Mr. Chairman, seldom in this House have I seen the hon. member for Parktown struggle as much as he did yesterday evening. I do not envy economic recession him his position, because in a time of it is very easy for an Opposition to criticize and to obtain general support on the wave of that criticism, but only a short while ago an ostrich upset the Opposition’s applecart and at the moment the Exchange, too, is upsetting its economic applecart.

And Brakpan?

Sir, I had no intention of talking about Brakpan, but since hon. members have just referred to Brakpan, I should like to tell them that this morning someone remarked to me that we had not done so well in Brakpan. My reply was, “Well, if we had not done well, then it means that the United Party had, in fact, done well”. Now I should like to know this: If a party adds just over 700 votes to its minority within three months, has it in fact, done well? When one analyses the voting, one finds that the United Party obtained 709 votes more than it did in February; but surely those are simply the 784 votes which Mr. Louis Stofberg obtained in February and which they have gained now. [Interjections.] Sir, it is quite clear to me that the poor United Party is on the run to such an extent at the moment that it has to clutch at any straw to see whether it cannot bring it to an end. I can only tell him this: “If he had ever believed that there had been a turning point in their adversity after Brakpan, three months ago, that illusion had been completely shattered now.”

But let us rather come back to the economics of the hon. member for Parktown. I said that an ostrich had upset his political applecart a few weeks ago. Of course, his economic applecart was full of sour apples, those sour apples of complaints, grievances, and what-have-you. But fortunately for us the economy has now taken such a favourable turn and the economy has revived to such an extent, as is naturally reflected on the Exchange—that sensitive barometer of our economic situation—that the poor hon. member for Parktown really has a very difficult task. I am glad I am not in his shoes. When we were experiencing difficulties in a time of a world-wide recession, I issued a warning to the hon. member. I warned him that the day things were going better once more, I would remind him of how he blamed this Government for the slow-moving economy when we were experiencing difficulties as a result of a world-wide recession. I said the day would come when things would be going better once more with the economy and that I would remind him then of what he had said so that he could, by the same token, give this Government the credit for a stronger economy too. World events, of course, have much to do with the state of our economy. The prices of our export goods are increasing very nicely. I have in mind, for example, wool, diamonds, platinum, copper, nickel, etc. At the same time nature has been kind to us, because we have had a wonderful agricultural season and excellent agricultural conditions are still prevailing because of the favourable natural conditions we are experiencing. But, Mr. Chairman, I may most certainly attribute a large part of the improved economic climate to the steps taken by this Government and to the steps taken by the hon. the Minister whose Vote is under discussion, because that hon. Minister is working night and day to create an improved economic climate, and he is succeeding in this masterly. Everyone also agrees that the latest Budget introduced by the hon. the Minister of Finance has contributed a great deal to the creation of this improved economic climate in our country. I just want to mention a few of the steps which helped to create an improved climate. There is, for example, the relaxation of foreign exchange control restrictions, which leads to higher domestic liquidity, which in turn exercises a downward pressure on interest rates. The measures for the promotion of savings will also give rise to an easing of the pressure on the capital market. In addition there is export promotion. With regard to this, the hon. member for Parktown said the Government was doing nothing for promoting exports. I do not know whether he is living in another world, but surely he should have taken cognisance of the steps for promoting exports announced by the hon. the Minister of Finance. I want to point out that the relaxation of hire purchase terms for motor cars has also contributed to the creation of an improved climate. And then, of course, there is devaluation; that too, has contributed to our having a favourable economic climate at the moment. Now, of course, it depends on our entrepreneurs, especially our industrialists, whether they are going to make use of the concessions and incentives in order to stimulate our economy further, because these measures are calculated not only to promote exports, but also to stimulate import replacement. The production of industrial goods for export is definitely no easy matter. In order to be able to compete on most of the markets, our industrialists must, in the first place, overcome the problem of long distances to our markets, and that is not so easy. Our domestic market is limited, and it is common knowledge that for growing exports one’s industry must be based on a strong domestic market. Thirdly, we have the problem that most of our industries are still suffering under the defect that workers in those industries have not yet built up a labour tradition in those industries, because we are a young industrial country and, finally, we have the new problem we encounter so often nowadays, i.e. the formation of strong trade blocs, such as the E.E.C. Therefore, if we want to promote our exports, we shall have to be far more selective in our industrial production. I want to refer, in the first place, to the refining of our base minerals, a field in which we can export far more. In this regard, too, the hon. the Minister of Finance indicated in his Budget speech that he was hoping the banks would utilize this greater liquidity for promoting the industrial production of base minerals. Furthermore, Sir, we shall have to give far more attention to the production of iron and steel goods, for we are in the very fortunate position that we produce the cheapest basic steel in the world and consequently we shall be able to compete far more easily in so far as we produce iron and steel goods, rather than goods in respect of which we do not have these natural resources as readily available. For that reason I say we shall have to be far more selective in our industries that will have to export. For this reason I see no problem; if we are more selective in our exports we shall indeed gain a place in the world market for industrial goods. Therefore, things are going much better with our economy, and I foresee that in the next few years it will go a great deal better, much to the discomfort of the hon. member for Parktown.

Mr. Chairman, I hope the hon. member for Paarl will excuse me if I do not follow his argument in detail. But I would like to say that this Economic Affairs Vote has to do with the material welfare of people, and that the material welfare of quite a number of members on this side of the House has been improved considerably since the Brakpan announcement today.

Sir, I want to return to a subject which I raised in the no-confidence debate at the beginning of the session and which was covered to some extent by the hon. member for Parktown last night, and that is the import control happenings of October and November last year. I raise it because the manner in which import control was intensified in November last year, and the events which preceded that intensification, have led to so much harm and so much confusion and so much loss of confidence in business circles that I regard it as vital that such a sequence of events should not be repeated. I said on that occasion that there had been no new elements entering on to the economic scene which would affect the balance of payments position between 22nd October—when the hon. the Minister of Economic Affairs gave the green light to importers to make their plans to import for 1972 on the same basis as they had imported for 1971—and the 25th November, when that policy was revoked and harsh and retrospective import control restrictions were imposed in its place. In reply to what I said on that occasion, the Minister indicated that the rapid deterioration of the foreign exchange reserves in November, 1971. was the factor which was responsible for the reversal of his policy at the end of November. I would like to point out to the hon. the Minister that our foreign exchange reserves had been falling every single month for more than two years before November, 1971, and in November, 1971, the deterioration of the reserves was no worse—in fact, it was not as bad as it had been in the corresponding month of the previous year. I would also like to point out to the hon. the Minister that the currency uncertainties which were triggered off by the American decision in the middle of August last year to suspend the convertibility of the dollar into gold, had been with us for more than two months before the Minister made his announcement on 22nd October, giving the green light to importers. Sir, with those currency uncertainties still unresolved in October last year, clearly there was an amber light shining over the balance of payments position, and yet the Minister chose to turn on the green light, and it was only about a month later, realizing that he had switched on the wrong light, that he had to switch on an emergency red light in an attempt to put the whole mechanism into reverse.

He is colourblind.

Mr. Chairman, this was a sorry, distressing episode in our economic history. It led to the imposition of unprecedentedly harsh measures on innocent importers and innocent overseas suppliers, who had acted in perfectly good faith. It forced importers to cancel and to repudiate contracts, which in turn damaged their own commercial reputation as well as that of the country as a whole; it caused losses to importers and suppliers alike, and it caused a great deal of confusion in the business world. It also resulted in innocent importers having to pay heavy deposit penalties and to raise money at high rates of interest to do so. It is because this episode led to all these unfortunate repercussions that I hope that the Government has learned its lesson from this sorry tale of mismanagement and misjudgment.

Mr. Chairman, South African importers may by now have been able to sort out the problems which were put in their laps as the result of the decision of 25th November, but little is being done now to help them plan for the future so that they can make the best of import allocations that are granted to them. Since November importers have had to cope with a 50 per cent cut in the balance of their 1971 permits; they have been given only 20 per cent of their 1969 import allocation for this year, which was only valid from March, and they have had to live on the promise of a review taking place this month. On that, their ability to plan for the future has virtually been taken away from them. They cannot possibly risk entering into commitments knowing what happened last November, until the Government has made a clear and definite statement of its policy. I wonder if the hon. the Minister appreciates that goods from overseas have to be ordered well in advance, and that with all these obstacles being placed in the way of imports, with the delay in obtaining imports from overseas, the probability is that a vacuum is going to develop in the months ahead in certain lines of merchandise. Already it is too late for some importers to place orders for next summer season. Already it is too late for wholesalers to order toys for the Christmas season from Japan. One would have hoped that this vacuum would be filled by local manufacturers, and to some extent it has been, and that is a very welcome development, but the South African manufacturers themselves have their problems. They have their labour problems and their own problems caused by import control and the dislocation of their own sources of supply, of raw materials and plant. As a result of this and as a result of the switch in demand from imported goods to local goods which has resulted from import control the delivery period of local manufacturers is becoming very extended, and costs and prices are tending to go up. I would like to make an appeal to the Minister as a matter of great importance. First of all an announcement in regard to import allocations should be made timeously. Only if they are made timeously can importers plan properly and make the best use of those allocations, not only for their own sake but also for the sake of the country as a whole. Now is the time, in fact the time is past when the announcement of the second round should have been made, and surely the reserves are in such a position that such an announcement can be made. Secondly I would like to appeal to the Minister, that when the announecment is made, it be made on as liberal a basis as possible in the interests of fighting inflation. With the pressure that is building up on local manufacturers, and building up it is, if that pressure becomes too heavy it can only lead to increased costs and to increased prices. [Time expired.]

The hon. member for Constantia himself does not know what he wants. It seems to me that if he had been the Minister of Economic Affairs and had to apply import control, he would go to the Press and tell them he was going to apply import control in two months’ time. The hon. member proclaimed the sad news here of what happened after import control. I do not know where I stand with that United Party. Last year, at their congress, the hon. member for Parktown criticized the Government terribly because of the fact that our balance of payments had shown a downward trend and had fallen so low. In truth, although not in so many words, he asked that something be done to save our balance of payments. Eventually the Government applied import control, and he is the hon. member who agreed afterwards that import control was necessary, but it seems to me as though the hon. member for Constantia has not agreed to that as yet. He is still complaining about it. Last night the hon. member for Parktown came along here and used these words. He said the introduction of import control “was a breach of faith with the business community of South Africa”. But, surely, if one introduces import control, then that is what one is doing; surely one cannot do it half-way. [Interjections.] We did this in the past, and the department has gained very good experience in this respect. But if one were to introduce it, certain people would have problems. We cannot help that. Certain people are going to have problems, and there will be hardline cases, but these are in the minority. But why was it done? It was done in the interests of South Africa, in the interests of the economy of South Africa, and if a small minority has to suffer as a result, then this is simply the way it is with most of us, who have to suffer at some time or other when certain measures are introduced in the national interest. But they are always so negative. They ask for something and then they complain about the same thing for which they asked. They do not state here what the benefits are which we have derived from import control. They do not make any reference to the signal success we have had up to now in regard to our balance of payments. They do not think of the major benefit this has brought to all the other people in the country. All they do, is to complain about the few who have been prejudiced, those people who live on imports alone. There is nothing else one can do. If people live on imports alone and that source of making a living is cut off, what can be done about the matter? When it is said that those few people are unhappy, I want to tell hon. members that hundreds of industrialists in this country are quite happy because import control has been introduced and their goods can be sold again.

Just take a look at our balance of payments and our economic position at present; in doing that, we will realize what major benefits import control has brought about. I think those hon. members should decide whether at that stage they were for or against import control in principle. After all, if they are in favour of import control, one must introduce it. One cannot do so in two ways; one can only do so in a properly ordered manner. Import control has been applied very sympthetically and judiciously by the department. If there are people who were guilty of misconduct and had to pay fines, they should have known beforehand that this would follow.

On several occasions we have heard it being said on that side of the House that our State corporations are going too far and are entering upon the domain of private enterprise. Today I want to pay tribute to our State corporations in this country. We on this side of the House are people who make a very strong point of the principle of free enterprise and the principle of the profit motive. However, I do not know where South Africa would have been today if we had not had State corporations which could assist in developing the country. We are a country with a small population. Private enterprise was not prepared to provide the risk capital for bringing about key development and other important development in the country. State assistance was necessary. We are thinking of the Railway, for instance, which provided the infrastructure. We are thinking of the Department of Posts in so far as communications are concerned. Then there is Iscor, which provided a sound basis for certain developments. If we did not have these, where would we have been? Private enterprise was not prepared to do these things. Then we also have the IDC. Strangely enough, the IDC was established under the leadership of that party. Now they want to tie the hands of that body which has helped to build the country. That is what they want to do. Whenever any of those hon. memers criticize State corporations again, they should tell us according to what formula they want State corporations to operate. They should tell us in what spheres State corporations may operate and in what spheres they may not. They should tell us exactly how matters are to be arranged. This is not so easy, for State corporations have, as I said before, grown out of a need which existed in the country for that type of development; a demand arose for it. To that I must add that State corporations developed as a result of the faith, dedication and love of the National Party and the National Party Government. Those corporations were inspired by this side of the House. As regards State corporations, inter alia the IDC, I think that the role played by them is being exaggerated to a certain extent. I know that the IDC has played a major role in this country. What does the IDC do? It takes the hand of private capital, and together these two take the risk of bringing about certain developments in the country. I found the report of the IDC very interesting. Let us see what the investment in industry in South Africa was over the past five years. The IDC only invested R24.8 million in industrial development. What did private enterprise invest by comparison? Over the past five years private enterprise invested R462 million. Therefore, only 5,4 per cent of the total investment came from the IDC. The people are saying now that the IDC and the other corporations are posing a threat to private enterprise. This is not true. I think this is quite exaggerated. The IDC has made a tremendous contribution in helping to bring about decentralization. I know what attitude that side of the House adopts in respect of decentralization. They say it must be economic, whereas we say it has to be done on an economic basis, but also to promote our ideology. We are not concerned about what that side of the House has to say in regard to that side of the matter. We are governing, and we believe that our ideology is right. What is more, we believe that we must implement it. It was for that reason that we started with border area development a mere 10 years ago. In looking back, we shall see that in the economic life of a people a period of 10 years is nothing. However, we. have had conspicuous success in that sphere. I do not have the time to furnish all the particulars now, but we have made very good progress. As we developed, we once again had to follow a course, a unique course, and formulate a policy. It is essential for such a policy to be flexible so as to provide for all the circumstances, because the problems of Pietersburg, the problems of Newcastle and the problems of Pretoria are not the same. The one differs from the other. For that reason our policy must be flexible. Now I want to say that at a place such as Pietersburg the cost factor, the wage structure, presents our greatest problem, for in border area development the cost factor of services is the greatest problem. Furthermore, Pietersburg is situated far away from the metropolitan markets. To influence an industrialist to invest and develop there, one must be able to lure him by way of cheaper production costs. That is something one cannot do if the wages are the same throughout the country. For that reason I want to make a special appeal to the Minister today, and I want to ask him to use his influence. I am also making an appeal through him to the Decentralization Board to make an appeal to the industrial councils … [Time expired.]

Mr. Chairman, the hon. member for Pietersburg in his remarks criticized the hon. member for Parktown for his criticism of the Vote. He criticized the hon. member for Parktown with regard to his remarks on import control. Surely he realizes that the steps which were taken on import control were disastrous as far as South Africa’s good name was concerned. The hon. member for Parktown’s criticism was valid, and he was supported in it by the hon. member for Constantia.

Then he went on to deal with the IDC. I want to ask the Minister to indicate his policy with regard to the IDC. He has appointed one of his senior officials as chairman of the IDC. I think it is time that a Select Committee should deal with the IDC and similar utility corporations.

The hon. member for Pietersburg, who is not listening at the moment, suggested that the IDC had done constructive work. He did not tell us of the disastrous efforts of the IDC in the National Growth Fund.

They cannot always have success.

He did not tell us how the country was misled. I think it is high time that a Select Committee should be appointed to deal with the IDC and similar organizations. Then we can see how far they are going. I am not asking that we should examine every investment and every loan to individual companies, but where they have the controlling interest in the company, surely it is in the public’s interest to know where the control and the influence lies. They must know where they will be up against it in competition. When we see and we hear of companies receiving finance from the IDC, where the IDC is the major shareholder, or the shareholder with virtually the control over the company, and that company is not successful, they have no opportunity of criticizing that company. There is no opportunity in this House, since we do not get the details in the Accounts. I think it is high time that we should get more information than that which is given in the Accounts.

I should like the hon. the Minister to indicate to the House what his policy is. He appointed a senior official to the board and it is obvious that he must have given him certain instructions. While we value the good work the IDC has done over the years, we think that there should be more control and more information given to the country than was given up till now. The annual reports and accounts for 1971 together with the balance sheet show that the total issued capital amounted to R248 500 000. The revenue reserves amounted to R47 548 000. Under the heading “assets” the following is shown: Financing of industrial undertakings, section 3 (a)—R118 541 000. No details of the type of companies are given and there is no breakdown of those companies. I suggest that where the investment is in shares and such shareholding amounts to a rigid control, those companies should be named in the schedules. The following is also shown under the heading “assets”: section 3 (b) general—R127 113 000. Under “Export finance” an amount of R32 180 000 is shown and under “Border are a development” we see a total of R87 751 000.

To what extent is that border development financed to carry out Government policy and to what extent is it based on sound economic lines? If it is based on sound economic lines, we shall support it, but if it is just to satisfy Government ideology, then we should have an opportunity of criticizing it in this House. The details should therefore be available to this House. The summary in the report shows under the heading “General financing of the various border areas” an amount of R88 000 000. Under “Sasol” an amount of R109 751000 is shown and under “General IDC” an amount of R109 000 000 is shown and under “General IDC financing” an amount of R42 million.

If the hon. the Minister is to support the hon. the Minister of Finance, who assures the country from time to time that he is in favour of private enterprise, surely he should reassure the country by dispelling the fear in many quarters that through the IDC the Government is competing with private enterprise and industry. That is the fear of private industry in many sectors. They fear that the IDC is the instrument of the Government to compete with them. This is particularly true in certain sections of the metal industry and certain sections of the clothing industry. The fear is that the IDC is exerting an influence which is unhealthy. The public is entitled to a more frank disclosure than is made in the annual report and accounts. There are other examples of reports with glossy covers, but the only information they contain is the information which can be obtained from the annual reports. I refer in this regard to the Bantu Mining Corporation, the Bantu Investment Corporation, the Xhosa Development Corporation and the Coloured Development Corporation. The report of the Coloured Development Corporation is significant because of the total of R4 400 000 given as assistance, more than half was given in respect of liquor and hotel businesses and the rest is distributed amongst cinemas, sawmills, panel beating, furniture stores, etc.

I come now to another aspect of the administration of this department and that is price control. I should like the hon. the Minister to indicate his policy with regard to price control. Price control is supposed to be spasmodically applied. I raised this matter in the Budget debate. The hon. the Minister did not have an opportunity of replying and therefore I raise it again now. Many activities are not subject to price control and in other cases price control is strictly applied. In effect, price control is profit control. The importance of the matter was emphasized by the recent escalation in the price of gold. If the price of gold continues to increase, it is possible that it may cause a further devaluation of the dollar. It is significant that the British Prime Minister called his Cabinet together to deal with inflation. One is entitled to ask the hon. the Minister whether he intends to use price control as the machinery to control profits, in which case he will be expecting the private sector to absorb the increased cost of further devaluation.

I should like the hon. the Minister to indicate to the House what he regards as a reasonable rate of profit. When the IDC receives an application for financial help in the private sector, it considers the viability of the industry. A figure of profits is then suggested as a reasonable figure for financial assistance. With price control there is another idea, and yet the same vote covers these two departments. The one department considers a certain percentage as a reasonable return on investments, while the price controller has different ideas. He considers the marginal profit against the demand. The IDC considers the marginal profit in relation to the investment in that industry. It is difficult when you are faced with the position that while one department considers a certain rate, the other department considers another. If the profit margins are to be controlled indefinitely, then development will be hindered. I think it is time the hon. the Minister took us into his confidence and indicated to the public the guide-lines which he wishes to apply in his policy of price control. He is not controlling everything, but only a certain selected number of items, a selected number of firms. Industry and commerce do not know what his main objectives are and I think it is time that the Minister indicated the guide-lines of his policy, so that we will know where we stand.

I now come to import control, which is also part of the Minister’s responsibility. It has been dealt with by the hon. member for Parktown and the hon. member for Constantia, but I wish to refer to the Swazi gap in imports. As the Minister knows the Government is having talks with the Government of Swaziland about the threatened Swazi gap which could open South Africa’s structure of import control. The point is that although Swaziland is bound to South Africa as far as import duties are concerned, by virtue of its membership of the Customs Union with South Africa, it is not bound by the South African import control regulations. The Swazis receive a share of South Africa’s customs revenue which forms an important part of their national income. On the other hand there is the possibility that overseas concerns may find conditions to be easier in Swaziland and establish industries there, which will be subject neither to South African import regulations nor to South African wage and employment restrictions. With the prospects of accelerated development in Swaziland, I wish the hon. the Minister to tell us what he intends to do about the Swazi gap. It is possible that the same problems which exist with the Swaziland gap can develop in countries like Botswana, and Lesotho because the same problems exist there. I suggest that the hon. the Minister should have regard to the present customs duty agreement between South Africa and these territories. There is this possibility of an import control gap, and I want the hon. the Minister to tell us how he will overcome this difficulty.

Mr. Chairman, the hon. member for Cape Town Gardens in a speech in this House on 10th April, made some very cryptic remarks about the motor manufacturing industry in particular, but also about the motor industry in South Africa as a whole. I do not think that we can allow that to go by unchallenged. The first point the hon. member made was that this department, this Minister and this Government, have failed in every single step they have taken in Phase III of local component control in South Africa. At this stage I wish to put it to the hon. the Minister that we should not hesitate for one single moment to go ahead with Phase III of the local content programme. Because of the lack of time, I wish to give only three reasons for this appeal. Firstly, those people with full responsibility, and those who believe in the future of South Africa, have financially committed themselves heavily over the past two years and for the next two years in that interests of the motor industry in South Africa. For that reason alone these people who have trust in the future of the motor industry and in the future of South Africa, it is a must that we should continue.

*In the second place I want to make another important statement; the hon. member for Cape Town Gardens referred to the 43 models that are now available in South Africa. Everyone who is interested in the motor industry agrees with him that that is not a good thing. Does the hon. member want the Minister to specify which models must disappear from the South African market? It is this Phase III, inter alia, which will determine, as a result of the enormous capital investment, which models will be able to continue and which not. I want to content myself with the statement that no foreign company can spend these enormous amounts in this country unless it markets approximately 30 000 to 40 000 vehicles of one model annually. It is true that there are companies that have made these investments in the recent past, but, Sir, we want to tell you they are doing so at their own risk.

†Thirdly—and this is very important— the hon. member made those cryptic remarks; but now I want to make this one remark, that the motor industry in Phase III will be one of the main foreign exchange savers in this country. I wish to refer to a certain model that I know of. In the C.K.D. pack—that is the “completely knocked down” pack—a car of which 100 per cent of the components are from the country of origin, is costing in South Africa R1 840. With a 66 per cent local content in South Africa, where we try to put the lifetime of a model in South Africa at 5 years, and supposing that 35 000 odd vehicles of this certain model will be sold, it will mean a saving over that five years of R40 million. If that is not important, then I do not know wihat is important. Furthermore, Sir, to incorporate that 66 per cent local content into this vehicle, we will have to spend roughly R5 million in tooling and dieing, but that R5 million is money spent in South Africa—in other words, a wonderful contribution to the economy of South Africa. We do not have much time, and therefore I cannot say much more about this matter.

Now I am proceeding to a second remark which this hon. member made. Why he did it, I do not know. The hon. member for Cape Town Gardens said that in South Africa—that is in his Hansard—the Volkswagen Beetle is costing 43 per cent more than in the land of origin, viz. Germany. I must say to the hon. gentleman, that is not true. The fact is—here I have it in front of me—that the Beetle actually is costing 59 per cent more in South Africa than in Germany. If we take into consideration a 4,7 rise in the price of that car in Germany recently, another 5 per cent in the next few weeks, then this is very far away from 43 per cent. According to this member—it is in his Hansard—a certain model of the Toyota Company in South Africa is costing 100 per cent more than in Japan. That is far and away; because this Corona car mentioned by the hon. gentleman costs in Japan 727 000 yen, equal to R1 817. It retails in South Africa at R2 867, 57 per cent and not 100 per cent higher than in Japan. That is a very far way off. But, Sir, there is a reason for this difference in price. Indeed, there are many; but because we do not have the time, I can only mention one. The one that I want to mention is the matter of purchase tax. For a certain model with a 1200 cc engine, the purchase tax in South Africa is R264—in Japan it is R157. For another model in South Africa it is R334 —in Japan it is R195.

*In other words, Sir, this tax is being levied by the Government for purposes approved by this Parliament. But now that hon. member wants to give out that it is the fault of this department and this Government that we in South Africa have to pay more for our cars. Finally, I want to tell the House and the country that this statement made by the hon. member that we in South Africa have to accept cars in which all the safety devices—he used the word “devices”—devices that are available to other people, are not built in, is not true.

†In South Africa motorcars are being manufactured to be as safe as they are anywhere else in the world. My time has almost expired, but I should like to quote just one instance. In this particular car was one of our most famous South African cricketers. In this car were built in all these safety devices. This cricketer was in a very bad accident, and that car broke up progressively fore and aft. But the cab was intact and that cricketer was saved for South Africa.

Mr. Chairman, the hon. member for Smithfield is an acknowledged expert in the motor industry to the extent that he has considerable vested interests in the industry. In replying to him today, it is my intention not to speak from the point of view of vested interests, but to speak more objectively, on behalf of all the motor manufacturers in South Africa, the big three who have considerable vested intests in seeing the elimination of the lesser nine, the component parts manufacturers, who have great vested interests in the future of the country and also the South African motoring public, all two million of them, who have one vested interest, namely to see that they are given a reasonably priced motor vehicle, a motor vehicle at a price which they well can afford. In these days, when the public is paying some R1 000 000 per month, in order to run vehicles, in respect of taxes and the cost of maintenance on the roads, the public certainly has an interest. I want to say immediately that I shall merely quote a man who should know a little about the motor industry. He was recently in this country, in the office of the Minister of Finance. I refer to Dr. Raffaello di Nola, the head of Italy’s State-owned Alfa Romeo motor works, who came from Italy last week and put this view squarely to the Minister of Finance in Cape Town: “Please, Mr. Minister, think carefully about this important problem of your Phase III.” This, according to the report I have, he said with old world courtesy. He appealed to the Minister to slow down on Phase III. That view was supported by no less a body than the Franzsen Commission, who indicated to the Government that at this moment in time, with our inflationary tendencies, it had no right to give priority to the expenditure of an additional R160 million of local capital in the motor industry, at a time when the economy was over-heated. I should merely like to indicate that the hon. the Minister of Finance, during the Budget debate, devoted only a few words to what is regarded as one of the most important industries in the country. He indicated that the industry was suffering from a loss of sales and therefore he made a slight concession to the industry in respect of H.P. terms and sales taxes. The contribution of the motor industry forms 7 per cent of our national income, which compares favourably with the 10 per cent of agriculture and 12 per cent in the case of mining. It provides employment to 113 000 people, of whom 43 000 are in manufacture. The motor manufacturers presently represent 14 per cent of the total industrial investment in South Africa. The imports of this sector amounted to R230 million in 1968. and the total direct investment of the industry in South Africa amounts to R10 000 million. Our taxes are R1 million a day. One has only to read the papers of the last few days to see that the motor industry has fallen on evil times. At manufacturing level, there is apparently a state of chaos. More and more appeals are being made to the Minister of Economic Affairs to revise his thoughts about the continued enforcement of Phase III. It has been recognized that the attainment of Phase III objectives has proceeded a fairly long way, namely two years out of the five, but if the industry is to be saved economically, Phase III capital investment must be spread over a longer period. In order to do that, one can only look to the present price increases in motor vehicles. There have been five in the last two years. Only a day or two ago, the Leyland Corporation announced increases of between R40 and R235 per model. The motoring public feels today that not only is it being overtaxed, but also that we are killing the goose that lays the golden eggs. In this regard even the Government must have an interest, because last year the hon. the Minister of Finance lost some R11 million from excise and sales tax because of the drop in motor vehicle sales. This drop-is drastic. Only last month sales again dropped, and it was the largest drop since April a year ago. Then, too, we have to realize that because of the Government’s present policy of overtaxing and over burdening the new passenger car industry, they have driven car owners to the use of light commercial vehicles. It has been pointed out that there is nothing wrong with an individual, a farmer or a commercial user, making use of a light commercial vehicle. But the trend away from passenger car sales has been so alarming that our annual sales are in danger of dropping this year to 155 000, as against a record of 202 000 two years ago. The economic plan for South Africa envisaged a growth rate for the motor industry of 8½ per cent, on which they thought they could warrant the introduction of Phase III. This drop in sales of some 50 000 models per annum, is absolutely critical as far as the new car manufacturing industry in concerned. Equally the component parts manufacturers are also suffering, and as a result of reduced runs in the new car industry, the prices of components are increasing. Again I quote Dr. di Nola—

I have been appealing to the Minister to do this for the last two years. This report continues—

This is understandable, Sir, The late Dr. Kuschke indicated that as far as the Phase III concept was concerned, “the main purpose was and still is to increase local content of motor vehicles progressively, without (and I stress this) affecting the country’s economy (in other words, adding to our inflationary trend) or the cost structure of the motor industry detrimentally.” This is just what has happened ever since 1971, when Phase III was introduced. Then the late Dr. Kuschke went on to indicate that in this country we are up against the question of short manufaturing runs. He said—

The Government is engaged in empire building in the sense that they want the IDC to enter the motor industry, and all this is being done at the cost of the motoring public. There are indications, too, that more and more new models are coming into the country. Only last week Dr. Wessels indicated that he intended introducing a two-door model and that he had a new Toyota model for Phase III. Then we also have Alfa Romeo being entered for Phase III. I wonder, against this background, whether the answer that I received to a question which I raised in the House just recently in regard to the allocation of Borgward permits, is excusable or explicable. Hon. members will remember that Borgward Motors ceased to manufacture some five or six years ago. These permits were not withdrawn from the Borgward interests, but they were allocated amongst a number of other interests, as a direct result of which a number of new cars came into the country in an assembled state. I refer to the Rover, the Jaguar, the Triumph, the Alfa Romeo, the Lancia, the NSU and the BMW. If we are genuine in endeavouring to build up a sufficient volume of local manufacture to lower production costs, what justification can there be for distributing permits which had expired to other newcomers to bring in new vehicles, at a time when the country’s policy is to use South African vehicles and South African vehicles only? [Time expired.]

The hon. member for Gardens has once again discussed here the question of the local content of motor cars, as well as motor manufacturing in South Africa. Once again he came forward with the same story we heard him telling here before. We, on our part, believe that the Minister should proceed with this Third Phase Programme. We think it is in the national interest that the third phase should be proceeded with, and we believe this for various reasons. We are making use of local materials; in that way we are creating opportunities for employment for our people and we are saving an enormous amount in foreign exchange, apart from the investment of foreign capital which we have in our country in this way. I think it is important for us to keep these aspects in mind. We should weigh the one against the other, and if I had to make a choice, I would support the Minister fully in his decision. The hon. member for Gardens said we had to defer the third phase to a more opportune moment. He has now been saying for the past two years that the moment is not opportune. Sir, I ask myself when, in his opinion, the moment will ever be opportune, if this is not the case now.

May I ask a question?

No. I have only ten minutes. In terms of this programme we shall have rationalization in the motor industry, which will enabl us to market these vehicles with the available capital at a reasonable price. This will in fact restrict the choice of vehicles to a certain extent; we grant that, but it is right that this should happen. But we shall get the vehicles on the market at a reasonable price, and we shall also have the other benefits flowing from the local manufacture of these vehicles. I am not frightened of a downward trend in the sales of motor vehicles. With the rise in the standard of living of South Africa’s total population, I think that the market for motor vehicles will only show an upward trend, and not a downward one. Actually, the non-White market has not even been exploited as yet; it has still to be exploited. I firmly believe that the hon. gentleman is unnecessarily pessimistic about the motor industry.

However, I want to refer to another matter that was mentioned by the hon. member for Parktown last night, i.e. certain business methods applied in regard to sales by multi-level sales organizations. We know that we in our country stand for absolute freedom of trade, and that the dealer may actually feel free to sell his wares as best he can, and one does not want to impose too many restrictions on him. This is the general principle which is interwoven in our business methods in South Africa. In fact, the old maxim says caveat emptor—let the buyer be cautious and know what he is up against when he enters into a transaction. The question that arises now is whether it is the duty of a government to protect a gullible buyer. I shall grant that in this regard we already have legislation, which indicates that we protected gullible buyers in the past, buyers displaying poor judgment. One calls to mind the Hire Purchase Act and one calls to mind the Act we passed here last year in regard to the purchase of immovable property on the instalment system. All of these are legislation with the same kind of tenor. They protect the buyer against exploitation by reckless businessmen and dealers. I nevertheless believe that in spite of this tendency to protect the buyer, we should move ahead cautiously and see to it that we do not precipitately impose curbs on the freedom of trade of our dealers. I personally believe that the action on the part of the Government, and on that of the companies as a whole, should be concentrated on properly informing and instructing one’s buying public, in the sense that they are warned against such abuses and exploitation. Now I say that control may be considered, but we should move ahead with the greatest caution in regard to creating new controls which may restrict freedom of trade in this country. We should not find later on that as a result of passing certain legislation, we created precedents which are going to impose even more restrictions on our freedom of trade. We should proceed with caution in that respect. Even so, when we speak in this House and also outside, and whenever we have the opportunity, we should call attention to the reckless exploitation of the buying public by some dealers. Recently there was a report in the Press concerning a company—it seems to me as though this also comes from the Transvaal—which sent out worthless detergents by mail, and one had to pay R5 in order to collect the parcel at the post office, a parcel containing something one did not even order at all, and in the end one paid R5 for something that was not even worth R1. Only this morning it was brought to my notice that a certain Watra Yellow Pages Proprietary Limited, also in the Transvaal, had simply given notice to a company here in my constituency that their name had been included in the Yellow Pages. They did not ask for it; they are simply notified that their name is being included, and an account for R55 was sent to this specific company. The company in question happens to be a company which owns a block of flats, and there is no need for them to get their name into the yellow pages. If they do not reply within a certain time, this will be regarded as a contract which will be held against them.

Are these the yellow pages in the telephone directory?

No, I do not know. All they say, is “Watra Yellow Pages Proprietary Limited, computerized world-wide yellow pages for commerce and industry”, and they merely state that they are sending an account for R55 and that the above address will be included in the yellow pages. This is the class of thing I have in mind. This company was not asked: they were not recruited, there is no contract, the account is simply rendered to them, and unless these people consult their attorney and lodge an objection to it or write letters back to this firm, they may later on land in a situation where they will need legal aid. This is the type of thing we should guard against, and it is our duty to take steps against it when it comes to our notice.

†I want to refer to another matter, and that relates to our export drive. This week we are experiencing an episode in our short-term programme to promote our exports. It has been called the event of the year; it is our first ever national trade fair which was opened on Monday by the hon. the Minister of Economic Affairs. This fair has been organized by the Transvaal Chamber of Industries and the Witwatersrand Agricultural Society and I think we should congratulate them on their initiative and on the way they have managed this affair. The Government should also be thanked for its participation and its enthusiastic support. They have recalled no fewer than 34 trade commissioners from foreign countries to be present at the fair to advise people from overseas. The South African Airways have taken part inasmuch as it has arranged for tourist-cum-business trips, combining business with pleasure. I have been informed that some 200 exhibitors are taking part in this fair, that some 200 000 invitations have been sent out and that some 500 foreign buyers are expected. Those who have organized this undertaking should be heartily congratulated on their initiative. Fairs and expositions of this nature have a double value. In the first place, it introduces foreign markets to our South African products and, in the second place, it proves to our local consumers that South African goods can hold their own vis-à-vis the imported produce and that we can do without the snob value attached to imported articles. South Africa can deliver the goods. That is the most important lesson that we learn from a trade fair such as this.

The South African export drive, I think, will only be properly co-ordinated and stimulated after we have had the recommendations of the Reynders Commission. In the meantime we must carry on with the ad hoc planning as we have been doing in the case of this fair. ur export drive is beset by quite a number of problems, of which I should like to mention a few. Firstly, there is the question of increased shipping rates and distant markets. Secondly, there is the situation of our main manufacturing centres in the interior.br of our country far from the coast with the attendant high cost of railage to the coast. Sometimes it costs more to bring a product from the factory to the harbour than from the harbour to Europe. [Time expired.]

Mr. Chairman, I think it is right that I reply at this stage to certain matters raised so far in this debate. The members of the Opposition, and particularly the hon. member for Parktown, who is the main speaker on that side of the House, do not under the present circumstances have such an easy task as they would have liked to have had. The hon. member for Paarl pointed out that there is every sign of an upsurge in the economy. There is every sign of an improvement in the economy as a result of the monetary and fiscal measures adopted by the Government. Naturally this makes matters more difficult for the Opposition. I am not saying this because I think that the hon. member for Parktown takes delight in things going badly for South Africa economically. However, it makes his task far easier if he wants to criticize the Government and wants to find fault with its policy, if he is able to find weak spots on which he can hammer.

Approximately two years ago I took over as Minister of Economic Affairs. I must admit in all honesty that things are going better for me today than at any stage during the past two years. Since I became Minister of Economic Affairs we have been through a difficult time economically; a very difficult time. Hon. members are all aware of the international and internal problems which arose and which made things more and more difficult for us. I do not want to go into details now. However, the Government has in the meantime adopted the necessary measures, and we now see all around us movements which were started as a result of those measures. We are looking forward to a much brighter economic future in South Africa in the months and years which lie ahead. I shall have more to say about that later, but I think it would be better if I at this stage dealt instead with the mattersraised by hon. members. I should like to deal now with the subjects raised by the hon. member for Parktown. After that I r shall deal with the other matters. The subjects which were raised by the hon. member for Parktown, were also touched upon by other hon. members on that side of the House. In so far as I am therefore dealing with the subjects as such, I hope that it will be regarded as a reply to all the hon. members who discussed them.

The first subject I should like to discuss is import control. I really do not know why the events of October and November of last year had to be raised to such an extent again today. Yesterday evening this matter was raised by the hon. member for Parktown, and again today by the hon. member for Constantia. We have in fact discussed this matter on a previous occasion, and it would seem to me as if they do not really have a better subject to discuss. For that reason, we shall have to rehash this topic again. The fact of the matter is that it is customary to make an announcement during September or October of every year in regard to import control for the ensuing year. So it happened that last year, when the time arrived, I felt myself called upon to make announcement in regard to import control. At that stage there was a measure of concern regarding our balance of payments position. Matters did not look as favourable as we would have liked them to have been. This concern was not as grave as it subsequently was on 25th November, 1971. It was in fact the case that no decision had yet been taken at that stage. In order to eliminate uncertainty among importers, it was necessary for me to say something and make an announcement. In the absence of any other decision, I made the announcement that import control for 1972 would be the same as that for 1971. Then, later in November of that year, we had to announce measures because of the events which had taken place—I do not want to elaborate on that. The hon. member for Constantia referred in passing to the most important reason which had given rise to that, viz. the dollar crisis in the United States. At that stage we had felt ourselves compelled to intensify import control. We did not do this without taking other considerations into account. There were many other considerations and measures which could be taken into account, and which we did in fact take into account. Once again I do not want to elaborate on the merits of that step. The fact of the matter is that we decided that import control had to be intensified. I want to point out that we should not draw the conclusion and we should not say that import control was introduced, for at that stage import control did already exist. Hon. members will recall that at the end of 1969 the International Monetary Fund had withdrawn its consent, enabling us to apply import control on the grounds of the balance of payments position. Consequently we had then relaxed import control completely as from the beginning of 1971. Despite that we still said that a certain degree of import control would be maintained on certain commodities. We said that it would be applied to certain commodities in respect of which we were tied and were not at liberty to offer local industries the necessary protection. Therefore a degree of import control remained in force, but it was really a very small degree. Because it was such a small degree, goods then flowed freely into South Africa. We then decided that the most desirable of all the means we were able to apply was to intensify import control. The hon. member for Parktown consequently stated that we had in fact committed a breach of trust against certain importers. When he makes this statement he must have based it on two considerations. The one is that I had first announced what the policy for 1972 was going to be and had subsequently retracted it, and the other is that the unused permits for 1971 were at one stage reduced. This may be true, but it was essential and in the interests of South Africa that we intensify import control. Since it was so essential we were obliged to do so.

At the moment I do not know of any goods which are in really short supply. The hon. members for Parktown and Constantia are concerned about this and say that we must make an announcement on what import permits we are still going to release in the immediate future. They allege that these people are beginning to suffer hardships. I do not really believe it can be said that any shortages exist at present, or that any special hardships were experienced. Hon. members on the opposite side know as well as I do that there was a large measure of stockpiling last year. When we introduced import control on 25th November, 1971, there were tremendously large supplies here in South Africa. The traders were then to a large extent able to live on those supplies.

At the time we announced in regard to the permits that had been issued for 1971 but not yet used, that 50 per cent of those permits—the amount involved was approximately R900 million—would be cancelled. They could, in other words, use only 50 per cent of those permits. I think that we were quite fair and reasonable towards those people throughout. We told them that they had to cancel any orders they had placed immediately. However, we also told them that in so far as the goods were already on their way from the factories of origin, we would grant the necessary permits. It so happened then that we had to return a certain percentage of the 50 per cent we had cancelled. We had to do this for various reasons. Some of the importers had already placed larger orders than had been allowed by the 50 per cent unused permits they still had in thier posession. In other cases, this was done in respect of goods which we could not divide, such as heavy machinery. After all, one cannot import only half of a machine. That is why we were subsequently compelled to return permits for approximately R120 million of the 50 per cent which were cancelled.

We made a further arrangement that those who had goods on order, but did not have the necessary permits, could pay a fine on the goods which were imported. A committee was established which consisted of officials as well as of representatives of the private sector. That committee would form an opinion on the payment of the fine. Questions were asked in the House about the extent to which fines were paid and the extent to which the fines were repaid. I have already replied to those questions.

To cut this story short, I want to point out that I am at present considering the extent to which we are going to allocate further permits. To a considerable extent the hon. member for Parktown supplied the answer to that question himself. In fact, he blew hot and cold, for he and the hon. member for Constantia want us to announce what permits we are going to issue. Then the hon. member for Constantia says we must be liberal.

As liberal as possible.

Yes, he said we must be as liberal as possible. However, the hon. member for Parktown said yesterday evening that our problem with the effective utilization of import control in order to improve our balance of payments was the fact that approximately 80 per cent of our imports consisted of capital goods and raw materials for our factories.

But how can the people order if they do not have permits?

The hon. member need not be concerned about that; I shall come to that. My reply to the hon. member is that I am almost unable to cut back on the import permits for that 80 per cent, for if we were to cut back on capital goods, it would mean that I would be curbing the expansion of the factories, machinery, the infrastructure, and so on. There would therefore be little chance of saving anything on the importation of capital goods.

But is that not exactly what you are doing?

The hon. member may rise and state where I am doing this.

With spares and essential requirements.

I beg your pardon?

With spares and essential equipment for industry. If they do not know how far ahead they can plan, they cannot order.

I shall furnish the hon. member with particulars in a moment of how we are dealing with this situation in respect of those goods. First I want to complete my argument. This 80 per cent consists further of raw materials which are used in our industries. The position is different now to what it was in earlier years. We have expanded in the manufacturing and industrial spheres and we now need raw materials for processing here. If the import of these raw materials is not allowed, it would mean that our factories would have to close down. We would want that even less, not so? So I have to fall back, as it were, on cutting down on the 20 per cent consumer goods. But there are local factories which manufacture most of those goods themselves. But we are not getting any co-operation from the public, nor, partially, from the importers in the trade. After all. there is this idea that everything which is imported is inevitably better, and that it is not possible to live without these imported goods. Therefore, these people are continually pleading with us to issue more permits. If I were to issue all the permits for the consumer goods which these people want, all my import control efforts would have been in vain. So I simply cannot do it. Initially we granted 20 per cent of the permits issued in 1969 in respect of consumer goods, and we are now considering to what extent we can issue further permits in regard to certain goods. I hope that we will be able to make an announcement in this regard within the next three weeks or so.

The hon. member for Durban Point referred to the uncertainty which exists. Where does that uncertainty exist? Our policy is that our import control effort is based for the most part on three different commodity lists. The one is the free list, as it was previously, which was cut down considerably as a result of the extension of import control. The second consists of a quota list of 18 different commodities, not necessarily all, which we deal with differently to a certain extent. Among those 18 commodities on the quota list, the first I want to mention is raw materials. Raw material permits for industrialists—and I take it this is what the hon. member for Durban Point referred to—are allocated on a four-monthly basis according to the consumption. In other words, industrialists are not being curbed. As far as the trade is concerned, there are certain raw materials which do not go directly to the industrialist, but reach them through the dealers. These raw materials are also made available through the dealers on a four-monthly basis according to sales. So where are all the hardships in respect of raw materials? There need be no hardships if there is proper co-operation among importers and the department.

As far as capital goods are concerned, where these are required directly by industrialists, permits are provided on the end consumer basis. In other words, as far as capital goods are concerned, the people say what they want and what they want permits for, whether it is for the expansion of factories, or anything else for that matter. They then receive the necessary permits to import what they want. All the other commodities on this list, of which I could just mention a few, for example, agricultural tractors and implements, passenger motor vehicles with the approved manufacturing programme, motor cycles and scooters, aircraft, professional and electronic equipment, hand tools, pharmaceutical products, fungicides, hard timber and lastly all classes of consumer goods not specifically mentioned here are all goods in regard to which I can exercise my import control.

This is why I ask, Sir, how hon. members on that side can expect me now to be liberal and grant import permits according to the requirements and the request of these people—“as liberal as possible”, as the hon. member for Constantia said? Then my entire effort would have failed completely. No, Sir, I want to make a plea here today for commerce and the importers, as well as the people who buy, to co-operate with us by buying South African goods. There are enough South African goods manufactured locally. But no, they come to me and ask for permits, because they specifically want imported goods, probably because they make bigger profits from them. But South Africa’s interests are not always taken into consideration. I want to ask the hon. main speaker on that side to help me in this repect instead. Last Monday I held talks with Assocom. I shall during the next few weeks hold further talks with the responsible organizations. Then I shall, just as soon as possible, make a statement in regard to the issuing of further permits. I may as well undertake to be as “liberal” as possible, but I am afraid that that is not going to be all that liberal, otherwise there would be nothing left.

How long does it take to dispose of an application for capital goods at the moment?

Well, in the normal course of events, I would say two to three weeks. If it is an urgent case, the hon. member can come to me—I shall try to expedite it a little.

The next matter which the hon. member for Parktown raised, was the matter of GATT. As far as our commitment to GATT is concerned, it is also rather seriously tied in with import control. You will appreciate of course that when we introduced import control last year, we first had to receive the necessary exemption from the I.M.F. Afterwards, a meeting of the GATT executive was held, and Mr. Steyn, the Secretary for Commerce, and other officials, went there to hold the necessary talks. We are one of the founder members of GATT. We joined approximately 25 years ago. Circumstances today—it is unnecessary for me to tell you this—are completely different to what they were in those days. The hon. member for Parktown now expects me to perform miracles to solve our problems with GATT. It would have been better if the hon. member’s own party had arranged matters to better effect in 1947 when we became involved in this.

That’s an old one.

It still remains the truth.

Very well, I shall not turn this into a debating point. But this agreement was concluded in 1947, in the time of the previous Government. Be that as it may, I do not want to advance any arguments on that basis, but the fact of the matter is that we have many problems today as a result of the agreement concluded at the time. You know how ironic it is, Sir, that in 1947 no less a person than the Prime Minister of the time, General Smuts, made an appeal to the persons responsible for the negotiations of that time to the effect that we should be sympathetic, that we should make sacrifices in our negotiations with GATT, so that we could help with the reconstruction of Europe.

We were a rich country then.

*The MINISTER. That was after the war. Europe had of course to a large extent been razed. We made those sacrifices. Great sacrifices were made at that time. Whether this was as a result of General Smuts’s appeal, or for whatever other considerations, the fact remains that major sacrifices were made. Where do we stand today? Our hands are, as it were, tied behind our backs. The countries which were down and out then, for example a country like Germany—where does it stand today? All the other countries of Europe which are joined together in the EEC, are speaking harshly to us today, while our hands are tied. We, as a young, developing country, do not have the means today to afford our own industries the necessary protection in order that we may develop. That is the problem we find ourselves facing.

This GATT contract, to which we are a party, is a binding contract. But it is not a bilateral contract, so that we may go to the other parties and say that we want to terminate it, or that we want to change its conditions. No, it is a multilateral contract; there are many other countries who participate in this contract, and which made this matter so much more difficult. There are two important obligations under this agreement. The one is the provision for tariff concessions according to which the different countries are mutually bound, and the other is that a member can only apply import control if he has problems in regard to his balance of payments.

As I have said, I do not want to elaborate at too great a length on this, but you will recall that in 1969—or rather from 1970 onwards—we were compelled to lift the import control we had previously had. Consequently we did lift it. You know what has happened since then. Last year, when we introduced import control again, we were told to attend a meeting of GATT, which took place in January of this year in Geneva. On that occasion other member countries argued that South Africa had no legal right to maintain these intensified import restrictions, after having devalued the rand in December by a greater percentage than the monetary unit of any other country was devalued. These countries insisted that South Africa should immediately lift its intensified import restrictions. There were hard discussions, according to the reports made to me.

South Africa’s representatives at these talks, held in Geneva in January of this year, adopted the standpoint that we could not relax import control until such time as there had been a real and permanent improvement in our current account, as distinct from the capital account. This is one of our problems today, namely that our balance of payments has improved fundamentally, and on the basis of the improvements which have taken place in our balance of payments, it is now being argued that South Africa no longer needs to apply import control.

But in the meantime we have had a very heavy inflow of capital into South Africa, and it is also true that our balance of trade recovery has not been altogether satisfactory. Therefore it is our standpoint—and we believe we have irrefutable arguments in favour of this—that we should be able to maintain import control until such time as our balance of trade is on a sound, permanent and stable basis. Eventually, at those talks, GATT decided that nothing should be done at that stage, but that South Africa should try to do away with this import control as soon as she was in any way able to do so, and that further talks should be held towards the middle of this year. I think that we will one of these days be obliged to hold further talks with GATT in regard to our import control position. As I have said, the standpoint which we adopt is that we want to make certain that our balance of trade has first been permanently placed on sound basis before we are able to relinquish import control, because we would like to have permanence instead of the uncertainty which will otherwise continue.

The hon. member asked why we have now appointed a committee to inquire into the Republic’s position under GATT. Recently a senior technical committee was appointed consisting of representatives from the public and private sectors, under the chairmanship of the Secretary for Commerce, on which members of the Public Service are also serving. I really believe that this technical committee will have to do everything in its power to see what is possible for South Africa in order to improve our position in respect of GATT. I have been informed that this technical committee envisages having its report ready for us by the end of August. All that I can say is that I believe sincerely that there are perhaps ways and means, which this technical committee will be able to establish, whereby we will be able to cope with the problems to better effect than we have in the past. Naturally we have constantly in the past been negotiating in regard to tariffs. We are perhaps good negotiators, but when one ventures into this sphere, one finds that there are people who are much harder and tougher than we are. We are unable to make much headway there.

The next matter raised by the hon. member for Parktown was the question of exports. In this connection he referred in particular to the Reynders Commission, which was appointed to investigate all aspects of our exports. I want to agree with one thing the hon. member for Parktown said, and that is that there are too many people who have something to say about exports, and that there are too few people who are doing something about it. Then, I should like to point out to the hon. member that it is not the Government which exports. All we can do is to assist industrialists and to stimulate exports. But it is not the Government which exports; it is private initiative which has to export. All that we can do is to create the necessary climate and to assist where we possibly can. We have a very good export promotion service which is at the disposal of private initiative.

Recently in his Budget speech the hon. the Minister of Finance also announced various incentives, and one sincerely hopes that the private sector will not only make use of this export promotion service, but also of the incentives in order to promote our exports in this way. Sir, this is perhaps a very serious thing to say, but I feel that we must identify where the best fields for our exports lie. We must identify the best export fields; and we are working on that. Once we have completed this identification, and if the private sector is not in favour of promoting exports in those fields, the Government will probably be obliged to render the necessary assistance through some or other State corporation or by establishing a State corporation, or by doing something itself in this connection.

However, one hopes that the private secfor will play its part in this matter. The Reynders Commission has already submitted an interim report, and some of the proposals made by the commission have already been included in the proposals made by the hon. the Minister of Finance in his Budget speech. We expect that it is likely that the commission will hold its last meeting in July/August of this year; that it will then be able to complete its activities; that the report will then have been translated by about November of this year, and that we will be able to have the report on the Table immediately after the opening of the session next year.

The hon. member for Parktown asked whether SAFTA, for example, had perused this report. The answer is “No”. This interim report was a report made to the Government, and it was used only by the Government. I expect the Reynders Commission to submit a very wide series of recommendations, which wil be aimed at promoting our exports. I agree with the hon. member that we should try to import less, that we should try to be more independent in regard to imports, but it is equally necessary, and more necessary, that we should promote our exports.

Then the hon. member for Parktown asked whether there had appeared to be any benefits from the overseas visits of the recent economic missions. Sir, I approved of these two missions. The one visited the Benelux countries—the Netherlands, Belgium and Luxemburg—under the leadership of Mr. Neil Malan. The first mission went overseas in November 1971. The other mission was under the leadership of Dr. Etienne Rousseau, and this mission visited Germany and Austria. I think that we were fortunate in having had two most outstanding men as leaders of these missions. As far as the missions themselves were concerned, we were fortunate in finding very good men to represent the various sectors of our industries. Generally speaking, I think that these missions were valuable to us. In the first place I want to say that these were not sales promotion missions, as the hon. member for Parktown will realize. These missions had been given general instructions to investigate the possibility of closer financial, industrial and commercial co-operation among South Africa and those countries they visited, and to make an alysis of the possibilities of trade with these countries. I have not yet received the report of the mission under the leadership of Dr. Etienne Rousseau, but we have received the report of the other mission under the leadership of Mr. Neil Malan, which visited Holland, Belgium and Luxemburg, and I should like to give hon. members a few of the impressions of this mission. In the first place it was found that the business climate in the Netherlands, Belgium and Luxemburg was favourable, under prevailing circumstances, and that these countries were well-disposed towards doing business with South Africa; secondly, that opportunities for exports from South Africa existed, particularly for the products of labour-intensive industries, including inter alia clothing and also goods the manufacture of which causes pollution, such as castings and forgings, and refined raw materials. They also say that there are opportunities for joint ventures between entrepreneurs in those countries and entrepreneurs in South Africa. Another remark made by this mission was that a more aggressive marketing method should be developed in South Africa. In fact, this was also the finding of the other mission, which I shall say a few words about in a moment. There are promising prospects for trade. One Netherlands factory displayed an interest in the purchase of castings from South Africa to the value of approximately R6 million per annum. This interest, as well as the interest in clothing and other goods, is being followed up. Sir, before I conclude my remarks as far as this mission is concerned, I should like to place on record my appreciation for the work done by these two missions. Apart from the secretaries to the missions, they were all private people who went overseas in their own spare time. I think that both these missions worked very hard and made great sacrifices. I had an opportunity yesterday of discussing matters with Dr. Rousseau, since I had not yet received a report from his mission. The general impressions which Dr. Rousseau recounted to me, are very similar to the impressions which the mission to the Netherlands and Belgium received. They say the climate is there and that the disposition is favourable for doing business with South Africa. In particular, Dr. Rousseau tells me, and this seems important to me, that it seems as if those countries, Germany and Austria, will be prepared, owing to the altered circumstances which have now begun to obtain there, to relinquish certain industries which they have been operating for hundreds of years. These are industries which are labour-intensive, for in Germany alone there are 2,5 million foreign labourers, who create many problems for them, as we have also experienced. Therefore they want to try to eliminate those industries of theirs which are so highly labour-intensive. In the second place, they have the same concern in regard to smoke and pollution as is being felt in the Netherlands and in Belgium. Therefore there is particular interest in our iron and steel products. In this way, Dr. Rousseau tells me that it takes approximately two tons of ore to make one ton of steel. If one has two tons of ore, one can expect to get anything from between R12 and R15 for it, i.e. R6—R7,50 per ton for iron ore; but if one makes one ton of steel, blister and steel, out of the two tons of iron ore one could probably get R60 for it. But now the industrialist from Germany comes along, in so far as he is prepared to buy blister steel from us instead of the iron ore, and he takes that ton of blister steel and processes it into a motor car or a washing machine or a refrigerator, and with the development and processing of that ton of blister steel, he eventually sells that ton of blister steel again for perhaps R1 000. In other words, instead of laying claim to the difference between the original R15 and R60, he says we may as well take it; South Africa is welcome to it for they are still able to develop that blister steel further and then derive the benefit of processing it further.

In addition, there is a further fundamental interest in the ferrous alloys which are being manufactured by Amcor, including inter alia ferro-chrome, ferro-manganese and ferro-silicones. These are ferrous alloys which are sold for prices in the region of R140 per ton. Dr. Rousseau informs me that it is expected that it is possible to conclude 10, 12 or 15-year contracts for goods of this type, and that one is not dealing with small enterprises, but with major, gigantic enterprices. He also tells me that he thinks our selling methods are obsolete; our selling methods have to be more aggressive, not only in the presentation of one’s product, but it must be sold.

There is one aspect Dr. Rousseau also brought to my attention which I should like to mention. He said the exporters in those countries spoke with one voice. I think we could probably learn a lesson from this. I am thinking of Saldanha for example. The hon. member for Von Brandis knows very well what the position is. While we are trying to sell iron ore, the people to whom we want to sell the iron ore are laughing because we are arguing among ourselves about the sales of iron ore; while Dr. Rousseau says that if one goes there, it is not this or that organization which is buying; it is the country which is buying. There is a homogeneity in the negotiations of the different enterprises in that particular country, and this is something which we should also apply in South Africa. When South Africa sells, the sales should not be made by individuals who are perhaps in conflict with one another, but it should be South Africa doing the selling. So, all things considered, I think we can say that these missions were reasonably successful, and that the results are likely to be good.

The last topic I should like to deal with is the matter of the EEC. The hon. member for Parktown also raised this matter yesterday evening. Allow me to express a few ideas in this regard. There is no doubt that we do have problems as a result of the British entry into the EEC. Up to now these problems have not really emerged. But the problems are there. Up to now we have not felt or experienced any serious problems yet. But they are on their way. Finality will be reached early next year about the inclusion of Britain, Ireland, Denmark and Norway. Over and above the enlarged EEC, which will then consist not of six but of ten members, there will in addition be a large number of associated members of the EEC. Trade agreements will also be concluded by the EEC with other countries. In other words, it will be a large and powerful trading bloc. They will have free mutual access to one another, and will do business freely. We can expect them to discriminate against countries outside the EEC, to the detriment of those countries. In so far as we will be a country outside the EEC—it cannot be otherwise—we must expect that we are likely to experience disadvantages as a result of this mighty bloc which is being welded together. We will therefore receive different treatment to what they are giving one another.

I want to sound a serious note this evening concerning the general development of world trade. Whether the establishment of the EEC and the expansion thereof can be justified on economic grounds, is not relevant. Whether it is correct in accordance with the provisions of GATT something which has been much discussed and argued about in the past is not relevant. The practical implications which this holds for us, are the things which are relevant to us, and with which we have to live. To my mind the question arises whether the development of economic discrimination in the world is in the long run going to be to the benefit of the world in general. Hon. members are indeed aware that where people are prejudiced in their business relations, and where countries are prejudiced in the economic sphere, it creates discontent and dissatisfaction. I am afraid that if this entire matter of the enlarged EEC and the degree of discrimination which goes hand in hand with it is not handled well, it could very easily create strained relations in the world in the political sphere. I also think that the major commercial countries of the world should give thought to this matter. In fact, they have already to a large extent realized their problems in this connection. It is now being envisaged—and the EEC has also spoken along these lines— that a need exists for the revision of international economic relations. That need for the revision of international relations must be admitted and international conferences must be held to review the entire trading position in the world. We have associated ourselves with this idea, but we have stated four very imporant reservations in respect of the discussons on world trade which are being envisaged and which will, it is hoped, commence next year. In the first place, the economic structural changes which have taken place since GATT was established 25 years ago, must be reviewed. In other words, we must not merely continue on the foundations as they exist today, but the economic structural changes which have taken place during this 25 year period must be taken into account. In the second place, the various developmental requirements of the countries affected must be taken into account. In the third place, the new and changing pattern and geographic distribution of world trade must be properly reviewed. In the last place, an attempt must be made to find a solution to the need for a stable condition for world trade in primary commodities. These are the four provisos which we have expressly stated, when we associated ourselves with the idea of negotiating on a high level on world trade.

The entry of England to the EEC holds serious implications for us. From next year onwards problems in respect of the export of wine, apples and pears will begin to crop up for us. Recently, two or three months ago, serious talks were held in Britain on official level in regard to this matter. It will also be necessary for us to holds talks on this matter with the EEC, for this new arrangement will take effect as from 1st February of next year. Time is running out. The hon. member for Parktown asked me what we have done. I should like to state what we have done in the meantime, for we are very concerned about this whole matter. In the first place, the hon. member referred last year to it having been mentioned or announced somewhere that a Cabinet committee had been established. That is true. There is a special Cabinet committee which is going into EEC matters. The Cabinet committee meets from time to time and holds talks when matters are submitted to it for discussion. It then considers what action we should take in respect of the British entry to the EEC. The first step we took after we had convened the committee last year was to establish what harm would be done to South Africa when Britain entered the EEC. Any possible harm must, in other words, be identified, and then it will have to be established what harm has been done. The Department of Commerce then conducted personal negotiations with all the different industries which could possibly be affected. We then tried to identify the real damage. Certain of the spheres which we had previously thought would be prejudiciously affected were eliminated, and that possibility no longer exists. In respect of certain spheres we arrived at the conclusion that no harm would be suffered, and they were therefore eliminated. Among others there are in fact real dangers of harm which may be caused. We then decided to address an official petition to the EEC to discuss specifically with them the problems we have now identified. Now I want to tell hon. members that the EEC in Brussels is a prodigious organization. The people there are extremely busy and the first and greatest task is simply to gain access and sit down across a table and so have an opportunity of discussing a particular problem. As one could expect, one arrives there and finds that the people are sympathetically disposed towards one. One talks over one’s problems, and then they say that they will see what they can do about it. but after you have left, you find that nothing has happened. That is why I went there last year, and I did not announce this in public. When I arrived in Brussels in October of last year, it was my intention to make an announcement so that the hon. member for Parktown and other people who have an interest in the matter, could know what we had achieved. When I arrived in Brussels, however, I decided for very good reasons that I was not going to announce for what reason I was there and what my modus operandi there was going to be. What we did was this: I went with an official petition to the president of the Ministerial Council, Mr. Moro, the Italian Minister of Foreign Affairs. I had a personal interview with him in Brussels, and I had an official document drawn up in Italian. I handed this document over to him, in which we simply requested that South Africa should be afforded an, opportunity of going to discuss with the EEC its problems which would be experienced with the British entry on a product for product basis. Before this document was handed over I met the responsible Ministers of the different member countries and told them that I was going to do this. I was afforded every possible opportunity. On the last evening prior to my departure I had discussions with the Ambassadors of the various EEC countries. We had pleasant and sympathetic talks. But to date no arrangements have as yet been made to enable us to have that opportunity of discussing our problems on this basis. What are we doing now? We are waiting, and we keep knocking at the door, for we should like to have an opportunity to be able to do something. There are things which can be done. For example, something has already happened in regard to our citrus fruit. I think that something can be done in regard to our other products as well. In the meantime we have a permanent ambassador at the EEC in Brussels. As the House knows, this is Dr. Naud. He maintains contact with the EEC, and keeps us fully informed. The Cabinet Committee decided that one of the requests we should make is that the Minister of Economic Affairs should, if it is possible, be able to hold annual talks with a committee or some or other organization within the EEC if South Africa so desires. Last year I attended a conference of our ambassadors in the EEC countries in Lodon. I regarded it as a very fruitful conference. I think it would be a good thing if such a conference could be held annually so that there may be proper coordination among our ambassadors in the different EEC countries. In this way we remain in contact and we must do whatever we are able to do. We drew up a very comprehensive document in which all our problems as identified in the interviews which the Secretary for Commerce had with the various parties were dealt with. We are prepared at any time to go to the EEC with this and discuss our problems one by one with the EEC. But up to now we have not yet been told when we will be afforded that opportunity.

Mr. Chairman, I think I shall conclude at this juncture and reply at a later stage to the other subjects which were raised.

Mr. Chairman, I rise to reassure the hon. the Minister of Economic Affairs immediately that I shall not touch on the question of iron ore exports this afternoon. We shall leave that, perhaps for a later date, when the facts will have caught up with the hon. the Minister. We may then continue the discussion.

We must thank the hon. the Minister for a very extensive review which he has given on matters affecting our imports, our exports and our relationships with GATT. I think it is a pity that there appears to be in the approach of the hon. the Minister a degree of inconsistency in regard to these matters. He was dealing, in the first place, with the question of import controls. These import controls which are being maintained contrary to the requirements of GATT, but permitted in terms of article 12 under certain conditions, were justified but it appears that they are to be continued for some indefinite period. In respect of exports, we are pleading with the European Common Market to give us commodity agreements, I presume, or reduced tariffs which will enhance our trade. We have spoken about various techniques which might be used for improving our trade with the rest of the world, and with the Common Market in particular. It is the purpose of GATT to do precisely these things, to encourage precisely these things. It is the purpose of GATT in terms of the Articles of Agreement to remove the barriers to trade, to reduce discriminatory factors and to enhance and develop the economies of the contracting parties to GATT by the reduction of tariffs and by the removal of controls or forms of discrimination. We cannot have it both ways. If we are in favour of freer trade, if we are in favour of enhanced trade, if we are in favour of the development of international trade, then we must also be reasonable in our approach to these discriminatory factors and these tariff barriers. The hon. the Minister indicated in his announcement last month, that he is appointing a committee of inquiry into the question of our GATT obligations and how these can be reconciled with South Africa’s developmental needs. He has also asked the committee to investigate what steps the Government could take to protect local producers against the effect of the GATT obligations. It seems to me that in terms of the GATT agreement the time will soon come when the Minister must in fact abandon import control. Import controls are permissible under GATT where there are serious balance of payments difficulties —I think this is article 12—but there are conditions attached. The main conditions are that the extent of the trade restrictions applied to assist the balance of payments must not exceed the need which arises; in other words, the measures must not be excessive in relation to the remedy that is required. Secondly, these restrictions must be relaxed as soon as and while these conditions improve. In other words, they must be progressively relaxed as the balance of payments of the country concerned improves. We either believe in the principles of GATT or we do not believe in the principles of GATT; we are a contracting party to GATT, or we are not a contracting party to GATT. I believe that we cannot expect to get the advantages which GATT offers unless we also meet our commitments as members.

I now want to touch very briefly on this question whether the United Party in 1947 married South Africa innocently to a beast with cloven hooves, a tail and horns. The fact is that in 1947 South Africa was mainly an exporter of raw materials. South Africa did not have a highly developed industry and it was therefore entirely to South Africa’s advantage to be able to export its raw materials abroad against low tariffs and to import, in return, manufactured goods from abroad. For anybody to enter into that sort of agreement in 1947, made perfectly good sense.

Rather short-sighted, don’t you think?

But how short-sighted? It is still true in 1970 that the bulk of South Africa’s exports are raw materials. If one looks at the export figures for 1971 one finds that we exported R1 410 million’s worth of goods. Of these only R27 million worth of goods were in fact articles ready for retail sale or consumer use. The rest was mainly raw materials or semi-processed materials. We are still importing a great deal of manufactured goods. As the Minister has said when he spoke a while ago, 80 per cent of our imports are essential imports. They are capital goods which we must have. They are exotic materials which are not produced locally and we must import these things. Out of our total import bill of R2 800 odd million last year, only R486 million in fact consisted of manufactured goods, goods for consumer use. I do not believe that this GATT agreement is nearly so dangerous or so detrimental to South Africa’s overseas trading position as the Minister pretends, and the figures prove it. I think that we make too much of this thing. If we are considering higher tariffs we must consider both the advantages and the disadvantages. What will the advantages be? It will certainly not assist our exports if we were to change or to get our tariffs with GATT unbound. We have insufficient productive capacity for consumer goods in this country to satisfy the needs of the country itself. If our producers need tariff protection in order to protect themselves against imports from abroad, how can they be competitive abroad where those very goods come from?

If the tariffs are needed to reduce our imports or to protect local industries let us consider that already in terms of our GATT tariffs, on the average, import duties worth approximately 5,5 per cent of the value of our imports are affected. So there is already an average duy of approximately 5,5 per cent. In addition to this, we have already devalued, which adds 12,28 per cent to the cost of imports. Some of the supply countries have also revalued, which adds a further X per cent to the cost. Then there are transport costs. When we add all these together, our producers in South Africa have a natural protection exceeding 20 per cent, running in some cases to 25 per cent or higher. If there is to be further protection over and above, 25 per cent, it can have only two consequences: One is that it will shelter uneconomic industries, that is, import-replacement industries, which will be protected behind the barrier of 25 per cent high, when you calculate all the factors involved. Secondly, it will be highly inflationary, in that either the goods which come in or will come in despite this high tariff structure, will include the high price factor which the tariff adds; or our manufacturers will be encouraged by this high barrier to produce locally at high prices. So the effect is clearly inflationary and it is certainly uneconomic. I hope that when the Minister considers the recommendations of the committee of inquiry, he will bear in mind that his first duty is to the South African taxpayer, the ordinary public of South Africa. They should be protected by being assisted to obtain the goods they need for their comfort and necessity at reasonable prices. This kind of thing is not assisted by tariff protection. In fact, we come back full circle to the purposes of GATT. We joined GATT because we believe in freer trade. We believe in the removal of trade restrictions. We believe in economic competition, because these factors together produce a strong economy and a contented population.

The hon. member for Von Brandis accused the Minister of not always acting in a very consistent manner, but the hon. member did not furnish us with the real facts. If he does have so many objections now, he should spell out the matter to us in exact terms, so that we may know where the Minister has been so inconsistent. This afternoon the hon. the Minister covered the matter here very widely and furnished all the facts— not only today, but also in the past—as to why steps were taken in the past. This was not done because this Government and the Minister were being inconsistent; it was as a result of factors abroad. We know, for instance, why import control was introduced. South Africans had simply started buying and importing wildly. We had the overseas monetary crisis, etc. Therefore this Government has never been inconsistent at all.

The hon. member also said these things involved a number of disadvantages. He said the hon. the Minister had to have regard to the fact that we had to protect the interests of John Citizen. But that is what this National Party Government has always done. We realize and understand the problems he mentioned there. The hon. member need not be concerned on that score.

But I should like to come back to the hon. members for Parktown and Pinetown. The hon. member for Pinetown spoke about the I.D.C. this afternoon. He was very worried, because he made certain vague complaints. Now I want to ask the hon. member for Pinetown specifically what his complaint against the I.D.C. is. He asked for the appointment of a Select Committee which would have to determine where the control, etc., was to be found; the public had to realize who was competing against them. The hon. member should tell us definitely what his charge is, to what industries established by the I.D.C. he is objecting. Then he should also tell us what industries in South Africa are being prejudiced. We know that the I.D.C. did finance industries in the past. An Act was passed here in Parliament to provide for the sale of an industry to private organizations. Now the hon. member has asked here for a Select Committee, and he has come forward with a charge which is unfounded and which he cannot substantiate. I should very much like him to tell us; I should like to follow him up at a later stage. He asked for a Select Committee; but the hon. member for Parktown said yesterday that this Government did not know what to do, and whenever it did not know what to do, it appointed a commission. See how these two are contradicting each other, Sir, The one asks for a commission and the other one says, “No, there are too many; we do not want more.”

The hon. member for Parktown referred to the GATT yesterday. He spoke about our imports, etc., and then he levelled the accusation that this Government appointed commissions when it did not know what to do. Now I should like the hon. member also to tell us what commission was appointed by this hon. Minister, or this Government, which should not have been appointed. Does the hon. member have it against that technical committee which had to investigate the matter of the GATT, yes or no? Is it that commission?

What about the one on co-operatives six years ago?

The hon. member should not wrest matters from their context. He is referring to a commission of six years ago, but in his speech he did not say a word about that commission.

But, surely, you have asked him a question and now you have the answer.

No, Sir, but in that case this person must at least be coherent in making a speech.

Of course, there are certain things on which I am in complete agreement with the hon. member. I am in full agreement with him as far as our exports are concerned. He is quite correct in saying that our imports are high. Our gold is not sufficient to pay for them; our exports cannot make up for them. As we know, our gold production amounted to 984 000 kg in 1970. It is estimated that it will only be half of that in the year 2000. Our exports will increase tremendously; I shall come to that later on.

The hon. member also stated here that the Government was doing nothing to, as he said, get the exports off the ground, and that nothing was being done. But the hon. member should at least give us the credit that this Government is doing the maximum. I want to tell the hon. member that I agree with him that more should be done, that there must be exports. That is correct. But the hon. member should not lay this at the door of this Government and the Minister. He is appealing to the wrong body. As the hon. the Minister said, it is not the Government that has to provide for the exports. I am now going to say what is being done. The Department of Commerce has no fewer than 4 full-time offices, namely in Cape Town, Port Elizabeth, Durban and Pretoria, with a full-time Director of Exports in Pretoria. These people are doing everything in their power to advise our manufacturers and exporters. As the hon. member can see for himself in the Estimates, we have a very large number of trade representatives all over the world. In these very same Estimates mention is also made of the South African Foreign Trade Organization, which is being financed by an amount of R140 000 per annum in order to enable these people to make publicity for our exports and to find a market for us abroad. We also know what financial assistance is being given in that regard. The Government has even gone so far as to pay devaluation compensation to our importers and exporters who had to suffer losses as a result of devaluation. The hon. member knows this. In that respect the Government has done its share. I am thinking of the promotion of exports. How much have we not already voted for that purpose? The hon. the Minister gave us R9 million in the Estimates—that is what it will amount to in one year to stimulate our exports.

We may also take a look at other aspects. We must have telecommunications with the outside world. South Africa’s system of telecommunications is as good as we can get. As recently as 29th April, the Postmaster-General opened the direct telephone cable to West Germany. In that sphere England has not even progressed to such an extent that we may have a direct line to that country, but West Germany has in fact done so. All of this is a result of steps taken by this Government to help our exporters. I want to tell the hon. member that I agree with him that exports must be promoted; but it is not this Government which is not doing its share. I want to say that we should lay this charge, or rather request, at the door of, mainly, three bodies: the Federated Chamber of Industries. the Chamber of Commerce and the Afrikaanse Handelsinstituut. After all, these are the people who are manufacturing and trading, it is they who have to export. It happens to be the position in South Africa that SAFTO is charged with the publicity that has to be made. But it does not manufacture; it is not the body that sells. Much less does this apply, on the other hand, to the Government. It does not enter into business transactions. This has to be done by an intermediate body or bodies. If these three bodies which I mentioned, do not want to do this individually, they should do so jointly. I want to say that in that respect I will agree that if they do not want to do their share, the Government must do something to induce them to take steps in this regard. If they as three individual organizations do not want to do this, an organization will then have to be established by them for the purpose of handling this matter.

Throughout the world we find that trade zones are being formed. For instance, we find the EEC, the European Free Trade Community in which the United Kingdom has been included, and we must realize that more than 50 per cent of South Africa’s exports go to these two bodies. Then we also find the Latin-American Free Trade Area, the Central American Common Market, as well as quite a number of others which I shall not mention now. It is a fact, and it is important, that our manufactured goods will account for a larger percentage of our exports. In the course of the Budget debate I argued that for a start our salvation was to be found, in the first instance, in our base metals and minerals. That is the first place where we should strike in order to export, to supplement our adverse balance of payments. We have seen, of course, that as far as manufactured goods were concerned, there was a flattening between 1959 and 1964. But between 1964 and 1969 there was an increase. It increased at an annual rate of approximately 15 per cent, and it is estimated by authorities that during the next two five-year periods until 1980, it may increase at an annual rate of 15 per cent. But then we must know that our people will pool their resources. In order to export, they will have to avail themselves of the Government’s assistance and the advice that is given. [Time expired.]

Mr. Chairman, time does not allow me to deal this afternoon with the Willem Barendsz or the Suiderkruis or the Sarusas 1972 awards, or the non-observance of the conditions of the white fish consortium licence in South-West Africa. Nor, unfortunately, does it allow me to discuss with the Minister the rock lobster industry of Luderitz or of Port Nolloth, or the very interesting Lusitania rock lobster export quota concession granted in the Republic last year. I am also unable to discuss, for reasons of time, the continuing destruction of mussels, oysters and perlemoen beds off our coasts, and the wiping out of prawns, worms and red bait in some of the coastal areas. But I can say this, Sir, that just as the reckless policy of the Government in granting quotas and licences has resulted in the present parlous state of the rock lobster and pelagic fishing industries of the Republic and South-West Africa, so our sea-shore life off the Republic is being systematically plundered, and for this too, the Government must accept responsibility, because of what I call an inadequate administration, its ineffective control and regulations.

Time does not allow me to deal with the position of the Fishing Commission which was appointed in September, 1967, which still has not reported, although it has admittedly issued three interim reports, or to deal with the Fishcor report that was only tabled yesterday. I want willingly to acknowledge the good work that is being done by the hardworking and underpaid departmental staff. But it is a fact that both our research and our patrol services are hopelessly inadequate, and the present position is this: Either we are going to have a well-run and a well-paid and efficient fisheries department or else we are going to have to face the continual danger of the depletion of our marine and seashore life, which is today causing considerable concern not only to marine economists, but also to nature conservationists. Mr. Chairman, this afternoon I want to warn the Deputy Minister. While acknowledging that his predecessors, especially Dr. Diederichs and Mr. Jan Haak, are mainly responsible for the years of avaricious assault on the pelagic fish and the rock lobster resources of the Republic and of South-West Africa, nevertheless today it is his responsibility because he has been in office for two years. He must bear the responsibility at least for the present state of affairs. He knows that there has been serious overfishing, and so apparently does the Administrator of South-West Africa, because only last week in his Budget speech he said this (translation)—

*In spite of this fact, the Deputy Minister recently approved quotas for 165 000 tons for the Willem Barendsz, the Suider-Kruis and the Sarusas company, and I understand that he is allowing three factories to use pilchards for fishmeal because the factories concerned do not have canning facilities. As the Deputy Minister ought to know, a ton of pilchards which is canned is worth seven times as much as a ton of pilchards which is used for making fishmeal. There is no reason, to my mind, why the companies concerned cannot be compelled to have their pilchards canned by other fishing companies in Walvis Bay, because they (the other factories) do in fact have sufficient capacity to do this. Even worse, Sir, is the fact that the Deputy Minister has not yet decided whether or not he can accept Dr. Lochner’s recommendations. Dr. Lochner has already warned him not to allow more than 150 000 tons of pilchards to be caught this year, but the existing quotas for South-West this year far exceed this figure, and approximately 140 000 tons of pilchards have been caught up to now. I want to appeal to the Deputy Minister this afternoon to take the initiative himself and to bring Dr. Lochner and the experts of the department together under his chairmanship so that they may discuss their differences and try to find a solution.

†I do not believe for one moment that the fishery scientists, with Dr. Lochner, cannot arrive at a suitable solution.

*But, Sir, to do nothing is nothing but criminal negligence.

†The generations that follow us will never forgive this Government if our marine resources are eradicated.

*Sir, there was talk recently of subsidies to the fishing industry. I should like to state my attitude on subsidizing this afternoon, because we on this side of the House can only agree to subsidies provided the Government is prepared to take effective steps to save the South-West African pilchard resources, for the taxpayers’ money cannot be used to subsidize the fish barons and then to destroy the resources still further. That is our attitude.

Then I just want to say a few words in regard to the recent price increases. On 4th May this year factory prices were increased by R9 for fishmeal and by one cent a tin for canned fish, without any definite stipulation that the fishermen and the boat-owners will receive a share of these increases. These people, the fishermen and the boat-owners, are the ones who have to be helped in these critical times, otherwise they are going to go bankrupt. This is a simple fact. The fishing companies have the licences and the quotas, and recently they got this price increase, but the fishermen received neither shares in the fishing companies nor a fair price for their product from the companies. Before this Government began destroying these fish resources the boat-owners incurred heavy expenses, but their catches were also large at that time, and I want to mention a few figures this afternoon.

†First of all a boat which cost the boat-owner in South-West Africa R46 000, was helped with the Fishcor loan of R23 000, repayable over a period of ten years, and the present quarterly rate of capital repayment and interest is no less than R2 450. A boat that cost a boat-owner R180 000, received from Fishcor a loan of R100 000.

*This is also repayable over 10 years, in the form of quarterly instalments of R7 900 at the moment. Sir, who in Walvis Bay can afford these instalments today, particularly in the light of the quota restrictions and the rising costs? Boat-owners and the fishermen need Government assistance. I appeal to the Deputy Minister at least to subsidize the interest of the boat-owners during this lean year. This is also being done in the case of some farmers in the Republic. I go further and say that both the boat-owners and the fishermen should be assisted by being granted realistic prices for their products by the factories. Otherwise they, too, must receive direct assistance from the Government.

†Now, what is the position of boat-owners at the moment and the prices they receive for their products? In 1954 the boat-owners received R8 per ton, of which they had to pay the crew R4. In 1969 they received R9.30 and in addition to that 65 cents for diesel, and then the crew received R4. In 1970 they received R10 and free diesel and the crew received R4, but in respect of 1970 Mr. A. P. du Preez’s companies claimed back from the boat-owners and from the crew an amount of 30 cents. In 1971 there was a small increase and the boat-owners received R11 per ton and the crew R5. At the end of 1971 an additional R1,20 in respect of back pay, was paid, but both Konsortiumvisserye and A.P. du Preez’s companies refuse to make payment of this R1,20 to the boat-owners and the crews under their control. Now the present position is that the boat-owners have been offered by the factories R13,65, of which the crew receive R5,85. With the present fishmeal price increases of R9 per ton, which have been passed on to the factories, the crew are expected to be satisfied with the small increase recently announced of 85 cents per ton, and the boat-owners with 60 cents per ton for the raw fish they produce! ! [Time expired.]

Mr. Chairman, it is not pleasant to follow the smelly tracks of the hon. member for Simonstown. He is merely engaged in a racial hate campaign. He is a species of Boerhater. The hon. member for Simonstown is jealous of the Afrikaner—and that is why he hawks their names around here; if he were to make these speeches in public, flinging people’s names around, he would see what would happen to him.

Are my facts wrong?

But he does so here under the protection of Parliament.

But my facts are not wrong?

He is jealous because under this Government the Afrikaner has obtained a small share in the fishing industry. He is terribly worried about the fisheries, about the fishing industry. Sir, there has never been anyone in this country who has given more protection to the fishing industry and is more jealous of the fishing industry than the hon. the Minister who is now dealing with this matter. I cannot think of anyone else. I cannot think of anyone who has done more for the fising industry of South-West Africa than specifically the Minister. But the hon. member’s facts are so wrong. One moment he says, in the same speech, that the fish prices have been increased but the workers have not shared in the increase, and the next moment he says how much they obtained and he then complains that this is too little.

Don’t talk nonsense.

The fact of the matter is that the fishermen’s prices were increased before the department increased the fish price. This is a new technique. Since the 1970 election the hon. member for Simonstown and others have developed a new technique. They mention people’s names in this House implying deceit on their part. The fishing industry has now become the gossipmongers’ hobby. As far as I know, the Government has nothing to hide.

Then appoint a judicial commission.

There can be one, when the one that is busy with you is. finished. There are two factory ships, the Willem Barendsz and the Suiderkruis. The Willem Barendsz is not in Afrikaner hands.

Nonsense.

Afrikaans and English-speaking people have a 50-50 share in the Suiderkruis. In a previous speech that hon. member launched a tremendous attack here by saying that banks such as Volkas, Trust Bank and Federate Volksbeleggings had a share in the fishing industry. I shall tell you today what happened in the past. In the past, small quotas were allocated to people who were not financially well-off, and then the big men bought them up, so much so that at one stage the Afrikaner had been sold out of the fishing industry. I personally support the granting of those quotas to large institutions whose shareholders are here in South Africa and not 6 000 miles away overseas, because the country benefits and the shareholders of those companies benefit, and not individuals.

You have not the remotest idea what you are talking about.

The Afrikaner has shares in this company, and in this way they are obtaining their share. But there was the Land Bank story, and then there was the story about the fish to besmirch our leaders, and we are tired of that. I want to say that the biggest act of deceits I am aware of in this country is how the Afrikaner’s land was stolen from under his nose for the sake of its gold and mineral sources. That was deceit. Afrikanerdom did not share in the riches of South Africa. We became poor whites, virtually our entire nation, and then the South African electorate decided in 1948 to entrust this country to the National Party, and the National Party made that same poor white people prosperous. The Afrikaner has become so prosperous since the National Party has ruled this country, because the country has become prosperous and the Afrikaner has begun to obtain a small share in the riches of South Africa. It is only a small share, because people who know say that today the Afrikaner does not yet have a 10 per cent share in the economy of South Africa. But we have become prosperous. We have also had Afrikaner millionnaires under the National Government, because they have obtained a small share in the wealth of South Africa, and they cannot stand that; they want everything for themselves, the way they kept it while they were in power. There was a stage before 1948 when it was generally known that there was one rich Nationalist in South Africa, and that was the late Mr. Bruckner de Villiers, and do you know what his estate was the day he died? R400 000. But he was regarded as the richest Afrikaner and the richest Nationalist in South Africa. That shows the way in which the Afrikaner was kept down, and they have always wanted us like that. They can have this story of theirs about deceit for a present. It is this Government’s duty and task to allow a part of the wealth of South Africa to accrue to the Afrikaner.

I should like to say a few words about import control. I think import control must never be relaxed. There are occasions when we need certain capital goods and there must consequently be relaxations and concessions. But it can never be abolished, and I shall say why. Trade is never particularly patriotic in any country of the world. In South Africa the major portion of trade is not only unpatriotic, but also politically hostile. The major portion of the trade world would very much like to destroy this Government because it does not see eye to eye’ with the policy of this Government. Whenever there was unrestricted import, our balance of payments was virtually destroyed. It was the National Party with its take-over in 1925 which introduced a protective policy for South Africa’s industries. Since 1948, when import control was introduced, it is interesting to look at the growth and the decline of our reserves. This also reflects the growth of our exports. Our 1947 imports amounted to R570 511 212. In contrast our exports amounted to R181 million. In 1948 import control was introduced. In 1950 the value of our imports was still R578 million, only R8 million more. In contrast our exports quadrupled to R453 million. [Time expired.]

Mr. Chairman, I do not propose to follow either the speech or the example of the hon. member who has just sat down because it seems to me that that type of speech has no place either in this century or in this debate. I could just as equally get up and complain that of the farming land in South Africa only 15 per cent is owned by English-speaking South Africans. All one can say of the hon. member is that he is following the example of his provincial leader, the hon. the Minister of Defence.

The hon. the Minister earlier on made reference to the fact that he felt that the industrialists of South Africa did not do enough to export their ploducts. I must say that I agree with him. Overseas businessmen say that our own businessmen here do not do enough to sell their products in the outside world. But there is one exception which is invariably quoted as a notable exception, viz. the sugar industry. When one talks to overseas businessmen, they quote the South African sugar industry as a shining example of what should be done to develop markets in the outside world. I must say that this is an industry in regard to which I would like to say a few words this afternoon. As the hon. the Minister knows, the sugar industry is noteworthy for two things. Firstly, it operates under its own industrial agreement and secondly it has virtually run itself for many, many years. It has virtually run itself not only in the administration of its affairs, but also in practical fields, such as the financing and the running of its own experimental stations and extension officers. This is a long tradition in that industry and it has extended to the extent that the Minister is required to interevene in really only two spheres. The one is the question of the establishment of the price and the other is where there had been disagreement between the growing section and the milling section. Such disagreements are usually on how the cake should be divided between them. Then the Minister has to come in and decide on that issue. I would like to make a plea to the hon. the Minister to limit his intervention in the industry to the traditional fields, and to allow the industry to operate on its own accord. I had the opportunity earlier this year of raising with the hon. the Minister, although merely in passing, the question of the extension of quota land which he granted last year to a sugar interest in the Transvaal. This caused a great deal of disquiet in the industry. It caused such disquiet that for the first time in the ten years that I have been in this place—together with the hon. members for South Coast, Pinetown and Pietermaritzburg District, I have the honour to represent virtually the whole sugar industry—I have been specifically asked to raise an issue across the floor of this House relating to the internal affairs of the sugar industry. This is the grant by the hon. the Minister against the unanimous opinion of the organization of the sugar industry of an additional quota to certain interests in the Transvaal. When I raised this previously, the hon. the Minister said that I did not know what I was talking about when I said that he was responsible for the grant of quotas. I quote his words—

That is what the hon. the Minister said to me. Later on in an interjection he said: “You do not know what you are talking about.” I do not know what caused the hon. the Minister to make those remarks, but both in terms of section 17 and Schedule G of the Industrial Agreement, it is quite clear that the hon. the Minister and the Central Board are the two bodies which can grant quotas or which can bring about an extension of quotas by an amendment to Schedule G. This. I think, is what the hon. the Minister did in the instance that I am referring to. I raise it in the short time availble to me to establish the following point with the hon. the Minister: It creates the very worst impression when the hon. the Minister takes a decision against the unanimous advice of all sections of the industry, which has the effect of benefiting one section only. This is so because the inference which is drawn, is that the Minister has bowed to political pressure in order to benefit one section of an industry. That inference has been drawn, it has been widely drawn, and it is a most regrettable circumstance.

The other aspect which I want to raise is in regard to the question of price. Of course, wrapped up with price is the question of the stabilization fund. The stabilization fund is in itself, in my view, a very good thing, but I would ask the hon. the Minister, when it comes to the question of price negotiations year by year, not to penalize existing growers in the industry by putting too great a slice of the cake into the stabilization fund at the present time. That is to say, I would ask him to lean in favour of building up the stabilization fund over a period of years so that the burden of establishing that fund does not fall principally on those who happen to be growers in the industry at the present time. I say “growers” because at the present time the growing section of the industry is in my view, and I believe it is correct, in a far less happy position than the milling section is fortunate enough to be in. The point is that I would like to ask the hon. the Minister when the price of sugar is altered, particularly altered downwards, to do it in a manner which brings about some real benefit to the consumer. Just before the Brakpan by-election, and it may be fortuitous that it happened at that time, but I have my doubts, the price of sugar was reduced, but it was reduced in such a manner that the reduction of the pound of sugar to the ordinary housewife was negligible. The principal reduction went to the bulk buyer, the man who could afford to pay for the sugar and the housewive, whom it was presumably intended to benefit, got virtually no benefit out of it at all. The persons who benefited principally were the manufacturers who use sugar, i.e. the manufacturers of cold drinks, sweets and things of that kind. I do not know of a single commodity in the manufacture of which a substantial quantity of sugar is used where that reduction in price, which cost the industry about R7 million, has been passed on to the consumer. I do not know of one single instance. The result of this was the minimal benefit to the housewife or rather the fractional benefit to the housewife, the substantial benefit to the large consumer and the manufacturer—which could not have been the intention but resulted from this—together with a reduction in the amount of money available to the grower and the miller. This was done at a time and with a result which has suggested that it was a political manipulation to benefit the governing party in a by-election. I say this is not the way to treat a major industry which is of substantial benefit to this country. I would ask the hon. the Minister to adhere rigidly to the acceptance of the past in his future dealings with the sugar industry. This means that the industry should be allowed to govern itself and that the hon. the Minister should follow the unanimous opinion of the sugar organization which does represent this industry.

Mr. Chairman, it is general knowledge that South Africa has rich fishing grounds, and over many years these fishing resources were the responsibility of the Executive Committee of South-West Africa and fell under the direct control of the present Deputy Minister of Economic Affairs. After the entry of the factory ships, and especially the entry of the Suiderkruis as a large factory ship, it was clear to all of us that the resources would not be able to withstand these additional onslaughts. Accordingly representations were made to the authorities for the withdrawal of these factory ships from the fishing waters. However, in season and out of season we are blamed for having made those representations in good time. This withdrawal of the factory ships was finalized this year.

After how many

years?

It was finalized by the same person who has been responsible for the protection of the fishing resources all these years. The industry and everyone who has an interest in these fishing grounds are grateful for the fact that these factory ships have been withdrawn. On behalf of all interested parties I should like to thank the hon. the Deputy Minister for his zeal and hard work to bring about a compromise in this regard. He was loyally assisted by the hon. the Minister of Economic Affairs and we should like thank him too.

It is not true that quotas of altogether 165 000 tons of pilchards were granted. What was granted, was a total quota of 165 000 tons, of which only one third may be pilchards. This means that for the three quota holders it is only a total of 55 000 tons as against the single quota of 200 000 tons last year for the Willem Barendsz alone.

Are Wiley’s figures wrong?

All the observations indicate that, as a result of the strict control measures which are being applied, the pilchard resources are recovering remarkably, if there was in fact any great damage. Large shoals of pilchards are plentiful in the vicinity of Walvis Bay and excellent catches are being made. The Secretary for Industries also informed me that the head of the Division of Sea Fisheries will shortly station some of his staff on fishing vessels in order to gather even more information and to cover a wider field daily. The fishing industry in Walvis Bay is experiencing a record canning season, because large and abundant shoals of fish are available in the immediate vicinity of Walvis Bay. The programme has reached such massive proportions that the tin factory at Walvis Bay cannot meet the demand at all, so that tins have to be transported from Cape Town and Vanderbijlpark to Walvis Bay. We trust that these additional measures the Division of Sea Fisheries is going to take will enable them to continue their good work by finding out, in an efficient way, as much as possible about these resources and to endeavour to determine the extent of these resources as thoroughly as possible. We believe this survey will result in a relaxation of the restrictions on the catching of pilchards, because we have great confidence in that industry and know that there is not at all such a crisis as is being suggested here. I should also like to bring to the hon. the Minister’s attention the two factories, i.e. Suid-Kunene and Konsortium-visserye. It is true that a restriction was imposed on their licences, a restriction which prevents them from canning fish. That was necessary as a result of the circumstances at that time. If these concerns were to lodge an application, I should just like to ask for favourable consideration to be given to the making available of canning facilities to them.

I now come to the hon. member for Simonstown. He is in actual fact the hon. member for dead fish. This hon. member thinks it fit to attack and discredit the hon. the Deputy Minister morning, noon and night. I want to tell the hon. member that this Deputy Minister is also the leader of the National Party in South-West Africa. Since assuming office in 1950, this hon. Deputy Minister has done more for South-West Africa and its people than that hon. member, his party and all their cronies will be able to do in an entire lifetime. For years the hon. member has been engaged in smelling out Nationalists and Afrikaners in the fishing industry. However, there are other people as well in the fishing industry. There are also people who speak his language and who share his political views. It is a pity that the hon. the Leader of the Opposition is not present, because I should very much like to know from him whether people from those ranks have not yet spoken to him. Have people from those ranks not yet appealed to the hon. the Leader of the Opposition to silence this hon. member? Have they not yet told him that he is harming Walvis Bay and South Africa and the fishing industry?

Why do you not plead for the interests of the boat-owners and the fishermen?

The interests of the people referred to by the hon. member are protected.

Where?

Hardly a month goes by without the hon. the Deputy Minister granting interviews to these people in my presence in Cape Town. They have also been granted interviews in Windhoek, Just recently the hon. the Minister of Economic Affairs granted them an interview in Walvis Bay. The Secretary for Industries is leaving for Walvis Bay next week. However, I have never yet heard this hon. member ask something for his own constituency in this House. I have never yet heard him make a positive contribution in this House. His attitude is one of negativism and he is preying on grievances. He preys on what the National Party does and allegedly neglects to do. He has no will or mind of his own.

He is a Boerhater.

He is nothing but a Boer-hater. He is acting the vulture. For years he has been mentioning here the names of Nationalists and Afrikaners who hold shares, but he has never publicized the names of the other people who also hold shares in that fishing industry. We are fair enough to those people not to bandy their names across the floor of the House. I want to tell the hon. member that by this means he will not get a single vote in South-West Africa. The record of the United Party in South-West Africa is an extremely poor one and he is making it even poorer. The record of the United Party in South-West Africa contains entries such as: The depriving of language rights, the closing of schools, the internment of people, the expropriation of farms and the deportation of people. That is the proud record of the United Party in South-West Africa! South-West Africa has no room for the United Party. Sout-West Africa has no room for people such as this, people who only break down and do not build up. These people and the officials who are working in the interest of the fishing industry deserve our thanks and appreciation. The United Party is engaged in decrying and running down. Today, all of a sudden, they tried to champion a cause here. However, the United Party never has a good word for these people, who work night and day. They should go and find out for themselves with what risk to their lives these people toil and moil at sea in order to gather information in order to ensure that these resources are preserved for posterity. I want to tell the hon. member that these resources are in safe hands. He need not be concerned about that. The National Party and this Government will see to it that these resources are preserved for posterity. *

Mr. Chairman, the hon. member for Omaruru really is an amazing personality. In a previous speech he once told the hon. member for Simonstown that he was in Jaap Marais’s camp. Today, however, my hon. friend for Simonstown is a Boer-hater. I do not know how the two things go together. The hon. member for Omaruru asked for a judicial inquiry earlier on because he was so afraid that this fishing industry which is of such importance to South Africa would be destroyed. He has now listened to quite a few speeches by the hon. member for Simonstown in which he painted the dangers vividly. I am surprised that the hon. member did not plead here this afternoon for that judicial inquiry, because he should know better than many other people how extremely parlous the position of the fishing industry is.

†I wish to approach the hon. the Minister about an issue for which I make no apology. I wish to raise once again the question of establishing an ore terminal, a modem one, while Saldanha is not operational. I want to tell the hon. the Minister that I do not wish to criticize Saldanha or the decision of the Government to continue with this project. I would only like to remind the Committee that the estimate by Iscor of R400 million was rejected by the hon. the Leader of the House during the discussion of his Vote, because he thought that a more correct estimate would be in the vicinity of R600 million to R700 million. I plead with the hon. the Minister to reconsider the claims of the promoters of the St. Croix scheme. They claim that their project, to be financed from private capital, would provide an immediate answer for our growing volume of ore exports and would be complementary to the Saldanha Bay scheme. I raise this issue because it has come to my notice that Japanese steel interests have decided to extend the deadline for the expiry of Consolidated African Mines’ iron ore negotiations. The original deadline was April, but they have now decided to extend it. Mr. Wilhelmi, the managing director, has said that he has in writing an undertaking that they would enter into firm agreements should the Government grant St. Croix the same conditional approval as was granted to Saldanha. The additional quantities of ore which are visualized in this Press report, are 3 million tons by 1976, rising to 5 million tons by 1980. In reviewing the St. Croix Scheme, I would ask the hon. the Minister to consider the following. Ten years or more would elapse before this vast Saldanha Bay scheme could become operational. Secondly, the technological breakthrough achieved with the introduction of diesel traction has increased the capacity of the existing Sishen-Port Elizabeth line to 10 million tons of ore per annum. Theoretically the ore installation in Port Elizabeth can handle 6,3 million tons per annum. But due to the shallowness of the harbour, and the fact that only relatively small carriers can operate there, the through put is only 4,7 million per annum. An additional berth could be built and the export of manganese and iron-ore be separated, that is true; but the shallowness of the harbour remains the limiting factor and would handicap us in trying to become truly competitive in the international ore trade. Port Elizabeth is known in international ore circles as a delay port. This fact naturally pushes up the freight. Shipping circles estimate that if the freight of one ton of ore were to be eight dollars on a 40 000 ton carrier, the freight of one ton on a 150 000 tonner would be four dollars.

*It will be possible to handle carriers of 150 000 tons and more at St. Croix. St. Croix will provide South Africa with a constantly growing basis in the international ore trade, and will also be a guarantee that the ambitious Saldanha scheme, when it gets under way, will be an economic enterprise. Shipping costs are low at the moment, and experts claim that this is the obvious time to enter into new ore agreements. When we start exporting iron ore from Saldanha Bay, manganese can still be shipped from St. Croix.

In previous debates dealing with the St. Croix project the hon. the Minister tried to disparage this scheme by means of misrepresentations.

On a point of order, Sir, is the hon. member entitled to say that the Minister came along with misrepresentations?

No, he must withdraw it immediately.

Order! Order! The hon. member must withdraw that.

I shall withdraw it, Sir, In Hansard (col. 4517, 1970) the hon. the Minister said that the swells in the sea at St. Croix can change from nothing to 30 feet within half an hour. Sir, the harbour captain of Port Elizabeth says this is nonsense. In col. 4518 he said that St. Croix was such a small island that some of the ships would be larger than the island itself. The length of St. Croix is 650 metres, while the length of a 350 000 tonner is only 365 metres. In Hansard (col. 1121, 1972) the hon. the Minister said that the cost of construction of St. Croix would be R220 million. He arrived at this by taking the cost of construction of R47 million and adding to this R93 million for improvements to the Sishen-Port Elizabeth line and R80 million for rolling stock. And then the hon. the Minister compared the R220 million which he got in this way with the R400 million for St. Croix, but surely that is quite wrong. The R93 million is the amount which was mentioned by the hon. the Minister of Transport as the amount which would be necessary if the capacity of this line were to be increased to 50 million tons of ore a year.

Oh no!

The promoters of St. Croix have always said that St. Croix was designed to handle 10 million tons of ore a year and that this could possibly be increased to 15 million tons a year by incurring further expenses. They have never mentioned 50 million tons. The Railways are acquiring the rolling stock at the moment, not for St. Croix, but for the existing installation in the Port Elizabeth harbour. How can these two amounts then be added to the R47 million? Surely the comparison is R47 million as against R400 million, or rather, R650 million, according to the hon. the Minister of Transport. Why does the hon. the Minister not tell the House that the recommendation of the departmental commission of inquiry, according to rumour, was that St. Croix should be given priority? Sir, it would be economic sabotage of South Africa for the Government to keep blocking the St. Croix scheme without good reason, because if it is blocked, the Government is going to prevent South Africa from earning an extra R400 million, approximately, in foreign exchange, while Saldanha is being constructed. What is the Government’s motive in continuing to block this scheme?

†Sir, increasing our ore and mineral exports is the first step we should take to improve our balance of trade. Secondly, the Government should vigorously encourage the export of manufactured goods. Industrialists will not venture into foreign markets unless the return on their investments is adequate. [Time expired.]

Sir, in spite of the attitude of the hon. member for Simonstown and the threatening warnings he directed at me, I shall show him the courtesy of replying to him. In the first place, I have a bona fide message to convey to him from the fishermen of Walvis Bay. They invite him to come and spend a week in Walvis Bay on condition that he goes out to sea with them and with the prospect that he will then come to see things aright. This is the message from the fishermen of Walvis Bay.

I was there last week.

Furthermore, I can make the hon. member this compliment: In the two years that I have been sitting here and handling this matter, he has made one or two speeches on it every year. I can assure him that during this time he has not made any contribution at all towards solving this problem about which he is so concerned. He may go and page through his speeches and see if he can find anything positive in them …

Stinking stories.

… something which has real meaning, something which is truly realistic. He speaks of proposals he has put forward. Let us take a brief look, for example, at the proposals he made here today. He referred dramatically to “the present state of affairs”. I do not know whether the hon. member is interested in what is happening at the present time, but I know that there are hon. members who are in fact interested, and without being over-optimistic, I can say to them that there are very definite indications that we are regaining lost ground in respect of pilchards and rock lobster.

I hope you are correct.

The hon. member referred to the annual report of Fishcor, covering a period which ended last year in, I think, September or October. If he would only read that report he would already find indications of this in that report, regardless of what the position is at the present time. The hon. member came here and spoke of the quotas for the Willem Barendsz, Sarusas and the Suiderkruis. He reproached me for having granted quotas. It is not true; it is not correct. What happened in actual fact was that the quotas of approximately 570 000 tons which those people legitimately had, were reduced to 165 000 tons, besides the pilchard restriction. They were prepared to settle for 270 000 tons in Walvis Bay, but because the department, the Minister and I were adamant, it was eventually fixed at 165 000 tons. It was reduced from 570 000 tons to 165 000 tons. Sir, if at this stage the hon. member feels he has made a fool of himself, it is not my fault. Then the hon. member spoke of factories without canning facilities and said that they should be compelled to install canning facilities.

I did not say so.

The hon. member for Omaruru indicated why those factories had not been granted canning facilities at the time; it was due to a threat of a trade boycott on the part of those countries to which we sold.

I said they should use the services of other factories.

The hon. member spoke of factories which did not have canning facilities. If he feels he has made a fool of himself in that respect, it is not my fault. Today, when the situation appears to be completely different, those people may have canning facilities if they want them, but would it be advisable at this stage before there is absolute certainty about the situation? Sir, on a previous occasion I asked the hon. member whether he would be prepared to implement Dr. Lochner’s theory just like that if he were to come into power. He did not reply to me at the time. Will he reply to me this afternoon? Will he tell me today that he would prescribe 100 000 tons of pilchards per year for Walvis Bay if he were in power?

That is not what he recommended. He recommended 150 000 tons.

Sir, he recommended 100 000 tons for this year’s catches, and if the hon. member feels that he has made a fool of himself in that respect as well in that he does not even know what Dr. Lochner recommended, it is not my fault either.

The hon. member also spoke of subsidies to the industry. This industry is not in such a condition that subsidies from the taxpayer’s pocket are necessary. The hon. member complained here about the fishermen’s remuneration and he complained because no conditions had been attached to the increase of the price of fish. There was an understanding with the fishing industry when that increase was granted. The hon. member does not know what that increase really implies. The increase is R9 per ton of fishmeal; this is apart from canned fish; and one ton of fishmeal means 4 tons of raw fish. Only half that tonnage of fish is marketed in South Africa. In other words, the increase is only on approximately one half of the fish which is processed. Now the hon. member may make a little calculation, if he is able to, and he will find that these factories receive approximately R1 per ton extra on their raw fish. Then the hon. member may do a little calculation to establish what is paid out to the fishermen and if he feels he has made a fool of himself in that respect as well, it is not my fault.

What is more, Sir, the fishermen of Walvis Bay and the boat-owners know that as far as remuneration is concerned, their interests are being looked after. They know their interests were looked after last year. Last year the fishermen were placed in the same position as if there were catches of 90 000 tons. They know that on my instruction the department negotiated with the industry and that an increase of R1,20 per ton was agreed upon. Furthermore, as far as this matter of Du Preez and the Consortium is concerned, I have already made provision for that matter to be taken up with them, and a meeting in this regard will take place one of these days. If the hon. member finds that he has made a fool of himself in this respect as well, it is not my fault. These matters cannot be determined just like that in this fluid situation we have.

The fishermen, the boat-owners and the factories know that the department and I intend examining this situation every year as the catches develop. But we must first reach the end of the season and establish what sort of catches have been made. At the moment it seems that the catches are going to develop unfavourably in the sense that pilchards are in fact reasonably plentiful but that there is very little other fish. This creates another difficult situation of which the hon. member is probably not even aware and which he has not taken into account, and if he wants to make a fool of himself in that regard as well, it is not my fault either. Then he spoke of the interest of boat-owners which should be subsidized. This has already been arranged with Fishcor. It is not a subsidization of interest, but a special approach in respect of the position of the boat-owners in these difficult circumstances. And it was arranged long before the hon. member put forward the idea that interest should be subsidized. If he feels he has made a fool of himself in that respect as well, it is not my fault. Then there is the transfer of the increased prices of fish to the fishermen. In that regard I have indicated to him how that money is transferred to the fishermen, and consequently he has made a fool of himself in that regard as well.

I want to make haste to discuss two other matters, mainly because of the circumstances of the hon. member for Parktown. The first is in regard to the matter he raised yesterday evening in respect of pyramid selling. I want to compliment the hon. member for Parktown on the extensive knowledge he has of that system, because yesterday evening he gave a very accurate exposition of how this system does in fact work. I went to the trouble of gathering some information about this kind of system, and I must say that in essence my information corresponds to the version he gave this House yesterday evening, and therefore I do not feel obliged to give any further explanation in that regard. I should like to inform this Committee that the Consumers’ Council, too, has already written to me, owing to the good offices of the hon. member for Pretoria District, in regard to the malpractices prevailing in respect of sales of this nature, as well as others, and that the Consumers’ Council has submitted certain proposals to me in regard to legislation, in respect of which I have fundamental problems, but it is not necessary to discuss it further here today. I just feel obliged to reply to what the hon. member for Parktown said yesterday.

†The hon. member suggested that if we could not do anything else we should look for legislation to do three things; Firstly, that there should be a written contract, as the hon. member suggested, and, secondly, that there should be a seven-day cooling off period and, thirdly, that there should be a take back provision. I think those are the three conditions the hon. member suggested last night. We have had a closer look at this whole matter, and it was felt that we could do something under section 9 of the Price Control Act, but I would like to put this to the hon. member now and I would like him, if possible, to react to my suggestion, because I would like to hear from the Opposition if I can rely on their support if I do anything of this kind. The Price Controller could, by proclamation, prohibit sales of this kind, but I fear it will then also apply to all those others to which the hon. member referred last night and which he regarded as being reasonably respectable. The suggestion is that the following proclamation should be published in the Gazette—

And then follow the three conditions—

1. (a) the purchaser is denied the right to withdraw within seven days after having so bought or received the goods from any contract into which he may have entered in connection with the purchase of the goods and to return the goods within the said period to the seller.

That provides for the first condition the hon. member suggested last night—

Now this is the written part of the contract which the hon. member suggested—

I would like to hear from the hon. member or from other hon. members opposite, what they think of a suggestion of this kind. This is the only thing we feel that we can do at the present moment without further legislation. I realize that it would also affect other sales at dwelling houses or at working places and in the circumstances I think it might be a serious thing to do, as it might do harm to certain other possibly reputable sellers of goods of this kind.

*I think hon. members may perhaps discuss this proposal later. This is the only thing I can suggest in this regard at the moment. I must say we are very concerned about this type of sale. In the absence of a better word, I can only call it a racket. Unfortunately it is the position today that to a large extent our people expect the Government to look after everything. Hundreds of people let themselves in for this type of thing and instead of using their heads and asking themselves whether it is the sensible thing to do to concern themselves with an organization of this kind, they do it nevertheless and in the end there is a tremendous explosion and hundreds, perhaps thousands, of people suffer losses, and then it is for the Government to ensure that they are not done in in that way. But this is the position, and we should like to combat it. At present I do not have anything better to suggest except perhaps legislation, apart from the fact that we have handed the matter over to the Police who may perhaps take action in terms of the Gambling Act. That is another possibility. The matter was brought to the attention of the Police some weeks ago, and they are conducting investigations.

Another subject I should like to discuss now, is the matter in respect of price control which was raised by the hon. member for Pinetown in the Budget debate and once more this afternoon. I want to say that I hold very definite views on price control and that I shall not hesitate to express my very definite views in that regard today. In December, 1971, we were obliged to intensify price control materially. As you know, there has always been price control in respect of certain commodities, but in December last year we were obliged to intensify it materially. It happened as a result of circumstances which had brought about a measure of imbalance in the economy, i.e. the intensified import control which we introduced, as well as devaluation. As a result of these two steps on the part of the Government, some exploitation and malpractices occurred. Consequently the Price Controller received many complaints and initially, in December last year, we froze the prices o’ certain commodities. Instead of the frozen prices introduced initially, maximum prices in respect of certain commodities were laid down at a later stage. I must say we would have been failing in our duty if, in the prevailing circumstances, we had not asked and had not intensified price control. The malpractices which resulted from import control were simply price increases which were imposed in anticipation of goods becoming scarce.

The prices of certain imported commodities sold in South Africa, suddenly rose the day intensified import control was announced. The prices rose simply because of the expectation that the articles were going to become scarce and that there would be a greater demand for the goods because as people rushed to buy goods which would suddenly become scarce. There were some exploitation and malpractices as a result of devaluation, because the prices of goods which had been imported at pre-devaluation prices rose at once without any justification as though devaluation prices applied to such goods.

These are the circumstances which brought about the degree of imbalance and which afforded people the opportunities of applying malpractices and of exploiting the public. The Price Controller conducted discussions with trade and industry. I think these produced very fruitful results. As hon. members know, in the meantime it was necessary for us to combat inflation as well. I think there were perfectly encouraging signs as a result of the discussions conducted between the Price Controller and trade and industry. It is our responsibility of course, to ensure that exploitation does not take place, but I think we must admit in all honesty today that an equally important duty rests on the consumer. I must honestly say that the ideal and most effective price control rests with the consumer. It rests with him provided commodities are obtainable fairly readily.

The sovereignty of the consumer.

If the commodities are available and the consumer makes a point of buying the articles at the place where he can obtain it the cheapest, it is in my opinion, the most ideal and most effective method of price control. In that case the prices would be forced down to a level where the seller is still able to make a living but below which he cannot drop without showing a loss. It seems as though our buying public do not discipline themselves properly, and I want to address a serious appeal to them. As far as their purchases are concerned, they must discipline themselves, buy carefully and buy at places where the prices are the lowest. I know that not everyone can save, but those who have good earnings, should save, not only in their own interests, but also in the interests of South Africa. It is a misconception that regardless of circumstances, the public should, in respect of prices, be protected by the Government at all times. I want to say unambiguously the price control cannot be applied in order to prevent price increases. If circumstances justify an increase in prices and it becomes essential for prices to be increased, we cannot keep prices constant by means of price control. What we can in fact do, is to ensure that no exploitation occurs in disturbed circumstances and that such circumstances are not abused. In recent times, of course, we have had the problem that large quantities of goods are imported—goods of which the prices also increase. The number of goods subject to price control at the present time, is in fact relatively small in relation to the large number and variety of goods which are available.

I want to tell the hon. member for Pinetown of my philosophy on price control. I believe that price control should be restricted to a minimum, especially under normal circumstances in which there is the customary competition and in which the consumer and the buyer themselves are able to play a role in keeping prices low. In such cases price control should be resticted to a minimum. Furthermore, I believe that profits should be made if we want our economy to run smoothly and especially if we want it to flourish. We cannot expect the entrepreneur to invest his money in a business if he cannot make a profit. Therefore it is my added belief that price control cannot and should not be applied to prevent a seller from making his ligitimate profit in the business he runs. That is why I say unambiguously that as far as I am concerned, price control should not be applied to prevent businesses from making reasonable profits. It is true that there has to be price control in certain cases. In this way we have always had price control in the past. I can mention a few examples. For example, I have in mind the few commodities in respect of which the Government pays subsidies. It is necessary for the price of such a commodity to be laid down, because it forms part of the calculation to determine the subsidy. There are certain basic goods, for example building materials, in respect of which it is desirable that there should be control from time to time. It is essential to control the prices in the case of certain industries where there is rationalization. In this regard I have in mind, for example, the chemical industry and cement. As far as the ordinary commodities are concerned where the supply is reasonable, I believe that if conditions are at all normal, it is unnecessary to have price control. I believe that where commodities are available, prices should find their own level. Since we have extended price control considerably at present in respect of a larger volume of commodities than before, I want to state unambiguously that it is not my policy to maintain this position. I think that as soon as these imbalances which were created by import control and devaluation, have been eliminated, we shall have to examine the situation once again so that price control in respect of those commodities for which there is a reasonable supply, may be removed. At the moment I believe that the imbalances still exist, and for that reason I regard it as a duty we have towards the consumer public to ensure that prices do not rise unreasonably when such rises are not justified. I hope this gives the hon. member for Pinetown some idea of my policy and philosophy in respect of price control.

For the present I want to confine myself to the hon. member for Zululand. I have singled him out as he is a different sort of member from other hon. members. The hon. member always sees spectres. He always sees suspicion. He simply loves talking about “there is suspicion with the public and you cannot blame them for suspicion”. This afternoon again he bruited a few things abroad. It reminds me of what he once said, i.e. “It reminds me of maggots feeding on a corpse.”

Order! The hon. the Minister may not refer to that, because it has already been withdrawn.

No, Sir, he did not withdraw it. He said he withdrew what he had said, i.e. that the hon. the Minister of Defence was a “mag ot”. On a point of order, that is what he withdrew. If I am wrong, you may correct me.

Order! The hon. the Minister may not elaborate on that, because the hon. member has withdrawn it.

Mr. Chairman, I ask myself what is wrong with a person’s mind if he thinks of things such as he again thought of here this afternoon. A person who thinks of such things, is sick; there is something wrong with him. Mr. Chairman, you and I do not think of such things.

Reply to the facts.

No, why do you want to run away? You can go and look for rotten fish up in Walvis Bay if you want to. I am sick and tired of this type of thing; I am sick and tired of us always being accused by that hon. member with his sick mind that there is dishonourableness on this side of the House. I am sick and tired of it. The hon. member did not render the sugar industry a service here this afternoon. There cannot be a better relationship between me and any other industry than there is between me and the sugar industry. There is nothing wrong with it. I want to congratulate the sugar industry on the prosperity it has had in recent years. Now the hon. member blames me for having exercized my right last year. What happened? The sugar industry made a recommendation in regard to the extension of the quota at TSB, viz. a sugar area in the Eastern Transvaal. The recommendation of the sugar industry was that we should increase the quota by 4 000 acres. It is my right to accept or reject the recommendation of the sugar industry. The sugar industry, which is a sound industry as it is, and I am placing the industry on an even sounder basis. There is the odd weak link in the sugar industry. Our first task is to eliminate the weak links in the sugar industry and at places where the quota is such that the mills cannot operate profitably as a result of a shortage of production, to ensure that the production there is expanded so that those mills will be able to produce economically. This mill, TSB, has never made a profit since it was established. The recommendation was that I should increase the quota by 4 000 acres. The mill had requested an additional 7 000 acres. I decided to increase the quota by 5 500 acres. It is my right as a Minister. Now the hon. member comes along and makes a fuss about it. And what does he say? He says I create “the inference that I bow to political pressure”. He does not come here with an idea like any normal, sensible person, but with his sick mind he sees all sorts of suspicion and motives why I had supposedly done so.

Is it correct that the recognized authority in the industry was implacably opposed to the grant of that quota?

Of course; I presume the hon. member is referring to the industry. The industry made a different recommendation. But I need not necessarily follow the industry’s recommendation.

[Inaudible.]

No, wait a moment. I shall come to that. I am not through with you by any means. I did not take the trouble to read the hon. member’s Hansard, but if he does so he will find he said that I had given an individual a quota increase.

I did not say that at all.

You read your Hansard and you will find out. I do not give quotas to individuals. I just give a particular mill a quota increase. The granting of quotas to individuals is not done by me, and that is why I told the hon. member that I had not granted that quota to which he referred.

You have got that power.

Yes, but I do not exercise it. The hon. member ascribed it that to me that I had given individuals quotas. I gave no individual a quota. The only thing I approved, was the increase of the TSB quota by 5 500 acres. That is all I did. That is why I tell the hon. member that he is still stupid. The hon. member went further. As is typical of supporters of United Party, it was of course something as bitter as gall for him when we succeeded in announcing a decrease in the price of sugar. The hon. member said here that we had done so just before the Brakpan election and he called it “political manipulation”. Surely I did not do so on my own. After all, I did so in close consultation with the Sugar Association, his people there in Natal. When the Sugar Association and I agreed that we could decrease the price of su ar in South Africa, I announced it. If it had a political motive, why does the hon. member not blame the Sugar Association as well?

That chap has a bilious complaint.

However, he sees siniter motives because we have decreased the domestic price of sugar. There is always suspicion in his mind. Goodness knows what will happen if he is to be placed in a responsible position one day, because then one can only practise those things one always has in mind and which one always wants to ascribe to others. When we announced this reduction in the price of sugar, something like Brakpan was not in my mind at all. The hon. member need not believe it if he does not want. I did so in close consultation with the Sugar Association. Does the hon. member know what this concession is worth to the consumers in South Africa? R9 million per year. My negotiations with the Sugar Association place R9 million per year in the pockets of the consumers of South Africa. Now the hon. member pretends that that is working. It is only half a cent per kilogram, but it nevertheless comes to a total of R9 million for the sugar industry. I do not think it is worthwhile speaking to the hon. member.

Mr. Chairman, I am sorry that the hon. the Minister in the latter part of his reply lost his “cool”, as one might say, because I had gathered two things from the hon. member for Zululand. The one was that his appeal to the hon. the Minister was to leave to the sugar industry those things that belong to the sugar industry, and, secondly that the hon. member was speaking on behalf of the sugar industry. I want to assure the hon. the Minister that he is much more effective in his more pleasant frame of mind than he was a few moment sago.

We were glad to hear from the hon. the Minister about his policy in regard to price control when he said that it was not his policy to impose price control and that he would impose it to as limited an extent as possible. We hope the limited extent will be very limited. I think this is the hon. the Minister’s own wish and I am sure that as time goes on he will get rid of more and more items that are controlled. I think there is one thing that one has to be very careful about with the question of price control, viz., that through price control you can stop the expansion of the production of a commodity where greater production in due course would reduce the price. In other words, if you have control of an item a businessman may say that it is not worthwhile his investing to produce a product which will only fetch X for him. If it was X plus something, he would extend his capacity and eventually the price would come down. Anyway, we are reasonably happy with what the hon. the Minister had to say.

I now want to say something about multi-level selling. I am gratified that both the Minister and his Secretary of the department are keen that something should be done. I think this is a very important step that the country now knows that the Government is giving this matter very serious consideration. We will have to study this document. It is not something on which I can give the hon. the Minister a snap answer, although it does appear to me right at the beginning that it is not going to do the job, especially if you read the fourth line—

This would not seem to be applicable to some of the distributors who never see goods and other distributors who take their goods from the factory. But we will be very happy to co-operate with the hon. the Minister. We will go through this document if he so wishes. We will meet with his economics group and see if we can find a modus operandi which will give an “oplossing” to this problem.

There is one other matter I want to deal with, and that is a point raised by my friend, the hon. member for Sunnyside. It is the question of our exports and private industry. I agree with him entirely that private industry has to play its part. I take the opportunity whenever I go abroad to always call on our embassies, particularly to discuss export matters with the officials concerned. I agree with what the hon. member has said; because I have seen documentary evidence of inquiries to South African firms for exports sent to nine or ten companies, and perhaps one reply was received. The South African industrialist is not getting on with the job. But this is not uncommon. What I believe we have to do, is ignite something, spark something off, get something going. I think the hon. the Minister will agree that it is as important to export as it is to create new industries, in many cases. But look what happens in regard to the creation of new industries. Let us take Ireland as an example. In Ireland, if you are prepared to establish a new industry at Shannon, as the hon. the Minister knows, I think you can get your profits tax-free for seven years. If any industrialist wants to go to Israel and establish a factory there, for a period of years his profits are tax-free. If I remember rightly, I think Taiwan is doing the same thing. If anybody wants to go to Taiwan and establish a factory, for a period of time his profits are tax-free. We have something very similar here. If you want to go to the border industries—or you have got to go to the border industries—a certain proportion of your profits are tax-free. What I want to suggest to the hon. the Minister is what I have already suggested in this House before. We have to do something dynamic, spectacular. These tax benefits we are offering to the exporters I do not think are enough to generate exports. I mentioned briefly during a previous debate in this House this publication “Disc”. This is, as the Americans would say, “hot off the Press”. It was only published on January 24th of this year. It is Domestic International Sales Corporation legislation introduced in America. In terms of this legislation, what actually and basically happens, is that 50 per cent of all exports are not taxed, provided they are not distributed, but used in the production of the product that is exported, or provided they are used to finance the export of the product. Here is the great United States of America. We know she has been running into a balance of payments problem; but what is her total export today? A maximum of about 5 per cent. Yet, she has gone as far as to say to her exporters: “If you will export, we will make 50 per cent of your export profits free of tax”. That is in effect what it means. They set out very fully how you calculate export profits, and so on. I think this is what the hon. the Minister should try to get his colleague, the hon. the Minister of Finance, to agree to—something dramatic, something that is going to mean something to the exporter. He should say to the exporter, “For a limited period of time”—whether it is three years, five years or seven years is something to be determined—“whatever profit you make on your exports will be tax-free; whatever your additional profits are from today, for that period of time your tax will be only 50 per cent.” Sir, if that is done, then I believe our industrialists would start exporting. In the same way as Ireland has built up a fantastic industrial sector in Shannon on a tax-free basis, I believe it is important that we should do the same for our export industry. Sir, let us be bold. This is a critical stage in the industrial development of this country.

I quoted some figures from SAFTO, which is almost a quasi-Government organization, as to what our position is going to be in the year 2000, which is not very far off. Unfortunately, I do not think that I will be here to see it, but it is not very far off. We have an obligation, not only to ourselves but to posterity to plan now to take care of the problems which are going to arise in the future. What we have got to do now is to try to create that incentive, that excitement, that willingness to do something, which will make the exporter really get off his chair and go to work. I do not think that anything we have done up to now has given him that incentive. He makes his profit locally. Jan Kitshoff, in a speech which he made the other day— a very good speech indeed—said to the exporter, “We acknowledge that your first consideration is the profit you make.” Mr. Chairman, you will never change an industrialist. This will always be his first consideration. If it is easy for him to make his profit here, he will make it here. If it is difficult for him to make his profit abroad, he will not make it abroad, unless the incentive is such that it will pay him to export. Give him the incentive of a tax reduction now, and then he will build up an export trade, and after three or four years it will be automatic. We will then start a chain of events—not like multi-level selling, but a better chain of events—and I think we can then establish a pattern of exports, a concept of exports, a philosophy of exports, which will do the things which the hon. the Minister wants as much as I want them.

Sir, I do not want to comment on the arguments of the hon. member who has just resumed his seat. I think the hon. the Minister will be able to do this with much greater authority than I would. I nevertheless think that he pleaded a very good case, i.e. in connection with assistance for our exporters.

Sir, I should like to draw the hon. the Minister’s attention to a matter which has perhaps not been mentioned in this debate yet, but which can become a very important aspect, in my opinion, as far as our future economic activities are concerned, a matter which should perhaps be mentioned here so that the hon. the Minister can inform this Committee in so far as the matter affects his department. I should like to focus attention on the possible introduction of television into South Africa within the next few years. I think it is an irrefutable fact that the introduction of television in South Africa can become a tremendous stimulus, over a very wide area, for our economy and our economic activities. I accept that the hon. the Minister and his department will play the role of allert watchdogs to try to protect our own industry here and to encourage it, and that very strict control will be exercised over the import of television sets. If we are to be chiefly dependent upon the import of television sets, it would cost our country a tremendous amount in foreign exchange— probably between R80 million and R100 million per year for the first few years. Therefore I want to advocate, firstly, that very strict control be exercised over the import of sets and, secondly, that very sympathetic encouragement be given to the manufacturing of the local product. Possibly the hon. the Minister will be in a position to inform this Committee about steps which his department is planning to encourage the establishment of a television industry in South Africa. I believe that the establishment of such an industry would start up many supplementary activities in the public and private sectors in our national economy. As far as the public sector is concerned, the Post Office would undoubtedly be compelled, for example, to extend its microwave system even further and, in particular, to erect a ground station for the satellite transmission and receiving of TV programme. While I am speaking about satellites, Sir, it would be interesting to know, although I do not think this matter relates to the Minister, to what extent we will make use of satellites, since the beaming distance with respect to a television set is about 60 miles and problems will therefore be experienced in our country with its wide reaches. According to newspaper reports, it is calculated that in the first year about 130 000 monochrome and colour sets will be needed; in the second year about 140 000 sets will be needed and in the third year about 210 000 sets, and that over-all sales in the first five years will exceed 500 000 sets, which will yield an over-all amount of R500 million. That is a great deal of money, Sir, but I have only obtained this figure from a newspaper report, and I do not know how reliable that is. I should like to know whether the Minister and his department can make any accurate estimates in advance. It nevertheless would appear from this that the manufacture of television sets can develop into a tremendously comprehensive industry in South Africa. What already appears to be essential is that careful attention be given to planned and scientific research so that the industry can rest on proper scientific foundations. The sound establishment of a television manufacturing industry can inevitably lead to tremendous technological development and can serve as a stimulus for the establishment of an electronics industry, a facet which has perhaps not yet received quite enough attention in our industry. There are some of our industrial cities that complain that the industrial areas, which have border area benefits, are drawing the industries. If we have an electronics industry, established, it will be labour-intensive, and this can again give new life to our existing industrial cities which are perhaps on the decline.

Sir, in conclusion I want to ask whether it is correct, as Press reports indicate, that black and white sets will also be manufactured. I have the utmost sympathy for people with small salaries who could possibly not afford the more expensive colour sets. But according to what I have personally seen in Europe, it does seem to me that the black and white sets are on the way out, and I am just wondering whether it would not be a question of buying more expensively if one also makes the black and white sets available, because it is frequently the people with the small salaries that have the biggest radiograms and similar items, and I do not know whether they would not simply buy the black and White sets provisionally and then trade them in for colour sets after a year. Sir, I am asking these questions because we are still groping around in the dark, to a certain extent, with respect to this matter.

In addition I should like to know from the hon. the Minister whether a decision is going to be taken on the standardization of television sets. I want to advocate that we do not make the same mistake, when we start out in this industry, that we made with our motor cars, with the result that one has 101 different types of motor cars, a situation that entails great financial expense. In conclusion I should like to know whether provision will be made for reasonable hire purchase conditions for television sets. It is probably important, particularly if black and white sets are not being made available. But personally I doubt whether it would be sensible to import black and white sets, but I am no authority in that field. But I believe that if colour sets are made available, and reasonable hire purchase conditions are allowed, everyone will eventually be able to afford the colour sets.

I ask the hon. member for Algoa to forgive me if I do not react directly to his speech, because I want to deal in just a few words with a product which is not as foul-smelling as rotten fish nor as sweet-smelling as fresh fish. I want to refer briefly to an extremely uneconomic practice followed by the Department of Economic Affairs. In reply to a question put by me to the Minister, he said it cost his department approximately R96 per ton to collect guano on the islands off our coast. This guano was then sold to our farmers at a price of R47 per ton. In other words, the State suffers a loss of R49 per ton. The figures for 1971 are not available as yet, but the loss on the sale of guano during 1970 is calculated at R127 000. Nobody in this House can congratulate the hon. the Minister of Economic Affairs on such a transaction. No matter how keen we are to help our farmers along, no business concern can afford to sell its product at a loss of approximately R49 per ton. But this is not the worst of it. Apparently the Minister is not satisfied yet. His department also pays an additional subsidy of R2,26 per ton to the farmer for every ton of guano he buys. It is clear, therefore, that the taxpayer subsidises the farmer by approximately R53 per ton for this guano. Now, it is common knowledge that guano is a highly sought-after fertilizer. The gardeners of our country would very much like to use it too, and the same goes for our nurserymen, but what do we find? To the man in the street this is almost unobtainable. The man in the street has to subsidize the farmer, but he himself cannot buy it. To the man in the street guano is taboo. It is as clear as crystal that if the Minister were to permit the consumer trade to distribute the guano, or if it could be made available to the man in the street in retail quantities, the Government could easily sell this guano, not at a price of R50 per ton nor of R100 per ton, but probably at R150 per ton. This is the kind of economy which the taxpayer of South Africa does not understand at all. Now I wonder whether the Minister will agree that as the Minister of Economic Affairs he simply cannot afford to proceed with such an uneconomic policy. Therefore my request to the Minister is that he will ensure that the guano will not be sold to our farmers at much less than it approximately costs the Government to supply it. If not, the man in the street should also be permitted to buy smaller quantities at economic prices so that he may also grow vegetables in his own garden, and in that manner it may help to bring down his high cost of living to a certain extent.

†In the few moments remaining to me, I also want to refer to the Steenkamp report on co-operative societies, dated 1967. I merely want to enquire from the hon. the Minister if it is his intention to react to this report in the foreseeable future, in particular in respect to certain aspects where the trader—very often the small trader in the country—feels that he is at a disadvantage in relation to the cooperative society in certain co-operative practices. *

Mr. Chairman, the hon. member must excuse me if I do not venture into the field of guano. However, I should like to come back to that matter which the hon. member calls the “economic affair”. I do not know to which affair he is referring, but I should also like to come back to that “economic affair”. The hon. member for Port Elizabeth Central today launched a very serious plea for St. Croix. I want to tell hon. members that we recently had the privilege of paying a visit to Sishen. We also paid a visit to Saldanha, with a view to possible development there. In expressing myself about this matter today, I am merely doing so objectively, because I am perhaps in the privileged position of representing a constituency where we already have a steel industry. My constituency’s problem is actually that the development there is perhaps too rapid. For that reason I can speak objectively about this matter. As the hon. member put it here, St. Croix will only be able to handle ships of 150 000 tons in future. As I have said, we had the privilege of paying a visit to Saldanha. We also had the privilege of paying a visit to the C.S.I.R., which has a model of the Saldanha harbour and where research is being done in that connection. There is not only the research which the C.S.I.R. has done, but some of the best consultants have also been approached. It is very clear to us that Saldanha offers possibilities for much larger ships than the 150 000 tonners which the hon. member spoke about. With today’s modern developments, with the shipping and transport problems, it is of course much cheaper if one can make use of ships with a larger tonnage. I think that in that respect Saldanha lends itself far more to a harbour that can be used for the exporting of ore. As has been proved, Saldanha will also be able to handle ships of 250 000 tons in future. Those ships can be properly brought into the harbour; they can be handled and loaded in such a way that they can also tackle the open sea without too many problems. When inquiries were made about weather conditions, it was proved, it is true, that this could create problems for the big ships, but it was also proved that in the course of a year there would be very few days on which problems would be experienced in bringing large ships into the harbour. I think this is not only a question of the development of the Saldanha harbour. because that harbour can also be converted into a bigger harbour than all the harbours in South Africa. Saldanha Bay lends itself to being developed into a much bigger harbour than Cape Town, Port Elizabeth, Mossel Bay and Durban put together. Another reason why it is very important for the project to be developed, is the opening up of the entire North Western Cape. Since not only ore, but also other minerals lie hidden still in the North West, one would be creating an opportunity there for the opening up of the entire north western areas. This will also entail the possibility of creating employment opportunities for people of that area. I am thinking in particular of the greater utilization of the Coloured labour. As far as I am concerned, the only question is whether the iron ore should be shipped and disposed of in ore form or whether the iron ore should not be exported as semi-manufactured products, “billets”, “blooms” or “slabs” as we call them. The Minister rightly said that this could bring much more foreign exchange into the country for us. However, it is a question that will have to be investigated. The only question I want to ask the hon. the Minister is whether it is reasonable for Iscor alone to incur that tremendous capital expenditure for the development of so large a project. I think in all humility that as far as that is concerned, the State should contribute its rightful share to the development. So much for the Saldanha project.

I want to come to another matter which I think affects the general public very acutely. It concerns the motor industry, the garages and the quality of the service which the motor car owners obtain in South Africa today. With all due respect I think that the quality of the service we obtain from our garages is certainly of the poorest in the world. Here I do not want to level accusations at all the garages, but the simple fact of the matter is that the service we get from the majority of them is extremely poor and the public is exploited on a large scale. What it amounts to is that when the car is serviced and is then returned because this was not done satisfactorily in the first place, the public must repeatedly pay for the same service.

I also want to refer to new vehicles. A service is performed which is known as the “pre-delivery” service. The agent, who is the representative of the relevant article, is supplied with a certain sum of money by the manufacturers to furnish certain services prior to delivery. I do not believe that that service to the vehicles is done properly. Cars are sent from the factories to various distributors, and under such circumstances the distributors are supposed to check such a car properly for the remuneration they receive for that purpose from the manufacturer. I believe there are hon. members who have personal experience of the circumstances to which I want to refer. I have clippings in connection with a case where a person bought a car in Witbank, for example. The car had covered only 100 or 200 miles before it was brought to the Cape. Here some defect or other was found in the car and it was brought to the local agents of the same article. To get rid of the person concerned the repair work was done by the Cape agents after a fashion. If the car is still covered by the 6 000 mile guarantee the local agent tells one that one should simply pay the account and that one can recover the amount at a later stage from the garage owner from whom the car was originally purchased. I ask whether this is being reasonable. One can never get to the right place and person. And so that burden is simply placed on the purchaser of the vehicle again.

I myself have had that experience. I bought a vehicle, and after 6 000 miles I saw that the tyres were wearing down fairly unevenly. I then took the car back to the garage where I had bought it from. I asked them whether the wheel alignment was correct and the wheels had been balanced. I was informed that the wheel alignment was correct and that the wheels had been balanced. After 9 000 miles the tyres were in such a condition that I had to throw them away. I took the tyres back to the garage and I was then informed that there was something wrong with the rubber; the rubber was of a poor quality. I was then advised to consult Firestone in Johannesburg. I took all the trouble and went to consult Firestone in Johannesburg. There I was informed that there was nothing wrong with the rubber and that there was a mechanical fault in the vehicle. That is how one is sent around from one place to another. But when one buys a motor vehicle from a garage, one does not buy the tyres from Firestone, the battery from Willard and the hooter from Bosch. One buys the vehicle at Leon Motors or at Currie Motors. I really think the time has come for the motor vehicle owner to have greater protection.

As far as repair services are concerned the position is the same. I ask whether the time has not come for garages to be classified like hotels, so that certain requirements must be met. The mechanics should for example, be in possession of certain qualifications so that it is not simply a matter of anyone lifting the bonnet and pottering around in the engine. When one gets the car back, believing it has been repaired, one finds, for example, that the lights still do not work, and if they have been repaired one finds that now the hooter does not work any more. So it goes. I really think that the time has come for us to grant protection to the motor car owner.

Mr. Chairman, I want to come to another subject altogether, and I am sure that the hon. member who has just sat down, will forgive me for not following his line of thought. I want to come to the question of oil pollution and the danger to our seaside resorts as well as to our territorial waters. In this connection I will touch upon the question of the breakdown of responsibility for dealing with oil slicks or oil spillage. Over the past 3 or 4 years—and I am now referring particularly to my own province, Natal—a committee has been established and meetings have taken place in that province under the chairmanship of one of the MECs, Mr. Archibald, now Mr. Watterson, for the purpose of dealing with oil slicks when the oil comes ashore. Various measures have been debated and discussed with a view to dealing with that particular problem of oil pollution on our beaches when the oil comes ashore under circumstances which bring it under the jurisdiction of that particular committee. But there are times when it comes ashore in the area of a local authority. Then the local authority has to deal with it, that is when it is in the form of a small slick. Here at once I want to put it to the hon. the Minister that the present arrangement is completely unsatisfactory because there are no definitions. There is no definition as to what a small slick and what is a big spillage. I want to point out how impractical it is to have a system whereby a dividing line is established between the control of oil spillage by the department as opposed to control and modification by the committee or a local authority. That dividing line is the difference between the water and the dry land. I want to bring it to the hon. the Minister’s attention because this has been going on for some years. With everyday that passes we are running the risk that the law of averages is going to bring us a major disaster on our coast. This is not the first time that this matter has been raised. In this connection I think of the World Glory, the Tigres at the entrance to Durban harbour the other day, the Silver Castle and the Wafra. We have missed a major disaster by the narrowest margin in every one of those cases. But, Sir, it cannot go on forever. One million tons of oil per 24 hours goes round our coast. It is inevitable; it is coming. Now, Sir, I say that this dividing line between the edge of the water and dry land is a completely impractical dividing line. You may have a big oil slick coming ashore. The committee with its people and all the forces which it can command—and they are very small—must sit on the beach supine, with their hands folded. They cannot touch that oil slick because it is on the water. It belongs to the department. But when once that oil is washed upon the beach, then they can get stuck into it to clear it up. I am sorry, but this is not reasonable. We have no grounds whatsoever for calling ourselves homo sapiens when we allow a thing like that to happen. Surely, the place to stop the pollution of the beach is while the oil is on the water. It is true that under certain circumstances the department will do its best to deal with that slick whilst it is on the water. That is particularly the case, for example, with the offshore mooring buoy, near Durban. There they have a boat stationed with supplies of detergents and dispersants all ready and handy because they know that is a place where the spillage is continually taking place. That is why they are ready to handle it at this particular place. But a wrecked ship or a ship that breaks apart does not first give warning and say: I am going to do it off the Port of Durban or near Port Elizabeth, Algoa or near Cape Town. That is not known; it is just one of those things that happens. That is what it is so unfair about asking a local authority to bear the cost of an oil pollution when spillage comes ashore as though it was responsible for that spillage. This is the work of fate. A local authority is not responsible for the cost of washing its beaches and cleaning up the mess—it is a shocking thing to try and clean up—merely because it has come ashore from a certain spillage which fact decreed should be opposite that particular local authority. Durban can have a big spillage which could pollute its beaches but that is the chance of fate. That ship may just as easily have broken up down here in Cape waters and affected one of the beaches of the Cape sea-side resorts. It is by chance that it goes ashore or that it breaks up opposite Durban. Why should Durban have to carry the costs? Durban makes no profit if that ship doesn’t break up. It is a national profit and a national undertaking. It is up to our national economy to see that we get our oil to our shores safely. If something goes wrong with it, and the profit belongs to the nation in the event of success, then in the event of disaster the nation must carry the responsibility. It is surely most unfair that the responsibility should be carried by the local authority in whose in-shore waters a disaster may take place, when the oil is on the beach. Again I ask what the difference between a major spillage and a minor spillage is. Nobody knows; it is not defined. Here we have a lack of definition.

I want to say at once that one of the problems we have to deal with here is the question of the ships that come into our waters which are oil carriers, the big oil tankers that come into our waters. The time to prevent spillage is before a tanker gets into territorial waters. Let them have their spillages out at sea if they want to have them. Once you have a tanker in your territorial waters and spillage takes place, you are in trouble, because you already have the oil spill on your in-shore waters. This year particularly I have flown up and down from Durban over and over again. I can assure the Committee that we had in some cases up to four tankers inside our territorial waters at any one moment. This could be seen from the aircraft when visibility was such that one could see what was going on down below on the sea. I think I am not missing my guess when I say that one in five is trailing a more or less serious trail of oil. It may be a very small quantity of oil, it may be washing out of its tanks, or anything else. There are a lot of excuses and reasons put up. But what is the net result of this for South Africa? This is not a matter for this province, or that town, but a South African matter. What it means is that the accumulative effect of all those small spillages is building up against our shores. We still do not know what the ocean currents are doing with that oil. and I want to say at once that I am not going into the question of the damage that is done to our marine ecology by using dispersants on oil slicks. It is accepted the whole world over, and in America this practice is barred in some places. They will not allow dispersants to be used on oil slicks because of the damage that is done to the under-sea marine biology. I rule this factor out and simply say that I hope that everybody who has given any thought to this matter and has done any reading on this subject, will come to the conclusion that we have to stop dealing with oil spillage by means of dispersants on the surface. That goes for the big off-shore mooring-buoy outside Durban as well. It goes for that the same as for any other spillage that takes place. There are other means of dealing with this problem, and these other means have to be used.

There are developments that are taking place in the scientific world at the present time and we can learn the lessons that come to us from other people. It is there in the papers. We know what is happening elsewhere. We know what is happening in America and we know what is happening in Great Britain. These spillages have to be dealt with in a different fashion, and I want to come back to my point that you only have a spillage to deal with if you allow these ships to come into your waters. In regard to that, I think that we have to adopt a new approach altogether. We cannot have aircraft and naval vessels tailing tankers around our coasts to sea if they obey the law, that they do not infringe the provisions of the law which we have passed to punish wrongdoers. In practice that is quite impossible. There are too many ships, they travel by night and do all sorts of things under cover of darkness, and they cannot be identified. There is one thing we can do, however. We can go along the line of insurance. I have found that the tankers that pass our coasts in fact come under two different sets of insurance. I see the hon. the Minister nods his head, and I am glad. No doubt he is well informed on this subject. I will be surprised if he is not, because he has some very well informed officials who can give him information. I think we can deal with these ships through insurance. Unless a ship is carrying, and for want of a better term I will say, a general insurance—not merely a third party like a motor-car—we should not allow that ship to enter our territorial waters. The ship that only carries third-party cover should be told to stay out of our territorial waters and must not be allowed in. They must be told that they are not adequately covered by insurance and are therefore a risk which this country cannot afford to carry. We do not want to quarrel with the international interests and we do not want to quarrel with other countries. We try to be friends with countries overseas. We do not want to do something that is going to blacken our name, so far as overseas countries are concerned, but we are perfectly entitled to say that if a ship cannot get adequate insurance to satisfy the demands of our own department here in South Africa, then that ship cannot come into the South African territorial waters.

Too many of these ships that are having accidents are flying flags of convenience. Why are they sailing under flags of convenience? Why do various big, financially very, very strong corporations in other countries run their ships under flags of convenience? It is because those ships are being run as cheaply as they possibly can. They are badly constructed, badly manned, and running on as cheap a shoestring as they possibly can to compete in this oilcarrying business. We allow those ships to come into our waters; and around the world, as well as around the South African coast, you see case after case where a ship flying a flag of convenience has broken in mid-ocean, run ashore, had a collision, or what-would-you. [Time expired.]

Mr. Chairman, the matter raised by the hon. member for South Coast is a very important one. I am convinced that the hon. the Minister would like to avail himself of the opportunity to react fully to that. Consequently it is not my intention to take the hon. member’s argument further, but I think today is a suitable opportunity to express our sincere thanks and appreciation to the department, and especially to Mr. Japie Venter for his actions in regard to and handling of a few matters in recent times, matters which in actual fact could have proved disastrous to our shores if quick and effective action had not been taken. Therefore I think it is fitting for us to pay tribute to Mr. Venter for his positive action in having prevented possible disasters in this regard.

I also want to associate myself with the argument which my friend the hon. member for Vanderbijlpark advanced in respect of the motor industry. Last year we dealt with certain aspects. I do not indend to go into them again on this occasion, but there is nevertheless a matter I should like to bring to the attention of the hon. the Minister, and that is the question of the transportation of new motor vehicles from the assembly plants to the various distribution points in the interior. I want to refer in particular to the long convoys of new motor-cars which are brought by road from the assembly plant to the distribution point. Owners of new vehicles are complaining more and more that they are having engine trouble at a very early stage in the life of those motor vehicles. When the matter is investigated, it is found that this trouble is largely due to the high speed at which these vehicles are driven from the assembly plants to the distribution points. I really think the time has arrived for consideration to be given to having the distributor of a vehicle indicate along which route that vehicle was transported and brought to that distribution point.

I should also very much like to refer to another aspect. Earlier this afternoon the hon. the Minister went into the question of price control very thoroughly. Now, I do not want to return to the whole question of price control, but at this state, in the first instance, I want to express my appreciation on behalf of my constituency to the Price Controller, who has been so kind as to instruct the price supervisor at Springs to keep his eyes open for unjustified price increases. I want to assure the hon. the Minister that, on our part, we call on the buying public to report such price increases immediately.

Business interrupted in accordance with Standing Order No. 23.

House Resumed:

Progress reported.