Mr. Chairman, as far as the provisions of clause 2 are concerned, I want to say that whereas we have no objection in regard to facilitating the making of advances to farmers for the purpose of carrying on farming and that we shall therefore vote for this clause because the principle contained in it is related to what I have just said, we certainly disapprove of the mechanism set out in clause 3. We will move amendments to clause 3 but we support clause 2.

Mr. Chairman, I wish to move the amendment to this clause printed in my name on the Order Paper, namely—

1. file with the clerk or registrar of any competent court a statement certified by him as correct and setting forth the amount due and payable by the debtor, and such statement shall thereupon have all the effects of, and any proceedings may be taken thereon as if it were, a civil judgment lawfully given in that court in favour of the board for a liquid debt of the amount specified in the statement.
2. (4) The board may by notice in writing addressed to the aforesaid clerk or registrar, withdraw the statement referred to in subsection (3)(b), and such statement shall thereupon cease to have any effect: Provided that, in the circumstances contemplated in the said subsection, the board may institute proceedings afresh under; that subsection in respect of any amount referred to in the withdrawn statement.
3. (5) Notwithstanding anything contained in the Magistrates’ Courts Act, 1944 (Act No. 32 of 1944), or the Magistrates’ Courts Ordinance, 1963 (Ordinance No. 29 of 1963), of the territory, a statement for any amount whatsoever may be filed in terms of subsection (3)(b) with the clerk of the court of the magistrate having jurisdiction in respect of the person by whom such amount is payable in accordance with the provisions of this Act.

In moving these amendments I want to emphasize that what concerns us on this side of the House as the official Opposition is the impingement upon the existing right of third parties who are also concurrent creditors. This clause provides for certain matters which are fundamental and the first of these to which I want to refer is the fact that the Land Bank will be entitled to recover the amount due to it without argument in any court of law by the debtor as to whether or not he is liable. It was suggested last night by the hon. member for Yeoville in his usual quiet and unimpassioned way that this was a breach of the rule of law.

It is.

I want to remind the House that there is a standard form of guarantee that is used by commercial banks in South Africa such as the guarantee in respect of an overdraft.

Would that include WesBank?

Yes, all commercial banks. The hon. member for Yeoville is a banker. This standard guarantee contains this clause—

I am sorry that the hon. member for Yeoville has for such a long time in his professional and business career associated himself with such violence against the law as he indicated last evening,

The second question which arises as far as this clause is concerned is in regard to the sale in execution of the assets of an individual debtor of the Land Bank Having indicated that he will pay the loan back under certain circumstances which are the conditions of the loan, the farmer is then faced with the position where the bank wishes to recoup the money due to it. In this respect there is a departure from the normal procedure in that in terms of his clause the bank may seize all the movable assets of the debtor, the farmer, in order to recover its money. This is the situation that is involved, Let us assume that the farmer has obtained facilities from a commercial bank and with those funds he has purchased certain movable assets. He then acquires a loan from the Land Bank for the specific purpose of buying a threshing machine or something of that nature. He is then liable to two creditors, the Land Bank and the commercial bank, both of which are unsecured creditors. If the Bill before us is passed as it stands it will mean that the Land Bank can seize the movable assets acquired with the funds loaned by a commercial bank as well as those acquired with the funds loaned by the Land Bank, and can execute against all those assets. Because the method of execution has been taken out of the normal procedures laid down by rules of court it means that the Land Bank has a preference over another concurrent creditor in so far as the proceeds of any sale in execution are concerned. I do not think that this is justified. The procedure laid down in the courts for execution is a simple one. There is an application for judgment and then follow the normal procedures for levying execution that are laid down in the rules of the magistrate’s court.

The clause as it is before us at the moment goes even further. One finds that when one comes to execute against immovable property, the Bill then seeks to bring in the Deputy Sheriff to deal with this portion of the levying of execution. If the normal procedure of executing through the magistrate’s court is followed it is commenced, continued and finalized by the Messenger of the Court. It is for this reason that we believe that it would be correct under these circumstances—this is inherent in the amendments I have moved—to adopt the procedure which applies at the present moment in so far as liability for income tax is concerned. There is the lodgment of a form, a certificate of liability, and simultaneously with the lodgment of that form with the Clerk of the Court, there is the lodgment of the document authorizing the levying of execution against movable property, and the normal court procedure follows. One realizes that the Land Bank has problems. It does not have staff all over the country who can take action in regard to the question of execution. However, the position is that the Land Bank has in any event to instruct the Messenger of the Court in regard to what to do and how to do it. If the Land Bank is going to do that then it can quite easily do so by lodging proof of its claim, and the authority to attach assets, which is in the form of a writ of execution or warrant of execution to execute against those assets. The normal procedure then follows and the other current creditors have a right to participate by the issuing of warrants and also to participate in the proceeds of that sale in execution. That is all we are concerned about. We are concerned about an unfair preference that is being given without warning over other concurrent creditors. It is for that reason I have moved the amendments. They provide for the lodgment of a certificate which then becomes a judgment and then the normal method of levying execution against the assets of the debtor is followed. The hon. the Minister will know that this has worked over the years in regard to the recovery of income tax, and I believe it is a legitimate procedure which should be adopted under this Bill.

Finally, Sir, I just want to mention that I have made inquiries which lead me to believe that unless this procedure under the Income Tax Act is applied, farmers will have grave difficulty in securing unsecured advances from banks. I have investigated this with various banks. The bank is prepared to rank as a concurrent creditor and to take that risk, but it is not prepared to be placed in a position where the Land Bank can seize all the assets of the debtors and the commercial bank is left out in the cold. I think those hon. members who represent the agricultural sector in this House would be well advised to have regard to that fact. Sir, this is the view of those people who are advising the commercial banks at the present time—and I am not one of them—as to what risk they will run in allowing overdraft facilities to farmers when once those farmers are able to obtain unsecured loans of this nature from the Land Bank. I hope the hon. the Minister will accept the amendment which I have moved for those reasons.

Mr. Chairman, I would like to move the following six amendments—

1. (1) On page 4, in line 1, to omit “in the opinion of the board,”;
2. (2) on page 4, in lines 27 and 28, to omit “or shareholder”;
3. (3) on page 4, in line 31, to omit “consider reasonable” and to substitute:
   • stipulate at the time the advance is made
4. (4) on page 4, in lines 33 and 34, to omit “proceed as in subsection (3) prescribed” and to substitute:
   • immediately claim the amount of the advance together with interest
5. (5) on page 4, in line 41, to omit “addressed” and to substitute “delivered”;
6. (6) on page 4, to omit all the words after “advance,” in line 43 to the end of the proposed section 34 and to substitute:
   • file with the clerk or registrar of any competent court a statement certified by or on behalf of the managing director as correct and setting forth the amount owing with interest, and such statement shall thereupon have all the effects of, and any proceedings may be taken thereon as if it were, a civil judgment lawfully given in that court in favour of the bank for a liquid debt of the amount specified in the statement.

May I say in the first place that we in these benches support the provisions of section 34(1). In other words, we support the concept of providing further facilities in this manner to the farming community, but we cannot support the provisions which follow thereafter for the enforcement of this debt. Sir, we made our opposition clear yesterday. We believe that these provisions offend against the rule of law. We believe that they avoid the courts and that this should not be done. But as in fact the principle underlying these provisions has been agreed to at the Second Reading, we can do no more than to vote against this clause in order once again to register our protest against this departure from the rule of law. It is quite clear that it is the intention of the governing party together with the United Party to support these provisions which infringe upon the rule of law. All that we can do in the exercise of our duty is to try to reduce the effect of this infringement of the rule of law which is being perpetrated here. Sir, may I just say for the benefit of the hon. member for Green Point, who I should have thought would have known better, that there is a tremendous difference between, on the one hand, a certified copy of a document, which is regarded as a liquid document for the purpose of obtaining provisional judgment in a court of law, where that provisional judgment may be opposed and where in fact the documents have to be served and the court has to give a judgment and, on the other hand, the circumstances which are set out in this particular piece of legislation where the courts are entirely ignored and where the board itself, through its own action, can in fact not only claim money but can seize property and can have it sold extra-judicially. If he cares to look at some of the dusty law books in his office which, presumably, have not been opened for some time, he will find that there is a provision there which is called parati executi, an old provision of the Roman-Dutch Law but one that our courts have not accepted—in other words, as a creditor you may not take the law into your own hands in order to sell your debtor’s property. If he would look at that he would then see how the rule of law has, in fact, been circumvented again in these particular provisions. Sir, with respect, what the hon. member has done now is that, having realized the error of his way, he has taken verbatim the provisions of the Income Tax Act and has sought to insert them in here in order to mitigate the faux pas that the United Party perpetrated. [Interjections.] What he has done is to take the words verbatim from the Act. I have done the same with respect to my sixth amendment except that I have taken the trouble to check it to make sure that it applies to this piece of legislation correctly. I have dropped the other two provisions which are unnecessary in the present circumstances. Having again made a faux pas, having again made a mess in regard to what, in fact, is required of people who pay lip-service to the rule of law, and who in fact want to go further than paying lip-service, he has tried at the last minute to salvage a little bit from the wreck, which is something to which we have become accustomed. [Interjections.] But let me go one step further. I find it quite remarkable that yesterday, when the division took place, at least two of the lawers in the United Party found it convenient to be outside and not to participate in the division, because they had some degree of conscience left. [Interjections.] What has become so interesting, is that instead of dealing with the merits of the matter what is happening here is that personalities appear to be more important. The fact that I in the past had associations with certain institutions appears to be a matter of concern to some hon. members who, while I had that associations, were very happy to try to benefit from it but now talk contemptuously of it. I think these hon. members should think twice about the manner in which they speak.

Then there was another matter yesterday. The hon. member for Lichtenburg found it necessary to make a similar personal insinuation and in the course of the debate he said—

I passed a note immediately to the hon. member intimating to him that I thought he owed it to me to give me the name of the institution he alleged I was associated with and also the name of the person who was alleged to have been sold out, because I would also regard it as a matter of some concern that where an amount of R60 000 was lent R129 000 is demanded, and I certainly would want to make inquiries. But despite my sending that note to the hon. member, and despite my asking him for that information, he still has not given it to me. I think the very least he owes a person against whom he makes an insinuation publicly is to be prepared to furnish him with the information so that he can make inquiries to find out whether there is any iota of truth in the allegations. But, Sir, this is not the sort of way in which to behave. I find it remarkable that having passed the note to him immediately requesting that information, the hon. member has to this moment not seen fit to furnish me with that information.

Sir, I want to deal specifically with the amendments as I have moved them now. The first amendment is that the words “in the opinion of the board” be deleted. The reason is that I want it to be an objective test—in other words, it should be capable of being objectively ascertained whether the advance has been applied for the purpose for which it was made. It should not be a person’s opinion which is in issue but the factual situation. Accordingly I think this amendment is one that the hon. the Minister might well consider.

The second amendment deals with the fact that when the debtor is a company and any director or shareholder is sentenced to imprisonment without the option of a fine, the board may in fact claim the amount immediately. I have not asked that the term “director” be deleted, because presumably the argument will be that the director might well be the person who is farming, and if in fact he were involved in this, he would possibly not be able to carry out the job and there would be prejudice as far as the investment of the board is concerned. In the case of a shareholder, however, it may be someone who has no interest in the matter whatsoever. It may be that he is not farming and that he merely has a sleeping financial interest. In these circumstances the actions of that person and the conviction of that person should certainly not be regarded as being material when it comes to calling up the loan. [Time expired.]

Mr. Chairman, I should like to reply to what the hon. member for Yeoville said a moment ago. It is quite correct; he sent me a note last night, asking me to furnish him with the name of the institution and of the farmer. Sir, I should very much like to furnish him with this information, but not in the way he wants me to furnish it to him. I shall furnish him with the information here in the House. I shall furnish it to him now. But before doing so, I want to make another statement, and that is that I am going to accuse him of something else. The reason why I shall not furnish him with the information in the way he wants me to, is because I am going to accuse him of something since I suspect that he will try to do it to me if I furnish him with the information in any other way. Therefore, I shall not furnish him with the information in any other way, but I shall do so here in the House.

The institution which I am referring to is a subsidiary of Western Bank, i.e. Premier Finance Corporation, which granted a loan of R60 000 to Mr. W. Jacobs for the purpose of purchasing some land. They calculated the interest in advance for I do not know how many years, and within a year they issued summons against that person and informed him to pay interest for less than a year plus interest for another ten years in advance. Because he was unable to do so, they simply held an auction, and that man is staying on somebody else’s farm today. Therefore I want to say that we do not need that kind of financing in agriculture, and that kind of organization with which the hon. member is associated, should rather stay away from agriculture. I want to warn the farmers not have anything to do with the organizations this hon. member was associated with. I want to state emphatically, Sir, that it is only those organizations he was associated with, or still is associated with, that take steps such as these, and not the other financial organizations. The accusation I promised to make, is that he and his organizations are the eradicators and exploiters of the farmers. [Interjections.]

Order! The hon. member must withdraw the words “eradicators and exploiters”.

Sir, I am not going to withdraw them. I am sorry; I shall obey your ruling if you order me to leave the House, but this is the truth and for that reason I will not withdraw them.

Order! I order the hon. member to withdraw those words.

Mr. Chairman, I cannot withdraw those words. If you order me to leave the House, I shall obey you, but I cannot withdraw the words.

I am asking the hon. member for the last time to withdraw those words.

I withdraw them, Mr. Chairman.

Mr. Chairman, I want to say here and now, so that there should be no misunderstanding about it, that Premier Finance is not a subsidiary of Western Bank and never has been, to my knowledge. Secondly, I have never been a director of Premier Finance, nor have I been a shareholder of Premier Finance, nor, Sir, have I been employed by Premier Finance. I regard this smear as something which, with great respect, a member of Parliament should know better than to indulge in.” I asked the hon. member by way of a note to give me this information because I believed that in fact it was wrong to have the name of institutions and of private individuals who had borrowed money from institutions bandied about in a public place. I thought that if the hon. member would pass me such a note and would give me that information, I could then tell him that I was not a director or shareholder of Premier Finance. I did not dream for one moment that he was going to suggest that it was a subsidiary—he used the words “filiaal”—of Western Bank. I would imagine that before an hon. member would make so serious an allegation, he would take the remotest trouble, the slightest trouble, in order to find out the truth of his allegation. I want to say that I find this a most remarkable situation, viz. that in order to argue the merits of whether a law should be amended or not, there are these grave personal attacks which are being made, smear tactics being applied without any regard to the truth of the allegation, with reckless disregard for what may be the truth or not.

May I ask the hon. member a question?

The hon. member for Yeoville must first withdraw the word “smear”.

I withdraw it, Mr. Chairman. The hon. member may put his question.

Does the hon. member suggest that neither he nor Western Bank is in any way associated with Premier Finance, that there is no association whatsoever in the group, or in the set-up and association?

The hon. member for Lichtenburg suggested that Premier Finance is a subsidiary of Western Bank. I say this is not true. Secondly, I said that to the best of my knowledge—I am sure this is correct—Western Bank has no shares in Premier Finance. Thirdly: I am not a director of Premier Finance and I am not in the employ of Premier Finance either and fourthly, I am also not a shareholder of Premier Finance. That is the position. I do not know what statements the hon. member is going to make now to get out of this tight spot he got himself into but I can only make it clear that I personally know nothing about this incident, that I had nothing to do with it, that I have nothing to do with Premier Finance and that Western Bank does not control Premier Finance either. Those are the allegations which were made against me. If there any are other allegations, people should make them. It seems to me, however, that what is important now, are my financial interests and not the legislation which is before the House. The important point is whether or not this legislation is sound legislation. If this kind of tactics is now going to be applied in South African politics, no businessman who is worth anything, could have anything to do with politics.

Order! I now ask hon. members to stop all personal remarks and to confine themselves to the contents of this clause.

I respect your ruling, Sir, and will go on with the amendments I propose moving. I want to refer to my fourth, amendment, i.e. in lines 33 and 34, which is to give effect to the amendments which follow thereafter with the object of changing the provisions of subsection (3). In other words, that amendment is merely necessary by reasons of the fifth and sixth amendment. My fifth amendment deals with the fact that in this case you can take proceedings against and sell a man up merely by addressing a letter to him, and I want to submit to the hon. the Minister for his consideration that where such a draconian measure is taken, it should at least be assured that the letter is received by the person concerned. [Interjections.]

Order! The hon. member for Umhlanga must contain himself.

In the present case, all that has to happen is that a registered letter must be addressed to him and even if the letter is not actually received by him—the post sometimes does play strange tricks—his property can be sold up. I believe that with such a draconian measure care should at least be taken that the letter is received by him. It is the least one can do to minimize the problem as far as he is concerned.

I would now like to turn to my sixth amendment. This is to the effect that it is insisted upon that there should be a shortcut in the proceedings, there should at least be a court order so that execution can then be levied upon the judgment of the court and not merely based on the decision of the board. This is, as has already been indicated, a similar provision to the one contained in the Income Tax Act.

Mr. Chairman, I support the amendments moved by the hon. member for Yeoville but I do not intend replying to the allegations made by the two gentlemen on the other side of the House. I would like to address myself to the hon. the Minister because I hope the hon. the Minister will agree that the items set out in clause 3 to which we as well as the hon. member for Green Point have moved amendments, are basically concerned with the whole thrust of the Bill. I hope the hon. the Minister will agree that this deals with the financial position of those persons or individuals who have borrowed money from the Land Bank. In these circumstances it seems to me, as the hon. member for Yeoville has pointed out in so far as paragraph (b) of his first amendment is concerned that this is a question of fact. I am sure the hon. the Minister will agree that if somebody borrows money for a specific purpose, this can be clearly established one way or the other, and that there is, therefore, no question of the matter being left to the discretion of the board or even of the necessity to allow the board to express an opinion. The hon. the Minister also said last night that the Land Bank has performed an extremely important service in the development of the agricultural industry of South Africa. We would certainly have no argument with that, but in so far as this is concerned, the purpose should presumably be specified when the Land Bank lends money to an individual. There can, therefore, be no reasonable question of doubt as to whether or not the money has been used for the particular purpose.

I would also like to ask the hon. the Minister at this Committee Stage the reason for the words “or judgment is obtained against the debtor for the payment of any sum of money” in paragraph (d). If the thrust of this Bill is simply to establish the financial position of those who borrow money from the Land Bank, the hon. the Minister will, of course, be well aware that there may very well be a number of circumstances where judgment is obtained against somebody who has borrowed money from the Land Bank for a sum of money which, in no sense, could really be a matter of significance when it comes to the loan from the Land Bank.

I now would like to refer to paragraph (h) to which the hon. member for Yeoville has moved an amendment. The hon. the member for Yeoville has given the hon. the Minister and the Land Bank the benefit of the doubt by leaving in the words “any director”. A director may or may not be concerned in so far as this clause is concerned. If the main thrust of this Bill is to try to ensure that the Land Bank makes secure loans to farmers, whether they be companies or individuals, one can foresee circumstances where a director of a company would not be essential to continue to ensure the security of the loan from the Land Bank. I hope that as we raised this matter in the Second Reading debate that the hon. the Minister will give us reasons underlying the rationale which lies behind the words “or shareholder”, for the reasons the hon. member for Yeoville has mentioned. We on these benches raised this point as well during the Second Reading debate. It could be totally irrelevant whether the loan from the Land Bank was secure or not or would continue to be so. The thrust of the amendments of both the hon. member for Green Point and the hon. member for Yeoville as well as our objection to this clause and our support for these amendments turn on two simple facts. The first is that when the Land Bank makes a loan to a farmer, an individual or a company, their concern should be the financial security of that loan and the purposes for which it was made. Secondly, they should not take action thereafter which could in any way prejudice third parties.

Mr. Chairman, the hon. member for Johannesburg North has raised questions in regard to the circumstances under which the Land Bank may call up the loan in terms of subsection (3). I do not want to say more than that we do not regard it as necessary to amend any of these provisions because they are permissive provisions which are not in conflict with the conditions imposed by any commercial bank which makes advances to an individual in the commercial life of the country. They have the same sort of conditions. The hon. member said that a judgment against a debtor might be for a minor matter, but the creditworthiness of the debtor is immediately in question. The option is then left to the Land Bank as to whether that judgment is of such seriousness that the Land Bank loan should be called up. Subsection (2), which contains provisions that are already in the law, makes provision for normal precautions and rights which a lending creditor would expect to have against a debtor in respect of an unsecured loan.

Before I come to my amendments to clause 3, I want to clarify something for the purposes of the record. The hon. member for Yeoville seemed to suggest that these amendments were the result of some quick thinking. I think the hon. the Minister will be aware of the fact that these amendments have been in the hands of his department for some two weeks or so. They have also been in the hands of the department and in the hands of the Land Bank. They represent an endeavour to find a solution to the question of the protection of third parties. Furthermore, my amendments appear on the Order Paper for today and now one wonders where the late thinking is when one sees no amendments from the hon. member for Yeoville on the Order Paper. In fact, I was handed a copy of the amendments of the hon. member when I came into this House this afternoon I may say that I am deeply flattered that the hon. member has produced an amendment which is almost the same as my amendment except for a few verbal changes.

Mr. Chairman, I should like to put a question or two to the hon. the Minister concerning the implementation of the clause in question. The hon. gentleman will know that cash credit loans have been granted to farming companies, too, in the past. Evidently hypothec loans are not granted to farming partnerships and farming companies. Since the hypothec loan system is now being done away with and replaced by advances on promissory notes, I want to ask the hon. the Minister, in the first instance, whether it is his intention and whether it will be his policy to enable farming companies and partnerships, in addition, to obtain advances with which to purchase machinery, implements, breeding cattle or anything of that kind to enable them to carry on their farming activities. In my opinion it is becoming the practice to an increasing extent today to form farming companies or partnerships. Not all companies or partnerships are so big and one realizes that some large farming companies, for example, citrus companies, and companies picking apples, pears and so on, often have substantial cash facilities at their disposal. This is, of course, welcome and right, but as far as the purchase of machinery and breeding cattle under the hypothec scheme is concerned, one can deduce from the report of the Land Bank that the average amounts involved are not particularly high. The average amount applied for by farmers was only something like R5 000. In my opinion, if this facility could also be afforded the partnerships and the agricultural companies, this would be an important step in the right direction.

In the second instance I want to say that I support the standpoint of the hon. member for Green Point. It surprises me that the hon. member for Yeoville should have come along with these amendments. He proposes that the words “in the opinion of the board”, in the proposed new section 34 (2)(b) be deleted. The hon. member will note that clause 6 provides that the bank has the right to institute inspections or appoint people to do so on its behalf. These inspections may be instituted by the Board to determine whether a farmer is complying with the conditions of the loan or advance he has received. After an officer of a bank or the person deputed for this purpose has carried cut the inspection, he reports to the bank. Action may then be taken as the board sees fit. In my opinion, it is going a little too far to want to delete the words “in the opinion of the board”. If those words are deleted then the rest of paragraph (b) still remains, viz. “… any such advance has not been applied for the purposes for which it was made”. How will the board know what the advance has been used for if they do not carry out an inspection? I am sure the hon. member is going to vote for clause 6, but now he wants to delete those words in paragraph (b). How can the board decide if it has not carried out an inspection?

The hon. member for Yeoville also requested that the words “or shareholder” be deleted. If one had had the same kind of provision in the case of large companies, it would have been understandable that the hon. member would have wanted to delete “or shareholder”. However, practical knowledge of the farming industry and of the establishment of agricultural companies tells us that there are usually a few shareholders who are often very good friends or relations. Where such a shareholder who is involved with the company but is not necessarily a director is sentenced to imprisonment without the option of a fine, then surely it is obvious that the Land Bank must be in a position to act if there should be a suspicion that such a person who is a shareholder might be involved. The Land Bank could suffer damage if such a shareholder were to be imprisoned for a long time. I do not think that is such a terribly wrong principle. Once again it is aimed at protecting the bank’s position when it provides additional aid to the farmers of South Africa. When I, as a farmer, apply to the Land Bank for an advance for specific purposes, the bank will certainly ask me whether I am aware of section 4 as amended, and whether I know what the obligations are to which I should be subject if I should fail to act in accordance with my obligations and the conditions on which the bank gave me the loan or advance. I really think the hon. member for Yeoville is conjuring up a spectre which in this case will frighten off nobody, least of all the farming community in general. I think that because we have conditions such as those in clause 3, which could perhaps affect third parties, the motion of the hon. member for Green Point is correct. Here, too, one has to bear in mind the practical situation prevailing. I want to contend that anyone who has a Land Bank advance or loan and applies to his own local bank manager for credit will tell the bank manager: “Here is a statement of my assets and liabilities.” The moment he mentions that he has a loan with the Land Bank, the bank manager will no longer be apprehensive about him. On the contrary. The moment he mentions that he has a Land Bank loan, they see such a client in a new light, because they know how conservative our Land Bank is in lending money—often too conservative in the opinion of the farmer. In other words, the situation is such that one’s creditworthiness cannot be affected merely by the fact that one has been granted a loan by the Land Bank under this or any previous clause. That is my experience. I have absolutely nothing to do with the Land Bank, nor have I ever asked them for an advance or a loan, but my own bank manager tells me that that is the position. If that is the case, why should we not be prepared to provide assistance to those farmers who want to make use of the facilities under this clause?

Mr. Chairman, it is quite certain from the way in which the Government and the official Opposition react to the amendment of the hon. member for Yeoville, that they have complete contempt for the farming public of South Africa. [Interjections.] The trouble is that the Government and the Opposition only use the farmers as voting cattle, but when it comes to protecting their interests, they are not interested at all. [Interjections.]

Why did you vote against the Second Reading of the Bill? [Interjections.]

The new section 34(2)(b) reads—

then all these Draconian methods can be applied. Is it not possible that there could be a misunderstanding between the farmer and the Land Bank? Is it not possible that you can have an inspector of the Land Bank who does not like a farmer and who will report certain facts to the board with the result that the farmer gets sold up? It is only the farmer whom the Government is prepared to act against in this way and it is only in the case of the farmer that the official Opposition is prepared to support the Government to act in this way. That is so because they only have complete contempt for the farmers.

You are all “Boerehaters”.

How many farmers do you represent?

I am a farmer myself.

That will be the day!

The proposed new section 34(2)(h) reads—

Sir, can you imagine the IDC lending money to a company—let us call it Metkor—one of whose shareholders is then sentenced to a term of imprisonment for some reason; the entire loan made by the IDC to Metkor may then suddenly be cancelled. One simply cannot imagine such a situation, but because the farmers are just voting cattle as far as the Government and the official Opposition are concerned, they are prepared to inflict a provision of this kind on the farmers. It is absolutely unbelievable that the Government, with the support of the official Opposition, can treat the farming community with such contempt.

Mr. Chairman, I would like to go back to the hon. the Minister and ask him whether he can tell us where there will be any difficulty with the amendment proposed by the hon. member for Yeoville under subsection (3)(i), because most people when they lend money to somebody stipulate a period of time. This is not left open in the sense of being allowed to be considered a reasonable period or an unreasonable period. Then, with regard to the proposed new section 34(3)(b), I hope the hon. the Minister will tell us why the word “addressed” should not be deleted and substituted by the word “deliver”, because accidents do happen in the Post Office service in this country, just as they do in other countries, and the letter of demand may not in fact reach the debtor. Sir, the hon. member for Green Point made the point that these conditions are permissive. That is indeed correct. But the point that we are trying to get across and about which we feel strongly is that they are permissive in so far as the Land Bank is concerned, but they are not permissive in so far as the person who has borrowed the money is concerned. The powers are simply taken away from him and this course of action may be set in process quite irrespective of how the principal or the managing director of a public company or of any company may feel about it. This is permissive within the discretion of the Land Bank only, and I hope therefore that the hon. member for Green Point will accept that the borrower of the money has no choice. He makes no decision as to whether or not this course of action shall be set in motion.

He borrowed on these conditions.

Sir, the hon. member says that he borrowed on these conditions. The hon. the Minister of Finance will know that there is also a duty to protect those who borrow money, just as there is a duty to protect those who lend money, but this is hardly the appropriate time to get involved in a debate of that kind; it might take a considerable period of time. Lastly, Sir, may I simply say that to a partial extent we agree with the amendment of the hon. member for Green Point, as what the hon. member for Green Point and the hon. member for Yeoville are trying to do is simply to ensure that the normal processes of law will apply as opposed to what is provided for in the Bill at present.

Mr. Chairman, in the first instance I would just like to remind the House, because I think certain hon. members have overlooked the fact, that of course the procedure set out in this amending Bill for the recovery of debt is not a new principle. The hon. member for Green Point made that clear and I wish to repeat it. It is clearly in the original Act. The Land Bank has proceeded according to that type of procedure for many years where, for instance, it has had a lien against harvests, or a hypothec on movables and there has been default in respect of those contracts, as you might call them. In those transactions the Land Bank has in fact proceeded according to the procedure we are setting forth here. What it amounts to is that we are extending this particular procedure to cover the operations of the Land Bank for the recovery of debts where loans are backed by promissory notes signed by the farmer who borrows the money. I want to stress again that it is not a new principle which is being embodied. It has been used a great deal and it is merely being extended. That is the first point.

Secondly, the hon. member for Green Point referred to the position of a commercial bank which might have made a loan to a farmer—as well as a loan by the Land Bank—and said that the commercial bank might be at a disadvantage. I should like to make this point, that where a commercial bank has made an advance to a farmer, possibly in the form of an overdraft, and the commercial bank, because there is a default, wants to call up its money, the commercial bank does not notify the Land Bank. The Land Bank in fact in the past on many occasions has not known of the action to be taken by the commercial bank. It does cut both ways, and this has happened in many instances. So I do not think it can be argued that the Land Bank is in a preferred position to a commercial bank which also has made an advance, as I say, probably in the form of an overdraft. Going further, I want to say that the hon. member for Green Point put his case very reasonably and clearly. He is relying on the Income Tax Act, as he has said. I have the relevant section here of Act No. 58 of 1962. I have been looking at the wording here and I have been checking it with the wording of the Income Tax Act.

Where the hon. member moves his amendment to the effect that after the word “advance” in line 43, he wants to substitute “file with the clerk or registrar of any competent court a statement certified by him as correct”, I presume that would be by the board of the Land Bank, because it is the board of the Land Bank which may take certain action. I presume that is what the “him” refers to. I just draw his attention to that. I think it is a matter of the correction of a word there. I think that refers to the board of the Land Bank, which would give that certificate.

*The hon. member for Newton Park has just asked me what the position will be under the new dispensation, if it is approved, and whether farming companies and partners will also be able to receive these advances from the Land Bank. I can see no objection to this if a farming company or partnership meets the requirements of the Land Bank and complies with the provisions of the Act. If this is the case I can see no good reason why they cannot get loans of this kind in this way as well.

To come back to the amendment which is printed on the Order Paper in the name of the hon. member for Green Point, I want to repeat, in the first place, that the Land Bank has a long history of very valuable assistance to the farming industry and to farmers. It is not at all the intention of the Land Bank to recommend legislation which will be to the disadvantage of the farmers. In fact, we have precisely the opposite end in view. We want to keep the costs in connection with these transactions as low as possible, and therefore we feel justified in making this sort of amendment. I also want to point out to the hon. member that it is very important for the Land Bank that there be as much uniformity as possible in the procedure which the Land Bank must follow in connection with attachments and the sales which arise from them. I am referring to the sale of assets. Although there are different kinds of loans, we should not like different methods to be applied if this can be avoided in any way. I think that is fairly obvious.

I also want to point out that the Land Bank has a very limited number of branch offices in the most important agricultural areas of the Republic. The Land Bank is not in the position of most commercial banks, which have branch offices throughout the Republic. Often farmers are very far from a branch of the Land Bank, and therefore it is absolutely essential in these cases that when the Land Bank has to recover a debt—it will only recover a debt if there is absolutely no other way—it should be able to act quickly and in a simple way. If the bank cannot act as is now proposed, it will mean that the bank will first have to address a postal application to the clerk of a distant magistrate’s court, which has jurisdiction over the debtor concerned, for the issue of a warrant for execution. As we know, the issue of a warrant can take several days. After a warrant has been issued, arrangements will have to be made for the sale of the movable assets, or whatever assets there are, and that also takes up a great deal of time. The bank has gained experience in this respect over many years, and I think that the bank’s record in this connection is available for everybody so as to establish how it has acted in the past. I have discussed this matter with senior officials of the Land Bank and with certain farmers, and I know of no case in which the Land Bank has exploited farmers or tried to make use of these procedures to the exclusive advantage of the bank and the disadvantage of the farmers. It simply does not work that way at all in practice.

I am speaking now of the position in practice, and in this connection, I believe that it is very clear that this procedure entails certain financial disadvantages for the bank. In particular, there is a loss of interest which must be taken into consideration if we want to argue about the long delays which may occur if the bank has to act by means of judicial process. Under the bank’s own system of sale of immovable property, for example, by means of public auction, the proceeds of the auction are immediately paid over to the bank as creditor on receipt, together with the interest on the capital payable till that date. But in the case of a sale in terms of the court rules, we find that payment of the proceeds of a sale to creditors only takes place after a distribution plan has been drawn up and has been open to inspection for a specific time and no objection has been raised.

I mention these things to show that this takes time, and time costs money. It seems to me that this matter is also important in practice. I do not want to elaborate now on the rights which the Land Bank forfeits in terms of this new proposed legislation, but let me just mention that in respect of section 34, the lien on the farmer’s crops grown or to be grown on his land will no longer exist. This is forfeited by the bank. This includes the liens on items and materials which have been purchased from the loan for the production or the marketing of his crops.

The security which is implicit in the prohibition on the alienation of the debtor’s immovables without the consent of the bank no longer applies, nor does the right of the bank to enter the debtor’s property and cultivate the crop itself with the aim of selling it. These rights are forfeited by the bank, and in respect of loans in terms of section 34bis, the bank’s lien on the debtor’s movable assets is also forfeited. Of course, these are the assets which were hypothecated under the loan and can still be hypothecated during the term of the loan, together with the offspring and proceeds thereof. The bank also forfeits the statutory prohibition on the alienation of the hypothecated assets by the debtor. I mention this just to show that the changes are not all in one direction, and that the bank’s security suffers under these.

†Coming to the hon. member for Yeoville, who was supported by the hon. member for Johannesburg North and the hon. member for Randburg, I think he has been very effectively answered by hon. members of the official Opposition, but I would just like to refer to his amendments. I first saw these amendments at a quarter to twelve today and I had no opportunity until the lunch hour to look into them, but I do want to deal with them. The first one is on page 4, line 1, to omit the words “in the opinion of the board”. This is a discretion the board has always had in the past and is in the existing Act. I think the hon. member has to give a much better motivation as to why the original Act must now be changed. This is not the rule of law; this has been the case the whole time. The other amendment of the hon. member is on page 4, in lines 27 and 28, to omit the words “or shareholder”. The hon. member wants to change the original Act again. I merely want to point out that the Land Bank finances small family companies apart from individual farmers. The amendment merely follows the wording in the original Act again. I cannot see what the objection to that can possibly be. On page 4, in line 31, the hon. member wants to omit the words “consider reasonable”. This is also a discretion the board has had for a long time in the existing Act and what possible case has been made out why that must now be changed? On page 4, in lines 33 and 34, the hon. member wants to omit the words “proceed as in subsection (3) prescribed” and wants to substitute the words “immediately claim the amount of the advance together with interest”. I merely want to say that this wording also follows that of the original Act and is consequential upon the powers conferred on the bank in subsection (3). If you are going to change that, you have to change what goes before. On page 4, in line 41, the hon. member wants to omit the word “addressed” and to substitute the word “deliver”. I want to say once again that this wording in the Bill follows the original Act and that the bank cannot now undertake to deliver the notification to the debtor instead of addressing it to him by registered post. What is wrong with that? That has been the procedure over the years. Why should we now suddenly change that well-established procedure which, to my knowledge, has never been objected to right up to this moment?

That does not make it right.

The hon. member also moved an amendment to the provision on page 4 which the hon. member for Green Point dealt with. Of the two amendments, I would prefer the wording of the hon. member for Green Point because he at least has followed the wording of another Act which has worked very well. I would, however, like to put it to the hon. member for Green Point that, whilst I must appreciate the attitude of the official Opposition in supporting us in what we believe to be a very important Bill, I believe that these are very important practical amendments.

The Opposition is always supporting you … [Interjections.]

Order!

We have to be serious about this. These are important practical amendments in a very important field of activity in South African agriculture. I appreciate the views of the hon. members for Newton Park, Griqualand East, Green Point and others, but I am in some difficulty in this regard, because we have taken great pains to look into the practical implications of this amendment and we do feel that it is going to cause us to lose the main force of this whole amendment. I would like to put it to the hon. member that I will certainly look further into the points he has explained very clearly from his point of view today. I am not in a position to accept this amendment at the moment, but I am prepared to look at it still further in consultation with the chairman and other officials of the Land Bank as well as with others and with our farming friends on this side of the House who pay particular attention to these matters. If I can be persuaded that this will in fact be an improvement, I shall certainly do something about it in the Other Place. I regret that I will not be able to take it further at this stage.

Mr. Chairman, I am both pleased and disappointed with what the hon. the Minister has said. I would like, first of all, to deal with some of the points he has raised before I come to the amendment itself. The hon. the Minister said that this Bill will give the Land Bank a lesser degree of security than it had before. Before it had certain marked assets. There is rather a clandestine preference provided for in this Bill because the execution against the assets of the farmer are now not limited to a hypothec in respect of the marked or branded assets, but to all the movables. I think that the rights of the Land Bank are very much greater under this Bill than they were under the old hypothec system because it extends, as I say, a clandestine preference over all the movable assets of the farmer. That is what I would like to emphasize to the hon. the Minister. I hope he will take the opportunity to discuss this with the commercial banks. While this stands in this law the commercial banks will close down on ordinary overdraft facilities for the farming communities. I say this because it is a matter which I have investigated myself, and that is the attitude as far as the commercial banks are concerned. One can understand why it is so. The hon. the Minister secondly said that there was a loss of interest involved in the procedures. What are the procedures? When it comes to a sale of movables which are attached, the sale must take place 14 days after the date of attachment, and then the distribution takes place. Interest is recoverable from the date of judgment to the date of recoupment, and the judgment is given in respect of capital and interests. I believe the rate of interest at the Land Bank is 7½%, and this rate then becomes payable. There can be no loss of interest because there is a short delay of 14 days. When it comes to the execution against immovable property there could be a delay of a month but, as the hon. member has pointed out, in the distribution to creditors by the messenger or sheriff, the position is the same. There is provision for interest at the rate of interest which is due to the Land Bank. The commercial banks or other lenders are the ones who suffer because of a delay between judgment and recovery of the capital by way of execution, and not the Land Bank. While I am on this particular aspect, I want to say that an objection was raised during the Second Reading to the method of disposal in that the Land Bank can use an auctioneer to sell instead of the messenger of the court. That, however, is included in the rules of the court. The messenger of the court is entitled to appoint an auctioneer to effect the sale if he has the consent of the magistrate. The same provision is made in this clause. All the safeguards still exist as far as the Land Bank is concerned.

The other point the hon. the Minister made was that Land Bank could lose out because some of the commercial banks may foreclose before the Land Bank was aware of it. I occasionally subscribe to one or two of the very efficient information publications which publish details of judgment debts and are able to get to the normal creditor and the normal businessman timeously when a judgment is taken to enable that creditor to issue his writ and to take action to participate in any execution against movables. If this position affected the Land Bank before when they had a hypothecation over certain assets, it is certainly a case of the Land Bank having to be more alert to the possibility of other creditors taking action, because they are now going to be faced with the same position that if they are dilatory the commercial banks may take action before them, in the same way as this legislation enables the Land Bank to take action to the detriment of commercial banks. There is one difference, however, and that is in so far as an execution levied by a commercial bank is concerned, it must be in terms of the rules of court and ample notice and ample opportunity for participation is provided to the Land Bank. If, however, the Land Bank executes in the form suggested in this Bill, the commercial bank is left out in the cold. The hon. the Minister has said that he will give further attention to this matter, and I am grateful for that. But I believe that this legislation concerns a practical aspect of the economy of the farmer. He needs this assistance, but we as the legislature must not allow an Act to go through which—from what we hear from persons who provide finance to the agricultural sector—will have the effect of these sources of credit to the farmers drying up, because of a provision inserted for the benefit of the Land Bank. What is going to happen if the Land Bank is asked to lend twice as much money as it would otherwise have lent should the commercial bank facilities which were available to farmers previously, dry up? Although I appreciate what the hon. the Minister has said, I still believe that it is important that this amendment should remain and that it should be put to the Committee. I do, however, accept the good faith of the hon. the Minister where he said that he would have further discussions on the matter and would, if necessary, give consideration to it in the Other Place.

Mr. Chairman, it is clear that there is some confusion in regard to this clause. We have read the principal Act as closely as we can and when we ask for the words “or shareholder” to be deleted, the hon. the Minister justifies his reason for retaining them by saying that they already appear in the principal Act. We shall appreciate it if the hon. the Minister could tell us where we could find them in the principal Act.

Mr. Chairman, if the hon. member would give me the opportunity, I will obtain the principal Act and answer his question during the discussion of the Third Reading.

On amendments (1) to (5) moved by Mr. H. H. Schwarz,

Now that we are in somewhat more tranquil waters, may I say initially that we will support the Second Reading of this Bill. May I deal with certain of the individual provisions which are contained in the Bill. The first matter that I would like to deal with is the authority given in section 8 to establish a fund for the purpose of compensation for loss or damage suffered as the result of dishonesty or negligence. This provision is not only welcomed, but what I would like to stress here is that it is desirable that such a fund should be established at the earliest opportunity. Sir, there are examples at the present moment of pending actions, and quite obviously one does not want to refer to them, but I think that having regard to the activities of the profession as such, it is desirable that this fund should be in existence at the earliest possible opportunity and I would appeal to the hon. the Minister to use his influence with the profession to see that the fund is established without delay now that the powers are being granted here for its establishment.

The second matter that I would like to refer to is the question of non-resident accountants. Sir, one of the important matters for South Africa is our international associations. In the accounting profession international associations are in fact prevalent; they are desirable and they are of considerable benefit not only to the profession as such but to the business community and to communications between South Africa and other countries through, the medium of this type of professional contact. In this respect, Sir, I am pleased, therefore, that in dealing here with the question of non-resident accountants we are not excluding them entirely, because it seems to me to be important that the association of local firms with accounting firms overseas should continue. That association can continue by means of a correspondent’s arrangement, where one firm acts as correspondent for another. That arrangement can continue without any financial interest being involved, but, of course, I think the best contact is maintained where people have financial interests in each other’s firms, to the extent that that is permissible, and where a partner in an overseas firm can be admitted to practise in South Africa.

Sir, on the same page we have an amendment to section 22 of the principal Act. I presume that the hon. the Minister has received representations from the South African Institute of Chartered Secretaries and Administrators. We believe that that institute holds the view that the amendment which is suggested here may well prejudice the legitimate professional activities of that institute. I would like to make this appeal to the hon. the Minister, that, as this institute is one of considerable standing and fulfils a particular function in our society, having some 4 000 members, we should have a sufficient gap between the Second Reading of this Bill and the Committee Stage to enable consultation to take place both with the professional body of the accountants and auditors and with the institute to see whether these problems cannot be removed. There appears to be a very real fear that the amendment which is being suggested may well affect their activities, and there would be no prejudice if adequate time was allowed between the Second Reading and the Committee Stage to enable that consultation to take place, so that either the people can be reassured that there will be no problems which will affect them or, alternatively, that the necessary technical amendment can be effected.

Then I should like to deal with the provisions of clause 12(d) on page 12 and say to the hon. the Minister that one welcomes this amendment. However, one would like to make two points on which one would like to have the hon. the Minister’s reaction. Firstly, is the period of three months, which is in the existing Act, adequate and should it be left at that, or should we not in fact consider increasing that period?

What clause is that?

Clause 12(d) on page 12. That is the section which deals with the period of training in terms of the Defence Act. You are amending it by including any training in the S.A. Police, which in terms of that Act is regarded as service for the purpose of any of its provisions. The existing provision of the Act says that it is subject to a maximum period of three months, which is deemed to be served under the articles. I ask the hon. the Minister whether three months would be adequate, bearing in mind not only what the position is today, but also what the position may be in future. I can speak with some degree of feeling about the same sort of matter in regard to another profession, because when it came to the question of articles being served in the legal profession immediately after the war, we who were in the war received concessions in respect of our period of articles and I, for one, served articles for a lesser period by reason of my war service. It was substantially in excess of three months. I agree that you cannot make the complete service a period of exemption, but I would like to ask the hon. the Minister to consider whether that period should not be increased, particularly as it may be that other people may wish to deal with that and that we may in future have a position where people may have to serve for fairly long periods at a time. I should like to ask the hon. the Minister to consider—perhaps not now but at some future stage, if he would accept further notice of it, because this is actually the existing Bill; it is not one of the amendments before us—increasing that period to six months as the maximum period which could be allowed.

Then I would like to deal with the amendment contained in clause 13, which imposes certain further duties on the profession. We have always regarded the auditor as being the watch-dog. Also the courts have accepted that they are the watch-dogs and not investigators. I think the hon. the Minister will agree that the manner in which we are now extending the duties and obligations of auditors, while this is in fact a desirable thing from the public’s point of view, does in fact impose greater duties and obligations upon auditors in the future. It is for that reason that the possibility of error arises, the possibility of prejudice and possible actions which may arise, which make the institution of the fund to cover this situation perhaps an even more urgent matter. There are some matters which go very far, for example on page 14, subparagraph (b), where instead of saying that the accounts must exhibit a true and fair view of the affairs of the undertaking and explain all the transactions thereof, we now say that the accounting records should reflect and explain all its transactions and record and all its assets and liabilities correctly and adequately. While that is obviously a desirable provision which we support, I think it will be appreciated that the burden on auditors is now a heavier one and the concept of being merely a simple watch-dog is now to a large extent being departed from.

The last matter on which I would like to comment is the question of the number of articled clerks that accountants may have. Here we are leaving the matter as it has been, i.e. to the discretion of the board in respect of an individual and, of course, one has the possibility that different individualist will be approached differently. I was interested to hear the hon. the Minister—even though it is not contained in the draft Bill—refer to the fact that more Black, Coloured and Indian clerks may well come forward to be articled in future. I think the hon. the Minister is probably aware of the difficulties some of the Black people have had in obtaining articles, the difficulties they have encountered in this regard. I had personal experience when trying to find positions for articled clerks in the accountancy profession. Anything which is being done in order to make that task easier, is one that must obviously have our approval. For that reason that particular-provision is one we obviously welcome. This measure is, apparently, being introduced with the full approval of the board and therefore we do not intend moving amendments without referring them first to the accountancy profession again. That is why I would like to appeal to the hon. the Minister again to deal with this situation in regard to the S.A. Institute of Secretaries and Administrators so that we have sufficient time for him to receive representations and also to consult with the accountancy profession; otherwise we support the Second Reading.

Mr. Speaker, I would like to associate myself with what the hon. member for Yeoville has said. I have also had a message from the S.A. Institute of Chartered Secretaries and Administrators to simply repeat the plea made to the hon. the Minister of Finance by the hon. member for Yeoville. The proposal in clause 8, relating to section 21 of the principal Act, is to establish a fund for the purpose of compensating any person for loss or damage suffered by him as a result of dishonesty or negligence. The hon. member for Constantia said last night that, in so far as auditors were concerned, they were already required to take out a professional indemnity. I hope the hon. member will excuse me if I say that I could not find this in the Act. As I understand it—I hope the hon. the Minister will tell me if I am wrong—section 26(4) of the principal Act covers negligence by either accountants or auditors and it refers back to section 21(l)(g) of the principal Act where the power is given to the board—as is envisaged in the Act to make such an order with regard to the costs incurred by it in the hearing. I am sure the hon. the Minister will agree with me that auditors and accountants fall somewhat in the same category vis-à-vis the general public as some other professions who have a position of trust, e.g. lawyers, members of the Stock Exchange and a number of others of which the hon. the Minister will be aware. My concern here is that I am all in favour of the establishment of a fidelity fund to indemnify members of the public against losses arising to provide for cases where dishonesty or negligence of people in these two professions is involved. I would like to draw a distinction between the losses which might arise from these two offences in the sense that in practice there is liable to be a limit as to how much one could get away with by being dishonest. What worries me is when one comes to negligence. Negligence on the part of an auditor or an accountant could give rise to very severe losses or claims for damage, simply in the sense that they might be unlimited and, hence, unquantifiable. I simply hope the hon. the Minister has it in mind, even if it is not put down in the sense of a command in the legislation, to urge the accountants and auditors to place themselves in an analogous position to the attorneys in South Africa where they will not try to insure themselves against negligence, but will do it through insurance companies who have the assets and who have the size to look after such claims.

I want to turn to clause 11 on page 10 of the Bill. What I find difficult to comprehend is the circumstances which have given rise to the insertion of the new section 23A. As I understand it, the eight so-called large international accounting firms in the world who operate in South Africa are not liable to be affected by this. They normally have a very small number of members who might sit as partners in South Africa. I hope the hon. the Minister will confirm this or inform us that we are wrong, but under section 31 of the Companies Act, 1973, one cannot have a partnership in South Africa of more than 20 partners except where the hon. the Minister chooses to make an exception. The hon. the Minister or his predecessor has made exceptions in regard to lawyers and accountants. What really worries me about this is the normal modus vivendi when it comes to these sort of partnerships around the world. What these very large accountancy firms tend to do in practice is that if there are 30 partners in South Africa, to have three or four international partners in such a firm. If that is correct—we are now talking about number of partners and not about the holding of equity interests in a partnership—then I would very much appreciate it if the hon. the Minister would let us know what the underlying rationale in regard to this is. One does not want to get to a position where South Africa in any sort of sense—I am sure this is not the hon. the Minister’s intention—gives the impression overseas that it does not want to be part of the world of accountancy in the sense that most of the major developments and new thinking come from a comparatively small bloc of very large accountancy firms, primarily based in London or in America. I hope that the hon. the Minister will confirm that his intention is in no sense to discourage them taking part within the context of the proposal he puts here, in South African accounting because there is no substitute for that kind of interchange of information.

Mr. Speaker, last night the hon. member for Constantia supported the Second Reading of this Bill. He raised certain points, one or two of which have been raised in other forms today and I would briefly like to reply to them. The provision in regard to a fidelity fund is simply to give the board the power to establish such a fund. The question when this will be done is, obviously, something on which the board has its ideas. The hon. member for Yeoville thinks that this fund ought to be established as soon as possible. This is something I will discuss with the board, but at the moment the Bill simply empowers the board to establish this fidelity fund. We think such a fund is important. I take the point that has been made and will take this matter up.

The hon. member for Constantia also drew the wording of the new section 23A(2) to my attention. It reads as follows—

The hon. member drew my attention to such persons reporting on financial statements, etc. He felt that the certifying he could agree with, and also giving an opinion on financial statements, and so forth. If one looks at the principal Act, one will in fact find that almost every time they mention “certify” they also mention “report”. The two have simply been brought together and have been like that for a very long time. For example, if one takes section 26 of the principal Act on just one page they use the word “certify or report” on at least three occasions. A little further on it says—

A little further on again—

It is simply because these two terms have been used in conjunction for such a long time that we carry this over into the new nomenclature. If the hon. member feels very strongly about that, I will certainly look further at it in consultation with the board. The hon. member, in talking about non-resident accountants or auditors, said—

The hon. member went on to explain the sort of situation that could arise. In this particular subsection to which I have just referred, at the top of page 12, i.e. 11(2), the restriction is restricted to operations in the Republic.

No.

Yes, if the hon. member reads this carefully, it says—

I do not quite see if the hon. member is relying on this particular clause, what his difficulty is. Perhaps the hon. member can put me right on that. I have just received this note with reference to the point that I raised with the hon. member for Constantia about clause 11(2), to the effect that we cannot legislate extra-territorially. We cannot legislate for what the auditing provisions must be in another country. As far as this subsection is concerned, it is the intention that it should be restricted to the Republic only.

In regard to the argument raised by the hon. member for Yeoville: He mentioned the importance of our association with foreign countries, particularly our association with the accountancy profession on foreign countries. That is undoubtedly so. In fact, we have a very long history of close association in this field. This amending legislation certainly does not have the intention to disturb that relationship in any form at all. It is felt, however, that where we have developed our economy to the extent to which it has developed, and where our accountancy profession has reached the size and the maturity which it has reached, the time has arrived—the profession shares this feeling with us—to give it a more distinctive South African character in this sense. Therefore we simply place a restriction on the number of so-called non-resident accountants who may be in a partnership in South Africa. This restriction is not a very severe one; as a matter of fact, I regard it as a very liberal restriction. It is an important point and I can assure the hon. member that I agree with him on that.

As far as the chartered secretaries are concerned, I may say that I received a telegram yesterday afternoon in which they refer to section 22 of the principal Act and the amendment which is proposed by clause 9 of this Bill. They apparently have some problem with this clause. We have been dealing with this matter for a long time. The negotiations with the profession, with the board and with individuals have been going on for a long time already, and not just with accountants. Only now, at this very late stage, we received this objection. We are, obviously, looking at that particular point again and we are going to communicate with the board—which is sitting at Windhoek at the moment and as a result it has been difficult to get in touch with them—on this matter. We have a heavy legislative programme ahead of us and I was hoping to get agreement to go ahead and take the Third Reading today. If that is possible, I am prepared to give the undertaking that if anything is involved here and needs to be put right, I am prepared to put it right in the Other Place. That, however, is a matter for the hon. member to decide. If he objects, I cannot do it.

Mr. Chairman, is the hon. the Minister prepared to take the Committee Stage in a few days’ time and in the meantime to receive people from the institute and hear their personal representations?

Mr. Speaker, I do not want to press the matter, but it seems to me that that is really the only issue which has been raised at this very late stage. I think it is rather a matter for regret that we have to hold up this important measure only because of that objection. This is obviously a non-contentious issue and if there is any substance in it at all, I can assure the hon. member that we shall give effect to it as we want to satisfy all responsible bodies.

Mr. Speaker, may I put it in another way? If the hon. the Minister wants to take the Committee Stage immediately, will he agree to receive the delegation after the Bill has been passed by this House but before it is dismissed in the Other Place?

Yes, I shall be very happy if that can be done. I am prepared to give the hon. member that assurance.

Then, with reference to the amendment of section 24 of the principal Act by clause 12(d), the question was asked whether the period involved in this training should not be longer. This, of course, is something which has come from the board after very careful consideration and lengthy discussion. If I change this, I shall clearly be going against the recommendation of the board, in which the profession is strongly represented. Therefore I want to ask the hon. member if we could possibly proceed with that. I agree with the hon. member for Yeoville that clause 13 undoubtedly extends the duties and responsibilities and I think also the standing of the auditing profession. I think that this is inevitable in the light of the way in which the economy has been progressing. From our negotiations, it was clear that the accountants and auditors welcome this and see it as a challenge. They have assured us that they feel that they can carry out these extra duties.

The hon. member for Johannesburg North raised the question of indemnity insurance and its importance also to the client. There is no doubt about it that that is what is involved. Apart from the fidelity fund, one sees that in clause 17(c) there is a reference to indemnity insurance. The board would like to be able to cause the members of this profession to take out such indemnity insurance. Personally, I think that that is a very sound move and follows, really, on the sort of provision made in this respect by some of the oldest organized professions.

As regards the question of the number of partners, I think the hon. member was referring to non-resident accountants and auditors. Let me just briefly refer to that. The board feels that they would like to give a more distinctive South African character to the profession without in any sense wishing to or intending to suggest that there is not great benefit to be had from the close association which has been built up over the years with accountants from elsewhere, an association both in this country and indeed in other countries. It is not the intention at all to weaken that association, and I can assure hon. members that this proposal has been very well received. It has been discussed with some non-resident accountants and auditors who are well known in this country and there has been no objection of any kind to these proposals. The purpose of these proposals is well understood. I hope the hon. member will feel that that is satisfactory.

Mr. Speaker, I will leave the matter there. I want to thank hon. members for a constructive debate.

I should like to refer to the proposed new section 23A(2) which limits the power of a non-resident auditor in respect of the certifying of accounts of South African undertakings. I think there are two points involved here, both of which were mentioned by the hon. the Minister in his reply to the Second Reading. The first is that the Minister suggests that the South African law has no authority over what happens outside South Africa. However, I think there is some doubt as to whether the certification of accounts of the branch of a South African company operating outside South Africa by a non-resident auditor would be regarded as a valid certification in terms of this clause. This is something I should like the hon. the Minister to consider in consultation with the board.

The other matter which the hon. the Minister also knows about is a matter which I discussed during the Second Reading debate. What I am referring to is whether a branch of a South African undertaking operating outside of South Africa is in fact governed by this clause. My reading of the clause is that it would be governed under certain circumstances. The clause refers to an undertaking registered or established in the Republic under any law or carrying on business in the Republic. It is either one or the other. One might have the branch of a South African company, the company being registered in South Africa but the branch carrying on business outside of South Africa. I believe that under those circumstances that branch would be governed by this clause as it is worded here. That was why I asked the hon. the Minister to consider the wording which I gave him last night. I would also like to ask the hon. the Minister to consult with the board on this subject because I believe it is a matter which is worrying the board considerably.

Mr. Chairman, I follow the exposition given by the hon. member for Constantia. I will certainly go into this matter fully and obtain full clarity in this regard. We want this matter to be stated unambiguously. If there is any doubt I shall rectify the matter in the Other Place. I take the hon. member’s point. We must have complete clarity in this regard.

Mr. Chairman, I just want to raise the provisions of paragraph (d) of this clause with the hon. the Minister once again. I do not expect the hon. the Minister to change the period of three months to one of six months at this stage. In fact, I do not think that it would be in order to do so because this is one of the provisions of the original Act which is not being amended by this Bill. I would ask him, however, to raise this matter with the board.

In the second place, I see that the hon. the Minister of Justice is here at the moment. I think that this is an issue which applies to other professions as well such as the legal profession. I feel that we should have some measure of uniformity in the professions in regard to considering service in the forces as being service under articles with certain maximum limitations. I feel fairly strongly about this matter and I should like to appeal to the hon. the Minister in this regard. This is a matter of national importance. It is not a political issue as I see it. I would like him to raise the matter with the board and I should also like to ask the hon. the Minister of Justice to consider this matter as far as the profession that falls under his control is concerned.

Mr. Chairman, I shall certainly do so. As the hon. member for Yeoville has said, this period of three months was taken from the original Act, obviously on the initiative of the board. However, I shall certainly raise the matter in the way the hon. member has asked me to do so and I shall also take the matter up with my hon. colleague, the Minister of Justice, to see how this ties up with certain other cases of this kind.

Mr. Speaker, I move subject to Standing Order No. 49—

Sir, in the course of the Second Reading debate the hon. member for Umbilo raised very pertinently some of the difficulties that will ensue from the very small increase that will be granted in terms of this amendment. One obviously appreciates any improvement in pensions but, as the hon. member carefully explained, this increase, although very small, could very materially affect the recipient because of the application of the means test. I do not want to repeat what the hon. member has already said about the actual earnings that the pensioner will be permitted in addition to his pension. All I would like to know is what the hon. the Deputy Minister’s thinking is in this matter now that he has had an opportunity of considering some of the arguments put forward with regard to the question of consolidating the bonus with the pension. Sir, this question of consolidation is not an entirely new thing. We know that anomalies and inequities resulted in years past from the fact that the then cost-of-living allowance was not consolidated with salaries. As has been pointed out, this increase, which only affects the bonus, may in many instances be very minute. Although, as I have said, one welcomes any improvement that the State is able to grant in these matters, I do think that the whole method of treatment of pensioners is completely outmoded. I do not think that it should require consideration in depth to arrive at the conclusion that it is necessary and indeed essential to consolidate this bonus with the pension together with the allowance. Although this is just a bonus, one would never think of ever removing it. To the pensioner this bonus is a very vital part of his pension. I think that where increases can be granted to ex-service pensioners, they should be meaningful increases. That is really the essence of the plea put forward by the hon. member for Umbilo. Pensions generally have been increased somewhat. Social pensions have been increased; civil pensions have been increased, and the percentage increases have been based on the pension itself, on the conglomerate sum that the recipient obtains. It is only in this particular category that we get this form of discrimination. Without this being intended deliberately, it actually amounts to a form of discrimination against the recipient of the increase. Many of the widows who depend largely, and in many cases solely, on these pensions look forward to the increases that they get from year to year to meet the rising cost of living. I do not want to stress that now because it is a well-known fact. They look forward to receiving these increases, and if they are based purely on the bonus I do not think it is a real and meaningful contribution towards alleviating their lot. I think if the State wants to do something, then let them do it on the basis of some content so that these recipients can feel that some acknowledgment is being given them. Some of the pensions are very small indeed and others are a little better. In all cases, however, particularly in regard to the better pensions, one may find that this small increase puts them in the category where they can lose very much more than they gain. An increase which has no meaningful effect at all can on the contrary do a great deal of harm as it can deprive the recipient of part of the pension he is receiving at the present stage. So I ask the hon. the Deputy Minister to tell us what his thoughts are on the matter and to see whether something cannot be done to deal with this problem.

Mr. Chairman, I want to put a question to the hon. the Deputy Minister regarding this first clause. It is purely a technical question. The amendment as drafted purports to omit the previous provisions regarding bonuses and to substitute a bonus of 70% with effect from 1 October of this year. It seems to me that this would leave a hiatus between the date of the coming into effect of the amendment and that date. Presumably it should be provided that this particular provision will only come into effect from 1 October 1975. I raise it purely as a method of procedure.

Mr. Chairman, the hon. member for Jeppe made quite a number of requests which were also made by the hon. member for Umbilo last night. Unfortunately I did not have the time in the course of the Second Reading debate, to explain fully all the matters concerning this Bill. I think I should just tell hon. members what this provision is actually about and what the War Pensions Act is actually about. As I see it, the object of the Act is to compensate persons for disablement sustained or aggravated during military service. For that reason you cannot compare it with other forms of social pensions. Matters concerning war veterans are, however, traditionally, and I think rightly so, surrounded by quite a good deal of sentiment and benevolence. It is for this reason hardly comparable with the compensation paid in other circumstances but, stripped of the sentimentality and the benevolence surrounding it, it can in certain respects be compared with the compensation payable under the Workmen’s Compensation Act of 1941. In doing that, one finds that the compensation payable in comparable circumstances in terms of the Workmen’s Compensation Act is, for example, R180 in the case of 5% disablement as compared with R240 payable under the War Pensions Act.

Is that per month or per annum?

No, that is the payment for this disablement. It is R360 and R480 respectively in the case of 10% disablement. In addition, a pension is payable under the latter Act if the degree of disablement is more than 10%. However, the pension is only payable under the Workmen’s Compensation Act if the degree of disablement exceeds 30%.

Now, coming back to all the requests of the hon. member for Umbilo last night and of the hon. member for Jeppe today concerning the possibility of the consolidation of the bonus with the pension, as well as other requests originating from the hon. member for Umbilo, I think on this particular occasion I can say nothing more than just to repeat what I said about a month ago at the official opening of the annual congress of the South African Legion. On that particular occasion I said—

I hope the hon. member is satisfied with that. I went on—

I think the same applies today—

If that applies to the Legion, the same applies also to members of Parliament, and I want to say that I have listened to the points raised by the hon. members for Umbilo and Jeppe and we will take those points into consideration when we review the legislation.

As far as the hon. member for Pinelands is concerned, I do not think we have any problem at all as regards the issue he has raised. We will have no problem at all in making the increased bonuses available in the course of a particular month.

Mr. Chairman, I want to thank the hon. the Deputy Minister for what he has mentioned about the review of the War Pensions Act. What he said at the congress of the S.A. Legion, is very much, appreciated. We appreciate the attitude which he adopts. I want to add just one bit of pressure for the consolidation of the allowance and the basic pension. There is a great deal of hope built up in the hearts of many war pensioners when they hear that there is going to be an increase of say 30% in their pensions and afterwards there is disappointment when they find that the increase relates only to the allowance and not the pension as a whole. As I think it is unlikely that the allowance will be reduced at any stage, the Minister may well now have reached the stage where there should be a consolidation of the pension and the allowance so that future increases will refer to the overall amount which the pensioners receive and not merely to a portion of it, which, as I say, causes frustration and disappointment.

As the hon. the Deputy Minister knows, there are still a considerable number of war pensioners. I think the figure is something like 12 000 at the present time, of whom 10 000 are veterans of the 1939-’45 War. The number from the first World War is falling off, and I think now is the appropriate time for the Minister to look into the provisions of these pensions. I am grateful for the undertaking he has given. The number of the pensioners are decreasing, but at the same time the remaining pensioners have to face an increased burden by reason of inflation.

Mr. Chairman, I just want to add one more word to what my hon. friend the member for Green Point has said. I also appreciate very much indeed what the hon. the Deputy Minister has said, but I should like to appeal to him not to use the yardstick of the Workmen’s Compensation Act in relation to a war veteran’s pension, no matter what the circumstances are. I know that one is to a large extent motivated also by sympathy, but I think sympathy extends to all cases where there are injuries for which people should be compensated by the State. This is particularly the case where such people have no other means at all available to them. It is obvious that the question of sympathy does play an important part. However, in the case of war service, I think one must look at the problem a little more realistically than merely using the Workmen’s Compensation Act as a yardstick. That Act makes provision for the payment of compensation to people who, unfortunately, suffer injuries in the course of their employment but in respect of war service a different issue altogether arises. In our history of war service the questions of voluntary service and sacrifice for one’s country are very vital and important factors, and the hon. the Deputy Minister need hardly be reminded how the Government’s attitude with regard to compensation, and so on, has changed particularly as the result of some of the unfortunate and tragic events which have taken place involving some of our soldiers and members of the Police force on the borders. The hon. the Deputy Minister knows that since those incidents, there has been an entirely different approach to the subject and the compensation is not measured by a yardstick which can be related in any way to the yardstick which is to be applied in terms of the Workmen’s Compensation Act or any similar type of yardstick. We have an entirely different approach, and I think the hon. the Deputy Minister can bear that in mind. I will be most grateful to him if the sympathy and warmth with which one deals with war veterans still pervade in his thinking and those who assist him in bringing about these revisions.

Mr. Chairman, I would merely like the hon. the Deputy Minister to give an explanation as to what is meant by a provision in this clause. I refer to clause 10(2) of the Bill. The way I read the clause it would appear that a person who becomes a dormant member of the pension fund in the discretion of the Secretary for Social Welfare and Pensions would, when the fixed date arrived, receive a pension which would be that of a contributing member of the pension fund. I presume that he would receive the full pension as if he had contributed to the pension fund from the date he received the specific appointment referred to in subsection (1). If that is the case I am perfectly satisfied.

That is not the case.

If it is not the case, the suggestion I want to make to the hon. the Deputy Minister—there was some confusion even in our own ranks about this matter—is that such a person must be permitted to continue to contribute during the period he serves in this special appointment so that he is not prejudiced during that interim period, namely between the date on which he was appointed and the fixed date. Obviously he will then suffer in that he will receive a smaller pension than he would have received at the fixed date. One appreciates the fact that his rights are being preserved. One also knows of anomalies in the past which are reflected in some of the petitions tabled in Parliament in connection with the condonation of a break in service. One well appreciates that it is a great improvement in the situation, but the circumstances under which he becomes a dormant member are somewhat different from the normal circumstances because he is appointed either by the State President or by the State itself, in other words, by a Minister. Therefore he is in an entirely different position. It seems to me that he would be prejudiced if he did not receive the right, in view of what the hon. the Deputy Minister has said, to continue to contribute. He cannot belong to another fund and can therefore make no further payments. He is therefore bound by the date on which he leaves. On the fixed date he will receive a pension calculated virtually as at the date when he left his old pension fund. I do not think any appointee would object if he had the right to continue to contribute so as to enable him to receive the full pension as if he had continued to contribute to a pension fund.

Mr. Chairman, I would like to add a word of support to the hon. member for Jeppe because I feel that if a public servant is to be appointed to a board where I presume that he is needed because of his knowledge and experience, he is perhaps in his last five or six years going to lose an increment or promotion and it may affect his entire pension. It may even affect him as far as his widow is concerned. I feel that he should be allowed to contribute and that the board, instead of providing a gratuity for him, should also contribute its share towards his pension. In that way he would be compensated for any increments that he might lose.

Mr. Chairman, I shall reply to that with pleasure. I told the hon. member for Jeppe that the provision is not as he sees it. I want to state now what the provision will be. If a member withdraws and becomes a dormant mem member, then from that date his benefits are frozen, but they are retained for him until the date on which he would have retired from the Public Service in terms of his contract of service. Then, on the day he retires, he receives his pension in terms of the formula that would apply on that later date, because if he were to have remained in service in the meantime, he would surely have enjoyed the benefit of the improved formulas too, but the person he receives is, of course, based solely on his period of service up to the time when he became dormant. Now the hon. member quite rightly asks whether this does not discriminate against a person who has accepted another post on the request of the State President or a Minister or some other person. The reason for his being unable to continue with contributions in the meantime and instead becoming a dormant member is the fact that his new place of employment may have a scheme of its own that does not correspond with the Government’s service pension fund.

Provision is not made for that.

It need not necessarily be stated there, but that is the case. He will have to contribute again there, in accordance with his conditions of service; in other words, when the person concerned eventually reaches retirement age in terms of his Public Service contract, he will be entitled to two pensions. It may be that within three years or so he returns to the fund, something for which provision is made, but then he will, in any event, have the benefit of the payments he made to the other fund.

Mr. Speaker, I move, subject to Standing Order No. 49—

Mr. Speaker, I move—

During the second session of Parliament in 1974 a Liquor Amendment Bill, A.B. 58—’74, was introduced into this House. Its aim was to exempt further persons from certain differential provisions of the 1928 Liquor Act.

On 13 August 1974, on a motion by me, the House decided to refer—

1. (a) the subject of the Bill; and
2. (b) the subject of the admission of South African non-Whites to premises in respect of which on-consumption licences have been issued under the Liquor Act, and which are intended for occupation by Whites, and the supply of accommodation, meals, liquor for on-consumption, refreshments and other facilities to such non-Whites on those premises;

to a Select Committee for inquiry and report, the Committee to have power to take evidence and call for papers and to have leave to bring up an amended Bill.

The Committee was presided over by the hon. member for Potgietersrus and I wish to express to him and his co-members, whereby members of the official Opposition and the Progressive Party are included, the appreciation of this House and the Government. By the very nature of things the task was a difficult and involved one.

The Bill of which I am moving the Second Reading, is the outcome of the Select Committee’s inquiry and is recommended by a majority of its members. It is not my intention to deal at this stage with the terms of the Bill submitted by the minority. I accept that the provisions will be discussed and explained by one or more of those members of the Committee who subscribed thereto. If necessary I shall deal with it in my reply to the debate.

At the outset I consider it necessary to deal briefly and in general terms with the existing position and the problems arising therefrom.

There are provisions of the Liquor Act and conditions imposed thereunder which differentially affect non-Whites. These provisions and conditions sometimes differentiate also between Bantu and other non-Whites. An example hereof is section 94 of the Act.

In terms of section 7 of the Act certain accredited persons of colour are exempt from such provisions and conditions. In other words the provisions and conditions under the Liquor Act which apply to Whites, also apply to such accredited persons.

By clause 1 of the Bill it is proposed to extend this exemption to non-White foreign visitors to the Republic. In practice such foreign visitors include Ministers and officials of Black (and sometimes also White) States, businessmen, tourists, sportsmen, congress-goers (religious, medical, stockbreeders to mention but a few examples) engineers, jurists, actors, etc.

Since July 1974, and by way of administrative arrangements, foreign non-White visitors to the country have been allowed to use the facilities at hotels for Whites, subject to the production of a passport incorporating a permit issued in terms of the Aliens Act, 1937. What has been done in practice, over the past 12 months virtually, is now being included in the Act.

A foreign non-White person who enters the Republic under a migratory labour scheme, does not come within the ambit of the exemption since he is not issued with the permit mentioned in clause 1.

*The current position as far as other non-Whites are concerned, must be viewed in the light of the existing liquor legislation, provisions contained in the Group Areas Act, the Bantu (Urban Areas) Act and other statutory enactments and court judgments.

I readily concede that the present situation is of a fairly complicated nature, particularly since differences of opinion exist even in legal circles with regard to the interpretation and application of certain provisions and directions.

However, this is not the only reason why the matter has been referred to a Select Committee.

Situations which did not exist in our multi-national community five to ten years ago, situations which were hardly imaginable, have become very prominent, particularly during the past three years.

It is the aim of the Government continually and as far as possible to keep pace with developments and circumstances in this country, and for that reason it was deemed expedient to ask the Select Committee to give attention to the provision of facilities to South African non-Whites at hotels, and so on, for Whites.

In recent times it quite often happens that seminars, conferences, business discussions, and so on, in which non-Whites are also involved, are organized by White organizations. In cases of this nature use is for the most part made of the conference facilities at hotels, and this includes meals and liquor. In some cases accommodation is also required.

During the first four months of this year my department dealt with 624 applications of this nature, 7 617 of which involved non-Whites. In meritorious cases exemption is granted administratively but, in the absence of statutory provisions, problems arise.

The second part of the Bill—from clause 2—deals with this situation.

In the first place, a prohibition is being placed under clause 3 on the provision, in an on-consumption licensed building, of refreshments, meals, accommodation or liquor to non-Whites if such a building is intended for occupation by or for the convenience of Whites. This does not, of course, apply to people in respect of whom exemption is given under clause 1.

There are certain exemptions, for which provision is being made in this clause and which is clearly set out therein.

In the second place, provision is being made in this clause for the establishment of what I shall call “international hotels” and other on-consumption distribution points to which non-Whites may be admitted. Subsection (3) of the proposed new section 81 has a bearing on this matter.

Application for international status will have to be made annually, and may be granted by the Minister of Justice on recommendation of the National Liquor Board.

The granting of such status may be made subject to conditions and limitations, imposed by the Minister. I do not want to anticipate this matter now, and it is obviously one in respect of which I should also like to consult the National Liquor Board.

However, there are matters such as mixed dances and swimming, the indication of its international status at an hotel and in its publicity material, as well as a whole range of other matters which will have to receive consideration when the question of the imposition of conditions is dealt with. At this stage and on the basis of our experience over the past three to four years, it would seem as if the need for so-called international hotels exists for the most part in the cities in order to meet the needs of overseas travellers, conference-goers and businessmen.

Although, to a very lesser extent a need also exists in certain rural towns on main traffic routes to provide for the requirements of non-White travellers and certain professional people wanting overnight accommodation. In these cases it is not unlikely that the conditions and restrictions to be imposed, will differ from those which will apply in respect of urban hotels.

In terms of section 113 of the Liquor Act an hotel liquor license is compelled to provide meals and accommodation at request except when he is able to advance some reason or other which is deemed satisfactory by the magistrate by whom the complaint against the licensee is heard.

In the light of the new dispensation contained in this Bill, it is being deemed desirable and expedient to grant the licensee absolute discretion as to whom he wants to provide with meals and accommodation, and whom not. This is the effect of clause 4.

It is necessary for me to issue a word of warning in this regard: Licensees abusing the repeal of section 113 in terms of clause 4 of the Bill, will find that very firm steps will be taken against them in terms of the system of hotel classification.

Clauses 5 and 6 are the result of the repeal of section 113 by clause 4, and clause 7 provides for the short title and date of commencement.

Traditionally as well as statutorily there has always been and still is a specific separation between the races in our country as far as the use of facilities in hotels, restaurants and bars is concerned.

There have been and are hotels and other liquor facilities for Whites and similar facilities also exist for non-Whites, although, on a more limited scale because of the limited demand. In this regard it is necessary that I should mention in passing that prohibition in respect of non-Whites was abolished by this Government only about ten or 12 years ago.

It is by no means the aim or the intention with this legislation to terminate on a large scale the differentiating measures, which have been established over the years by means of liquor and other legislation. The concession which is now being granted will definitely be dealt with most selectively, and proper control will be exercised in order to prevent abuses and evils.

I want to mention specifically here that the provisions of this measure should not be seen as a termination to the provision of hotel and restaurant facilities in non-White residential areas.

Several excellent hotels and restaurants already exist in such areas and it is imperative that the establishment of further similar institutions and facilities should receive the active and urgent attention not only of the authorities concerned, but also of private non-White groups. The Select Committee investigated this matter in a very comprehensive and thorough manner, and I feel myself quite at liberty to recommend in all seriousness the provisions of the Bill before this House.

I am convinced that the proposed new provisions and the proposed system will go a long way towards eliminating the uncertainty which exists at present as well as the innumerable administrative acts arising from it.

I firmly believe that the provisions of this Bill will be welcomed by that section of the organized liquor trade which is affected by this measure, as well as by the general public—both Whites and non-Whites.

Mr. Speaker, it was interesting to hear the figures given to us by the hon. the Minister relating to the number of applications that he had received for permission to use facilities in hotels which would otherwise apparently not be available to the persons applying. If anything, this shows not only the growing need for these facilities to be made available but also that there is an ever-increasing need for these facilities. I am sorry that the hon. the Minister’s approach to this Bill has been one of extreme if not excessive caution.

He has been talking to Albert and Andries.

Yes, that may be so. I am also sorry that he found it necessary to say that he was going to apply the provisions of the Bill very strictly and that he was going to make sure that not many institutions had rights in terms of this Bill. Here again, considering that one of the motivations for this Bill is our international image, I must say that I was sorry that he felt it necessary to state that no mixed dancing and no mixed swimming would be allowed.

Do you want it?

I think that the hon. the Minister should have a little more faith in the people of this country and in the traditions of this country and in the traditional way of life of this country. These traditions existed without any legislation of this kind or that dealing with group areas. They existed in their traditional way as they exist more or less today except that no legislation was necessary at the time. The stage that we have arrived at in South Africa makes it necessary for some legislation to be passed. I think—we are all agreed on this point at least—legislation is necessary for the conduct of these establishments.

One has the extraordinary situation today which is almost a bizarre situation where we have the Liquor Act and imposed upon that the Group Areas Act, the Community Development Act and various proclamations that are issued in terms of the various sections of the Group Areas Act forbidding various things in various places in various ways. We have reached the stage where permits have to be issued. We have in fact reached the stage where mixed private functions or parties in hotels are not in fact prohibited in terms of the law. They are not prohibited by group areas legislation. The Department of Justice made it known to the Select Committee that the departments which administer all this legislation have up to the present in all cases of applications for permits acted as if attendance by disqualified persons at hotels for purposes other than residence were controlled by a proclamation under the Group Areas Act.

That is fraud.

They have acted as if this were the case but the law advisers agree that it is not in fact covered by such a proclamation. This is the sort of thing that has been going on. As the law stands at the moment, the hon. the Minister gives permission to various people to hold functions including functions where Blacks will or may be served liquor. Although section 94 of the Liquor Act prohibits the selling of liquor to Black people, nevertheless the hon. the Minister gives his permission. However, we are told that the permission consists of a request to the Attorney-General concerned not to prosecute if section 94 is contravened by the hotelier. This is an impossible situation. Either we have a law which determines what the situation is or we have a system by means of which the situations that arise and in respect of which the law is not relevant or is unsuitable can be controlled.

As the hon. the Minister has said, this Bill forms the subject of the report of a Select Committee. It was the recommendation of the majority of the members on that Select Committee. I think it is important to state that when this Bill was sent to the Select Committee it consisted of only one clause which made provision for diplomats or accredited representatives to be exempt from any of the provisions of the Liquor Act which differentiated between different races, and which also allowed Black tourists visiting South Africa to be exempt in the same way. That was all that was in the Bill. Another Bill emanated from the Select Committee and I think it is important for us to realize what this Bill does at this stage. It provides that certain hotels which have applied to provide facilities for Blacks as well as Whites and Coloureds and Indians must apply to the National Liquor Board. The National Liquor Board grants or does not grant permission—in its entire discretion —but if it does grant permission then the hon. the Minister is entitled to lay down certain conditions. That is what this Bill does. The hon. the Minister was almost euphoric about the Bill. He told us what a great advance it was. However, we do not agree that this Bill is an advance on the situation, because even in the shambles that it is at the moment, the law makes better provision in respect of public facilities provided by the private sector than can ever be done in terms of this Bill.

I want now to deal with existing rights and I think that I should deal first with existing rights under the law as it stands which are being taken away by this Bill. The first one I would like to mention— the hon. the Minister also mentioned it—is in connection with section 113 of the Act. This section provides that a hotelier or restaurateur is obliged to admit any person for board or for lodging—for a meal or to sleep. Quite rightly the hon. the Minister has said—and we agree with this—that hoteliers ought in fact to have a discretion in regard to whom they have in their hotels. Of course, the reason for this provision has disappeared. We now have a Hotels Act with a Hotel Board which ensures that accommodation is of a certain standard. This requirement is therefore in any event no longer necessary. It is moreover no longer necessary to prevent people —as would have happened because this was the intention—running a liquor trade and forgetting about the accommodation establishment. In any event, the section is vague and embarrassing and we agree with those provisions in this Bill whereby section 113 and its ancillary sections are being repealed.

There is, however, another right in the law at present which is being abolished by this Bill; oddly enough, a right specifically given by the Group Areas Act. This is a right which states that Whites, Blacks, Indians and Coloureds may be guests in a hotel; in other words, they may be the guests of the proprietor. The very helpful memorandum which the Department of Justice produced to the Select Committee indicated what this right was. It states—

They agree with the opinion expressed by the Transvaal Supreme Court that a person is a guest in a hotel if he makes use of any facility provided in a hotel, whether he sleeps in the hotel or not. In other words, the result is that all hoteliers may receive non-Whites in their hotels and may accommodate them without having to obtain permits in terms of the group areas legislation. That is the position now, Sir, but what does this Bill do? It takes away the right of all those hotels except those very, very few that the chairman of the National Liquor Board says are going to get the right to cater for non-Whites as well. The chairman of the liquor board, when giving evidence before the Select Committee, made it quite clear that what he envisaged under this Bill was one hotel in Pretoria, in Johannesburg a maximum of three, in Durban a maximum of two, in Port Elizabeth a maximum of one, in East London perhaps one, and in Cape Town a maximum of two. The hon. the Minister has confirmed that this is going to be applied very strictly and in a very limited way. Sir, what is the effect of this going to be? I think it is important that the House should appreciate what the effect of this is in fact going to be. What facilities are being provided for non-White people at the moment? As far as hotels for Blacks only are concerned, there is one in the Cape, one in the Transvaal, six in the Ciskei, 19 in the Transkei, one in KwaZulu and one in Lebowa. But none in the Free State; none in Natal; none in Bophuthatswana or Gazankulu or Vendaland or Basotho Qwa Qwa. So far as Coloureds are concerned, for Coloureds only there is one hotel in the Cape and none anywhere else. So far as Asians are concerned, there are eight in Natal and none anywhere else in the country. In regard to hotels catering for Asians and Blacks, there is one in the Cape and none anywhere else. With regard to hotels catering for Asians and Coloureds, there are nine in the Cape, one in the Transvaal, 10 in Natal and none in the Free State or in the homelands. Sir, let us look at the number of hotels which are involved and which is now apparently going to be restricted to a mere handful or two handfuls. There are 1 411 licensed hotels in South Africa. Of these, at this moment in time, there are 1 268 with the right to accommodate and to serve meals to Whites, Blacks, Coloureds and Asians. There are only 143 of them with the right to provide liquor, accommodation and meals to Whites only. Sir, these are very important figures. When you consider the rights which exist and the hotels which in fact afford these facilities, then it is clear that under this Bill you are in fact taking away the rights of a large mass of the travelling public, and certainly the rights of a large mass of Black people. That is why we believe that the discretion, which the Minister also believes hoteliers should have, should be an absolute discretion to conduct their affairs as they see fit because they are providing public amenities as part of the private sector. That is why in the Select Committee we, the Opposition, moved an alternative Bill which would have cleared up the whole matter once and for all and which would have provided us with a basis which was flexible, which would have been able to cope with all the circumstances that we cannot anticipate at this stage and which would also have done our international image much more good than this Bill is ever going to do. The Bill which we proposed and which was rejected read like this—

The same as your sports policy.

And your labour policy.

I would not talk about sports policy if I were that hon. member.

Sir, it is our policy and our belief that the private sector providing public amenities should have a discretion as to whom they serve. Hon. gentlemen who sit on that side have forgotten that in fact South Africa, before they came into power, had conducted its affairs, without people rushing into bed with each other or swimming together or living together. That was the situation without the legislation of this Government, as I have pointed out before. Before this Government came into power there was not a Group Areas Act prohibiting Blacks from going to cinemas in the middle of Johannesburg or in Pretoria or Cape Town, but there were no Blacks in those cinemas because the matter was entirely within the discretion of the proprietor of the cinema, and in fact the proprietor of the cinema had enough sense to conduct his business in accordance with the customs of the place where he conducted his business. In other centres, Sir, you found that a measure of sharing of the local bioscope took place, with Whites sitting downstairs and non-Whites upstairs, especially in the rural areas. Sir, the walls did not all fall down when this happened. There was no law prohibiting this, and for the very same reason this did not happen when hoteliers had this discretion before the Government introduced this legislation. Sir, the hon. the Minister has no faith whatever in the persons who conduct the hotel business. He has no faith whatever in persons who conduct their own restaurant business. If our formula is applied, Sir, you will in fact not only get a better spread, but you will be able to cope with the situations that will arise. I think it is very important as well that we should learn now, with all the experience that we have, that you cannot legislate for the conduct of people’s affairs in the future. We are not in a position to know what situations are going to arise in the future, and this Bill is inflexible in that regard unless the hon. the Minister is going to change his whole approach and many more hotels than the number he has already indicated are going to be classified as international hotels. We feel in any event that a civilized White man and a civilized Black man should be able to have a meal together and to talk together, and that they should be able to do this whenever they may be. But under this Bill, as it is going to be applied apparently, they can only do it in Cape Town or in Johannesburg or in the big centres. Sir, the hon. the Minister is a lawyer. Let me ask him this question: Perhaps this sort of situation does not occur as much in the Transvaal as it does in Natal, but has he never found himself in the situation that as a lawyer he is briefed to go and appear in court somewhere, that the attorney who briefs him, is not a White person and that during the court adjournment he wants to have lunch and talk to his attorney.

We make provision for this.

No, provision is not made for it everywhere. If, for example, I am in Port Shepstone or Fort Hare, there will be no provision for this because there will be no hotel there that will have the right to serve you. [Interjections.]

Order! We cannot all talk at the same time. Hon. members must give the hon. member the opportunity to make his speech.

There is a provision that the National Liquor Board, not the Minister, may grant permission for hotels to serve these persons.

Read the Bill.

I have read the Bill, Sir. If the National Liquor Board does not grant them permission, then the Minister is powerless in any event, and the result is that far from improving the present position, this Bill worsens it. If any further evidence were required in that regard, it was the evidence put before the Select Committee. Before the Select Committee the first proposal that was made was not just to have a Bill as we have it here where certain hotels can be made what the hon. the Minister calls “international” hotels. The first proposal was, as I say, besides this provision, that permits should be granted to various people.

That is not in this Bill.

I know it is not in the Bill. I wish the hon. the Minister would listen. I am telling him what happened on the Select Committee, and I am telling him of the proposals that his own department made before the Select Committee. If the hon. the Minister does not know the proposals which were made by his own department before the Select Committee, he must just listen and I will tell him. Now, the first proposals which were in fact made were that certain permits should be granted to various people. The sort of permit they had in mind was a permit issued by the Minister of Justice, on application, to non-Whites to have access to any of these premises intended for occupation by Whites and to make use of the facilities there. In some cases the suggestion was that the permit should be for an indefinite period, and the interesting part about this indefinite period was that the people they had in mind were people like a Minister of a homeland government; he should get a permit for an indefinite period. A Coloured inspector of schools, for example, should also get a permit for an indefinite period. Why should this happen? Because people of this nature …

That was rejected.

Yes, I know. I wish the Minister would stop getting so excited. In fact, I wish he would not be so cheeky!

I am taking a line from the Opposition.

That is what his own department had in mind. What I want to ask him is this. What is going to happen to the Coloured inspector of schools under this Bill? In the nature of things, and especially in a province like the Cape, he will have to travel tremendous distances and will find himself in places where there is not going to be the kind of hotel, “international” hotel, which can accommodate him. What is going to happen to that kind of person under this Bill? What, indeed, will happen to the Ministers of the homeland governments or a Minister of the Indian Council or a Minister of the Coloured Council? I want to say again that no provision is made in this Bill for this kind of situation. I also want to repeat that our amendment, our idea, our Bill, would have catered for that very situation. I mention this fact because on the evidence of the Department of Justice itself this is the sort of situation which should be catered for. What I find extraordinary also is that, having regard to the evidence before the Select Committee in regard to the absolute shambles in which the law is in at the moment—where when the hon. the Minister gives permission to people to do things it takes the form of asking the Attorney-General to decline to prosecute—no power is taken to meet the situation I have sketched should it arise. The only way in which the situation can be met is for the Minister to declare a hotel what he calls an international hotel. No provision is made for other circumstances which he cannot now envisage. No provision is made for the hon. the Minister to be given power to exercise his discretion to meet a situation which otherwise would be embarrassing, which should not occur, or a situation which he has not thought of or which the Select Committee has not thought of or this House has not thought of. There is no power taken to do that at all. I want to know what he is going to do. Is he going to go on with the present situation? I hope the hon. the Minister will listen. I want his reply. I want to ask him what he is going to do. Will he carry on with the present untenable situation where he says: “Well, the law does not cater for it so I cannot give you permission, but do not worry; just carry on and I will see that no prosecution follows”. I want to know whether he is going to do this or not.

I think it is very important for the Minister to consider some of the evidence given in this regard. I want to refer particularly to the memorandum received from the Incorporated Law Society of Natal. They of course have difficulties, as every other professional society has, in relation to the provisions of the prevailing law. They have them under this bill as well. In the nature of things they have to get together with their White and Black and Brown colleagues and the places where people can get together for conventions, etc., are obviously the hotels. They say the following about the methods used—

Then they go on to say that the resulting situation is prejudicial. They say—

They go further and say—

I think that is an attitude the hon. the Minister might well bear in mind because if in future he proposes to deal with any odd situations not covered by the Bill in the way in which he has done in the past, I think the strictures of the Incorporated Law Society of Natal will be borne out. Once again, the provision in the Bill we suggested of giving a discretion to the private sector providing these public facilities will in fact avoid any such situation. Furthermore, I want to say that the majority decision of the Select Committee, i.e. this Bill, flies in the very face of the evidence given on behalf of the Department of Foreign Affairs. There is no doubt whatsoever about that. In giving evidence the Secretary for Foreign Affairs was asked a question—it was put pertinently to him and hon. members will have read it in the evidence—to which he replied that the situation where you have demarcated hotels—some that will have Blacks and some that will not—is unacceptable and very difficult for him to sell. But, Sir, he agreed that the situation such as was postulated by us, the Opposition, in the Select Committee, was one which he could defend, and that it was the situation which obtained in America. But in the face of that, the hon. the Minister proceeds with this Bill.

Quite apart from these considerations, this Bill places the whole of the question of the provision of public facilities on a completely autocratic basis. The whole matter is within the discretion of the National Liquor Board. The hon. the Minister can do nothing if the National Liquor Board is not prepared to grant a licence. He can act and lay down conditions if—and only if—the National Liquor Board approves—all this at a time when we are supposed to be moving away from race discrimination, supposedly the official policy of the Government, certainly when it speaks overseas. But then we get legislation like this which is based entirely on considerations of race, at a time when we ought to be moving in the direction of more dialogue and more understanding between various peoples, at a time when the right to have private functions in hotels, is being removed. I must ask the hon. gentlemen sitting there, whether they have not had the experience of meeting non-White people. We have the situation all the time that the convenient places where we meet the non-White people and where the facilities are provided, are almost inevitably in hotels. The private sector provides public amenities which obviously the State does not provide. There are going to be more and more such occasions, because we are more and more becoming South Africans together, with more and more need for consultation and dialogue. However, this is now to be inhibited, except in certain centres, in certain hotels. Yet, as was complained of right in the beginning, in so far as foreign Blacks are concerned, they come to South Africa and have carte blanche, but the same does not obtain in the case of our own Blacks. One wonders whether it is not time to remember and for the Government to be reminded once again that détente begins at home. The sooner this is realized the better. The hon. the Minister has not touched on any of these problems, but I hope that we shall get some reaction from someone else in the House.

For the reasons I have mentioned, we cannot accept the Bill in its present form at this stage and I, therefore, move as an amendment—

1. (1) it deprives citizens of rights and privileges under existing law;
2. (2) it deprives the private sector providing public amenities of the right to decide Who will be served; and
3. (3) it subjects both the public and hotel and restaurant owners to absolute bureaucratic control based solely on race.”.

Mr. Speaker, in my opinion the hon. the Minister took a very wise step last year when he recommended that a Select Committee investigate the Bill which was before the House then. It was a great privilege for me to act as chairman of the Select Committee and I should like to avail myself of this opportunity to convey my sincere thanks to all the other members of the Committee for the sound co-operation given in the Committee. This also applies to the members of the Opposition who served in the Committee. I think that there was a very fruitful discussion in the course of which we obtained a great deal of information. In my opinion we will in fact be justified in arguing that majority decision of the committee was a very sound decision for the future of our country and for the Liquor Act as such.

The only part of the speech by the hon. member for Durban North with which I am really able to agree is his remark that in the opinion of the committee, legislation to amend the Liquor Act is necessary. Apart from that, I do not think there was much of substance in the speech by the hon. member. The only real point he made— and we, of course, disagree on that score— is his argument that a right is being taken away, viz. a right established for the non-White peoples in South Africa in terms of the Group Areas Act. Nor does the hon. member agree with the hon. Minister that progress is being made, and he went on to say that the existing statutory provisions made adequate provision for he non-Whites.

I want to reply very briefly to what the hon. member said. In the first place I want to point out to him that no one in this country is being deprived of rights. All that the Bill at present before the House does is regularize the procedure followed thus far and cause it to be more streamlined so that people may know where they stand under this Liquor Amendment Act. In the second place, I want to point out to the hon. member—this was stressed repeatedly before the Select Committee, too—that up to now there has been much unpleasantness and irritation as regards accommodation for non-Whites in hotels. This unpleasantness, too, is now being eliminated. We are trying to eliminate any friction that may arise by means of this legislation. In the third place I want to remind the hon. member for Durban North that, as he very well knows, we in the Select Committee, having discussed the point, strongly recommended that funds be found and voted to establish non-White hotels at strategic points throughout the country. The hon. member mentioned that there were a number of such hotels, but we feel that there should be a development of these facilities for non-Whites and we recommend that the necessary funds be found. In the fourth place I want to point out to the hon. member that although non-Whites were able to stay in hotels, and make use of accommodation, viz. bed, board and so on, they very seldom made use of these facilities which they were able to enjoy under the Group Areas Act. In fact, on the platteland it hardly ever occurred that they made use of these rights or privileges. In fact, therefore, a right is not being taken away from them, because it is one they never exercised. In the fifth place, I want to draw the hon. member’s attention to the fact that in evidence before the Select Committee, a body like Fedhasa, the Federated Hotel Association of South Africa, pointed this out, too, and I should like to quote from the evidence in order to put an end to this lack of clarity. They themselves were of the opinion that we should not move too fast in throwing open hotels to all peoples and races in South Africa, but that this should take place very slowly. The following question was put to them in the Select Committee by the hon. member for Jeppe—

What follows is of particular importance—

In the sixth place I think the hon. member for Durban North is losing sight of what was stated so very clearly in the evidence and in memoranda before the Select Committee, viz. that most of the witnesses did not advocate throwing open all facilities to everyone entirely, but that a specific demand —and I stress the word “demand”—be met by affording facilities to certain non-Whites. That answers the hon. member for Durban North.

I also want to refer to the legislation proposed by the Opposition members on the Select Committee. I want to put it clearly that when this proposal of theirs was seized on by a number of newspapers, a mistaken impression was created among the public. I am not referring to all the newspapers, but only to some. For example, one headline read “Hotels open to Blacks”. That was not the proposal in the majority decision of the Committee, it was the minority proposal. Here is another newspaper report: “Bill requests open hotels”. That, after all, is not true.

That is the impression you created.

The newspapers created this mistaken impression among the people and many people are now asking questions about this. In the second place, I want to point out to the newspapers that in their reporting of the matter they omitted to emphasize the conditions which the hon. the Minister and the National Liquor Board may lay down when they grant permission for international hotels. The conditions contained in the proposal of the majority decision are of cardinal importance in the granting of such a permit. In fact, they are basic to the granting of that permit. This, however, was not stated, and consequently the public is unaware of the conditions that would be attached to such a permit. In the third place, I think the newspapers omitted to explain to the public the existing position as regards our hotels and the admission of non-Whites to the hotels in the country. It is very important to give the public a brief survey of the position as it is at present. At the moment—the hon. member for Durban North mentioned this too—a non-White person is not prohibited in terms of the Group Areas Act from visiting a hotel as a bona fide guest. As a matter of fact, any non-White anywhere in the country can enter any hotel and ask for bed and board. However, section 94 of the Liquor Act prohibits hotels from providing Bantu with liquor for consumption on the premises.

As far as the Bantu are concerned, therefore, they can go and sleep and eat in an hotel, but they may not consume liquor there. What is more, section 113 of the Liquor Act prohibits a hotel proprietor from refusing anyone. In other words, if a hotel proprietor refuses a non-White— and that is the position today—he is committing an offence and contravening the provisions of the Liquor Act. At the moment—and this is very important—there is a great deal of confusion concerning the provisions of the Liquor Act. There are 1 411 licensed hotels in the country at the moment. Of these only 143 are classifiable as purely White hotels. This has applied from 1970. In that year the hon. the Minister attached conditions to certain liquor licences prohibiting non-Whites from visiting those hotels. Thus far there are 143 of these hotels. This means that if one deducts those 143 from the 1 411, there are a further 1 268 hotels which may accommodate non-Whites. Bantu may be accommodated in those hotels, too.

Mr. Chairman, I would like to ask the hon. member whether hotel proprietors knew that they were able to accommodate non-Whites.

I can assure the hon. member that hotel proprietors were in fact fully aware of that. We discussed the matter with members of the Hotel Federation. They were aware of the situation. I can tell the hon. member for Houghton that a few years ago, five or six years ago, in a speech in South West Africa—I think it was Windhoek—the hon. the Prime Minister mentioned that non-Whites were in fact allowed to stay in hotels. Today Bantu may stay in 1 268 hotels. As far as the Coloureds and the Asians are concerned, there are 57 hotels in which, liquor may not be served at all to non-Whites. Then there are 500 hotels in which liquor may be served to Asians and Coloureds in canteens—section 78 of the Liquor Act provides for this. If we deduct these from the 1 268 licensed hotels, there remain 711 hotels in which Coloureds and Asians may stay, eat, enjoy refreshments and consume liquor. A measure of uncertainty has now arisen among the people. Certain hotel proprietors were unaware that they could accommodate these people and refused them accommodation. That is why the hon. member for Houghton asked her question. The majority, contrary to section 113 of the principal Act, refused the non-Whites accommodation. As result the non-Whites usually did not know at which of the 143 hotels they were or were not allowed to stay. Consequently, absolute uncertainty began to develop.

There was an overlapping and division of functions in certain departments such as the Departments of Justice, Police, Community Development, Planning and Bantu Administration and Development. The hon. member for Durban North mentioned the permit system used thus far by the hon. the Minister of Justice. On some occasions, some of these permits were applied for at such a late stage as to cause endless difficulty, and there were difficulties as regards consultation.

After the committee had taken all the facts into account and considered all the memoranda and evidence, the majority of the committee came to the conclusion that there was a growing demand in the country for certain facilities for foreign and local non-Whites.

As far as the foreign visitors are concerned, I think the position is very clear and we need not dwell on it. Any foreign non-White is regarded as a foreigner. Any foreigner, whether White or non-White, comes to South Africa with a passport and will in future be able to enjoy all rights and privileges normally enjoyed by foreigners. I may just mention in passing that certain appeals have been made to prohibit the canvassing of tourists for South Africa owing to the fact that there is so-called discrimination in South African hotels. This discrimination has now been eliminated entirely and all non-White tourists from abroad will now be welcome to come to the Republic and stay here.

As far as the local non-White is concerned, we felt that the hotel doors could not be thrown open to everyone, but that the position should in fact be regularized. That is why we came up with the proposal incorporated in clause 3 of the Bill and in terms of which international hotels will be established. The Chairman of the National Liquor Board suggested that there should be about ten such international hotels in the bigger centres of the Republic. As the hon. member put it, there will perhaps be three international hotels in Johannesburg, one in Pretoria, two in Cape Town, two in Durban, etc. In other words, in the larger centres there will be ten international hotels which will also be subject to certain conditions, but these conditions will be far less stringent. Then, too, we considered having certain international hotels on the Republic’s main road routes. Those hotels would accommodate certain persons, such as some tourists and in particular those people who have applied to the hon. the Minister for accommodation in the past year or two. I just want to read for the information of the House and the public at large what kind of people will stay in such international hotels on the main road routes (translation)—

Not all people of this kind will be able to go to all the international hotels. Most of them will be able to go to the hotels in the larger centres, but as far as the international hotels on the platteland are concerned, there will be stricter conditions and restrictions. Not everyone will be free to go to such an hotel. We felt that when someone arrives in a town, for example, and wants to know at which hotel he may stay, it should be very clearly indicated which hotels are international hotels.

Other members on this side of the House will deal with the means of identification and the conditions attached to these hotels. Consequently I shall not go into that in detail. I do just want to mention that since certain minor problems could still crop up, the hotels will have the right to get in touch with the chairman or any officer of the National Liquor Board at any time in order to put their problem to that person and perhaps request the necessary permission. Then, too, there is the problem of seamen in our coastal cities. This is a problem which another speaker will perhaps deal with in broader detail. I do think, however, that these international hotels which are being established now will also meet a great need in accommodating these people.

In conclusion I just want to add that contract labourers visiting the Republic and visitors from our immediate neighbouring States will be dealt with on an entirely different basis to people with passports. Contract labourers come here on a worker’s permit and their passports are endosed accordingly. Such people will not be allowed to enter these international hotels at will, owing to the conditions attached to those hotels and owing to the capacity in which those people come to the Republic. Important visitors from our neighbouring States will be treated in accordance with the Bill at present before the House, particularly clause 1 thereof. After all the memoranda received and the evidence heard had been considered, the committee, in its wisdom, came to the hon. the Minister and the House with these proposals and consequently I should very much like to support this Bill introduced by the hon. the Minister.

Mr. Chairman, before I turn to the remarks which were made by the hon. member for Potgietersrus in regard to the Bill itself, I would just like to say on behalf of the members of the Select Committee that we appreciate his efforts as chairman of the Select Committee. We appreciated the fact that he was non-partisan and that he approached the rather important function he was exercising with real responsibility. However, I want to talk to him about the statements he made in regard to the background of this particular Bill. As I understood him, he stated right at the commencement of his speech that in his opinion no rights would be taken away if this Bill became law. I believe that he later contradicted himself because he agreed that at the moment there were some 1 268 hotels at which Whites, Blacks, Coloureds and Asians could all obtain accommodation and meals. He also admitted that in terms of the Bill this situation would now be changed and that there would be 1 268 hotels which would not be allowed to accommodate and to serve meals to Whites, Blacks, Coloureds and Asians. They would only be able to serve meals and accommodation to Whites. If that is so, then surely there has to be a deprivation of rights; surely the people who were entitled to go there are losing rights; surely the hoteliers who were entitled to entertain these guests at their hotels are losing rights. It is quite clear therefore that what is actually happening under this Bill is that far from taking away no rights, this Bill removes some very important and major fundamental rights, and I think that the hon. member should count his words before he makes a statement of that nature. He also mentioned the question of an attempt by this Bill to rid the country of racial friction which was taking place in relation to the operation of the liquor laws. I am afraid that I have no experience of that evidence whatsoever. I cannot remember one single witness who gave evidence before that Select Committee indicating that there was a need to change the liquor laws because of the fact that friction was developing between the various races. If any hon. member on the other side can refer me to such evidence I shall be very pleased, but I anticipate that not one of the hon. members on that side of the House will be able to point his finger to a person who gave evidence to that effect. The hon. member also stated that Fedhasa had indicated that it was not prepared to consider open hotels, which is what this side of the House recommends I also want to quote some of the evidence which, was given by the Fedhasa representatives. On page 37 of the report of the Select Committee Mr. Swanepoel said this—

That is the position. When Fedhasa came down to give evidence, the Select Committee was led to believe that Fedhasa had not been fully consulted in regard to this whole matter of open hotels etc. It is not quite correct therefore for the hon. member to state that Fedhasa did not agree with open hotels. The facts are that Fedhasa had not properly considered the question of open hotels.

Their representation was a cross section.

The hon. member says that their representation was a cross section. Well, that may well be so, but I believe that the hon. member will agree with me that the evidence that was given by Fedhasa was to the effect that they had not given it full consideration. The hon. member must accept therefore that they had not given the matter full consideration.

They were quite clear on what they wanted.

The position, as I understood it from the hon. member for Potgietersrus, is that the fact that 1268 hotels had the right to accommodate and serve meals to Blacks, Coloureds and Asians was made clear to the members of the hotel association or that they knew that this position existed. This is not so at all, because the members of the hotel association never knew the extent of the rights to which they were entitled.