with the nebulous political fantasy of separate development, our then Minister of Economic Affairs, now the Minister of Finance, said he was prepared to bend the economy to reach his objective. Well, he has achieved one objective; he has bent the economy all right. Like the strong man in the circus, it will require a great deal more strength and much more know-how to get it straight again once he has bent it.

That is what we are up against, and I believe that this country can no longer afford this Government, neither its businessmen, its workers, its middle income family men and, above all, not the pensioner and the poor people in South Africa. In the name of all who believe that South Africa’s prospects for greater growth, prosperity and happiness are being ravaged by this Government, I move the motion standing in my name—That this House has no confidence in the Government.

Mr. Speaker, if one did not know parliamentary procedure and did not know the Opposition sitting on that side of the House, one would have said that this is a ridiculous motion and that these are ridiculous arguments. Despite all these circumstances I must, in fact, still arrive at the conclusion that this is a ridiculous motion and that the arguments advanced really are silly ones. The hon. the Leader of the Opposition started by referring to the two elections held last year. At these two elections the Opposition, like people wandering about in a desert, saw an oasis ahead. Now, because of thirst, for some water, they have completely lost their balance and heads. This election was fought by this side of the House against foreign elements present in our national economy. One would have said that in the course of that process it was the task of the Opposition to help us, but they did not do so. They were political vultures. They perched themselves on the branches of the bare trees in the political desert so as to see whether there was anything for them to prey on.

I do not want to suggest that the National Party did not have any problems at the elections, for we did have our problems. However, today we are sitting in this House with 117 members as against a meagre 48 on their side. Yet the Leader of the Opposition has come forward with a motion that this House has no confidence in the Government. It is strange enough that he should come forward with such a motion, but his motivation with reference to the election held last year, is even stranger. He did not use one single word to motivate the premise that one single voter who went to the polls last year, had cast his vote this way or that way because he had gained confidence in the United Party. What was his motivation? His only motivation was that of a political vulture, i.e. that dissatisfaction was brewing against the National Party. I am now waiting for him or any of the members on that side to try to prove to us that the electorate outside have gained confidence in the United Party.

It is not their popularity which has in any way done any damage to the National Party at the elections last year. It is circumstances that prevailed and the struggle waged by this Party which probably gave rise to it. I accept the word of the Leader of the Opposition, i.e. that there has not been any increase in confidence in the United Party. In regard to the criticism which he raised here today in respect of both economic matters and price increases, I should like to ask the Leader of the Opposition at this stage what country in the world there is today against which he could not level the same criticism. The hon. member for Parktown will discuss this matter with me later on. I also want to ask him this question: What country in the world can you mention against which the same criticism in respect of price increases, to which the Leader of the Opposition referred again today, cannot be levelled?

Mr. Speaker, at this stage I do not wish to discuss the fishing industry, nor the Immorality Act. The Leader of the Opposition mentioned these things in passing. I assume that other hon. members will discuss these matters later on when they will be dealt with. I should like to say a few words about the economic circumstances, to which the Leader of the Opposition referred. He started by saying that it was the middle-income group that was suffering hardship today as a result of the economic circumstances for which this Government is responsible. I want to tell him now—and in the course of my speech I shall prove it—that that middle-income group are much better off today, with the money they earn, than they were at any time in the past, and are so much better off than they were under United Party rule. The hon. the Leader of the Opposition referred here to a speech in which I had said that “it softens the under-belly of the nation”, Then he sneeringly said that I was supposedly doing so well for myself and that I had no conscience or feeling for the people. My comment to that was: “I know them better than you do.” Mr. Speaker, I was not born in the shadow of Table Mountain with a Sir as my father. [Interjections.]

I may tell him that I was not born rich. I was born poor and I grew up poor. I did not matriculate at school. I did not have the privilege of going to Oxford, as he did. These are my people. These are the people with whom I have lived and grew up. I have not been sitting on soft chairs all my life, where everything was fetched and carried for me. I started working on the Railways when the United Party was in power, and I earned 4d. an hour. My wages were 2s. 8d. a day during my first year. Three pounds a month, that is what I earned. Now that hon. Leader of the Opposition, the rich Sir De Villiers Graaff, wants to reproach me with having no feeling for those people and not sharing their weal and woe. I am convinced that I and most hon. members on this side of the House are, with the experience we have gained, in a much better position to live with the middle-income group to which he referred, and to share their lot with them. But it is because this Government knows the lot of the poor man and the middle-class man and shares it with them that it has been in power for as long as 23 years. Because it has always been this party that has kept in touch with those people and alleviated their grief for them wherever it was at all possible to do so, we have remained in power for all these years. For that reason we shall be in power in the years that lie ahead.

The hon. the Leader spoke here of a house costing R20,000. He spoke of a seaside holiday costing R200 a week. This merely goes to prove to me how out of touch he is with the man in the street. He thinks in terms of his rich standards. He does not know how those people live. He does not know that the middle-income group do not buy houses costing R20,000 each. He does not know that they cannot stay in hotels at seaside resorts where they have to pay R200 a week. This is simply not being done by members of the middle-income group. Now he is trying to pass the circumstances of the more well-to-do onto the backs of the less well-to-do to whom he is referring.

The hon. the Leader of the Opposition said: “We must create more jobs.” Up to now the complaint has been that there are not enough jobs, and today this is the complaint again. Time and again he has said, “we must create more jobs”, and if it is now the complaint of the hon. the Leader of the Opposition that manpower is in short supply, why then does he want more jobs? That is the silly kind of argument we have had to listen to today. With great ostentation and sacrifice the hon. the Leader succeeded today in speaking for just over an hour. He used these hollow arguments whilst claiming that there were a hundred-and-one arguments on the grounds of which they could introduce a motion of no confidence against the Government. If the hon. the Leader does not have better arguments than the ones he advanced today, he should rather abandon the task.

The hon. the Leader spoke about the hire-purchase terms, and although I wanted to discuss this matter later on, I may as well refer to it now. However, before dealing with the hire-purchase terms, I want to refer to his statement in regard to the adjustment of salary scales for public servants. The hon. the Leader of the Opposition said that this Government had the exceptional ability to select dates, before the election dates, on which it could make salary adjustments. That is the statement he made. He said that the Government came forward with its restrictions, such as those in respect of hire-purchase conditions, after the election dates. If the hon. the Leader wishes to cast back his mind to last year, he will remember that last year the hon. the Minister of Transport announced salary adjustments amounting to more than R60 million, after the general election.

Before the Langlaagte election.

*The MINISTER: Hon. members might pay some attention. [Interjections.]

Order! The hon. member for Rosettenville must restrain himself. The hon. the Minister may proceed.

Have the hon. members ever seen anything as childish and silly as this? The hon. the Leader says that the hon. the Minister of Transport now wants to take advantage of the announcements in regard to salary increases by doing so shortly after the general election, but before the Langlaagte by-election. Hon. members will recall that the hon. member for Langlaagte died before the general election. I cannot remember how much time elapsed between the general election and the announcement, but the fact of the matter is that the salary increases were announced shortly after the conclusion of the general election and not before the conclusion of the general election. That was the easiest thing on earth for the hon. the Minister of Transport to do, if he wanted to act the way those hon. members think we want to do.

That is what they will do.

Yes, if the hon. the Minister wanted to do what they think he wanted to do, it would have been the easiest thing in the world for him to announce his increases before the general election. In fact, in the light of circumstances one must accept that those adjustments had already been prepared before the general election. Now the hon. the Leader goes on with his attack, but I want to remind him that substantial increases in the salaries of public servants were introduced after the provincial election. What does he have to say about that? There is probably no need for us to elaborate on this matter. It is the biggest nonsense out.

These hire-purchase conditions were put into operation at a stage when the Government felt that they were essential because there was such excessive spending on unnecessary and durable goods. At the time the Government felt that it was desirable that hire-purchase conditions be introduced. I readily grant that we had no previous experience of these hire-purchase conditions, and that from the nature of the case it was difficult to anticipate precisely what the effect of these provisions would be. They were made to apply to durable articles, to non-essentials, and subsequently it did in fact become evident that they were hitting certain articles too hard. Consequently we were obliged later on to give some relief again. The Bureau for Economic Research of the University of Stellenbosch referred to this matter, and their views on the matter differ from those held by the hon. the Leader. The Bureau referred to various factors in our economy and said (translation)—

This is not what I say. This is what the Bureau for Economic Research at Stellen bosch has to say. In other words, these hire-purchase measures which the hon. the Leader criticized here today, were successful. Then he came forward with yet another silly argument. He said that these measures had been made applicable to tents, but not to caravans. He said that a caravan was more of a luxury article than a tent is. This once again goes to show how wide a gap there is between the hon. the Leader’s way of life and that of members of the public. Does he not realize that there are literally thousands of people in South Africa who are using caravans as homes?

Where?

For a moment I thought that hon. members opposite were just as ignorant as their Leader is. Tens of thousands of people in our country are using caravans as homes today.

Why?

Because many prefer it that way. [Laughter.] That hollow laughter on the part of hon. members opposite once again proves how out of touch they are with reality. I can show hon. members many places where people prefer caravans. At other places people are living in caravans because they cannot obtain the necessary housing at the places where they work.

I should like to use the time at my disposal for the purpose of elaborating a little on the economic conditions in South Africa and, especially, also on how we are affected by the rest of the world. The hon. the Leader of the Opposition predicted that this would be one of our arguments, because it is indeed a very good argument. The high growth rate experienced in the world and also in South Africa in recent times, has become a status symbol with many people. In many countries of the world it is large airports or factories which have to provide them with these status symbols. This excessive spending and expansion merely for the sake of status has harmed many countries and may in fact lead to such a country becoming bankrupt.

The growth potential of every country is determined by its resources. The four most important resources which I should like to mention here, are the entrepreneuring skill, labour, investment capital and the production potential of the soil, i.e. the availability of land, water, minerals, etc.

It goes without saying that a country may be poor in one or more of these four essential resources I mentioned. One could compare it with the proverbial chain. A chain is in actual fact only as strong as its weakest link. By the same token the growth potential of a country is certainly comparable with the weakest resources it has at its disposal. To me it is an indisputable fact that there are serious consequences in store for a country if it tries to grow faster than it is capable of doing. I think one of the arguments which was advanced by the Leader of the Opposition last year, and which was once again advanced here to-day, is that our growth is too slow. We must grow faster. I shall tell him later on why I think that his theory in that respect is quite wrong. One might just as well say that one should try to fly higher than one’s wings can carry one, or that an athlete is trying to run faster than his ability permits. A motor car is made to perform a certain kind of work, but now it is to be used for heavier work. Something will seize up. Something will go wrong. It will become over-heated. In the same manner the growth rate of the economy of a country is limited by the resources on which it is to subsist. If one tries to go faster than that, something will go wrong. There is a certain pressure on the various resources, and as a result it is an indisputable fact that price increases will take place. There is an unbalanced utilization both of these particular resources and of the production means. The end product is a chronic balance of payments problem developing as a result.

South Africa is particularly rich in natural resources. But at present we are experiencing—and that is indeed the case in South Africa; this will not be disputed— a scarcity of capital. Capital is a limiting factor, both here and throughout the world to-day. In South Africa, too, we have, relatively speaking, a scarcity of entrepreneuring skill and skilled labour. It is no use talking about unskilled labour and the large numbers of non-Whites whom we are to make available to the economy and industry, for these large numbers of unskilled labourers cannot become productive without entrepreneuring skill. They cannot become productive if the capital which the entrepreneuring skill is to utilize, is lacking. They cannot become productive if the skilled labourers are not present to supervise the unskilled labourers. The hon. the Leader of the Opposition would like to have an unrestricted influx of unskilled Bantu. I know he said that it should not be entirely unrestricted, and that there had to be a measure of restriction, but the measure of restriction he has in mind is so slight that for all practical purposes it will be virtually unrestricted.

He was referring to the more effective utilization thereof.

Yes, but all afternoon he spoke about a more generous influx of non-White labour and about such labour being made available on a more generous scale. Sir, surely we know only too well that this would only lead to social and industrial unrest. Social problems and unrest on the labour market will upset our labour, and cause economic bottlenecks which we do not have to-day. These things will result in our production being hampered and our growth rate being restrained. The Government has geared itself for making use of non-White labour in as far as it is necessary to do so. That is why it is striving for decentralization and moving industries to the border areas. This is a sober utilization of the available unskilled labour in South Africa; this is how we can use the unskilled labour in South Africa and how we can increase our growth rate with our unskilled labour. However, it stands to reason that this endeavour of the Government towards decentralization cannot be fulfilled overnight. Last year the hon. the Minister of Finance made a commendable effort by announcing here that discussions would be held with industrialists. In fact, I think we have already made it clear here that discussions will be held with industrialists in an attempt at encouraging them to a greater extent to go to the border areas so that the labour at present being used by those transferable industries may be made available in the metropolitan areas. Now, I must admit that no matter how commendable the attempt made by the Minister of Finance may be, this may perhaps lead to a delay in our decentralization programme in view of the fact that industrialists who were in the process of moving, sat back for a while so as to see what was going to happen now. But the whole matter is being investigated, and once these investigations have been completed, I believe that we shall have more success with the moving of industries to the border areas. In South Africa we have an Economic Advisory Council, on which some of our best financiers and economists are serving. They meet every three months, and from time to time they work out a development programme for South Africa, which they then submit to the Government. In this manner they submitted a programme for the years 1964 to 1975, and after carefully analyzing all of our available resources of growth, this Advisory Council decided that a growth rate of 5½ per cent was a sound one for South Africa …

Regard being had to Government policy!

… and not 10 per cent as the hon. the Leader of the Opposition wants to have. If we could grow at the rate of 5½ per cent, we would have no undesirable pressure on our available means of growth; it would not upset our resources. Regard must be had to all relevant factors, including the large-scale employment of Bantu in industry, especially in the metropolitan areas to which the Leader of the Opposition referred. In spite of the fact that it is the right of the hon. the Leader of the Opposition to criticize, I do think that he should also display a sense of responsibility and appreciate that the growth rate worked out for South Africa, was worked out by the best brains at our disposal, and that any deviation from that rate will not hold any advantages for South Africa, but in fact disturbances.

Now let us see what has happened to our growth rate in practice. As I have said, we set ourselves the task of maintaining a growth rate of 5½ per cent. Since 1964 we have had, with a few exceptions, a growth rate higher than one of 5½ per cent. In fact, the year before last I think it was 7.6 per cent—in other words, we grew faster than our means actually permit us to do; we flew higher than our wings could carry us. And what was the result? Let me say here that if we accepted the proposal of the Leader of the Opposition and made a growth rate of 10 per cent our object, the consequences would have been much worse than they are at present. The problems we are experiencing now, are a direct result of growing at too fast a rate, in spite of our attempt at maintaining a growth rate of only 51 per cent. The pressure on our available means was too strong—for instance, on our entrepreneuring skill, on all classes of labour and on our investment capital. The demand for these things exceeded the supply, and consequently their prices increased. When demand exceeds supply, it goes without saying that there is an increase in wages and salaries, and if more capital is asked for than is available, it means that there is a rise in interest rates—in other words, capital becomes more expensive. As a very result of our growth having been too fast since the year 1964, the demand became too great for the supply, and because of that we have been experiencing the adverse effects which would be much more harmful to us if we were to accept the proposal made by the Leader of the Opposition. This increased growth rate has also resulted in an increase in production costs, for if there is an increase in salaries and wages and in interest rates, there is an increase in production costs as well. Owing to the increased demand for labour there has even been a decline in the productivity of workers. Higher income has created a higher degree of prosperity, and a sharp increase in the demand for consumer goods has taken place. There has therefore been a higher level of consumer spending as a result of this higher growth rate which we have had. We have also had a further increase in prices and an increase in the demand for imported goods, and as a result of these factors our balance of payments has been under pressure, the result being a sharp decline in our foreign reserves. All of this has happened as a direct result of the fact that South Africa’s economic growth has been too fast for the resources at its disposal. The fact that we have had all of these adverse effects, is attributable to the ideal growth rate of 5½ per cent having been exceeded and, consequently, not being in keeping with the available sources of production.

The hon. the Leader of the Opposition has asked us to-day to make available more Bantu to industry, and has said that our growth rate is too low. We must bear in mind that if we wish to increase our production capacity, we need foreign exchange to do so. If we are to grow at a faster rate and we want to expand our industries, we must import more to be able to do so. A large part of it has to be imported. Then there is an increased demand for basic services, and capital is needed for the infrastructure. I think the hon. the Leader of the Opposition should also give us a reply to these questions when he merely asks for a faster growth rate and for Bantu to be employed more freely in South Africa, or rather on a much freer basis. Then he should tell us how we are to do it. All he could do, as it probably behoves a leader of an opposition, was to criticize, to try to disparage, without suggesting anything as an alternative. As long as a leader and a party do this, they cannot come into power.

As regards the rate of inflation, and the price increases referred to by the hon. the Leader of the Opposition go hand in hand with it, since the last World War inflation has been experienced to a lesser or greater degree in virtually all the countries of the world. World experts have tried to find a joint solution to this problem of inflation, wherever it occurs, but without any substantial success. But in any country where there is a free market, and especially if it is a growing and developing country, it is basically impossible to eliminate inflation completely, and that is why it is being accepted internationally that in a growing country a rate of inflation of between 2 per cent and 2½ per cent is a reasonable and moderate one. If we do not want any inflation, we must stagnate, and, surely, stagnation is something we do not want. If we do not want stagnation, if we want to grow economically, we must expect there to be some inflation. That is why I say that in terms of international standards inflation at the rate of between 2 per cent and 2½ per cent is accepted as being moderate. In most countries of the world it is much higher. Up to now South Africa has succeeded in keeping very dost to that mark. Last year, this I must admit, the rate of inflation was higher than it had been in previous years. According to our calculations it was in the region of 4.6 per cent last year. At the moment we have reached a stage where we have not only cost inflation, but also demand inflation. There have been sharp increases in the production costs as a result of rising prices of machinery, equipment, raw materials for industry, wages and salaries and services. There are many cases where prices are being controlled. At this stage I want to say that all prices are not being controlled. It is impossible to control all prices. If we were to try to control all prices, it would mean that we would also have to control wages and salaries. In the circumstances only a small number of prices are being controlled in South Africa, but in cases where we do control prices, we are often confronted with circumstances making it simply impossible to prevent price increases. We have demand inflation because of the increased level of consumer income. People are earning more, the “poor people” to whom the hon. the Leader of the Opposition referred, and because of their earning more there is a higher rate of spending and there is a favourable opportunity for commerce to increase prices. At this stage I want to say—and I do not want this to be regarded as criticism against the commercial sector—that wherever money is available, wherever a higher income is to be found, one also finds a certain insensitiveness with the person who buys, a certain indifference, so to speak, as to what he buys and what he pays for it. The result is that to a large extent the competitive factor amongst dealers is being eliminated. The main prices increases last year occurred in food, house-ownership costs, servants’ wages and medical expenses. In the other sections the price increases were very slight, or, at least, considerably smaller. I may just refer to the increases in food prices. The increases in this respect were largely attributable to climatic conditions. In November last year vegetables, for instance, were terribly expensive; at that stage there was a tremendous increase in the price of vegetables, but since then, because of the rains, vegetables have become cheap once again and the position has stabilized itself, and at present the position in respect of vegetables is quite different.

As I have said, there has been an increase in the price of imports. To a large extent we are dependent upon imports. Approximately 22 per cent of the expenditure on the gross domestic product is on imported goods. Prices have not increased overseas only. The hon. the Leader of the Opposition said one thing which is true, i.e. that over the past few years the actual price of imported goods has shown a slightly smaller increase than has the price of domestic goods—the difference is admittedly a very slight one, but I am making this admission if it will console him. The price of imported goods has shown a slightly smaller increase than has the price of South African goods. We are, to a large extent, dependent upon imports from countries abroad. As regards prices, we are dependent upon freight charges; we are dependent upon the international price of oil; in addition there are insurance, dock charges and agency fees, which have gone up. These are world circumstances over which we have no control whatever. Take crude oil as an example. We have heard that the oil-producing countries of the world are meeting in order to determine a higher price for their crude oil. We have no say in that matter. These are world circumstances with which we have to contend and for which we can at least not be blamed, even if the hon. the Leader of the Opposition were to try to blame us for the other matters. Sir, it is easy for the Opposition to criticize. The Government has already taken measures which are internationally accepted as being the best methods. The fundamental causes of price increases and a high rate of inflation are, inter alia, that the production of goods and services is inadequate on the one hand and, on the other hand, that there is an excessive demand for goods and services. The measures taken by the Government in the past for the purpose of coping with this situation are aimed, in the first place, at increasing the supply of goods and services—in other words, at making available more goods so that the demand may not exceed the supply—and, in the second place, at curbing excessive demand. There are differences of opinion in this regard. In recent times authorities have been writing about which is the better: increasing supplies or curbing the demand. Sir, the Government did not do one thing and omit to do the other. In regard to increasing the supply of goods and services, the Government has, inter alia, done the following: Import control has been relaxed so that more goods may enter the country and be available to the people who want to buy; comprehensive systems of training facilities have been introduced; the immigration of skilled labourers is a deliberate policy of the Government; industrial decentralization is being encouraged in order to encourage production in under-developed parts of the country, and the infra-structure of the country has been expanded so as to meet the essential requirements of the country. The Government has established a productivity council, which was enlarged recently, to see to what extent we can improve our productivity. In order to curb the excessive demand, the Government has done various things. The bank rate was raised on various occasions, where necessary; measures were introduced for the purpose of encouraging savings, so that, on the one hand, the consumer demand might be curbed, and, on the other hand, the investment money being saved might be used for more productive purposes. In addition, a ceiling was placed on bank credit and the liquidity requirements of monetary banks were raised. The Government financed its own expenditure in an anti-inflationary manner. The hire-purchase conditions for durable goods, to which I referred a moment ago, were introduced. Over and above these things, the Government has also taken various other measures to cope with and check inflation. To what extent have we been successful? If we look at the consumer index, we find that in 1960 it stood at 102.8, taking 1958 as the basis year. In October, 1970, it was 136.9, i.e. over a period of 11 years it was 34.1. Therefore, the annual increase was approximately 3 per cent, as compared with the internationally accepted increase of approximately 2 to 2½ per cent in an economically growing country. That is why I think that we can be satisfied that this 3 per cent is not far off the mark recognized internationally. In contrast to this our average growth rate over the same period was approximately 6 per cent per year. As regards the growth rate, I have no international norm, as in fact I had in connection with the price increases. I think that our growth rate of 6 per cent per year may also be regarded as being very satisfactory, and it definitely compares very favourably with comparable countries in the world.

Now I want to take a look at the percentage increases of the consumer index in South Africa as compared with those of other countries in the world. I have before me a short list, from which I want to mention a few. There are 13 countries in respect of which the percentage increases in 1968, 1969 and 1970 are being furnished, as well as the average over these three years. Amongst these 13 countries there are only three that have done better than South Africa. They have only done very slightly better than South Africa.

On what basis did you select them?

I can read out the facts; then you can …

Why did you select those 13?

Because they are the most comparable countries. The countries with the lowest figures, are Switzerland, Germany and Australia. Their averages are 2.8, 2.9 and 3.2. South Africa’s average is 3.4, accepting 5.9 for last year. It is 5.9, because the figures from which I am quoting are not mine, but figures furnished by the International Monetary Fund. As such they are unadjusted figures. According to our calculations our rise in the index amounts to approximately 4.6, but without adjustment I accept that for the purposes of the International Monetary Fund South Africa’s figure is 5.9 for the purposes of my argument. In that case our average is 3.4. In Belgium, Canada, New Zealand, France, the United States of America, the United Kingdom, Japan, Denmark and Brazil the respective figures are higher than that of South Africa. In Brazil the cost increases over the past three years amounted to 24 per cent, 23 per cent and 10.5 per cent.

Mr. Speaker, another thing which I find conspicuous in this list, is the fact that all of these countries showed a sharp rise last year. For instance, Switzerland and Germany, which only had a rise of 1.7 and 1.8 in 1968, had rises of 4.1 and 4.3, respectively, last year. This does in fact appear to me to indicate that last year it was a general trend throughout the world for prices to rise. If we take a look at the United Kingdom, we shall see that the rise over the past three years amounted to 5.2, 5 and 7.1 per cent, respectively. This amounts to an average of 5.8 per cent. How does this compare with the figure of 3.4 per cent in South Africa? I want to refer to a report which appeared in the Cape Times of 27th January; a report in which mention was also made of the increase in costs. The Financial Editor of the Cape Times wrote as follows—

He puts it here at 5 per cent—

And this was indeed the case. It stands to reason that we are concerned about the price increases. Naturally, we should like to keep the prices low. But there is another factor which the Leader of the Opposition forgot, i.e. the increase in income. The hon. the Leader of the Opposition is only concerned about the increase in costs, but he does not mention the increase in income which people have experienced recently. A moment ago I said that our average price increase over the past three years amounted to 3.4 per cent. I accept it as such, according to the figures of the International Monetary Fund. But let us take a look at what the increases in income were in the various industries. I do not want to mention all of them, since time does not permit me to do so. Let us take the South African Railways as an example. In 1968/ 69 there was in the South African Railways an increase in income or in salary in respect of all races amounting to 15.2 per cent. The increase in respect of the salaries of Whites in the Railways in that year amounted to 17 per cent, and that of non-Whites to 12.1 per cent. In 1970 the salary increase in respect of all races amounted to 7.8 per cent; in respect of Whites it amounted to 10 per cent and in respect of the non-Whites to 8.3 per cent.

Let us take the electricity industry as a further example. In that industry there was in 1968/69 an increase of 11.4 per cent in respect of all races. The increase in respect of the Whites was 12.4, and in respect of the Coloureds it was 9 per cent. In 1970 the increase in income in the electricity industry amounted to 17.8 per cent in respect of all races, and 16 per cent in the case of Whites.

I have a long list which I can go through. The only thing this list points to, is that there has been a much more rapid rise in income than in the cost of living. That is all it points to. But I want to go on. During the years 1959 to 1969 the real increase in the income of our entire population amounted to 3.4 per cent per capita per year. In other words, after adjustments had been made in respect of the cost increase, a person was still 3.4 per cent better off annually than he had been before.

Over how many years was that?

Over the period from 1959 to 1969. Now I should like to draw a comparison by going back to the U.P. régime. This 3.4 per cent which I mentioned now, represents the real increase in the annual income of the people. That 3.4 per cent increase may therefore be regarded as the annual percentage rise in the standard of living of our population. If one looks back at what the position was in 1948 and takes the mining and manufacturing industry sectors, one finds that since 1948 the income in mining has shown an increase of 180 per cent and that in respect of the manufacturing industry, 196 per cent. That was the position while the consumer index showed an increase of 95 per cent over the same period. In other words, over this period the income of the mining sector and the manufacturing industry rose twice as fast as did the cost of living. This shows us how much better off our people are today, after 23 years of National Government, with a rise of 3.4 per cent per year in the standard of living. Where on earth would one have it better? Now the hon. the Leader of the Opposition says that we are not concerned about those people. Whether he wants to have it better, I do not know. But I am sure that he will not be able to do it better. This is a feat which the National Government alone can achieve, i.e. to bring about, in 23 years’ time, a rise of 3 to 4 per cent a year in the standard of living.

There are many drastic steps we can take in order to cope with the price index, but some of these proposals are simply impracticable. We cannot put them into practice. That is why I should like to emphasize that a growth rate of 5½ per cent, as was recommended by our Economic Advisory Council, is a good one, and that we should strive after it. I am optimistic, but I also appreciate that there are bottlenecks in our economy. For that reason we request the co-operation of the entire population. In his New Year message the hon. the Prime Minister said that we had to do something. We must be careful, for we are importing too much. We must be more productive. We must save more. Especially in respect of imports we want to try to do something this year. We want to try to make the people conscious of having to buy South African, and we are going to make deliberate efforts in order to prepare the people for this. Imported goods are not necessarily better than goods manufactured in South Africa. Apart from quality, we believe that it is a good thing to manufacture one’s own goods and to buy one’s own goods.

But I want to come back to the hon. the Leader of the Opposition. If I were in his position, I would rather look at my own Party and try to safeguard my own position. If I were in his position, I would look far to the left, politically speaking. Then I would see Japie Basson almost entering the fold of the hon. member for Houghton. That is a better political home for him. If the hon. the Leader would look to the right, once again politically speaking, he would see Douglas Mitchell far to the right, the man who says that a Bantu is too irresponsible to be a ganger. The hon. the Leader should rather consolidate his position in his own Party. The other day I saw a publication, and this is what it said—

[Interjections.] Listen to the rest of it—

That is where the danger lies for the hon. the Leader of the Opposition. He should rather set his own house in order and forget about us. We do not need him. That is why I say: What a silly motion this is!

Mr. Speaker, the hon. the Minister of Economic Affairs has fulfilled our highest expectations in that he has confirmed exactly what the hon. Leader of the Opposition had stated was lacking in the economic policy of the Government. He has fulfilled our highest expectations in that he has confirmed that the economic policy of the Government is lack—lustre, is unconvincing in tone, naive and simple in concept, stumbling and confused in reply, uninspired—in fact, that it consists of a dull and lacking all vision for the future. I say that, Mr. Speaker, because South Africa, at this juncture, stands at the threshold of an entirely new era. We stand in the year 1971, with three decades to go until the end of this century. These three decades will be more important, more vital and more significant for the future of South Africa, for the history of South Africa, than have been the last three centuries. I say this with absolute conviction and I say it because the facts bear me out. If we project the statistics of such institutions as the South African Reserve Bank and the statistics published by the Bureau of Statistics, we find that change during the next 30 years will be more fundamental than it has been in the past three centuries. I want to refer to our population growth as an example. The population of South Africa at the moment is approximately 20 million people. Within 30 years it will rise to something around 45 million people at the present rate of growth. This means that more people will be added to our population in the next 30 years than have been the product of growth over the past three centuries. This means that South Africa will have to produce more incremental goods and services in the next 30 years, will have to learn to become more productive, than over the past three centuries. It is against this challenge and against these problems that we have to consider the economic future of South Africa. It is against this background and in the face of this challenge that we have heard the hon. the Minister of Economic Affairs quote to us a number of facts dredged up from the past, make a number of references to other countries and indulge in a number of side swipes which are really quite irrelevant to the kind of situation with which South Africa is faced.

I would like to remind him in passing in regard to his references to the higher growth rates in other countries, notably Britain, that in Britain in consequence precisely of that economic weakness there was a change of government; and it is precisely in consequence of economic weakness that there will be a change of government in this country also. He also thought it amusing to quote from a magazine about the leadership of the United Party. I would like to remind him that the editor of that magazine is also out of office.

Now what do we find in response to this challenge of the next three decades? All that we have heard is doctrinaire, obsolescent and illusory. In a dynamically changing situation the Government is paralysed by its own dogma. It is unable to move: and here I will give an example which emerged very clearly from the speech by the hon. the Minister of Economic Affairs. He quoted to us the fact that the Economic Advisory Council had recommended a growth rate of 5½ per cent. Now we know very well that the Economic Advisory Council recommended a 5½ per cent growth rate as the maximum ideal obtainable within the present policies of the Nationalist Government. This is the point. What we are saying, and this is the basis of our accusation against the Government, is that the Government is unable to think outside the straitjacket of its own apartheid policies. If it were able to do this, if it were also able to take the Economic Advisory Council out of the similar strait jacket which it imposed upon it in advance, if it allowed the country to advance freely and if it gave the economy a free rein to advance, then the per cent growth rate would no longer be imposed as a maximum, but we would then set our sights rather higher. We would then not have these limitations imposed upon us. The reasons for the failure of the Government to deal with the economy are precisely this obsessive nostalgia and this fixation upon its apartheid policy. It is unable to think outside the straitjacket of this policy. What indeed it is aiming at with its policy is quite clearly to return South Africa to the 19th century. After all, in the 19th century everything was cosy. In the 19th century everybody knew his place. In the 19th century all the races accepted their lot. We did not have any of these haunting fears of integration. We did not have any of these haunting fears of jobs being taken from White men and so forth. All these reactionary fears were then safely tucked away because everybody lived in his own neat part of the world where these problems did not exist. There is a kind of deep nostalgia in the mind of the Government for this kind of 19th century philosophy and it is trying to sweep everybody back to his own corner. Then, of course, all these problems will be tidied up and will no longer exist. If you ask the Government what they will do about the growing population, especially the growing Black population, and how they will be fed and get jobs, they tell you the most extraordinary theoretical stuff about grafting the technology of the 20th century on to the tribal system and the aboriginal customs of the tribes. This makes the most charming reading and I read it with great pleasure myself. But it is really absolute nonsense. It will not work and everybody knows it.

Now we come to the question of inflation. It has been said that inflation can be compared to the temperature of the human body. Just as a high temperature in a human body indicates that there is something wrong, that the body is infected by disease or that the organs are out of gear, so inflation in an economy proves that the economy is out of order. A simple way of treating a patient with a rising temperature is of course to put him in ice. This brings his temperature down. But it is really far wiser to get to the root cause of his temperature and try to cure the disease itself. What I am saying to the Government is that this disease from which the South African economy is suffering is not something which can be cured by temporary measures, by taking a little money out of the economy, by changes in hire purchase regulations, by all these little bits of black magic which come out of the box of the hon. the Minister of Finance. These things are only temporary palliatives. In order to cure the real illness in the South African economic body you have to go down to fundamentals. The argument has been advanced that the South African economy suffers from the effects of an imported disease. I say that the causes of inflation in South Africa are purely endemic and I will go on to show why these endemic causes can only be cured in South Africa by South African means. To try to deal with inflation as though it is something imported, as though it is something for which the South African Government is not responsible, as though it is something which descended from heaven and over which no man has any control, as though it is something that can be magicked away by quoting such figures as we heard a while ago, are only attempts at avoiding the cure to this disease; we are only fooling and misleading ourselves and evading the true situation.

In the years 1959 to 1969 we had a growth in our gross domestic product of about 8.8 per cent per annum. In the years 1968 to 1969 we had a growth rate of 12 per cent. These growth rates were before the apartheid policy of the Government and its labour policy began to bite. In the decade 1959 to 1969 we had a rise in consumer prices of 2.8 per cent per annum and in 1968-’69 we had an increase in consumer prices of 3 per cent. This meant that we had a real gain in the gross domestic product of 5.9 to 6 per cent, and in the year 1968-’69 a real gain of 7.4 per cent. If one can show a net gain in the domestic product in spite of this mild rise in prices, then of course, one is not suffering from inflation, or if one is, from a benign inflation. Then one is, in fact, showing a real gain in the wealth of the country and every South African can go laughing to the bank.

This mild inflation was followed by a sudden rise, which could be described not as a benign inflation, but as a malignant one. It is a malignant inflation in the sense that it is no longer the mere accompaniment of a rapid rise in the economy. It has now become a structural built-in thing, caused by certain basic factors. I would like to show that four of these factors, which I propose to mention, are not factors which were imported. They are factors which are inherent and endemic in South Africa and which can only be cured in South Africa. They cannot be explained away by reference to statistics imported from overseas.

The first one is our labour policy. I do not propose to deal with it at any length, because enough has been said by economists of every shade and colour in this country. It must be obvious to everybody except this Government that the lack of labour and our inability to train labour for the demands of this country, particularly in this growing economic situation, is a serious problem. I said the population was rising from 20 million to 45 million. If we do not train labour and increase our productivity and output of goods, what kind of inflation are we not running into! There will be an ever increasing shortage of goods relative to the demand imposed by this growing population. Labour is absolutely essential. Unless the Government takes an entirely new, radical and fundamental look at this problem, we are really heading for major troubles.

The second point is that of the money supply. It is a fact at the moment that investment in industrial development in this country is 25 per cent below what it needed to maintain growth at 5½ per cent. We on this side do not accept 5½ per cent as the ideal. We recognize it as the maximum permissible within the policy implemented by the Government on the other side. Even at 5½ per cent we are saying that investment in industrial development in this country is 25 per cent below what is needed. This being so, there is no prospect whatsoever of maintaining the rate of 5½ per cent. Capital is as necessary for growth as labour. The hon. the Minister of Finance has taken several short-term measures. These, admittedly, will be effective in taking a little bit of heat out of the economy. But the difficulty about monetary measures to control the flow of money, either the volume or the velocity, or both, is that they are only effective for a short time. If, for example, you impose credit ceilings on banks, the financial institutions very quickly learn new ways of raising money. A grey market begins to flourish, people find new ways of procuring loans. Quite soon one finds that the measures have been defeated. They are only effective on short term.

I also want to deal with the application of hire purchase control. Here I want to say something which I regard as most important. There is in South Africa a city or an urban conglomeration named Soweto. This city happens to be the largest in South Africa. That is not generally known, but it is so. It has the largest population in South Africa. It is probably one of the four or five largest cities in Africa. The Government likes to pretend that it does not exist, but the fact is that it does exist. It contains the industrialized section of the African population. These people are at the moment, I am glad to say, peaceful and stable people. The reason is that they are gainfully employed in Johannesburg. I have looked at these people, I have talked to them, and I know that one of the reasons why they are stable is that they are aspiring to a higher standard of life; they are seeking to improve the quality of their life. They have no capital, therefore the only means they have of improving the quality of their life, of achieving the standards to which they aspire, is by buying their furniture, their kitchen equipment, their housing facilities, by hire-purchase; that is the only means open to them. In consequence of the fact that their little stock-in-trade, their little capital equipment is being accumulated through the hire-purchase system, they are in fact confirmed in their orderliness and in their stability. The husbands go out to work every day; the wives drive them out to work because they must bring a wage packet home; they do not take part in strikes; they do not miss a day at work because they have to bring money home in order to maintain the hire-purchase payments, in order to keep their noses clean and in order to ensure that they will not lose these goods which they are accumulating, that these goods will not be repossessed because of non-payment. Sir, it is a social fact that hire-purchase is a very important stabilizing factor in that kind of community. I say, and the history of South Africa will prove me right, that what is happening in Soweto is ten times more important than what is happening in any homeland, and this will increasingly be proved to be true. Soweto is being helped towards stability by hire-purchase and I say—and I challenge the hon. the Minister of Finance to deny it—that when the hire-purchase terms were changed no thought was given to this aspect of the matter at all, and it is a most important aspect. It is not good enough merely to clamp on financial controls willy-nilly without giving thought to its deep and important social consequences.

Sir, I want to deal with a third factor, which again is an endemic factor; it is not an imported factor any more than the labour situation is an imported factor or monetary control is an imported factor. The third factor that I wish to deal with is the question of delays and inefficiency. If ever there was a cause of inflation it is delays and inefficiency. Let me quote one example. When one looks at the proclamation of townships, one finds that before a man can obtain permission to proceed with the establishment of a township he has to go through a multiplicity of boards; his plans have to be approved many times. There is a complete duplication of activity at every level, and every town developer who has ever attempted such a thing will confirm that this is so, that too much time is spent on duplicating activities and that too much time is wasted. Take the case of a man who is developing a township. He has laid out a great deal of money on the land. It takes him three years of expense, plus interest on that money that he has laid out—three years at a time when it is costing 9 per cent to 10 per cent to borrow money. This means that the expenditure that he incurs may be increased by 30 per cent before he is able to realize anything from his enterprise. Sir, housing is one of the most important factors in the costs of the ordinary man. If you ask any man in the street what is the most important item of expenditure in his own budget he will tell you that it is housing. It is most important, if we want to fight inflation for the sake of the common man, if we want to stop the erosion of the money in his pocket, that we should try to keep the cost of housing down. Here, Sir, is a case where the cost of housing is being increased at the rate which I have indicated purely through the imposition by the Government of a multiplicity of controls and delays which can quite easily put up the initial outlay in building the township by 30 per cent; it raises the cost by 30 per cent and that 30 per cent is passed on to the owner of each house.

Have you read the report of the Niemand Commission?

Yes. Sir, I come now to the last point. I said that I would make four points to prove that inflation in South Africa is essentially endemic, that it is essentially due to South African factors and that it can only be controlled by South African skill and ingenuity.

The last subject is one to which I have referred before in this House. I will refer to it again briefly on this occasion and perhaps come back to it on another occasion because it is of extreme importance. I refer to the export of mineral ores. We are faced in this country with a grave lack of production; we are faced with a grave inbalance of trade; we are faced with the need to import a great deal of goods from abroad. We have an insufficiency of foreign currency to pay for these goods. Sir, nobody in this House would deny the need to export. It is urgent, it is vital. We have examined on a number of occasions the inability of our manufacturing industry to meet this vast trade gap, at least for a very long time. We are aware that it is possible for South Africa to make a major attempt, a successful attempt, to bridge this gap by an expansion of our mineral exports. Why are we not doing this? What are the delays?

First of all we are having this long delay in arriving at a decision on the harbour development around our coasts. At the moment there is simply no decision as yet as to where our harbour development is to take place and as to where our mineral exports are to go. We are waiting for contracts. The hon. the Minister of Transport says that he will not take a decision until these exports are guaranteed by contract. The buyers—the Japanese, Europeans and others—say that they will not enter into a contract with South Africa until they are satisfied that there will be sufficient rail facilities and ports to carry the goods, so we have had the sequence of extraordinary events of one trying to put the chicken before the egg and the other trying to put the egg before the chicken. There was even one marvellous attempt to create a kind of global or interdependent scheme whereby everything was to be hinged together. The problem, of course, is that you cannot sell such a scheme to the Japanese. I know this, Mr. Speaker; I have tried to sell mineral ores to the Japanese, and the simpler you keep the deal the better it is. Without simplicity you simply do not sell anything at all.

Now, Sir, we have reached this position: We can build St. Croix and we can develop Richard’s Bay at a cost of approximately R211 million, and by the year 1980 this will enable us to export ores to the value of over R1,000 million. Alternatively, we can build Saldanha plus Richard’s Bay, which will cost something like R506 million and will bring us exports to the value of something like R519 million. Purely on this basis there is clearly a great advantage in favour of doing St. Croix and Richard’s Bay first. There is simply not enough money nor enough engineering capacity to do St. Croix, Saldanha and Richard’s Bay simultaneously. It is quite clearly a matter which has to be phased and tackled in the correct order. Sir, a study has been undertaken to determine how much mineral ore could have been exported by South Africa by now if there had been no railway problem. In other words, let us assume that the South African mining industry had never had any problem in getting trucks; that we had been able to develop our markets to the fullest extent and that our mines, the producers of ores, had in fact been able to develop their ore production to the maximum capacity. If this had happened, it is estimated that South Africa would by 1975 have been able to export 90 million tons of ore per annum; and at average prices, 90 million tons of ore per annum would be bringing us between R600 million and R800 million in foreign exchange, quite sufficient to bridge our currency trade gap. The reason why this has not been done is simply that the Government has never had the foresight to build railways to the extent required for our future development. It goes step by step; it finances development out of current revenue; it has never taken the major, forward leap needed to prepare for this vast future which I tried to indicate at the outset of my speech, or for the next 30 years in which we have to double the capacity of everything that is being produced in South Africa. These things have never been done. We therefore have the labour problem and the monetary problem and the infrastructure problem and the inefficiency problem. These four things are absolutely endemic; they are local and not imported. These are the major causes of inflation in this country. These are the things which must be overcome and it is pointless and misleading to plead that we are importing inflation from abroad and that this is a kind of magical foreign disease which has come to this country. Sir, this is an evasion. We have to tackle inflation in South Africa and cure it in South Africa. We have to impose disciplines on ourselves, starting with the Government. The Government must meet these problems head-on and the first thing it has got to do is to make a fundamental reassessment of its apartheid homeland policy. This thing, Sir, will cripple the South African economy; it is running the country into the ground and there is nothing on this earth which can stop the South African economy from being destroyed if this policy is carried out.

The hon. member for Von Brandis has just concluded with the inference that in South Africa inflation, with all its detrimental consequences, is a purely South African problem that must be solved in South Africa alone, because it is not imported. The hon. member then mentioned four factors which, according to him, are the cause of this state of higher inflation in which we are living. He did, in fact, offer no solutions except one, i.e. that the Government should now simply cancel its apartheid policy and throw job reservation overboard, and then, as if by magic, all our problems will be solved. I now wonder whether the countries of the West that have higher rates of inflation than we in South Africa have at present, also have apartheid that is causing inflation there. I am thinking, for example, of the U.S.A., which has a rate of inflation of 5½ per cent at present. They surely do not have this problem which, according to the hon. member, is causing our inflation here, i.e. an apartheid policy and labour legislation, and yet the U.S.A. has a higher rate of inflation than South Africa. But the hon. member states that inflation is something that is peculiar to South Africa because this Government now has an apartheid policy and because we have these labour Acts that entail our not making the fullest use of all our labour sources. It is evidently so much nonsense that I certainly do not want to waste my time on it.

It is frequently said that in this debate, the no-confidence debate, the Government is standing trial before this House and the people, and that the Government must consequently give an account of its actions. I want to add a further statement to that. Just as the Government must, in such a debate, give an account of its conduct, so must the Opposition give an account, in such a debate, of its conduct. This Government has, for approximately the past 23 years, led this Republic of South Africa and its predecessor, the Union of South Africa, to previously unknown heights of welfare and prosperity. But this great prosperity also demands a very great sense of responsibility from the population. It is unfortunate that the problems we are experiencing at present, and chiefly the problem of a higher rate of inflation, about which so much has been said this afternoon, are the direct result of great prosperity in our country. I looked it up and found that in the past 16 years alone, from 1954 to 1970, our national income, that is to say the total income of all members of the population, increased from R3,000 million to R12,000 million. In other words, in 1970 our total income is precisely four times as much as in 1954; and if we divide the national income by the number of inhabitants over the same period, we find that the per capita income increased from R230 to R600. I therefore have the fullest right to say that we do enjoy tremendous prosperity. Since 1966, when the Government decided to work out economic development programmes, and on each occasion to make a projection, for the succeeding five years, of our possible economic development, an annual growth rate of 5½ per cent was proposed. But every year we have considerably exceeded that proposed growth rate of 5½ per cent. That is indeed the cause of the problems we are faced with. The fact that we far exceeded that projected optimum growth rate is the cause of our problems. In order to be able to promote and enjoy this large measure of prosperity to the utmost, the greatest measure of responsibility is, of course, necessary from all members of the population, and particularly the Opposition as well.

You will remember, Sir, that during the last big debate in this House last year, towards the end of the Session, I warned that these salary and wage increases were releasing a tremendous amount of new spending power which must, of necessity, cause great demand inflation, and I presented the House with a whole lot of the detrimental consequences of that excessive spending power. This excessive spending power creates excessive demand in respect of the production and further manpower shortages and balance of payments deficits.

This afternoon the hon. the Leader of the Opposition mentioned with a flourish that our balance of payments deficit for the year 1970 will be very close to R1,000 million. He forgot, of course, that the gold production still had to be subtracted from that R1,000 million. Even if the gold production, which is in the vicinity of R800,000, were to be subtracted, there is still a considerable deficit on our balance of payments. This is precisely what I warned against and what our economists warned against in the drawing up of those economic development programmes. I sounded a warning because I foresaw those dangers. While I was issuing warnings, the hon. members of the Opposition scoffed. The hon. member for Parktown referred to it very cynically. However, the fact remains that instead of bringing to light this responsibility and discipline, this greater prosperity has had the effect of causing our population to spend too much. They were unfortunately encouraged in this by the Opposition. In the two speeches we have had from the Opposition this afternoon, and all along, there have been pleas for greater spending. The hon. the Leader of the Opposition declared himself to be very concerned about the poor young married couples who must now start a home, since they cannot buy what they need because they do not earn enough. In the days when I set up house, I was not ashamed, where necessary, to stack a few paraffin boxes on top of each other to get the necessary shelves together to begin with. We grew up in a school in which we learned that if one earned 25 cents, one must not spend 30 cents. One must spend 15 cents and save 10 cents. That characteristic is apparently totally lacking in the hon. Opposition. They are continually recommending greater spending.

After the hon. the Minister of Economic Affairs at the end of last year envisaged the more stringent conditions for hire purchase, the hon. member for Parktown granted an interview to the Sunday Times. This is what the report states—

He continued by saying—

As I have already said, what the hon. members of the Opposition are continually recommending is greater spending. A young married couple must go and live in a large house more quickly. A family of four must earn enough to be able to pay R200 a week in a holiday house at Durban, etc. The poor man is continually being hit by the Government, but he also says—

I should like to remind the hon. member for Parktown of what he said last year in the Budget. When the hon. the Minister of Finance came along here with a few items of higher sales tax on the more luxurious goods, whereby he naturally “wanted to cool down the inflation”, these were the words of the hon. member for Parktown—

These were steps which this Government announced last year, in last year’s Budget, in order to cool down this over-heated economy. And now the hon. member for Parktown says in his interview with the Sunday Times—

But when the Minister announced those steps, he levelled an accusation at him to the effect that he should not have done such a thing. That is typical double-barrelled propaganda of the Opposition. On the one hand our people are encouraged to spend more and more, while on the other hand they are prompted about this Government’s unreasonable actions in levying higher taxes when it imposes higher savings levies.

But I am going to continue with the interview which the hon. member for Parktown had with the Sunday Times. He said—

Apparently this is the only solution the Opposition has to offer for the inflation problem we are struggling with. It is most certainly a problem that is not limited to us alone, but to all Western countries, many of them to a much worse degree than ourselves. That, according to the Opposition, is apparently the only measure against inflation. I shall come back to this a little later.

I just first want to point to the dangers of over-spending, which the Opposition so cheerfully recommends. In the history of our people we have numerous examples of foreign fortune-hunters driving all over the platteland recommending to our country people that they should incur greater debts. They palmed off increasingly more goods on our country people and kept at them to incur more debts. It was done with only one purpose in mind, i.e. eventually to get hold of the land belonging to those country people. And now I also want to issue a warning to the present people of South Africa. These very fine words, recommending that we spend more and more, are just as dangerous to our national character as they were to those country people of a hundred years ago. For them the danger of losing their land is as great. In speaking of their land I do not only mean their farms, but also their national character. For that reason we must be very careful that we do not allow ourselves to put up with pleas for greater credit facilities. That is why I want to bring it home very strongly to the hon. the Minister of Economic Affairs that he should apply stricter conditions for hire purchase without relinquishing one jot or title. No country can grow up on credit alone.

It is said that the American population is to-day living on their earnings two years hence. That is the extent to which credit has got out of hand there. Fortunately we have not reached that stage as yet. The Credit Management Institute calculates that today we are living on the income we shall earn in 14 weeks’ time. In other words, our incomes have already been spent 14 weeks in advance. It is a very dangerous phenomenon which can eventually lead to only one thing, i.e. bankruptcy. I now want to repeat what the hon. the Leader of the Opposition said. He said that he lamented the fact that in 1970 we had a balance of payments deficit of almost R1,000 million. A people that spends more in the long run than it earns by its labour, is inevitably heading for bankruptcy. The greatest degree of discipline and responsibility is therefore required of all of us not to spend more than we earn, because then we are inevitably heading for bankruptcy. But when we want to bring that discipline, that sense of responsibility, home to our people, we have the unfortunate position of being saddled with an irresponsible opposition, an opposition which is continually prompting our people about it only being this bad Government that is causing us to have a balance of payments deficit. A balance of payments deficit indicates to us only that we are spending more than earn.

I have very great faith in the future prosperity of our country. But there are certain requirements for that. The most important of these is self-discipline. When we take a look at the unfortunate outgrowth of our great prosperity, my heart really shrinks. Hon. members can perhaps ask the hon. member for Hillbrow what I am referring to when I speak of the unfortunate outgrowth of the prosperity we are enjoying.

Please repeat that.

I am saying that if hon. members want to know what I am referring to when I speak of the unfortunate outgrowth of the great prosperity we are enjoying at present, they must ask the hon. member for Hillbrow. Hon. members must then find out from him what takes place on Old Year’s Night in Hillbrow. Hon. members must find out from him about the extremely irresponsible behaviour of certain of our young people. If someone witnesses those events and his heart does not shrink, then he no longer has a soul. That is why I say that my heart shrinks when I observe the consequences of this great prosperity in South Africa. We cannot afford to let things go on like this. In order to change things, an extreme measure of self-discipline is necessary. But a Government surely cannot hammer self-discipline into a people by means of legislation. No Government can bring self-discipline home to a people by means of legislation. In so far as the Government does take steps to bring discipline home to the people, a firm duty also rests with the Opposition to co-operate in achieving that goal and not breaking things down. In my opinion the situation is so bad that no one, not even a frustrated Opposition, may permit itself the luxury of cynically breaking things down.

Fortunately there is also another side to the coin. With our tremendous problems as a result of this prosperity, with our manpower shortage, our price increases, etc., we have on the one hand this extremely unfortunate irresponsibility from a large portion of our population. In our richer cities this is more particularly the case than in the poor platteland. But the other side of the coin is that we find workers with so strong a sense of responsibility that they decide, on their own initiative, to work longer hours for the same wage. Here I want to refer in particular to the Post Office workers. If there was ever a praiseworthy gesture, then it is that of the Post Office workers who decided, without pressure on the part of the Government, to do their share to combat this inflation, i.e. by working longer hours without claim to more pay. We also had an example of it in the private sector when the employees of a well-known Afrikaans building society decided to work longer hours without asking for more pay, thereby putting this inflation spectre in its place.

While we are referring to the praiseworthy conduct of these workers of ours, I think it as well that hon. members be reminded that, according to our old economic norms, there was only one method of putting inflation in its place, and that was a little bit of a recession or a little bit of a depression. When unemployment sets in among people, those still retaining their employment fear that they will also lose their jobs, and then they work a little harder in order to be able to keep them. In this way greater productivity is obtained. Now I do not for one moment want to advocate that we should have a little bit of a depression to quash this inflation, because none of us want to see again that spectre of tremendous unemployment of the early thirties. That is why I am praising the conduct of responsible workers this afternoon who, before we have that depression with its disrupting spectre of unemployment, are rather on their own initiative working longer hours and working harder for the same salary. In that respect we are probably very fortunate, because in America they are in the unfortunate position of having a 6 per cent unemployment figure. By all norms and standards that is a very high unemployment figure.

The unemployment figure is 6 per cent and at the same time there is an inflation rate of per cent plus. Now we all know that unemployment and inflation do not go together. The one is the opposite of the other; one has unemployment with a depression, and full employment with inflation. In America we now find the damning phenomenon of unemployment with inflation. I just want to say again that the workers of this country are acting extremely responsibly, and on the part of the Government we want to praise them for their responsible conduct, because if we have to land up in a situation where we have 6 per cent unemployment together with a rate of inflation of 5½ per cent, we are heading straight for the abyss. That is why I observe what our people are doing with the greatest satisfaction.

The problem is just to get this self-discipline and great responsibility across to our people, because this cannot be put right by legislation. It cannot be put right by means of a Budget. If the people do not want to listen, all that can be done is to compel them, with fiscal measures, to save a larger portion of their income. I have now spoken of the praiseworthy conduct of certain of our workers, but unfortunately this is not nearly everyone. There are unfortunately still those who are continually demanding higher wages and salaries without accordingly guaranteeing higher production.

Since this is so, we can only once again appeal to our people to maintain that inward self-discipline, thereby displaying our sense of responsibility. If they do not do so themselves, a Government has no other option but to bring it home to them by means of fiscal measures. For that reason I want to express the hope here this afternoon that the hon. Opposition will not continually persevere in prompting the people about their not receiving their rightful share. The South African workers, i.e. the salaried man and the wage earner, are receiving their rightful share, and in many cases more than their rightful share. By continually prompting them in respect of not receiving their rightful share, we are breaking down the self-discipline and cultivating irresponsibility instead of responsibility. In that case there is no other choice for a Government than to supplement the State funds it needs by means of fiscal measures.

Last year, in that last debate to which I referred, I said that since there were now so many wage and salary increases I wanted to advocate that our people do not spend it all, but that a larger portion of those higher incomes be saved. If our people do not want to do it freely, our Government is compelled to collect it from the people by way of increased taxes and increased compulsory savings levies. That is why I once more want to advocate here this afternoon that we as a people should pay heed, and ourselves apply that self-discipline, ourselves display that greater sense of responsibility, so that it will not be necessary for the Minister of Finance, when he delivers his Budget speech at the end of March, or whatever, to compel us to save more. I hope that the hon. Opposition will also pay attention to this.

I want to conclude with what I began with. In a debate such as this it is not only the Government that is standing before the Bench; the Opposition stands there equally. No Government can cultivate that essential measure of self-discipline and a sense of responsibility in its people if it is dealing with a highly irresponsible Opposition that is continually squabbling.

Mr. Speaker, before I reply to what the hon. member for Paarl has said, I should first like to refer to what was said by the speaker who preceded him, i.e. the hon. the Minister of Economic Affairs. The hon. member for Paarl said nothing worthwhile, but at least he said what he had to say in good spirit. The hon. the Minister did not say anything worthwhile either, but I want to tell him that we take the spirit in which he said what he had to say sorely amiss of him. The Minister made a sharp, uncalled-for, personal attack on the hon. the Leader of the Opposition. If this is the direction that side of the House is going to take it indicates to us a total bankruptcy of policy. We regard the attitude of the hon. the Minister as a poor reflection on the Government. If the hon. the Minister acts in this manner in future, we on this side of the House will ignore him completely. When a Government has deteriorated to this condition, it is an indication to us that it is high time it was replaced.

Recently the hon. member for Paarl, who has just resumed his seat, found himself in trouble with the traffic authorities because he had apparently been driving too fast. His excuse was that he had not seen the danger signs. Today we had an exact repetition of that incident. The hon. member participated so quickly in the debate that he gave no indications of having the faintest idea of the danger signs. He persisted in alleging that we had imported inflation from overseas, but surely the hon. member for Von Brandis made it clear to him that what we have here is quite a different type of inflation. We do not have creeping inflation, but an inflation which is structural, and built into our entire economy. It has become quite endemic. It is of no use comparing our position to that of Britain and the United States of America, for there we are dealing with countries which have a fully-developed economy with full employment of their labour forces. South Africa is in an entirely different position. Ours is a country with a growing economy and as far as the employment of our labour forces is concerned we are nowhere near saturation point. Thus comparisons of that kind do not help us in the least.

The hon. member for Paarl said that the value of our national product had increased tremendously over the last ten years. Those are statistics worth mentioning. But why does he not present us with the other side of the picture as well, why does he not tell us what the value of the national product in Australia is, which has a much smaller population than we have? It is twice as much as ours. Why does he not tell us that it is four times greater in Canada, which has the same population we have? But statistics of that kind, of course, he will not want to give us, because it does not suit his purpose.

He spoke about the disequilibrium in our export balance and then said that this would have to be rectified by means of our gold production. Well really, he is confusing his economic concepts completely. But in any case, when he talks about a disequilibrium in our export balance of almost R1,000 million he must add to that all the invisible losses. If one includes the invisible losses one can add a further 50 per cent to that.

That is your Leader’s figure.

Yes, but he thought the hon. member was aware of it. What we find so strange is that two hon. members have already spoken on the Government side and did not seem to have the faintest inkling of what is going on in our country. If there is one matter which is occupying the minds of all our people today it is this economic situation which is deteriorating so rapidly. Every newspaper one opens, every report from a leader in industry and almost every set of statistics published, indicates that we are heading for a crisis situation in the sphere of economics. But they are unaware of this. They do not know that such a situation exists. Let them go to our people outside. Everybody is talking about it. Everybody is speculating about it. Feelings in regard to the cost of living are running higher to-day than has ever been the case before. There is a unanimity of thought as we have never witnessed before in regard to a matter of national importance. Everyone feels that if steps are not taken to prevent this now, we are going to reach breaking point. But those hon. gentlemen are unaware of this. As my hon. leader said, we warned them. But what did the Government do? Time and again they tried to distract attention from this. There was an inability to act. There was stubbornness and a lack of insight. They tried to disguise the true state of affairs. Even when we came forward with justified criticism, they termed it prophecies of doom. But of course there were elections in the offing. Notwithstanding what the hon. the Prime Minister said to his own congress in Bloemfontein, and notwithstanding the assurance he gave this hon. House that there was not going to be an early general election, that is what happened, and it was held prematurely, because the Government knew the situation was deteriorating and that they had to act quickly in order to retrench themselves for another longer period. But our people are aware of this, and they are not going to allow themselves to be bluffed in this way.

Before the election there were unheard of salary increases, and after the election there were incredible price increases. They were still busy counting the votes when the hon. the Deputy Minister came to light with his new control measures for our hire-purchase system. This was a form of political cynicism we have never witnessed before in this country. Our people will not forget it. I now want to say to the Government, they did in fact win this election in the short term, but it is clear to everyone that they are losing this war in the long term. If they do not want to believe this, we have an easy way of putting it to the test. Sir, let us hold another election. I challenge the Government. I challenge any hon. member there to move that we hold another election. Now that the people know what is going on, now that the nation has been informed, afford them the opportunity of deciding the issue again. But hon. members will see that the political memories of the people are not so short. I want to say to the Government that it has suffered a setback in its moral position from which it will never be able to recover.

But, Sir, the matter we are discussing now and which the Government is shying away from, is certain economic problems which we want to submit to this House. The first problem is the cost of living. A great deal is still going to be said about this, and I want to refer to it only briefly. Sir, over the last nine months the cost of certain essential items has increased almost as much as it has done over the last nine years. During the last ten years the price index has increased by more than one-third. On a previous occasion the hon. the Prime Minister said that what caused him concern was the possibility of unemployment among our non-Whites, and he is correct on that score, but if the cost of living increases to such an extent that these essential items are beyond the reach of the non-Whites then you are bringing about exactly the same situation, and that is what we are condemning here. Take the recent increase in the price of bread. For me as a White that increase in the price of bread simply means an increase of .14 per cent in my cost of living, but for the non-White it means an increase of .42 per cent in his cost of living, i.e. three times as much, and in addition to that his income is far less. But what do we get from the Government. As usual they must look for a scapegoat; they must distract attention; they must find something or someone else they can blame. What have they found now? Inflation! This is the new enemy; this is the new scapegoat, and according to them and their propaganda organs, this inflation was merely wafted here like an epidemic from overseas. But, Sir, surely this is not the case; this has already been indicated by the hon. the Leader and the speaker on this side who spoke after him. But what is going to happen now? It would appear that this inflation is going to in crease to 6 per cent this year. Our population increase is 3 per cent and that means that we must have a national growth rate of 9 per cent in order to remain where we are at present, without being able to make any progress. Is that the situation we are heading for? Sir, the Government has set in motion here a diabolic race between salary increases on the one hand and price increases on the other, and there is going to be no winner of that race; we are all going to lose. And the Government is doing nothing about it. We get senseless and puerile exhortations from the highest parties in the country to the effect that we must work harder, that we must save more. But, Sir, as my hon. Leader indicated, the vast majority of our population is not in any position to save. They are engaged in a daily struggle for survival. The Black man who today earns R5 per week, how can he save? Take a Black pensioner who receives R5 per month; how must he save?

What Black man earns R5 per week?

In any case, the entire spirit is wrong. Why should our people save if the Government takes our money and wastes it? [Interjections.] Everybody knows this. Even the Economic Advisory Council has recently stated in a report that the Government is wasting our money, and they used a hundred words to say this. In future they must not be so tactful and diplomatic. They need only say that the Government is wasting our money; we all know it. In any case, Sir, the Government has created the wrong psychological climate, for it keeps on telling us that we are one of the richest countries in the world and now it suddenly comes along and says that we must all tighten our belts.

Sir, we are caught in a vicious circle here and the Government itself is caught in the death grip of its own ideological nonsense. One day they introduce a salary increase, and what is a salary increase for one man is a price increase for the next. If there cannot be a price increase, then profits decrease, and if profits decrease, then development is restricted, and when development begins to decrease then exports are curbed. But because our population is steadily increasing we must export more, and consequently we have balance of payments problems and there is a further drop in our reserves as well. In plain language, that is what is happening; but the hon. the Minister gave us a long academic peroration here. Let him tell us in plain language what is happening. Our exports are decreasing not only because we are not producing more, as my hon. Leader indicated. The Government is guilty of reckless neglect of our natural assets, because even in cases where we are producing, we are unable to export. Take coal, for example. In 1962 we exported 1,600,000 tons of coal; last year it was a third less; it was just a little more than half a million tons. Why? In the meantime production has gone up 25 per cent; the entire world demand has increased. Sir, there is only one reason for that: the Railways was unable to transport our coal. Precisely the same problem applies in the case of anthracite producers. The exporters of anthracite were informed that they must decrease their export quotas by half this year. Sir, I have mentioned only two examples. Take this picture and multiply it a hundred times and you will have a very good idea of what is happening on the national level. As a result we have this unfavourable balance of payments of more R1,000 million, and if one includes the invisible losses, then one must add a further 50 per cent. As a result of this our reserves have now come tumbling down. There is less than R700 million in the State coffers. The International Monetary Fund tells us that reserves to cover three to four months’ gross imports are essential. In December of last year our imports totalled R240 million. Now, multiply this by four, or if you are an optimist even by three, and then it is clear that we are already in very hot water. But, Sir, as the hon. the Minister indicated, we have two forms of inflation. Previously it was demand inflation, and now we also have ecost inflation. But what he did not tell us and what he should have added is this: If one has these two forms of inflation within an economic situation which is in the process of stagnating, in which there is no growth, then one gets what we call stagflation, and if one has had stagflation for a long enough period of time, then one must either devalue one’s monetary unit or become bankrupt. I am not merely making superficial statements now; this is the warning I once again want to issue to the Government: If we are not careful we will shortly have to devalue our monetary unit.

Here we have a Government which originally came into power as the Government of many talents, and now we find, now that we have a crisis situation, that there is no talent. Sir, let us consider them one by one. There is the hon. the Minister of Transport, who is not here at present; he is the only one who still manages, to a certain extent, to keep things going at his end, but he is only able to do so by evading the policy of his own party to an ever increasing extent. The hon. the Minister of Finance, who is here, not only loaded this cannon, he lit the fuse as well. We now hear that he wants to retire, but they say there is no-one to replace him. Sir, not one of these two statements surprises us. Then there is the former hon. Minister of Planning, who also played a major role in this critical situation we have at the moment, because he was, after all, one of the architects of one of the laws which we warned him against, but he was stubborn.

He resigned.

Yes, resigned. Now he will probably deny that he ever had anything to do with this entire matter. Then there is the new Minister of Planning, who also deals with Coloured affairs. He is so busy trying to reconcile the divergent standpoints on Coloured affairs of the Bothas in the South and the Bothas in the North that he has no energy left with which to tackle this matter.

Then there is the hon. the Minister of Economic Affairs, who also deals with the Police. We have strange combinations in this country. Apparently the Police never inform him of what they are doing. He had to read in the newspapers, as we did, about what his Security Police were doing. It seems to me the same applies to the industrialists. But, Sir, that hon. Minister was in any case so busy organizing an election for the Other Place that he does not have any energy left either to deal with economic problems.

Then there is the hon. the Minister of Bantu Administration, with his over-eager side-kick. They are not displaying the least interest in these matters for they are engaged in building a new neo-colonial empire. And the hon. Leader of this team, who is not among us either, has not yet dared to say anything about the matter; if he were to do so, he would probably advise us to leave it to our children to find a solution. A leadership vacuum has developed; there is a leadership vacuum, and we find that every second letter we receive, comes from a former Nationalist. In all these cases there may be a different choice of words, but the theme is always the same, and the theme is this: They are unfit to govern. It is for that reason, surely, that they have now had to appoint a publicity agent to try to restore their tarnished image. [Interjection.] That was for us the first indication that this Government was on the downgrade. Once you begin appointing publicity agents—and they can appoint another twenty—it means two things. In the first place they have too much money as a party and in the second place they have a lack of confidence in their policy. [Interjection.]

Every so often we still find a slight verligte breeze emanating from the south, but then there is a destructive, verkrampte whirlwind from the north which blows us all back into the laager. There is a sterility of thought. The lack of true insight is disguised by means of a welter of slogans. That side of the House is madly pursuing the end of the rainbow and is becoming increasingly estranged from reality. Our people are sick and tired of this. Our people outside no longer want to pursue slavishly these strange myths. What the people outside want is that our daily problems should be solved. [Interjection.] There is in the Government a form of masochism; they want to inflict pain on themselves, but the rest of South Africa is not prepared to commit suicide. It is so much easier for us on this side of the House, because we have a different approach. We are not handicapped by an ideology which is unsuitable and unenforcable. We can tackle and solve all these problems to which we referred here with reasonable ease. We shall establish an entirely new economic objective for our people. We shall sweep away these bureaucratic cobwebs which we now have. We will not have all these control systems, we shall encourage our people. We shall create opportunities for the exceptional economic skill and insight of our people in order to develop fully.

As with any chain there is a weak link here as well, and the weak link, that which caused the entire chain reaction, is, apart from the Government, which is also a weak link, the labour problem. All of us have already said this, but the Government is incapable of tackling it. They do not even know what the labour shortages are. Last year the hon. the Minister of Labour was still trying to play hide-and-seek with his Labour Survey No. 8, and when we compelled him to lay it upon the Table here, it showed that there were vacancies for 70,000 people. All the surveys made subsequently indicate that this was a tremendous underestimate; the actual total is twice as many. But the Government is unable to do anything about this. Just to show how this affects the situation: Over the last ten years wages in the manufacturing industry have risen by 102 per cent while the output has increased by only 80 per cent. This indicates what is happening here. But the solution is also an easy one. I note from the latest statistics released that over the last six months wages for artisans in the building industry on the Witwatersrand have increased by 12 per cent, but in the Western Cape by only one per cent. Now, what is the difference? The difference is that in the Western Cape there are Coloured artisans. If you multiply this picture a hundred times you will see precisely what is happening on the national level. Sir, we will solve this labour problem in the first place by bringing more suitable immigrants out to South Africa. In the last seven years this economically active sector of the South African White population increased by a ¼ million. This is seventy per cent more than we would have had as a result of natural increase. This means that it is the immigrants who save our skins, and one will easily be able to prove that if there had not been any immigrants, our growth rate, which these hon. members boast of to such an extent, would have been less than 4 per cent. But it is that side who put a stop to immigration in 1948. At that time they said it was an evil. But what was wrong in 1948, is suddenly the right thing to do now. Just think of the ground we lost. If we had brought in immigrants then, we would not have had all the problems we have today.

In the second place we will have to train our people properly. We will not merely refer derogatorily, as this hon. Minister did, to crash programmes; we will introduce a crash programme. The Government is continually asking us whether we will train non-Whites. The answer is yes; of course we will train non-Whites, because they represent nine-tenths of our labour force. Does the Government want to tell us that they should do the skilled work they are in fact doing without training? We shall train all our workers.

What will you do with the hippies?

I just want to inform that hon. member that at the next election he will not return to this House again. [Interjections.] In the third place we will regard as permanent the Bantu who have been absorbed into our industrial effort, the vast majority of them. At the moment there are 1.3 million factory workers in South Africa. If we are at present growing at a normal rate, there will be 4 million workers at the end of the century, and who is there on the other side of the House who will tell me that those 4 million, or the vast majority of them, are going to have white skins? Of course they will be non-Whites, and we will accept that the vast majority of them are permanent; it will give them stability, something which will increase our national production. But we accept at the same time the necessity of attracting as many of them as possible back to the homelands. Once again we are in a far better position than the Government, because they are caught in the snares of their own ideological nonsense. We shall develop the homelands by using White capital and initiative there. The Government is unable to do so, and consequently there is no development there. In the fourth place we will make full use of the economic abilities of all our peoples, and one of the first laws which will have to go, is this ignorant work reservation of the Minister. It is a law which offers our Whites absolutely no protection; it causes us great embarrassment overseas, and it cannot be applied. When we ask the hon. Minister to apply his own law and introduce work reservation, he tells us that that is a foolish suggestion. Sir, have you ever heard the likes of that? The Whites must of course be protected. In Rhodesia they are also protecting the Whites. Is there any person who wants to suggest that Rhodesia is not protecting its white workers? But Rhodesia does not need such a ridiculous law, and has never needed one. The Government is setting about things like a Don Quixote. The Government supposedly wants to put a stop to labour integration now. Sir, in the last ten years, as my hon. leader indicated, the number of non-Whites who entered our industries exceeded the number of Whites by 50 per cent. Integration is taking place far more rapidly today, at a faster rate than ever before in the history of our country. But they want to put a stop to it. They are acting in the same way as this Spanish clown on his lean donkey who wanted to tilt at all the windmills with his broken lance, because he also wanted to put a stop to them. We will protect our white workers by applying the wage for the job on a realistic basis, by establishing national minimum working conditions, and by giving them proper training and creating better prospects for them. Where it concerns the incorporation of specific types of work, we shall leave it to our trade unions and to organized industry. If there are problems we will appoint an industrial appeal tribunal which will be able to act as mediator.

Mr. Speaker, we have a wonderful economic future. There is only one thing we must do—we must get rid of this Government. Here we have a Government which has lost its insight; which has lost its will to govern. Here is a Government which is erring. The confusion amongst its own ranks is unbelievable. Here is a Government which is without a leader, which no longer cherishes any ideals, and which is now merely setting itself certain myths, certain objectives beyond the horizon which we will apparently have to realize in the next century. This Government is an inept one. [Interjections.]

Is the hon. the Minister entitled to say to an hon. member that he has a big mouth (groot bek)?

I think the hon. member should listen carefully. I said a big brag. [Interjections.]

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

Mr. Speaker, as has been said by the hon. the Minister and a subsequent speaker, every year when the no-confidence motion is being dealt with, it is an opportunity for the Opposition to accuse the Government in front of the world and to place the Government in the dock. Such an attempt was made this afternoon. The hon. member who has just sat down, in fact summarized the position in regard to the political situation in South Africa, only his choice of words was a wrong one. He said that the difference between the two parties in this House is that that side of this House, to use his own words: “Is not handicapped by an ideology”. I say that he used precisely the wrong words. They are not inspired by an ideal. That is the difference between the two sides of this House. On that side of this House we have people who can talk sneeringly about idealists and who talk sneeringly, as does the hon. member who has just sat down, not only about the hon. the Ministers, but also of his nation’s people as being people who are handicapped by an ideology. I am sorry to have to say that this is not the first time that it has been said in this House. In 1969, column 34 of Hansard, the hon. the Leader of the Opposition also spoke about this word “idealists”. In reply to an interjection he said—

I know I will be told by the idealists on the other side that this means there will not be equality between the various race groups in the federation that we propose.

This was the reference, so derogatorily made, to the idealists on that side of this House. We are proud to be able to say that we are idealists. Therefore I can state with the greatest frankness and conviction that the youth of South Africa, who are inspired by ideals, will know where their vote must be cast in the election.

This afternoon we have listened to a few Opposition speakers, and on this occasion the point at issue was concerned what is being built up by the Opposition and its newspapers into a kind of psychosis in South Africa. It is a psychosis more dangerous than any economic situation would or is likely to be. There is no crisis. In comparison with the rest of the world, as has been indicated so clearly, there is only reason to be grateful and proud. I am not talking about arguments such as those quoted by the hon. member for Hillbrow when he compared us with countries such as Canada and Australia and said that their total population was the same as ours. The hon. member is living in a fool’s paradise if he compares the population of Australia with our population and that of Canada, in other words, a homogeneous population in comparison with such a population such as that which we have to carry in South Africa. Here 3½ million Whites must control and carry a large number of non-Whites as a task which has been entrusted to them and which they also have to accept as an ideal.

But for the most part this afternoon, as in the past election, we were concerned with the fact that people are being intimidated into believing that there is an economic crisis. Words were thrown out at random about a diabolic race between wage increases and rising costs. Words of any description were used to add weight to the argument that there is a crisis in South Africa. This brings me back to what I said at the beginning, namely that we on this side of this House are proud to be able to say that we are a party with an ideal for which we are striving. But it was not only I and this side of this House who said that. May I also bring it to the attention of fellow South Africans that two years ago, when the hon. the Leader of the Opposition proposed the customary motion of no confidence in this House (1969 Hansard, col. 33), he saw the position correctly for a moment when he said—

It was not this side of this House alone which spoke about it and warned its people. In a moment of lucidity and clarity the Leader of the Opposition said: I share in those fears. During that motion of no confidence they said that they were not concerned about the economic aspect but in fact about the political structure of the South Africa of the future. That is what this House bound itself to do and it is what the Government has been doing for the past 23 years and still is doing under bitterly difficult circumstances. Can we forget that? Has the Opposition forgotten it? Did the hon. member for Hillbrow, who has now waxed so eloquent about how soon he would rectify matters, and the hon. member for Von Brandis, who sees the next 30 years as the crisis in the future of South Africa, experience anything of the crisis which South Africa went through in the 20 years it had to fight for every inch of the way in order to retain what it had achieved through years of struggle for all White and non-White South Africans? Does he know anything about that? Did he remember anything about the fact that the rest of Africa, carried by world powers as large as Belgium and all those other countries, went to rack and ruin for all practical purposes and that a small White population which was left in the lurch even by its allies, remained intact? Does he forget about the crisis years of 20 years ago when he speaks about the next 30 years? The next 30 years will also be crisis years but it will be possible for them to be built on a firm foundation which was laid by 23 years of National Party government. Yes, it is true that that side of this House speaks about the handicap of ideology. But I believe there are still those among them of whom one can say something good, and who still are of the opinion that it is no handicap to have an ideal.

It is true. We have a task. Or, as the hon. the Prime Minister said, we have a mission we must fulfil. This has always been for the people of South Africa: A mission to fulfil, and not the handicap of an ideology. We have an ideal which we are striving to achieve. This Government and this Party will strive to achieve that political ideal, although we may still have to lose more people along the road who want to exchange their birthright for a mess of pottage. We will do it. We shall continue to remain in the majority because we are honest with our people, because we have been honest over the years and were honest in the past elections as well.

May I just draw the attention of the hon. the Opposition once more to one of the main reasons why the Government lost seats. It was because they kept their word of honour given the English-speaking people in South Africa, in spite of attacks from within their own ranks. It was exploited by that side of this House, but we kept our word of honour. We will keep our word of honour, not only towards that White section of the population, but also towards the non-Whites where we feel that they also have an ideal for which to strive.

Let me summarize briefly, as has been done by our leaders over the years, what the ideal of this Party is. The Opposition would do well to take note of it. The ideal of this Party is that South Africa will be retained for White Western civilization and that from here it will develop its mission towards the non-Whites living in South Africa and, further afield, the non-Whites living in Africa. It will fulfil its task towards them as well and take its place in the world. This was the task which we accepted in 1948 and which we asked people to entrust to us before 1948. It was consistent and without deviation the road we have followed and the road we shall follow in future.

I know it is true what the Opposition says and what they are eagerly trying to exploit, namely that it requires sacrifices. I do not want to become emotional about this, but may I remind them in the chill of this atmosphere that it is not the first time that people have made sacrifices for their ideals. It is written in red letters throughout the history of South Africa; all the people who strove after ideals, had to make sacrifices. Often it was not only sacrifices of money, of economic disadvantages but sacrifices of blood and of tears. We are prepared to make sacrifices of money. The Government is probably prepared to take the responsibility and to ask people to assist in that expansion of the non-White territories by means of taxation and by making contributions so that free independent peoples will develop alongside the White civilization in South Africa.

The hon. member for Hillbrow also found it necessary to refer sarcastically to the hon. the Minister of Bantu Administration and Development and his Deputy as people who are seeking to achieve colonialism. A few minutes later he stood up here and said that if they were to come into power they would invest White capital in those countries. What is closer to colonialism than to invest White capital in the non-White states and eventually to exploit the non-White areas? What is closer to that than this expressed policy of the United Party?

But now the hon. member has mentioned —and perhaps it is necessary for us just to point this out—that in addition to the idealism, we are also being unrealistic. No, in conjunction with idealism, one must of course face up to problems, and one must face them squarely. The hon. member used these words to which I have just referred in this House and said that the Government had set in motion a diabolic race between wage increases and rising costs. I concede that a race has started between wage and price increases. But I want to tell that hon. member who pleaded for and promised wage increases before every election. That side of this House not only pleaded for and promised wage increases which could be granted where practically possible, but also wage increases which were out of all proportion, while at the same time they spoke about reduced taxation for everyone, and promised higher pensions as well. I merely want to quote one example of this in order to remind the hon. member for Yeoville of what he said in 1967 when this diabolic race between wage increases and price index was being discussed. On that occasion the hon. the Minister of Labour introduced a motion and I shall quote from the Hansard of 1967, column 7363. The Bill dealt with the prohibition of the payment of exorbitant salaries to town clerks by municipalities. I shall quote what the hon. the Minister said at the time—

The Minister said this in 1967—

This is what the Minister of Labour warned in 1967 and he proposed these measures in order to combat loan inflation in municipalities, the Public Service sector and the semi-Public Service sector. Subsequently the hon. member for Yeoville stood up, because there are of course municipal officials and Public Servants who are entitled to vote, and said—I shall quote from column 7370—

When the Minister tried to exercise control over the sector over which he could at least exercise control in regard to exorbitant and unnecessary salary increases, this was the Opposition’s reply. This was what happened time and again when loan increases were being discussed. As we heard in the general election and in the provincial election, when there were votes to be caught, promises were made to all and sundry that salaries would be increased. This dissatisfaction was discussed again this afternoon. I merely want to remind the hon. member for Green Point of his speech last year about the great dissatisfaction which allegedly prevailed in the Public Service and how it could be solved only by the payment of higher salaries. The hon. member for Hillbrow has stood up and spoken about the diabolic race which this Government set in motion, although the Government is in fact taking measures to curb it.

I started off by saying that there are real differences, as the hon. member for Hillbrow said, between the two sides of this House. The difference still lies in the fact that we on this side are bound by a mandate we received from the lectorate, not only this year, but a mandate we have received from the population of South Africa over the years. I want to remind hon. members that in 1828 already full citizenship was granted to the Coloureds of the Cape by the “Cape of Good Hope Ordinance”. From that time onwards creeping integration has continued, and that integration had to be curbed for the sake of both Whites and non-Whites. The Government has bound itself to accomplish that. The Government said that it would try to combat further integration, but in spite of that, the hon. the Leader of the Opposition stood up and said in his no-confidence motion in 1969, and I shall quote—

And then he added—

“We cannot contemplate a completely integrated society.” Is this what the hon. the Leader of the Opposition said? Then I want to remind him of what one of his up and coming lieutenants said when the words “morality, justice and reality” were being discussed. This up and coming leader of the United Party replied to a speech which I had made. He said (Hansard, vol. 29, column 75, of 20th July, 1970)—

Must I accept that the hon. the Leader of the Opposition countenances a promise by one of his younger lieutenants to the effect that this fatherland for which we have fought, should be divided on the basis of numbers? Is this not heading for integration? Is this not an acknowledgment of absolutely equal rights when the finger of moral reproof is pointed at this side of this House because the territory has not been divided up on the basis of numbers? The speaker said that we merely make empty promises. They are not empty promises. What the Government has started doing, it will finish. The young people of to-day will again recognize the ideal as they did it in the past. The older people will tell them what happened over the years. Perhaps it is necessary that we should have more to say about what had to be rectified in South Africa over the past 20 years and that we should recall what was wrong. We shall have to point out what integration meant here in District Six and what grief it brought. We shall have to point out to them what integration meant for thousands who were on the borderline between White and non-White and what the results of that was. All this had to be rectified by this Government and this Party. We are not handicapped by an ideology, but are proud to be able to say that we are moved by an ideal and that in future we shall try to inspire the people of South Africa, Whites and non-Whites, with that ideal. Let the United Party win a few seats through its policy of “let us eat, drink and be merry, for to-morrow we die”. Let them propagate the idea that non-Whites should be put into certain posts. Let them abolish everything for which we have striven in the past. We shall not say to our children that they should eat, drink and be merry for to-morrow they die, but that they should work and serve because after this generation there will be another, and that in the distant future we shall still remain a White South Africa and a white civilization.

Mr. Speaker, the hon. the Minister of Economic Affairs belittled only himself and the cause of his party in his unseemly and uncalled-for attack on the Leader of the Opposition. I had the privilege to serve with the Leader of the Opposition in a prison camp during the war when he was stripped of all rank, of all power, authority and possessions and when we lived together with Indians, Negroes, Canadians, Australians, Britishers and South Africans. Under those conditions the Leader of the Opposition showed that he had the maximum of humility and integrity and he is perhaps the most acceptable person in this country that we will ever know.

Mr. Speaker, I want to allay three fallacies which were exposed by the hon. the Minister of Economic Affairs. The first was dealt with ably by my friend the hon. member for Von Brandis, when he said that as far as a 5½ per cent growth potential is concerned, the Prime Minister’s Economic Advisory Council is hidebound by the stipulations by which they are regulated. The hon. the Minister then went on to say that South Africa cannot expand its economy for lack of capital amongst other things. Let me say that we recall a bankrupt Germany after the First World War and a bankrupt Japan after the Second World War, as well as a bankrupt Italy. All these countries reinstated their economies because they had three priceless assets—raw materials, workers to work and skilled mechanics. The third point was to the effect that on the right and left hand of our party we have an attack on our party leadership. What balderdash!

The only challenge there is, as I see it, is when the hon. the Leader of the Opposition challenges the Prime Minister for his seat.

If I have to deal with the previous speaker, may I merely quote Schalk Pienaar in Rapport:

The hon. the Leader of the Opposition has outlined with brilliant analysis and crystal clarity the arguments on which this debate are based. Perhaps at no time in the last 20 years has there been in effect a more significant and more necessary No-Confidence Debate before this House. The Government, which has experienced a political slide during the 1970 Parliamentary and Provincial elections, will itself have analyzed the reasons for the movement away from nationalism towards the United Party. If it is an axiom that good government is government of the people by the people and for the people, then surely this Government today stands indicted as no government has stood before. May I quote merely the words of the late General Smuts, issued in 1944 as a guide to South Africa:

If there is a government that has failed more miserably in the achievement of this ideal, then it is the one in front of us.

South Africa in the years of the ’70’s has entered into a decade of challenge, where the pragmatical affairs of today are the ones that face our people. We have to face the space age. We have to face a population explosion, progress in the sciences and progress in the welfare of mankind. To do this, we must be equipped. It is not sufficient for the Government to draw the old, aged red herrings across the political scenery of Republicanism, the language problem, the flag problem, the “Engelse gevaar” and the “swart gevaar”. The politics of the Ossewabrandwag are no longer popular. The politics of the Government are out-moded. The new political trends which we have today are accepted by the youth. It is only the laager mentality that remains in the Cabinet. It is not surprising then that today the Government is being attacked for its failure and its tragic inability to deal with the current economic affairs of South Africa as we know them today. The Government has failed and the indictment is clear. It has failed the youth of South Africa. Let me quote the words of a correspondent to Die Burger—

Sir, that is what the Nationalist Party and the Government have left for the inspiration of the youth. The Government has failed to hold the loyalty of the civil servants, even to the extent that the chairman of the Public Servants’ Association has asked for a full inquiry into the affairs of the Public Service, failing which he anticipates that there will be a crisis in administering the Service. The Government has failed the non-European community, as evidenced by its blatant packing of the Coloured Representatives’ Council after its first elections. The Coloured people are frustrated to the point of bewildered reaction.

The Government has failed to hold the confidence of commerce and of industry, whether represented on the Government benches, on the United Party benches or on the cross-benches. The Government has failed the mining industry. With the tremendous inflation that is taking place today the mines are being crippled and the present inflationary trend is taking a heavy toll of our gold mines.

Above all, the Government has failed the farmer. With the Government’s ideology of apartheid, the farmer today is faced with a situation where almost 90 per cent of the labour on the farms is Bantu labour, and the white farmer is rapidly drifting to the towns. Last but not least the Government has failed the man in the street. Life has become a burden, and intolerable burden for the man in the street. The image of the Government today in the eyes of the pensioner, in the eyes of the ordinary man, is one of arrogance and self-aggrandizement. The harsh labour laws putting into force the Government’s ideological obsessions are resented, and the Government may fairly be said to be out of touch with the feelings of the South African people. The Government image today is typified by the Black Cadillacs of the Ministers, by their pretentious dwellings which are so uncharacteristic of the ordinary Afrikaner.

I want to summarize very briefly the arguments which I will adduce in order to indicate to what extent this House has lost confidence in the Government. I will deal specifically and briefly with the Government’s failure to contain inflation in South Africa; with its failure to deal with our manpower problems; with its failure to ensure that the infrastructure will keep pace with our economy, and with the cost to South Africa of the Government’s policy of decentralization of industry to border areas and to the homelands.

Sir, the hon. the Prime Minister has claimed recently that there is no crisis facing our country, and he has claimed this while we are experiencing the greatest measure of inflation that we have known since Korea. There is also a tremendous crisis in the confidence amongst businessmen and industrialists and there is a crisis of confidence in the Stock Exchange, and yet the hon. the Prime Minister says that we have no problem in this country that cannot be dealt with. Our people are being crippled by the high cost of living. Commerce and industry are hamstrung by inability to plan for the future because of the Government’s labour laws, which make it impossible to plan, to originate and to co-ordinate the investment of capital, of raw materials and of labour. We are exposed to the recommendation that we must export in order to survive, yet the infrastructure of our country is such, as was indicated by my hon. Leader, that we cannot cope with the export incentives which are given to us by overseas countries. We are told that to survive we must measure up to the production standards of European countries, and yet we see our own country being fragmented into a number of immature, separate, independent states. Our motto is that unity is strength, but the policy of our Government is to divide and rule, to break up and to smash. It was left to the president of the Afrikaanse Handelsinstituut to summarize in nine short words where the responsibility lay when he said: “It lies in the hands of the Government.” They are responsible for the inflationary trends. It is up to them to find the answers. Similarly it took a Nationalist public relations officer, Mr. Dirk Riezelman, addresing a Jeugbond meeting in Durban recently, to pinpoint the failure of the Nationalist Government when he said—

I want to deal immediately with the argument that inflation is a world phenomenon. This has been used too often, too publicly and by too many members of the Government. This is an argument which should be quashed immediately. It holds no substance whatsoever in the eyes of any thinking economist or businessman. Let us recognize that it is our lack of industrial productivity in relation to our demand for consumer goods that is the chief cause of the crippling inflation we are experiencing today. If we could free the shackles on our industrialists and the shackles on our productivity, then credit and capital would flow immediately into those sectors of the economy where they could most effectively be dealt with. Sir, when you deal with production you create your own capital. The capital comes out of profits and not out of other people’s pockets. What are the fundamentals then? We have the problem of high imports, of excessive spending, of high consumption and low productivity. The problems which are besetting this country are problems largely of our own making. It is our inability to finance our imports with our exports. These in turn induce an upward spiral of wages which, as the trade unions have said, then require further increases in order to meet with the falling off in productivity.

The root of all our economic evils is in essence that too much white labour is being done by too few white people. It is unfortunate that the Government will not, or perhaps cannot, realize that we can no longer continue to run a country of some 21 million people using only those limited supplies of white labour. It is therefore necessary that we should take a long and hard look at the area in which price rises are taking place.

The price explosions affect 23 basic items in the cost of living. Bus fares are sure to rise again. The man in the street who has to take home his pay packet is enduring an intolerable existence and he will not put up with it much longer. We are told that the hon. the Minister of Finance will introduce harsh fiscal and monetary remedies in his forthcoming Budget, but do we realize the extent to which Government expenditure is in itself a component of this excess demand which is creating the conditions under which we live today? The Government cannot evade the fact that to the extent that demand is a component of inflation, this excess demand results to a considerable extent from increases in Government expenditure, which is expected to rise by 15 per cent this year as it did last year, and this on the whole is as great as has been the rise in consumption.

We are told about the need for a tough Budget. There are two reasons for having a tough Budget. The first is the classical one, with the object of bringing savings and investment into line; paying for what the Government is doing and ensuring that there are not too many imbalances. The second one is directed towards curtailing consumer demand as such. We have heard all too often the phrase “excess consumer spending”. Mr. Speaker, the public of South Africa have realized that they no longer can have faith in the money value of our South African currency. Anything related to money is halving in value over a decade or two.

It is then no wonder that the public are being rational in their purchasing decisions and that they are moving into the field of property and goods related to property, causing an innate pressure on the properties that we have in our market today. The hon. the Minister of Finance must accept a large degree of responsibility for the uncertain economic climate in which we are moving today. Thinking businessmen who have no political allegiances have highlighted the fact that we cannot plan until the Government makes up its mind to be straightforward and decisive and make some statement on its policy as to labour, as to capital availability and the general economic fields into which we are moving.

The simple issue underlying our situation is the fact that we are being crippled by a shortage of labour. Let me say immediately I do not refer only to skilled and semi-skilled labour; I refer equally to non-skilled labour. It will no longer suffice for the Government to say that we must be white and poor. We in South Africa have an exciting economic future and we intend to make the most of it. No less an economist than Dr. Hupkes has recently clearly stated that labour shortages are also the main cause of inflation and the main source perhaps of most of the imbalances which our economy is experiencing. In most countries of the world they face the same problem, but they have not the same solution. We would certainly alleviate our labour problem to-morrow if we would stop referring to our traditional labour problems as though in this country we are not prepared to alter traditions ever. Nothing is more certain in life than change itself.

To typify what I mean, we have what happened at an industrial congress recently when one of the speakers indicated that in this part of the world they were not prepared to have black shop-workers serving them. Having the comment made to him that in his town they did have non-European waitresses, he said: “Yes, that’s different—we are used to it.”

The field in which the Government stands most condemned by almost every sector is in the field of labour relations. In this field there is more ministerial confusion than in any other field. The Government has lost its way. During the previous session we had a complete lack of unanimity between the hon. the Minister of Bantu Administration, the Minister of Labour, the Minister of Economic Affairs and the Minister of Finance. I also include the hon. the Minister of Transport. In contradistinction to this confusion, which made a laughing-stock of the Cabinet in the country generally, there is extraordinary cohesion amongst all members of the economic and industrial community, whether they be English speaking or Afrikaans speaking.

Mr. Speaker, I would now like to indicate a partial solution which is available to the Government and which they have not yet availed themselves of, even though it does not transgress their doctrinaire policies. It is not generally realized that some 38 per cent of all economically employable persons are today employed in the Civil Service, including municipalities, provincial departments, divisional councils and local government bodies. In the United States that figure is 16 per cent.

There is a further solution to the whole problem of our manpower and the easing of inflation. This has been described by Dr. Hupkes as the computer solution. He has indicated in an address to the Association of Chambers of Commerce that if we were to scrap the race obsession of the Government and programme a computer to give us an answer to the problem, the reply would be: “We can achieve a growth rate of more than 6 per cent without any inflationary problems—please do not persist with your doubts—this matter is getting boring.”

In fairness to Dr. Hupkes, I would like to mention that he did indicate that this ignored the sociological problems and the race problems. This matter indicates that there is a political viewpoint, but today when we have to survive in the world as we know it, facts are facts. There is no suggestion that we should scrap our sociological and political attitudes overnight, but there is a solution. Inflation need not exist as it does exist in other countries, because we have a labour source which we are abusing and neglecting instead of using. Other countries do not have that. They have to import their labour.

My Leader has already dealt with the subject of the inefficiencies and the inability of the infra-structure to cope with this country’s growing economic requirements. I would like to make only one other comment and that is that when the hon. the Minister of Transport was asked to build a railway from Sishen to serve Saldanha in the event of our getting the contract, he said “no”. He said that private enterprise must build it and he would run the service. When the question of a large super dry-dock to cope with the increasing number of super ore-carriers and tankers was mooted, the Minister again said that private enterprise must build the dock and that he would lease them the land. Is this indicative of the trend in which we are living that the Minister of Transport should be so short-sighted as not to be with-it in matters of vital interest when it comes to our economic growth?

Finally I want to deal briefly with the border industries and the Bantu homelands. If there is one overriding criticism of the Government’s inability to guide the destiny of South Africa, then it must surely lie in its handling of these all important questions. The balkanization of our country into a number of separate independent states is a tragedy. The draconian powers which are being taken unto himself by the hon. Minister of Bantu Administration and Development constitute a threat. He will go down in the history of South Africa as a man who has done South Africa no good. I mention the farmer who says that he will sell no land unless he has to sell it. We are giving away land that belongs to South Africa, in a country in which we are running short of land. We do not have to give it away. It is singularly strange that in the creation of a European Common Market the underlying thought as expressed after the war by the then political leaders was that wars would always continue in Europe while there were some twenty to thirty independent sovereign states. These leaders came together in an endeavour to amalgamate these sovereign states into, as near as possible, one political economic unit.

Political?

One political unit is the aim of the European Common Market. The aim is that there should be free movement of labour, free movement of capital, and free access to agricultural profits. The ideal of an economic community is a Common Market inspired by a politically united Europe and I repeat the word “politically” for the benefit of those who would like to read the progress of the Common Market. Against the background of this global thinking, Europe being co-ordinated after Britain, Norway and Denmark enter the Common Market to a total entity of some 400 million economic souls, how petty, how small, how destructive, how dangerous is the thinking of the hon. Minister of Bantu Administration and Development. It has been conservatively estimated that to create a single job opportunity in the Bantu homelands R4,000 in the form of capital is needed. If we maintain a present growth rate of some 5 per cent to 5½ per cent as has been indicated in the State President’s address to the Senate last week, there will be a little or no White unemployment. However, we will be faced with between 158,000 and 240,000 unemployed non-Whites. Just think of the cost to the taxpayer, of the cost to the White man who must bear this burden, of trying to find job opportunities in the Bantu homelands and in the border areas for 240,000 non-Whites at a rate of R4,000 per job. I want to quote Prof. Hobart Houghton when he addressed the Assocom congress recently. He said—

And he goes on—

How different is the present-day talk of separate development.

To those who created the Union and to those of us, even today, on this side of the House who have faith in our Republic, separation and development seem almost incompatible. In fact, we may say that separate development can easily lead to separate stagnation.

What the Government does not apparently realize is that almost 80 per cent of the total industrial product of South Africa originates from the Southern Transvaal complex, the Cape, Natal and Port Elizabeth. It is this area that must produce the wealth that must then make possible the movement of our industries to the border areas or to the homelands. While it has been abundantly clear that the Government has had some very minor success in the homelands, this has not been correlated in any sense in the Bantu homelands. Every economic review of the cost of establishing industry in the homelands indicates that it will be fantastically expensive, so expensive that it is unlikely that the White tax-paying public could bear this burden. It is a price that the White worker will not want to pay. We are still faced with the suggestion that we divide South Africa and create independent nationhoods and that we develop the Bantu homelands without realizing that we do not have the wealth to do that. As my hon. Leader has said, unless we can maintain an economically strong and progressive industrial organization in those centres where we are already established, then South Africa is doomed if we have to pay for the cost of this ghastly experiment.

In conclusion I want to say that this Government is morally hollow in its concepts. It is prepared to pass laws and then governs by exceptions. It passes laws with which to gull its electorate. It pays lip-service to its electorate and then governs by wholesale exemptions. This is an attitude which is shaking both commerce and industry.

Finally, it is politically inept, because so many actions of Ministers of the Republic today are taken as kite-flying without, as the hon. the Minister of Economic Affairs himself said recently, knowing, for example, that the reaction against the hire-purchase regulations would be so disastrous. He had not consulted commerce or industry. The Government waits for the reaction of the public, and when the public reacts adversely they then make minor concessions to cover up their confusion. This is government by confusion. [Time expired.]

Mr. Speaker, I do not know why the hon. member for Gardens was so angry with the hon. the Minister of Economic Affairs. He said that the hon. the Minister had insulted the hon. the Leader of the Opposition. Hon. members on the other side were so sensitive that they all raised a hue and cry. All the hon. the Minister had done was to defend himself. The Leader of the Opposition had accused him of being cold and unfeeling towards the man in the street, of not caring for him and having no sympathy for him. All the hon. the Minister then did was to tell this House that he, the Minister of Economic Affairs, had grown up in poverty. He grew up in difficult circumstances, and this is no sin. He merely stated here that he had not grown up in comfortable circumstances like the hon. the Leader of the Opposition, who is a Sir, who received a good education, has a lot of money and never knew any hardships. It is no sin to be rich. On what grounds can the hon. member for Gardens now say that the hon. the Minister insulted the hon. the Leader of the Opposition? He did not insult him. He merely put his point of view and said that he had as much contact with the man in the street as the hon. the Leader of the Opposition had. At this stage I move—

That the debate be now adjourned.

Agreed to.