In keeping with what we indicated at the second reading we want to ask the hon. the Minister to accept an amendment to define the type of officer who will make these reports to him from time to time before he takes precipitate action in respect of the various weeds dealt with under this Bill. Sir, I want to move the following amendment which I think is in keeping with what the Minister requires—

We move that amendment because of the fact that the soil conservation committees and the officer in charge of the district are more conversant with the position in the district than anybody else. The hon. the Minister knows full well that “officer” is undefined and that anybody may be termed “an officer” Having regard to the seriousness of the position we feel that the hon. the Minister should define the type of officer who will make the report on which he will then take drastic action. We feel that this amendment will meet all that he requires to overcome his various difficulties. Let me assure him that the reliable extension officers that he has in every district are the best men to report to him on the extent of infestation in any district in which you have a soil conservation committee and an extension officer.

I very much want to support this amendment. We want to make this Bill as good as possible. I think the hon. the Minister takes it that that is our intention. I think we shall improve the Bill by accepting this amendment. The members of the Soil Conservation Committee have the best knowledge not only as far as the weeds in the district are concerned but also the weeds on the farms themselves. They are therefore in a better position that anybody else to make recommendations to the Minister. I think, therefore, that this amendment will definitely improve the Bill and that is why we have moved it.

I do not for a moment suspect the motive behind the amendment moved by hon. members opposite. I accept that it has been moved in an attempt to improve the Bill. I agree with hon. members that the Soil Conservation Committees are doing excellent work and that they know the areas in which they work very well. They have a reasonable intimate knowledge of the areas which fall under their jurisdiction but they fall and function under a totally different Act. They have their hands full; those people have a great deal of work to do. In the second place they are not really the people you want to use to start prosecutions and they themselves do not want to be used for that. They do not like it. Exactly the same applies in the case of the members of the fire prevention committees. The Weeds Act defines in general what is meant by “official”. The plague which the Department of Agricultural Technical Services mainly wishes to combat is jointed cactus. We do not have too much trouble with burweed for example, and other plagues. We have our weed inspectors whom we can use there. We shall of course only use officials of the Department to institute prosecutions, because you can only institute such a prosecution after the Minister has convinced himself that all reasonable steps have been taken to free the land. Those “all reasonable steps” can only be taken by two persons—by the Government or by the Department of Agricultural Technical Services themselves, without the assistance of the farmer or with a little assistance from him, or the infestation may be so small that the farmer himself, with the assistance of the Government by way of providing him with sprays free of charge, can undertake the eradication of the weeds, under Government supervision. In that case the farm is in such a condition that we consider is essential that the farmer must in future be responsible for keeping the farm free of weeds. Who know what the condition of a certain farm is? Not the Soil Conservation Committees.

Oh yes.

Oh no. The hon. member apparently does not know that I have appointed an advisory jointed cactus committee in the Eastern Province representative of three separate agricultural unions in the Eastern Province.

Why do you not define them as “officials”.

I shall tell the hon. member why not. It consists of the representatives of three agricultural unions. The chairman of that committee is an official of my Department. Those people have to educate the farmers and make propaganda and the members of that advisory committee themselves have told me that they were not policemen; they do not want to prosecute their fellow-farmers; that is the responsibility of the Department itself and I have my extension officers for that purpose. We have records from which we can ascertain where all reasonable steps have been taken before we prosecute anybody. I repeat that we in South Africa, through the Department of Agricultural Technical Services and through the Department of Agriculture, as it was called originally, have taken the farmers along with us; we have improved our agricultural methods and have applied our soil conservation measures with great success, not because we have prosecuted farmers but because we have convinced them of the importance of this work. I cannot over-emphasize that aspect of the matter. We take the power under this measure to institute prosecutions where necessary but I hope that will seldom be necessary. The hon. member for King William’s Town (Mr. Warren) referred to a case where the Department itself had cleared somebody’s farm. He said that when they got to the one end the other end where they had started was as infested and even more infested than it was originally. That is quite right but I shall tell the hon. member what the problem was. Nobody attended to the area which had been cleared. We originally thought we would start from one end and that the owner would keep that portion clear which had been cleared. The owner, however, sat back and waited for a certificate that this farm was clear before he got busy. That is why we are no longer making provision for certificates in this Bill. We simply serve an order on the farmer that all reasonable steps have been taken to clear the farm and that it will be his responsibility in future to keep his farm clear, or at least that portion which has been cleared. We can serve such order on him in respect of the portion of the farm which has been cleared and we can serve an order on him in respect of the whole farm as soon as we have cleared the whole farm. We shall do it discreetly and I can assure hon. members that we shall not appoint irresponsible people; they will be of our best officials, officials who will act judiciously. The Minister will nominate the officials who have to institute action where necessary. I cannot see, therefore, why we should drag in the soil conservation committees and other people who do not like instituting action against their fellow-farmers. I honestly do not think the amendment will be an improvement. It will only complicate the issue.

Amendment put and negatived.

There is just one other comment I wish to make on this clause and that is with regard to sub-section (3), which provides—

I feel that the obscurity in that particular subsection should be removed. What is the Minister’s object in inserting phraseology of that kind? Of course, we recognize the fact that an owner is responsible. It does not matter whether he is an occupier or not; he is a lessee and he is bound by the conditions of the lease. I should like the hon. the Minister to give us a little clarity in this regard before we allow the Clause to go through.

I think this Clause is very essential and it is also very clear. We are dealing here with two persons. We are not violating the principle that the owner is the person responsible but then we say that we serve the order on the owner and the occupier. The occupier need not necessarily be a tenant.

The sub-section provides that it will bind the person on whom it is served, and the occupier may be the owner.

It must be served on both the owner and the occupier. The main responsibility, however, still rests upon the owner. It will have a very good psychological effect if the man residing on the place (not only the lessee) is served with the notice and I think if he is aware that steps are now going to be taken it will assist the owner in his control and in his rights; it will make the man on whom the order is served realize his responsibility for keeping the land clean. I am thinking especially of members of Parliament upon whom notices may be served while Parliament is in Session, when they have farm managers working for them. I think if that farm manager knows that the notice has also been served on the owner who is his boss, the owner will find when he gets back to his farm that his farm is much cleaner that it would have been if his farm manager had not been notified as well.

Clause, as printed, put and agreed to.

I move—

This is the same type of Bill as the Kopjes Settlement Bill. It is regarded as a hybrid Bill. The Department of Water Affairs is at the moment busy with the erection of the Stompdrif Government dam in the Olifants River on the farm Doringkraal and Fonteinskloof in the Oudtshoorn division. When that dam is full its capacity will be approximately 22,000 morgen feet. In view of the scarcity of water which that district is experiencing and with a view to the number of farmers and the fertile land that has to be served by that Government dam, in view of the losses which are sustained in the process of distributing water, it is the intention of the Department to cement the canals that will comprise that distribution system. The Government will consequently be investing large capital there. In that same district there is an irrigation board dam which was constructed in the early twenties, namely, the Kamanassie Irrigation Board dam. That Kamanassie Irrigation Board dam is under the control of the Kamanassie Irrigation Board. It connects up with the Olifants River Government water control area because after the riparian owners along the Kamanassie River have been served, that dam also serves the riparian owners lower down the entire Olifants River right down to the end. The water supply in that dam is insufficient to enable the necessary irrigation to be undertaken along the lower reaches of the river. We consequently had discussions with the owners and the public there before we commenced with the Stompdrif Government scheme. We told them that the Government would only construct that dam in the interests of everybody concerned if the two dams could be pooled and regarded as one unit so that the canals could run into one another and so that you could extract water according to your needs, either from the Stompdrif dam or from the Kamanassie dam. The Kamanassie irrigation dam is a dam which was built by the Government for the Irrigation Board but the costs of construction were written off years ago already. The maintenance costs and the distribution costs were paid by the Kamanassie Irrigation Board and the distribution was controlled by the board. In the case of legislation of this nature the Standing Orders provide that notices should be sent to every riparian owner who falls within that Government water control area and who are served by those two dams. You will have to give every one of them notice and ascertain whether they approve of such a scheme, whether they are against it or whether they do not mind what happens. I intended introducing this Bill last year already. Notices were served on the people and we received replies. After I had seen the replies I personally could not understand why the people were dissatisfied. I myself convened a large meeting of farmers in Oudtshoorn, a meeting which was attended by farmers from far beyond the borders of my constituency, farmers from above the Government dams and below the Government dams because the Government Water Control Area includes the entire catchment area of the Kamanassie River and the entire catchment area of the Olifants River, above and below the dams. I discovered that the legal provisions had been drafted in such a way by the legal draftsmen that they lent themselves to an interpretation with which I myself did not feel happy; I was given powers which I did not want, powers which I had I been one of those farmers, would not have liked to give to any Minister or Government. I am referring to vested rights which could have been violated according to the provisions of that Bill. I then had the Bill amended and we have again sent out notices. Unfortunately the majority of the owners did not even reply to our request to indicate their approval or disapproval of the proposed scheme or whether they were neutral. I take that to mean that them is generally greater satisfaction with the Bill, but we shall only be able to determine that when objections are lodged or not lodged after the second reading of the Bill has been approved of. We did not hear from the majority of the owners, above as well as below the dams. There were, however, quite a number along the upper reaches of the rivers, above the Government dams who will not be served with water from these dams, who have objected to this Bill and who have expressed themselves against it. There are a few below the dams, in certain areas who have also said that they were against the Bill. The majority are in favour of the Bill. I take it that it is immaterial to those who did not express an opinion. If anybody is against it he will register his objection. If he does not register his objection I am more inclined to regard him as somebody who does not object to it. The majority of them have indicated their approval of this Bill, but even if it had been the minority, which is not the case. I would still have regarded it as being in the interests of the country to continue with this Bill: I would still have introduced it. I can well understand people who live in the catchment area above the Government dams, within the Government Water Control Area, objecting. In those two cases irrigation projects are being developed along the upper reaches of the rivers. There is also a fairly large area of irrigable land along the river which has throughout the years not been irrigated. When you declare that a Government Water Control Area it means that all future developments, all further extraction of water from those main sources that have to feed these dams in as much as it is being declared a controlled area, will have to be done under permit. In other words, they will have to stop extracting water; the Department must know about it; the Department must issue a permit and say that it is legal to extract that water. We are not taking anything away which the people already have, but if a farmer wants to install a pump or wants to enlarge or change a furrow or dig another in order to expand his irrigation projects, he cannot do so in a Government Water Control Area unless he has the permission of the Minister of Water Affairs in the shape of a permit. There are farmers who do not know what the meaning and the set-up is under the 1956 Act and the controlling powers which that Act gives the Minister. They are under the impression that those who have not yet exercised their water rights in that area will now lose those rights; that the Minister will arbitrarily say: “No, I want the water in the dam and I am not going to allow people above the dam to lead water.” These two rivers are not perennial streams. The Kamanassie River is regarded as such to a lesser extent but the Olifants River is regarded as an out and out flood river which does not have a perennial stream. But that is not how we will apply the Act.

We have never yet deprived any person of his riparian rights in a Government Water Control Area. We look at it in this way that where, under the old set-up, the riparian owners have more or less had an exclusive right to the water in the river for more than 150 years, and where the waters from the one catchment area could not be diverted to another, the rights of those riparian owners must be recognized. All we are doing now is to determine his legal, his theoretical rights of extraction and to tell him that he may extract within those limits. That objection rests, therefore, on a misunderstanding. It is understandable, Sir, that nobody wants his rights limited or curtailed. I think 90 per cent of the people would prefer to have no laws at all to control them. The fact remains that people do not like it. As I have said, there are people below the dams who are not happy about the provisions of the Bill and it became very clear to me at the meeting which I held last year why they did not feel happy—the cause of their unhappiness is rectified in this Bill—namely, because all the riparian farms in that Government Water Control Area below the Government dams were specified. Hon. members must remember that Oudtshoorn is the oldest irrigation district in the country. Moreover it is one of those irrigation areas which the small water streams, the waters of the mountain streams have already been divided amongst the riparian owners either by way of Water Court decision or old servitudes. It is only the surplus water of those various mountain streams that reach the flood river during torrential rains, and that water flows down very quickly. That flood river as such, the water of the great Olifants River, has never yet been divided. People could pump water from it and could lead water from it as long as they wished. That river flows down very quickly. The mountain waters, however, have all been divided. What we are now doing is to include those farms in the mountain, farms which are riparian to the Olifants River, in this Government Water Control Area. Where people say that the Minister has the power and the right in the Government Water Control Area to devide that water in the way he deems fit and as fairly and justly as he may decide, they conclude that I may now also interfere, because it will be a Government Water control area, as far as those water are concerned which have their origin in the mountain streams and which originally made the farmer establish his farm there and to the development of which farm the Government did not contribute one penny. That is not the object of the Bill nor is that how it will be applied and that is why the Act is being changed as it is changed in this Bill. “River” in this Bill means the Kamanassie River and the Olifants River; it does not mean the mountain streams whose waters have already been divided. We do not want to interfere in those rights at all. A farm may originally have extended for two miles right up the mountain. Supposing that farm had been subdivided and that the lower portion had also been subdivided. Those are riparian owners, people whose boundaries extend to the centre of the river. The mountain farmers are a mile above them and they get their water from the mountain streams. Now they find that they are also included in this Government control area. The reason for that is this: The legal advisers inform me that if a farm had originally been a riparian farm and a portion had been cut off it did not mean that the portion which had been cutt off, although it did not border on the river, had lost its riparian rights. With the scientific development that is taking place and the cheaper and more effective ways of pumping water—atomic power may perhaps even be used later on—the position may arise where people who do not fall under this canal system but who farm higher up may come forward and say: I want to exercise the riparian rights which I have as the owner of an originally riparian farm and I want to extract water from the river or from the canal. That being the position those farms have to be included but only for the purposes of extracting water from those two main rivers. That is the position we want to control: we do not wish to control or affect their right to extract water from the mountain streams.

That, Mr. Speaker, are briefly the changes this Bill envisages. We have to introduce this Bill because there is a certain dam, for example, a certain canal system which is an earth canal. We now want to improve that canal system by cementing it. The total distance from the Stompdrif Dam to the end of the canal is between 40 and 50 miles. About 17 miles from the Stompdrif Dam the canals of the Kamanassie dam enter the same river. They come together there. We want to cement that canal because we can save as much as 25 per cent of our available water—in some cases 30 per cent—by letting it flow in cement canals instead of along the riverbed. In certain areas, such as Oudtshoorn, for example, the percentage is somewhat lower because the climate is not so dry there. In this case we think the loss will be between 25 per cent and 30 per cent if we do not improve and modernize the distribution system. We cannot co-ordinate these two works and treat them as a unit if there are two controlling authorities. That is why we are in this Bill depriving the Kamanassie Irrigation Board of all the rights and powers it has over that irrigation area to-day. The Government is taking them over. The Government is also taking the dam over and the Government is taking over the canal system.

Does that mean there will no longer be a board?

The Kamanassie Irrigation Board will stop functioning from the moment we say we are taking the functions over. But the works, such as the dam and the canals, the water works and weirs are all being transferred to the Government. The Government will be the controlling authority. The Kamanassie Board is not being abolished, however. It will still exist because provision is made in this Bill for the Minister, if he so wishes, to transfer the control of these Government works to the Kamanassie Irrigation Board or to another board which will be more representative of the larger area which stretches right up to the dam walls and which will comprise the Government Water Control area. While I am on the subject of boards, I may just say that the owners higher up had another complaint. As the law stands at the moment we can transfer the powers to the Kamanassie Irrigation Board; we can give them control over the entire Government Water Control area below the Kamanassie dam, below the Olifants River, and also over the catchment area that is, above the dam walls. They then said: No, we are not going to allow the Government to give that control to a board on which we are not even represented because the only interest they have is an interest which conflicts with the interests of those of us who live higher up. I am changing that in this Bill in that only the control over the Government dams and the control over the land below the Government dams may be transferred to a board, but the control over the land above the Government water works, the catchment area, will not be transferred to a board, a board to issue permits for the extraction of water because the Minister and the Department must remain responsible for that. That, of course, is now satisfactory.

I have not received any objection from the Kamanassie Board as a body against the Bill. I think if a board is ever appointed to control those matters and to perform the functions in the whole irrigation district as an agent of the Government, it will have to be another board, a board more representative of that area which had never fallen under the Kamanassie Irrigation Board. I think those were the main aspects I wanted to explain. I have dealt with the objections and the changes which are envisaged so that those people whom you unfortunately cannot reach, people who, I believe, do not understand the law as such, will learn from this explanatory speech which will appear in Hansard and possibly in the Press, in what way their objections have been met in this Bill and what the objectives of this Bill precisely are.

I intend moving a few amendments myself to make the position even more clear and so that there will not be any misunderstanding as to the object of the Bill. In the Committee Stage I intend moving that in Clause 1 (2), after the words “Proclamation No. 48/1917” the words “or any other irrigation board established under Section 79 of the Water Act” be added. That is to make provision that the control shall not only be transferred to the Kamanassie Board, as it exists to-day, but to any other irrigation board established in terms of Section 79 of the Water Act.

The relevant portion of Clause 1 (3) is being deleted and substituted by the following: “River”—that is the definition … “means any Government water work situated in the Government water control area, that portion of the Olifants River therein below the dam referred to in Section 5 and that portion of the Kamanassie River therein below the dam referred to in Section 2”. We shall then know precisely with which rivers we are dealing.

The words “in all rivers” in Clause 3 are being substituted by the words “a river” to bring the Clause in line with the preceding one where “river” is defined, so that it cannot be asked why we talk about “a river” in one Clause and about “rivers” in another Clause ….

As I have said, if the Minister should decide to transfer the control and the administration of the Olifants River Government scheme to a board, and if such a board should not be the Kamanassie Irrigation Board, the board will be an irrigation board established under Section 79 of the Water Act. In other words, it will be an irrigation board elected in the manner prescribed by law by all the irrigators falling under the Government scheme. I believe that makes the position clear and I think, if there are objections, the Standing Rules provide how they should be dealt with. I trust I shall get the support of the House also in respect of this Bill.

The hon. the Minister has dealt with the Bill in particular detail. He has explained all the difficulties that have been encountered and which may still be encountered. We on this side of the House support the Bill. I believe Government control will be much more effective and that it ought to give greater satisfaction generally and that it will be in the interests of the majority of those people.

We realize, of course, that there are people who will be affected, particularly those higher up the river but if the Minister applies the 1956 Act as he says he intends doing, we believe those people will also get their rightful share of the water, as well as those people lower down who in terms of this Bill will also now be affected in that they will remain riparian owners although they are not adjacent to the river. Their position is also now very clear. We support the Bill.

This is the first time that the 1956 Act has really been put to the test. I am satisfied to accept the Bill as it is. I think the Minister has said something which he will have to carry out in future and that is that all registered rights that were acquired prior to the introduction of this legislation will be respected. As you know, Sir, the rights in all irrigation areas, rights which existed prior to the 1956 Act, have to be protected. If the Minister will protect those rights and not deprive the people of them, something which I do not think he can do under the 1956 Act, we are satisfied that this Bill go on the Statute Book.

I want to make it quite clear that no rights which have been registered or acquired through usage over the years should be touched otherwise a principle may be introduced which may affect our irrigation projects in future. If the Minister gives us that assurance I am quite happy to support the Bill.

I am very pleased to learn from the Minister that he intends cementing those canals which are still earth canals to-day. I should like to suggest that in future all canals under Government controlled schemes ought to be cemented because an enormous amount of water is lost if you do not have cement canals.

There is one respect in which I have a great deal of sympathy with those people who are riparian owners above the Kamanassie dam and the Stompdrif Dam or whatever dam it may be. The rights they enjoy to-day and which are registered must be respected. I always feel sorry for such people, Mr. Speaker, because I myself have had experience of that. It might have happened that you did not register your rights when you should have, firstly, because you were not financially strong enough to construct those works within the limited time allotted to you. There are also many people who, with the improved methods of extracting water from rivers, never thought about registering those rights, because they did not think at that stage that the development would be such as to enable them ultimately to place that land, land which was far away from the river, under irrigation. Because they are riparian owners along the upper reaches they are not allowed to register or to undertake irrigation works, according to the law if I understood the Minister correctly, without a permit from the Minister. I take it that the Minister will treat those people with the utmost sympathy and that when he receives applications from upper riparian owners to extend their irrigation works he will treat them very sympathetically.

Then I should also want to learn from the Minister what the position will be of those people below the irrigation works. How will irrigation rights be awarded to them? Will it be done according to the number of morgen that can be irrigated or will that be limited? I should very much like to have clarity on that question.

For the rest the Bill is very acceptable. I approve of it. I want the people below the irrigation dams to be given every opportunity to develop. But just as I am in favour of development below the dam I am equally in favour of development above the dam. It is in that regard that I want to appeal to the hon. the Minister to treat those people with particular sympathy.

I am grateful for the support this Bill has received. A few questions have been put to me which deserve replies. The hon. member for Kimberley (North) (Mr. H. T. van G. Bekker) has pleaded for those people above the dam. He pleaded that their development should not be hampered. If a riparian owner wants to know what his lawful rights are, if he wants to know how much water he can lawfully extract from a river for irrigation and development, and he is not in a Government Water Control area, if he wants those rights registered against his deed of transfer, he can go to the Water Court. The Water Court then determines what his extraction rights are, with due regard to the strength of the stream, the average flow, the irrigation potential along the river, the rights of all the other riparian owners, etc. But the extraction rights are no longer determined by a water court in a Government water control area; that will only be determined by the Department of Water Affairs; actually by the Minister, because all permits issued must be signed by the Minister himself in terms of the Act. The Minister therefore undertakes that responsibility. The difference is simply this: Whereas it used to cost a great deal of money, sometimes thousands of rand, to have your water rights determined by a water court it practically costs you nothing in future under this procedure. All you have to do is this: You indicate that you want to embark on an irrigation project and that you want a permit. The Department of Water Affairs knows more or less how much irrigable land there is along such a river. Without much difficulty or red tape the Department will carry out an inspection and issue you with a permit provided the Department is of the opinion that it is within the limit of your theoretical extraction rights. What are your theoretical extraction rights? You are theoretically entitled to extract water from that water which can be regarded as the normal flow. When they have determined how many morgen of irrigable land there is along the river and how much water is available they divide the available cusec water amongst the irrigable morgen of land. If there are 100 morgen and 200 cusec water to be divided they can issue a permit allowing you two cusec per morgen. That is your theoretical extraction right. This is the position above the dams. The other question was whether we would consider existing development. There are a few places where the law had been applied stringently. I have in mind the Krokodil River, the Blyde River, Letaba and a few other places. There we have throughout taken existing development into consideration, whether the rights in respect of that development have been registered or not. That is not the point. Any development that has taken place by way of servitude or even through usage is always respected. Because it is not our intention to apply the law so injudiciously as to say to a farmer who has incurred costs to plant orchards or a vineyard: We shall allow you water for 30 morgen where he has perhaps developed 60 morgen, except where he has developed more morgen than he was entitled to develop in terms of his theoretical extraction rights and we do not have a dam in that area from which we can supplement his water supply.

As I have said the Oudtshoorn district is one of the oldest in our country. There is practically no more fertile land in the Oudtshoorn district that can be developed. I think the maximum number of morgen that can be developed with the available water have already been developed. With this Stompdrif Government water scheme and with the inclusion of the Kamanassie dam it is not envisaged to give water to any additional land; it will be limited to the existing irrigation projects. We calculate that with the improvements envisaged—normal years, bad years and abnormally good years included—we can hardly guarantee 20 inches of water per year per morgen. It will not be more than that. In other words, it will be stupid of us to enlarge the irrigation area still further when we know that we cannot supply more water than about 20 inches per annum per morgen, taken at an average over 10/15 years. But it will bring about a great improvement. Because it is calculated that the average water supply, forgetting about the new dam to be erected, has never been more than about 13 inches in that district. Seven inches extra will mean more to farmers who have learnt from experience how to put water to the absolutely most beneficial use and because of the fact that that has been an irrigation area for generations, than it will mean to new irrigation farmers in a new area, new irrigation farmers who still have to learn what the value of water is and how to make the best use of it.

I can assure you, Mr. Speaker, that it is generally known in Oudtshoorn—they are dear good people—that a farmer will not hold it against you if you perhaps give his wife a little kiss although you do not know her too well, but you must not touch his sluices or interfere with his water when it is his turn; he takes strong exception to that. That is my reply to the hon. member for Kimberley (North).

I want to assure the hon. member for Cradock (Mr. G. F. H. Bekker) that we shall maintain the principles to which he has referred in the application of the 1956 Act. We do not intend departing from them.

What about the cementing of canals?

As far as the cementing of canals is concerned, not only in respect of these works, we are spending several millions of rand annually on the cementing not only of new canals but old canals that were earth canals in order to eliminate the loss of water and to make the irrigation more effective. Where a new work is constructed we always bear in mind that the canal must be planned in such a way that, if we cannot cement it immediately because of the costs, we shall be able to cement it at a later stage when money is available. It is the policy of the Department to cement as many as possible. The canal system usually costs twice as much, and in many cases twice and a half as much or three times as much, as the main dam structure. The most expensive work in an irrigation scheme is the distribution canals if they have to be cemented and that is extremely important in a country like South Africa.

Motion put and agreed to.

Bill read a second time.

I move—

It is surely not necessary for me to say that every State Department is exceptionally and intensely interested in the provision of the money which is voted for that Department every year, because on that financial provision depends the whole of the planning and to a large extent the implementation of the Department’s functions. Not only are there certain essential services it has to maintain in the interest of the community, but every Department continually strives more and more to serve the interests of that section of the community which is entrusted to it. In a developing country like the Republic of South Africa, where new practices are continually being applied, and particularly in a Department like the Department of Agricultural Technical Services where not only do we have to give guidance to our farmers in combating pests and plagues and in keeping their farms clean, but also have to show them how to apply better agricultural methods and to farm more scientifically, in order to see whether they cannot obtain a higher production per unit of land, plant and livestock and so increase their intrepreneur’s wage a little, it will be appreciated that there is a continual extension of the functions of the Department.

Now, in so far as the Department of Agricultural Technical Services is concerned, we can thankfully say that it has always been possible for the State not only to provide funds for the maintenance of the existing services, but also from time to time, by providing greater funds, to enable us to establish great new scientific and research institutions. Hon. members will note that in the Estimates for 1963-4, if we also include the Loan Account, provision was made for approximately R21,000,000 for the services of the Department of Agricultural Technical Services. The Department has approximately 70 small and large institutes, research stations and experimental farms, and even those are still insufficient because our country is so divergent by nature that even where one has a research station and an experimental farm at one place, conditions and the climate and other factors are so entirely different 50 or 60 miles away that more co-operative experiments have to be conducted, experiments which we have always as far as possible tried to link up with the experimental farms, and one finds that strong representations are made, because of the particular variety of agricultural, climatic and soil conditions, for an experimental farm to be established there as well and for experiments and research to be done locally. As a research organization, the Department of Agricultural Technical Services is probably one of the largest in the country, with 1,183 technical posts for researchers and lecturers alone, and there are a large number of experimental farms, laboratory facilities and other technical facilities available. As I say, conditions in our country are very divergent in regard to stock farming and crops, and it is obvious that such a divergent industry makes particular demands in respect of research personnel and facilities. I think we sometimes forget how great the diversity in our country actually is in respect of stock farming, crops and horticulture. It redounds to the honour of the Department that not only in respect of the research requirements, but also in respect of guidance and education, it can render such services that in this regard we are the envy of many other countries. It has traditionally developed in such a way that the State in our country plays the greatest role when it comes to the financing of agricultural research. In this regard we should, however, remember that there are a large number of industries dependent mainly or to a large extent upon agriculture. In the first instance we think of the fertilizer industry, the manufacturers and distributors of tractors and farm implements, insecticides, stock remedies, stock feed and other requirements. Secondly, we also think of other secondary industries which process farm products, like the milling and baking industries, canners, dairy factories, cigarette factories, wineries, textile factories and numerous others which are dependent upon agriculture directly or indirectly. In the United States of America already more people are employed in this type of industry than are employed in agriculture. The importance of the agricultural industry, therefore, not only as a direct but as an indirect source of employment, is tremendous, but unfortunately in our country, in contrast with what is the case in other countries, we have hitherto not received any appreciable contributions from private entrepreneurs for the promotion of the services and the research done in the agricultural sphere, although they themselves depend on it to a large extent. There are a few exceptions but, apart from the State, it is still really only the control boards which, from levies contributed by the farmers themselves, have made donations towards the training of technological staff and the provision of research facilities. The control boards have already contributed more than R680,000 for the provision of land, buildings and equipment, and appreciably more than R1,230,000 for the training of scientists. It is estimated that in the past ten years already 568 pre-graduate and 130 post-graduate study bursaries have been granted in this way. We have also received money from various control boards for study travels because they regard it as very important, just as I do, that our scientists employed in the Department of Agricultural Technical Services (and this applies to all technical departments) should be au fait with the latest and the most modern developments in other countries of the world. I must also mention a few large donations by a tobacco company, a citrus co-operative, the K.W.V., and a few other donations made or promised by other bodies.

It is perhaps to some extent understandable that prospective donors may not have complete clarity as to the procedure followed in regard to such donations. At a show I opened—I think it was the Royal Agricultural Show at Pietermaritzburg—I made an appeal to manufacturing companies which are really dependent on agriculture to give us more tangible proof of their interest, and that they should not just draw scientists from my Department, but should assist us in training scientists. Shortly afterwards I received an offer of more than R5,000, but when those people heard that it would have to be paid into the Exchequer and that we would then have to budget again in order to get that money, they said, “No, our donation is for a specific purpose and we do not want it to lose its identity.” I then said that we were busy doing something in that regard. I had this legislation in mind, but I could not then say anything with certainty because we had not yet obtained approval for this Bill. But I held it out in prospect as encouragement to these people to make such donations. As I have said, there are fixed rules which have been established for sound reasons, in terms of which these donations have to be paid into the Exchequer and then have to be voted by Parliament for the purpose for which they were donated. This procedure can quite rightly lead prospective donors to think that their donations to a large extent lose their identity. The object of this Bill is particularly to provide that donations and grants for agricultural research and for the training of agricultural technologists may be put into a separate account, and that my Department will then have direct control over the expenditure of that money. That will facilitate the whole process and it will, for example, facilitate the arrangements of control boards and other bodies in regard to the financial administration of bursary schemes. They must administer these bursary schemes, and then we have the position that every time we need money to pay these students an installment, they must pay the money to us so that we can send it to the student. That involves much cumbersome bookkeeping. They say, “We make a donation and want to get it off our books”. Now they will be able to do so because in terms of this Bill a fund will now be established into which all this money can be paid, and it can then be used for the purposes stipulated by the donor. That will facilitate the whole procedure and it will relieve the control boards, and other bodies which themselves have to administer their bursary schemes, of quite a lot of work. It will enable the Department in every case to ask the control boards for these funds and to pay the bursaries when the progress of the students justifies it.

For the rest, the Bill needs little explanation, because to a large extent it follows the pattern of the Tobacco Research Account and the Viticulture Research Account which were established by legislation in 1960. The fact that this new account will fall under the control of the Secretary of the Department as the accounting officer also means that it will be scrutinized every year by the Controller and Auditor-General and that it may be dealt with by the Select Committee on Public Accounts. The Treasury has consented to this Bill and has in the meantime intimated that where, for example, a donation is made for a building, just to mention one case, which represents at least 75 per cent of the cost of that building, the State will consider making a contribution towards the erection of such a building. You know that the Treasury never quite binds itself, but I just want to state this here in order to indicate the goodwill on the part of the Treasury, and to point out that when considering such a donation made by the public, it may also feel compelled to assist in achieving the object of the donation by also contributing something. It will consider such a matter sympathetically. The actual amounts the Treasury will contribute will of course depend on the circumstances prevailing at that time. The Rautenbach Committee which was appointed a few years ago to investigate certain aspects of the Department’s technical services strongly recommended that legislation such as this presently before the House should be passed. It may help to encourage people to make donations and further to simplify and speed up the whole process for the provision of buildings and facilities.

I think that this measure may be regarded as a very important breakthrough, and I want to express the hope that it will achieve its object in every respect. I also want to thank the control boards and other bodies which in the past contributed to our services and the training of staff for what they have already done. At the same time, I want to direct two appeals to the private organizations, particularly those concerned with agriculture. In the first place I ask that they should not try to persuade the staff of my Department to come over to them by offering higher salaries, and secondly, that they should consider making donations to the Department, which can then be put into this account and used for the purpose they have in mind. If they still do not see their way clear to doing that, I want to make this further appeal to them to institute special schemes for the training of their own staff where they have not done so before.

This side of the House supports this Bill for the establishment of an Agricultural Research Account, and we want to associate ourselves with what the Minister has said and express the hope that it will fulfil the object for which It was instituted. Organized agriculture has long been asking for such an account and we are glad that eventually this is being realized and that facilities will be created so as to have a separate account covering all agricultural research. In years to come we will still continue asking for more funds to be made available for agricultural research because we believe that to be essential. We do not want to be placed in the position of having to compete with the rest of the world—we are becoming a great exporter of agricultural products—without having the best possible agricultural research.

But I should like to make an appeal to the Minister on behalf of this side of the House that whereas he is now establishing an Agricultural Research Account he should also consider complying with the request which has for some years been directed to him and his predecessor to establish an Agricultural Research Board. It is not necessary to expatiate on the failures of the past in connection with agricultural research advisory boards and sheep and wool advisory boards. The hon. the Minister knows as well as I do what happened to those bodies. We established an agricultural research advisory board with the best intentions in the world; it sat once or twice and submitted a voluminous report, and that was the end of it. In the same way we established a sheep and wool advisory board, which also just did not function. We just cannot comprehend why industry should have a research board, the wonderful C.S.I.R., to do research in regard to science and industry, and why we should have a medical research board and research boards for certain other industries in the country, whereas the industry with the greatest diversity and the most diversified branches does not have a research board, an agricultural research board. We cannot understand why the Minister wants to shoulder this great responsibility of determining, in connection with the payments made from this Research Account, to what branch of the industry it should go and in what proportion it should be awarded from time to time, and why he does not want to be assisted by an Agricultural Research Board to correlate agriculture as such and its research, and to co-ordinate it and to advise him, as any research board will do, in regard to how the funds should be used, what amounts should be asked for, what most important research should be given preference, what research is of such a nature that it cannot be delayed any longer, what branches of agriculture should be given buildings and how things should be tackled.

I do not want to speak at length about what I would prefer not to call failures but will call disappointments in connection with the research we have already done in the past, but I just want to mention that in regard to stock farming—the Minister has also mentioned it—and I begin with sheep and leave the wool industry aside because it has its own organization which pays for research and which does so internationally as well as locally.

Now I want to ask the hon. the Minister with all respect whether he and his Department and agriculture in the country can be proud of the sort of cross-breeding which took place in our country to provide meat both for the internal consumer and for export purposes. We fumbled around so much in regard to the cross-breeding of sheep for purposes of slaughter that we no longer know where we are. The Minister’s Department is just as busy in that respect as the farmers are. And when I come to cattle, what is the position there? The individual cannot do research in regard to cattle. He cannot say whether the best breed of cattle to export as young beef or as mature beef is the Afrikander-Brahman or the Afrikander-Hereford or the Afrikander-Korthoring or the Afrikander-Charolaix, or the Afrikander-Limousine or any other type. He cannot afford to do this research because it is a process which lasts from ten to 15 years. There are companies in this which are doing research with bulls they had to import from abroad and which cost thousands of rands, and which have been engaged on large research projects for as long as ten years but which are not yet prepared to say which is the best beef one can breed for consumption in this country and for export purposes. And we should remember that if we continue with our cattle breeding as we should, and if we have schemes which are as they ought to be, and if we can put the weight under the skin of every animal which should be there before its throat is cut, it should be only a matter of time before we have a large surplus in so far as the cattle population is concerned.

I would use up all my time if I were to talk of the crime we are committing in our country by first cutting an animal’s throat, whether it is a breeding animal or not, and then wanting to use it, instead of having a scheme in terms of which through the Department and the various boards we would have a fodder scheme which would first bring the animal up to the right weight and the right quality before being slaughtered. If one did that, one would push up the average weight of the carcase by 100 to 150 lb. more than it is now, and the country would have more meat available and we would have more meat for export. I mention this to indicate how essential it is in regard to this particular research that assistance be given. When one has been engaged on this project for ten years, one can begin to expect results. I recently spoke to the managing director of the organization which has been engaged on this research for so many years and asked whether he was prepared to recommend what the best animal was for particular circumstances, in a particular climate, with a particular type of soil and a particular rainfall, and he replied: “No, we cannot say that at this stage yet; we know many things in that regard but we do not know what that animal would do in any particular circumstances with a series of droughts and a series of years with a heavy rainfall, and we are not yet prepared to disseminate that information.” It is for that reason that this matter is so important. Three or four days ago the hon. the Minister opened the splendid Fruit Research Institute at Stellenbosch, the type of institute of which we are all proud, and whether it be a wool research institute or a fruit research institute or a tobacco research institute or a stock-breeding research institute, agriculture is always proud of it and grateful for having it. We will always ask for more funds and the Minister must expect that. The farmers will always ask for more funds for research, because they are research conscious and have come to realize that if they do not farm correctly they cannot be successful. I want to make an urgent appeal to the Minister not to try to bear the responsibility alone in regard to the distribution of these funds for research. He must now pay heed to the pleas made by agriculture all these years and he must see to it that a research board for agriculture is established which can share that responsibility with him.

Business interrupted in accordance with Standing Order No. 30 (2) and debate adjourned.

The House proceeded to the consideration of private members’ business.

I move—

My motion postulates two circumstances. Firstly, it postulates that the information which now comes to Parliament in respect of certain state-sponsored corporate bodies, which are financed solely or substantially from public funds, is no longer adequate to keep the public reasonably informed about the affairs of these bodies of which they are in effect the shareholders. It is also no longer sufficient to enable Parliament to discharge effectively its prerogatives in the public interest in so far as these bodies are concerned which have been established by Acts of Parliament. Secondly, my motion postulates that the time is now opportune for Parliament to set up a Select Committee to examine and review the whole matter with a view (a) to remedying what is presently defective about the methods afforded to the public and to members of Parliament to get information, and (b) in devising more effective methods for ensuring better accountability to Parliament in respect of these public-owned bodies than presently prevails, both in law and in practice.

It is not necessary for me to go further at this stage. I do not think I am called upon to say either what the precise type of information is that will afford more effective accountability to Parliament, nor what the changes are that must be made in order to achieve that end in the public interest. Those are matters which the Select Committee would have to consider and they are of course matters which are best left to a Select Committee to probe and to settle.

Let me say at the outset, however, that the essential purpose of my motion is to strengthen the authority of Parliament in the public interest, not to lessen the responsibility of the public bodies concerned and not to lessen the obligation which rests on those persons who are charged by statute to direct and discharge the functions of those bodies. My motion aims to get enlightened insight into the carrying out of the functions of these public bodies, and thus to avoid misplaced inquisitiveness and to remove unfounded doubts about their activities. My motion aims, moreover, at providing an appropriate channel for informed disclosure and so to get rid of the possibility of irresponsible criticism. A similar type of enquiry into what is known as nationalized industries in the United Kingdom was carried out a few years ago and the then chairman of one of the largest of those public undertakings, the British Transport Commission, is reported to have said this in favour of having such a channel for informed disclosure—

I think those words indicate better than I could have put it myself why there is this great need for having a better channel of informed disclosure than exists to-day.

Secondly, I believe that for a number of reasons this is the appropriate time to consider the problem contained in my motion. I will have time only to deal with two of those reasons. In the first place I think it is clear to everyone in this House that the modern trend in public life is for Parliament to take more and more interest in and cognizance of how the general business affairs of the community are being conducted. That is a modern trend to which this House, in particular must have regard, because whether one thinks of it in terms of unnecessary interference, or whether one thinks of it in terms of necessary intervention by Parliament in private business, the fact is that the modern trend is towards greater supervision through the agency of Parliament over the business enterprises as a means of safeguarding the public interest generally.

Last Session there was legislation to tighten up supervision over the affairs of private financial institutions, and this Session again there is proposed legislation of that kind which is now under consideration by a Select Committee of this House. There are indications of more such legislation to come in the near future. I think the latest report of the Registrar of Financial Institutions foreshadows further legislation of that kind. So we cannot get away from the fact that the modern trend is towards greater supervision and more information being made available not only to the public but also to this House.

The second reason for saying that this is the appropriate time for making a change is that this House is now operating under modern and improved Rules of Procedure relating to public business. That is a change brought about by a review and a revision of the procedure of this House which was carried out during last session by a Select Committee appointed for that purpose. That, in itself, is an indication of the need for modernization and for improvement of the procedures in other directions which are indicated in the motion I have moved. What the House did last year in the direction of improving its procedure and its ability to deal with the affairs of the country should not simply rest where it is now. There is need for carrying on; therefore that is my suggestion, that there is need for a revision and an improvement of the procedure on the lines set out in my motion. Clearly there is need for reform whether that information has to come to Members of Parliament and to the public generally, either by way of question and answer in this House, or by way of the tabling of reports and statements, or by the scrutiny of accounts and statements by a Select Committee clothed with power to call for papers and to examine witnesses. For all those three reasons there is need at this stage for this improvement in terms of the motion I have moved. My hon. friend has indicated that on occasion one does not get replies to questions. I think that is true, and that in itself is an indication not that the questions are necessarily wrong but that the methods by which they are being dealt with might be improved in one way or another by Parliament re-examining its procedure in that direction. Certainly if it reexamined its procedure in other directions the need for probing questions would possibly fall away or become less necessary, because the essential purpose is to provide a better chanel for informed disclosure in regard to the affairs of these very important bodies than there is to-day.

Mr. Speaker, a motion of this kind must necessarily be framed in wide terms, but it is equally necessary of course to narrow the discussion down to workable limits and practicable proportions. It is just not feasible to bring into the debate every corporate body covered by the terms of my motion. Here again, the broader approach to the problem is one which the Select Committee itself should undertake. Accordingly I will confine my argument to those corporate bodies which can be classified as coming under public ownership and for which the Minister of Economic Affairs is the responsible Minister for giving the directives and for being answerable to this House. I am sorry that the Minister of Economic Affairs is not here himself, but I see that his Deputy is here. In that regard I have in mind the S.A. Iron and Steel Corporation, which was set up by Act 11 of 1928, and the Industrial Development Corporation set up by Act 22 of 1940 and its subsidiary undertakings, Sasol, Foscor and Fine Wool Products, and the Klipfontein Organic Products Corporation set up under Act 40 of 1950, and the Fisheries Development Corporation set up under Act 44 of 1944. I also include in this category the S.A. Broadcasting Corporation, which was set up under Act 22 of 1936. That body, to my mind, is as much a public-owned business and utility undertaking as all the others I have mentioned. My own belief is that the S.A.B.C. should, in the order of things, be under the control of the Minister of Economic Affairs rather than the Minister of Posts and Telegraphs. I think it is much more appropriate to that form of direction than is the case at present. That is why I specifically bring it into the category for purposes of argument. But as I have indicated, the list I have given is not exhaustive. It serves merely to illustrate both the extent and the variety of the problem with which we are confronted in this House.

In all these cases I have mentioned, the reports of statements of account are tabled session after session. Sir those reports grow glossier and become more decorative every year, as the one I have in my hand now illustrates. But the figure side of the reports also continue to grow greater year by year, yet the information contained in these reports remains the minimal, and stereotyped. I think it is also fair to say that the usefulness of the information is composed like that of a bikini by what it conceals and not by what it reveals. I think it is fair to say that the accuracy of the information contained in the reports is not in doubt, but the fact is that the information given does no more than to half-reveal the truth within it. Moreover, in all these cases I have mentioned the general desire for information both inside and outside this House goes on increasing. That is so largely because of the vast amount of public funds which are involved in the conduct of the affairs of these public undertakings, whether that vast amount of public funds takes the form of capital or of income and expenditure. But the figures, as I have indicated, in all these reports grow year by year, and the public interest in the amount of money involved grows equally. I have stressed that there should be accountability to Parliament, in my motion, but accountability to Parliament inevitably extends beyond the narrow confines of rands and cents appearing in each set of financial returns. What justifies the use of the extended use of public funds in any particular case, and whether or not the purpose of the outlay is being achieved, are all matters which are germane to the responsibility of Parliament as the ultimate guardian of the public purse.

Changes are taking place in a different direction as well. The relative importance of these public-owned corporate bodies has been changing over the years. Whereas formerly they had quite a moderate influence on the economy of the country, there is a considerable change in that respect. These State-sponsored undertakings are now assuming a very important place in the country’s economy. As those changes are occurring, so of course does Parliament’s interest in the conduct of the affairs of these bodies become correspondingly enhanced, and so also does the need for improved and more up-to-date methods by which this House can be kept better informed of the affairs of these public undertakings become increased, and it also becomes more important from the point of view of the public. These changes in importance to the country as regards the economic roles that these undertakings are playing is emphasized, particularly in the case of the Industrial Development Corporation. In fact, the ramifications of the I.D.C.’s role in our economy is growing at an amazing pace and it is developing into a sort of conduit pipe for the channelling of public money into a strangely variated assortment of business undertakings. In fact, whenever one talks about the I.D.C. to-day it is very much like quoting from “Through the Looking-Glass.” One is almost obliged to say, like the Walrus—

But that is indicative of the vast influence which one of these bodies in particular, the I.D.C., is having on the economy of the country to-day. But I shall leave the specifical for other speakers to deal with, and I shall return to the subject in broad outline.

Hon. members will remember that in 1962 the Government announced a high capital expenditure scheme in which most of the undertakings I have mentioned are to participate. This scheme is being launched as a matter of Government policy, and it is to involve a capital outlay of something of the order of R2,000,000,000 over the next few years. It is obvious that with a project of that type in view, all these bodies will put on considerable flesh and muscle in the process, and therefore the need for the disclosure unrevealed becomes more emphasized. More information will be needed than is presently revealed. Therefore it also stands to reason that as the importance of the role of these undertakings in the general economy of the country grows, so must Parliament’s over-all supervision over the conduct of the affairs of these public undertakings become a matter of greater importance in the public interest. As the status of these public bodies increases in business circles, so too must the necessity for Parliament being able to fulfil its function as the final arbiter on all matters of public administration become correspondingly greater.

But there is another side to the problem in so far as parliamentary supervision over these bodies is concerned. The ramifications of the changes I have outlined go even further in actual practice. It is quite evident that the inter-relationship between these State-sponsored enterprises, on the one hand, and private enterprise, on the other hand, is becoming progressively more complicated. Let me take Iscor as an example to demonstrate my point. Iscor as a State-sponsored industry is in this unique position, that it is both competitive in some directions and co-operative in other directions, with private steel-making or steel-using enterprise. The position that it occupies enables Iscor to foster private enterprise, but the coin which is being used is two-sided and the competitive aspect of the State-sponsored industry can of course have the effect of stagnating private enterprise. That in itself is a circumstance which in my view compels Parliament to hold a watching brief and to keep itself constantly abreast of the developments which are taking place in these public-owned undertakings such as Iscor. I mentioned Iscor merely as an example to make my point. But the importance of Parliament being placed in a position in which it can keep up to date in respect of both the competitive and the co-operative aspects of this complicated relationship between public-owned and private-owned enterprise cannot be over-stated, in my opinion. But Parliament itself can only do so, firstly, if there is proper and effective accountability to it by these bodies concerned, and secondly, if Parliament provides itself with a means of being kept informed of how these bodies are carrying out their responsibilities.

I should just like to re-emphasize that the essential purpose of the motion which I have moved is to strengthen the authority of Parliament and not to lessen the responsibility of those persons who are charged with carrying out the functions assigned to these bodies. I have indicated that the aim is to aid Parliament, and thus to aid these bodies themselves and to ensure that there is not merely inquisitiveness on the part of Members of Parliament or the public, but that there is available to them a source from which there can be informed disclosure on the part of those persons who are concerned with the administration of those bodies. Therefore I move.

I should like to say, Mr. Speaker, that I consider it a privilege to participate in this debate at this stage. I have listened attentively to the speech of the hon. member for Port Elizabeth (South) (Mr. Plewman), and I appreciate some of the submissions he made here. I shall reply to those in the course of my speech. I shall not try to reply seriatim to the points he has made. He spoke in general terms to a fairly large extent, and for that reason I shall be able to reply more effectively to him during the course of my speech. However, I do think I can say I appreciate the manner in which he debated the matter. He did so on a strictly non-party political basis. I propose to follow him in that approach. We can really only make a success of this very interesting debate on that basis, because in my view it is a particularly interesting subject. It really is a subject on which we as political parties do not differ very widely, nor did we differ very widely on it in the past. I have paged through the old Hansards, and I saw there that when that side of the House constituted the Government, and this side was in the Opposition, members of the Opposition at that time raised much the same arguments here about parliamentary control of these semi-autonomous State-aided corporations.

I can also tell the hon. member that in my opinion he rendered the House a favour by moving this resolution. This House of which we are members has attained a special position through the ages. It attained it in Britain and in this country too. The old Cape Parliament specifically fought for that right. It has attained that special position because it controls the treasury of the country; because it is the bearer of the public purse. That is one of the special privileges of this House which it has jealously guarded through the years, and it has been consistent in its refusal to permit any interference with that right. Therein lies its power, and therein lies its triumph against the King in Britain, and therein also lies its power in the last resort as against the executive authority at the present time, which is the Cabinet under our system. Therein also lies its power as against the Other House of Parliament. Because that is so, I think it is proper that this House should see from time to time what the position is relative to this most important prerogative it possesses, namely to control the finances of the country; to see whether a red light is not going up somewhere; whether some process has not been set in motion which may ultimately result in its being deprived eventually of this special privilege and power. That is why I have said I think it is really a service the hon. member has rendered the House by raising this matter here to-day, so that we may discuss it in this atmosphere.

Of course as the hon. member has rightly said, it is a problem that is not peculiar to us alone. The emergence of public corporations is a feature, particularly during the last two decades, in other countries of the world also. It just came to pass that after thorough inquiry and consideration it was resolved that certain functions of the State should be performed by this type of corporation. As the hon. member has stated, in Great Britain one finds they have used this form of institution to exploit their coal; to generate and distribute their electricity and gas, to organize their transport; to organize their overseas air transport, and to regulate their broadcasting activities in this way; and they have just the same problem we have here, namely, how to retain and maintain parliamentary control over these undertakings. They have also, as we have done too, for years sought the proper solution and time and again they also, as we have done, have again come back and found that the present order is best when all is said and done.

For the purposes of my discussion I wish to classify these semi-autonomous State-aided corporations into two classes. The one class are those I wish to refer to as the public key service corporations, such as the S.A.B.C. and Escom, and then secondly there are those I shall refer to as those operating in a key industry sphere, such as Iscor and Sasol and some of the others. When the State has to proceed to establish these corporations—and I am dealing with this point because I think it really has an effect upon one’s final approach to the request of the hon. member—when any State has to decide how it is going to organize a particular service or undertaking, there are three courses open to it, as hon. members know: It can leave the whole field open to private enterprise. It can do that. It is possible that private enterprise will be able to make a success of the task entrusted to it by the State. It may even be probable that private enterprise will make a success of it, but then you are confronted with this cardinal problem, namely, how are you going to ensure the say of the State in that field of undertaking, that field of enterprise entrusted by you to private enterprise, for the services that are being rendered are key services, and it is an operation in a key industrial sphere. These things are on the fringe of your national State existence, or inside it: it is not a case such as that of say the O.K. Bazaars group in this country, which may rise and become insolvent and disappear without affecting the State. These are things on the perimeter of the life of the State, and during times of crisis they are right within that national life, and if those things go wrong, the entire body politic will be upset. That is why it is completely inconceivable that the State should entrust those fields of operations to private enterprise without ensuring that it has the necessary say. The other day we passed a Bill on the Rand Water Board here, where the State finally came along and with the cooperation of all concerned passed an Act whe eby it finally obtained full and sole control over that essential service of water supply in that great area. That is the reason why no State has up to the present time left this service to private enterprise.

The State may then adopt a second course of action. It could say: Very well, I shall entrust it to a Department of State of full status. That has been done already in some countries in respect of certain services and undertakings. The obvious disadvantage of this is that then you are really placing that service or undertaking right in the political arena; it cannot be otherwise, for that will be the effect of it. That is a great disadvantage and actually it is such a great disadvantage that it is a fairly decisive argument in the matter. Furthermore I think it is generally accepted that the machinery of the Public Service is not geared to running and managing a competitive commercial undertaking. All over the world people have come to the conclusion that an expert authority, a separate statutory expert authority, clothed with the requisite powers, whose members shall be people with the requisite expert and financial knowledge, who will be able to gather around them and recruit people with the necessary expert knowledge, which is not bound by the restrictions of the Public Service Act etc., is the best body to render these key services and to develop these key industries. I think we can agree on these two points thus far: Firstly, that it is indispensable that these services should be rendered and secondly, that it should be rendered by a public corporation and that in this regard we have gone in the right direction in this country. The hon. member for Port Elizabeth (South) (Mr. Plewman) referred to the Radio Act of 1936. If he were to refer to the speech of Minister Clarkson made at the time, he will see that the Minister came to the conclusion that that was the only manner in which the radio could be dealt with in South Africa. That is the way also in which Great Britain has been doing it to this very day.

The question that has arisen to-day, and which arose in this country in the past also, is what form of parliamentary control we should retain; is the present control adequate? If it is not adequate, what control should there be, for the State usually is the sole shareholder in these corporations; the State usually provides the initial capital and under various laws of this country, the State guarantees any loans these corporations may float, and it guarantees the repayment of the capital and the interest on it. Now what form should the control take then? When all is said and done, it is State money and public money. In fact there is really no particular history of solutions. I have referred to the Hansard reports and have found that since 1950 these matters have been discussed frequently in this House already. Here sits the hon. member for Kensington (Mr. Moore). He has often referred to it. Throughout all the years hon. members have referred to this matter in this vein, namely they have complained that there is not sufficient time for discussion: that insufficient information is available; but they have never used the information they actually obtained. Nor have they ever come forward with a substantive motion. The hon. member for Port Elizabeth (South) will forgive me if I say that he has not come forward with anything concrete here this morning. [Interjection.] He wants a Select Committee to investigate the matter. But we and the Opposition have already been considering this matter for the past 20 years. Could the hon. member not have come forward with something positive here this morning? The only proposals made in the past, so far as I was able to determine, were the following. At one time there was a proposal on the part of a member of the Opposition, who is no longer in the House, that a Select Committee of Parliament should be specially constituted, a Select Committee on Utility Corporations, and then last year there was another proposal by the hon. member for Kensington. I should like first of all to deal with the proposal of the hon. member for Kensington, for it seems to me he is going to participate in this debate. Last year the hon. member said this: “What can I propose this evening?” after he had complained that there is insufficient opportunity to discuss the matter. He said this—

The hon. member thought so much of that story that he came here and conveyed it to this House. He says further—

The hon. member associated himself with it to the extent that he conveyed it to this House, and he associated himself to this extent with that view that he says it is a direction in which we could think—a good direction—but at this stage he is not prepared to go so far, but he envisages that we should go so far; that we should hand over to private enterprise these utility companies, these key service organizations. The hon. member goes further and says—

He then proceeds to say what we have already done and then he says this—

I am reading this merely to show you that the hon. member for Kensington in my view has suggested his preliminary plan. He virtually said that these things remind him of Socialism; he tried to bring it into discredit and then said: Come, let us transfer it to private enterprise. I should like to say to the hon. member that if that is the direction in which his mind is working, then he will most certainly be opposed very strongly by us.

Next there is the other solution which has been suggested in the past, and that is that we should have a Select Committee of Parliament on this matter. Now I should like to ask the hon. member this question: If now we were to have such a Select Committee of Parliament, and the Chairmen and Directors of these organizations have to be cross-examined before this Select Committee and account for their actions to it, which men will permit that?

Why not?

Hon. members need only think of Dr. van der Byl for example to realize how ludicrous such a suggestion is. Will one of these hon. members tell me that Dr. van der Byl would subject himself to coming to Cape Town to appear before a Select Committee so that every member serving on that Committee can cross-examine him? No, if we had adopted that course, I ask the Opposition: Where would Iscor have been to-day if that had been our policy? I go further and I ask the Opposition also: What business in Pretoria can manage its affairs there with one eye on the exclusive interests of its business, but its other eye on Parliament in the Cape; where they continually have to ask themselves what the Select Committee will say if they take this or that decision?

There is nothing wrong with that.

You cannot run a modem competitive business in that way.

What about the Railways?

The corporations discussed here to-day are highly competitive organizations—some of them in the steel industry and the petrol and oil industries. Those industries are competing in this country with people who are backed by a mass of experience and knowledge; they are also competing with overseas countries. They have to keep their business competitive and run it successfully, and they now have to come and lay their cards upon the table before a Select Committee, and explain to the Select Committee why such a project has been a failure, what their policy is in this regard and what their policy is in that regard. They have to submit particulars to the Select Committee.

Business suspended at 12.45 p.m. and resumed at 2.20 p.m.

Afternoon Sitting

When business was suspended I was putting to the House what the consequences would be if we were to proceed to appoint a Select Committee of Parliament to examine the affairs of these public corporations. I think we have to account fully to ourselves on this matter: whether we wish Parliament to concern itself with the particulars of the administration of those bodies; whether we wish Parliament to express itself on why a power line has been erected in this part of the country and not in that part; why the Industrial Development Corporation is investing its money in these undertakings and not in those undertakings; why Iscor for instance should have a particular price policy and why its price policy has failed? If we do not want that, then we should make up our minds very clearly as to what we really want if we do not wish to inquire into the particulars of the administration of these bodies; we should ask ourselves whether we wish to go further than to discuss the general policy and the general principles and the broad financial control. If the Opposition have in mind something of that nature, then they are advocating something that will drag those bodies into the political arena. It is the task of an Opposition to criticize, and in a Select Committee it will be the task of the members of the Opposition serving on that Select Committee to try to find fault, to try to dig up what is wrong; to be a true watch-dog, for that is what it has to be. It will be the task of the Government members on that Select Committee to present the matter in a favourable light as far as possible, and to protect the Government, and then these corporations are immediately thrown into the political arena.

In this connection I should just like to put this last question: Once we have decided in this Parliament that a certain task should be performed and that it should be performed by a public corporation, is it our wish that having made this decision, and having passed an Act of Parliament to establish that machinery; after we have procured picked men to be in charge of that organization; after this Parliament has said to them: “Here is a task we want you to perform; we have confidence in you; carry out this task; we are giving you a free hand” must we then still go along and say: “No, we do not have sufficient confidence in you; we are not giving you a free hand; we want to remain the watch-dog on your acts and omissions”?

I should like to ask very briefly then: What control do we have at the present time? The Opposition is not satisfied with the control we have. I say the control we have is good. I do not wish to dilate upon that, but I should like to remind hon. members that the hon. the Minister has the right to appoint the directors of those organizations. Mr. Speaker, if I had the right to appoint the directors of Anglo American I know who will very soon be the boss of Anglo American. Is it not complete control? The Minister can appoint all the experts. He has an unlimited choice. According to the Acts I have looked at, there are only three kinds of people he may not nominate to those boards, and they are criminals and insane persons and Members of the House of Assembly. Do hon. members now really want to tell me that considering all those reports we have had during the past few years from Iscor and the N.D.C., considering all those tables, tables extending over ten years and dealing with various aspects of their work, they cannot discuss the general policy of those corporations in this House; that they are unable, on the basis of those reports, to discuss the broad financial implications and tenor of those corporations; that they are unable to discuss it on the basis of the balance sheets over a period of years?

That is not the purport of the motion.

It is my contention that the hon. members are not advocating parliamentary control, because there is parliamentary control; they are advocating control by the Opposition. Let us be practical. The nose of the business world in South Africa is very keen, and there is nothing going on in these corporations which they would not like to know, and which hon. members could then raise here in this Parliament. They will remember the debates on bags we had here some years ago under the I.D.C. What lengthy discussions the Opposition had on that. Nothing will go wrong but that hon. members will know about it and it will come to light here, and in the long run it will be the responsible Minister who will be held responsible. I say we do have parliamentary control in as much as Parliament still remains the boss of these corporations through the control it exercises over the Minister, and if anything goes wrong I say here—and the Opposition will agree with me—the Minister will be called to account, and on the basis of the principle of joint Cabinet responsibility, the Cabinet and the Government will be called to account. So we do have adequate control.

I conclude where I started by saying that this Parliament has to keep a watchful eye but this Parliament may be satisfied that it still remains the boss of these corporations and there are still sufficient opportunities for discussing the affairs of these corporations. If the Opposition feels that there is not sufficient time for that, let them ask for more time; let them ask that every Tuesday during the first month of the Session an hour or two be set aside for discussion of these matters, of delegated powers and authorities of which we have a number. Let them then ask for more time, but I say this Parliament still has sufficient opportunities for discussing these matters and it still has adequate control, and the money of the taxpayer is still safe under the present set up.

This debate has got off to a very good start.

Do not spoil it now.

We have a motion introduced by the hon. member for Port Elizabeth (South) (Mr. Plewman), and from his rich background of experience and his care for the dignity of Parliament, he was able to give us a splendid statement on his own motion. I think it is a very fine motion. And then the hon. member for Queenstown (Mr. Loots) made what I regard as an excellent speech. I preferred his introduction to his peroration, but apart from that he made a most excellent speech because he understood the subject. He understands what we are discussing. I have raised this question in the House for 13 years, and my difficulty has been that whenever the subject has been introduced—and the only opportunity, of course, is on the Minister’s Vote or in a Budget debate—my arguments have been brushed aside and never debated; there has been no discussion. But to-day we have had a discussion. The hon. member for Queenstown has put forward his point of view. As he said at the beginning of his speech this discussion is non-political. If ever there was a non-political discussion in this House it is this one, because we are not concerned with any special interpretation of our attitude towards these corporations. What we are concerned with is the privileges, the rights and the responsibilities of Parliament. We are discussing them and we together here to-day are trying to devise a method by which we can assert those rights and accept our responsibilities.

I should like to return to the hon. member for Queenstown. I agree with his classification of the utility corporations. He takes Escom as being in a different category, for example, from the S.A.B.C. Perhaps you can put them in the same category. He tried to classify them. I think that is necessary. They are not all of the same kind. I do not think the Industrial Development Corporation or the Bantu Development Corporation or the Coloured Development Corporation can be placed in the same category as Iscor or Escom. We regard Iscor and Escom as different. I regard Escom as different from the others. But I leave it at that. But the rest are in a different category. They are companies of the same class as the Industrial Development Corporation. There is no desire on the part of any member in this House to nationalize industry. We are all declared in favour of private enterprise. I think that is the declared policy of the Government and it is the declared policy of the Opposition.

At the close of his speech the hon. member came to the main problem: What is his proposal? I must do justice to the mover of this motion. He does not say that he has a solution. I have suggested a solution in the past, but the mover does not say he has a solution. What he says is that there should be a select committee to give a solution to this House, which is something quite different. I have advanced a solution, a solution which was very well quoted by the hon. member for Queenstown. I want to thank him for quoting my own speech to me. I have never had that experience before. It sounded very well, by the way! The mover of the motion says that the present investigation is no longer adequate. And of course the greater these corporations become the less adequate the present arrangement is. It is a responsibility upon the Minister which, I am sure, be finds embarrassing at times. I did not suggest that the I.D.C. should sell its assets. I did not suggest that. I said it had been suggested; but I should like to point out that the Act makes provision for that. The purpose of the Industrial Development Corporation Act is given to us in Section 3 (a). Section 3 (a) says that the Industrial Development Corporation will enter into Government-owned industries, for example, Sasol. Section 3 (b) says that it will assist smaller industries by loans, by debentures and perhaps by taking shares. When they have developed sufficiently those shares would then go back to the private shareholders. That was the original idea. So there is provision for it. When an industrial leader—and I quoted an industrial leader in my speech on the Budget last year—says that the assets should be disposed of I think he is wrong. I would not say all the assets should be disposed of; they cannot be disposed of, because you cannot dispose of the loans that have been floated by the I.D.C.

The next point the hon. member made was this: Surely this House cannot, through a select committee, ask Dr. van Eck to appear before a select committee? I say: Why not? The hon. the Prime Minister appears before a committee of this House for about two days at times. Every Minister in this House appears before a committee of this House—a committee of the whole House, not a select committee. Talking about financiers and industrialists, Mr. Harry Oppenheimer, the head of the biggest corporation in this country, meets his shareholders every year, and more than one group of shareholders. They ask him questions. [Interjections.] No, I have not missed the point. I am speaking of the responsibility of the company directors to their shareholders as laid down in the law. Mr. Harry Oppenheimer is the chairman of a company and he has to appear before his shareholders, but the chairman of the South African Broadcasting Corporation never appears before anybody. That is the difference. This is the principle of responsibility of directors to their shareholders. The same principle holds good here in Parliament. Ministers are responsible, through our select committee on Public Accounts, to give account of expenditure during the year. There is nothing remarkable in saying that any person should appear. I agree that when they do appear the nature of the information they give will not be in the nature of the information the hon. member for Queenstown has in mind. What they will give is a general description of their policy. They will answer ordinary questions which arise from their annual reports. What do we do when we get the annual reports? Whom do we ask? If we ask the hon. Minister of Economic Affairs he shrugs his shoulders and says it is an autonomous company; that all he does is to appoint the directors. It was suggested in Britain, Mr. Speaker, by a very important financial expert, the late Mr. Gaitskell, when this same problem was discussed in the British House of Commons, that the Minister should account for the actual directors he had appointed. Well, we do not want to do that. We do not want to say: Why have you appointed Smith and not Coetzee? What kind of a man is this Smith? We do not want to do that; that kind of investigation is impossible. But that is the only alternative the hon. member for Queenstown has in mind. I will say this, the suggestion given by the hon. member for Queenstown is the suggestion given by another Socialist in Britain, Mr. Herbert Morrison. Mr. Herbert Morrison said the directors of the nationalized industries should be left alone. Well, what about the head of the South African Railways? He does not appear for a day or two days. As you know, Mr. Speaker, there is a select committee, of which you have knowledge, in which he gives account to this House because it is a nationalized industry. They have to report; they are responsible. What we are asking here is that something of the same kind should be done. What should the duties of such a select committee be? I do not know what the hon. member for Port Elizabeth (South) (Mr. Plewman) has in mind. All he says at present is: Let us come together and try to devise something. Well, I have heard the story of the bags; questions were asked about the bags in this House for many years. And what happened eventually? We found that the bags were destroyed in a fire and that solved the whole problem.

My share in this discussion dates back many years. In 1940 we had the Industrial Development Corporation formed. Four years later, when the company had hardly got on its feet and when the party opposite were in Opposition, this question was raised first by Mr. Erasmus and then, much more eloquently, by Dr. Eric Louw, who was the chief speaker on economic affairs of the Opposition. Dr. Eric Louw and Mr. Erasmus raised the same question that I am raising to-day: How are these corporations to become responsible to Parliament?

That shows you the Government is always right.

That was at the beginning. I raised the matter with the hon. the Minister of Finance in those days. I raised it when I first came to Parliament in 1951. I raised it with Mr. Havenga. I think one should have in mind Mr. Havenga’s attitude. We had had a discussion and he said—

And you have to find the money.

If we have to accede to the demands that have come forward this afternoon, we shall have to have legislation. I know that as a result of greater burdens which the State has to bear in regard to the financing of these corporations it is reasonable that Parliament should demand the right to have some control but that control, I submit, should be over broad questions of policy. I know my hon. friend was worried by certain developments, and he has promised the House that he is going to take a greater interest in the running of these corporations.

His “hon. friend” was Dr. Louw, the Minister of Economic Affairs—

That was done in the past.

I sympathize with him. If this is going to mean that he is going to run these undertakings, I submit, that it will not be in the interest of the country.

What are you quoting from?

Mr. MOORE: This was written by a research team specially appointed on “Accountability to Parliament”. The Acton Society Trust in England—

I should also like to express my appreciation for the objective approach revealed to-day by all the speakers thus far in the discussion of this very important measure. I want to agree that the role played by these corporations in the economic development of our country is a very important one. We cannot and dare not allow them to develop in the wrong direction. There may be much difference of opinion in regard to the motion of the hon. member for Port Elizabeth (South) (Mr. Plewman), but we dare not differ from one another in respect of one aspect of that motion, and that where we are dealing with the money of the taxpayer the greatest measure of responsibility should be displayed in order that that money should be wisely spent, and opportunities must be created to hold the persons concerned responsible.

The debate we have had here to-day is of course nothing new to us. The hon. member for Kensington (Mr. Moore) has already pointed out that this matter has been discussed on various previous occasions. The hon. member for Port Elizabeth (South), as far as I can remember, has also raised it on various previous occasions in this House. What we find ironical, something to which the hon. member for Kensington referred, is that a certain member of the Government, when he was still in opposition, expressed himself very strongly in regard to the parliamentary control of these utility corporations. It is ironical that after that hon. member became a member of the Government he evidently became so convinced that matters were in order that he never again referred to it during his career as a Minister. The hon. members for Port Elizabeth (South) and Kensington have never yet had the privilege of being members of the Government. I want to express the hope that if perhap sone day they are members of the governing party they will hold other views.

When we analyse the motion of the hon. member for Port Elizabeth (South), we see that it sets out from the supposition that the present means available to Members of Parliament for gaining information with regard to these industrial and business undertakings no longer adequately meet the requirements of Parliament or of the public. I can of course say much about this, but I do think that an analysis of the way in which information is made available to the public and also to members of this House can be of great assistance to us in this respect.

I want to take as an example the Industrial Development Corporation. In terms of Section 19 of the Industrial Development Corporation Act, it is provided that after a meeting of shareholders copies of the balance sheet and the profit and loss account must be sent to the Minister. I just want to point out that this is a proper balance sheet and a proper profit and loss account which is drawn up and certified by auditors appointed in terms of Section 17 of that Act. The Act also provides that two persons should be appointed as auditors, one by the Minister, and the other by the shareholders. Further, the report of the director and also of the Chairman’s speech (if there is one) are immediately sent to the Minister. I have studied the report of the I.D.C. for this year and I am compelled to Say that to me it gives a clear picture of the activities of the corporation and that it gives sufficient data in regard to the operations of the corporation for a critical analysis to be made. Here I differ from the hon. member for Port Elizabeth (South). In any case, it gives a very true reflection of the activities of the corporation. The Minister is therefore kept au fait with the activities of the corporation and by virtue of his office, having appointed certain members of the board and some of the auditors, he must bear full responsibility for the actions of such corporation. Indirectly, therefore, as has already been said by the hon. member for Queenstown, the Government is also responsible here. During the parliamentary session there is every opportunity for discussing these matters under the vote of the Minister concerned. It is interesting to know that the select committee on Public Accounts also devoted attention to this matter and that there is a great difference of opinion between that select committee and the Treasury as far as this matter is concerned. I have here extracts from the conclusions of the select committee on public accounts and the Treasury’s replies thereto. In the Fifth Report of the select committee on Public Accounts of 1926, which dealt with the Electricity Commission. According to Resolution No. 17—I do not want to read it—the select committee decided that it was necessary for the accounts of the Electricity Commission to be audited by the Controller and Auditor-General. I just want to read the Treasury’s reply to that—

I also have the resolution here of the select committee on Public Accounts in regard to the auditing of the accounts of the Iron and Steel Industrial Corporation. In that resolution they also request that the books should be scrutinized by the Controller and Auditor-General, to which the reply of the Treasury was as follows—

Then they also quote from the Act what I quoted in connection with the reports to be submitted, and they then conclude as follows—

As I have said, here also there is a difference of opinion between the Treasury and the Select Committee on Public Accounts. But it is also interesting to note what the attitude and standpoint was of a former Minister of Finance, Mr. Havenga, whom the hon. member for Kensington quoted here so conveniently to prove his standpoint. I just want to point out to him that he did not quote the whole speech. He did not quote a certain portion of Mr. Havenga’s speech. I want to refer him to that speech. In Columns 1699 and 1700 (Afrikaans), he will find these words of Mr. Havenga. What the hon, member for Kensington quoted before was correct, but this part of the speech he did not quote. Mr. Havenga said—

That was really Mr. Havenga’s standpoint.

That then brings me to the second part of the motion, that a select committee be appointed to investigate and to tell us how parliamentary control can be increased. As I have already said, this matter has already repeatedly been discussed here since 1944, also by the hon. member for Kensington in 1955, as well as by the hon. member for Port Elizabeth (South). Now they come to-day with the vague suggestion that a select committee should be appointed. Unless they suggest in what respects the select committee is to investigate, I do not really know whether we will get very far with the select committee. It seems to me rather as if they seek to relieve themselves of that responsibility. I feel very strongly that the confidence on the part of the taxpayers that public funds are spent with great care and caution should be strengthened. These people should have the opportunity to convince themselves of that. There I agree with the hon. member for Kensington. But I want to allege that in our legislation to-day sufficient provision is made for such opportunities. To increase the existing opportunities may perhaps amount to the State interfering in the actions of a body which is a corporate body controlling a highly specialized business and being run on a commercial basis. State interference can only lead to doubt or lack of confidence and it may possibly lead to the stultification of the whole object of the corporation. Therefore we prefer that the State should evince a lively interest in our corporations, that it should have an interest in them, but that the field should be left open for the imagination and initiative of those people who were placed in control of those bodies by the State itself. At the moment there is not sufficient reason to depart from the customary practice which has been followed since the establishment of Iscor, and I think that in the meantime we should be content with what we have to-day.

I want to thank the hon. members for Welkom (Mr. H. J. van Wyk) and Queenstown (Mr. Loots) for their contributions to this debate. Their contributions have made my task so much easier. I want to confine myself this afternoon chiefly to what was said by the mover of the motion and also refer to a few remarks made by the hon. member for Kensington (Mr. Moore).

These two hon. members have both spoken on this matter previously, but each year we have what is virtually a repetition of what has been said previously. Hardly any new arguments have been raised in the debate here this afternoon. I expected to hear something new, but I was disappointed. The hon. member for Port Elizabeth (South) (Mr. Plewman) asked for a select committee to investigate the question of improved control over these corporations. It is true that Parliament has certain important functions to perform and it performs these functions because a considerable amount of State funds is invested in these corporations. The taxpayers’ money is invested in the Industrial Development Corporation and in other corporations but State money is also invested for example in Escom in the form of shares. Let me say immediately that all the money used by Escom is in the form of share capital. There are no outstanding State loans and all the capital therefore has been underwritten by the public sector. But even this fact does not relieve Parliament of its obligation. Members of Parliament act as representatives of the public. They are practically the shareholders. That is why a certain duty rests upon them and that is why they are also treated as shareholders of a company. The hon. member for Welkom has told us quite clearly what the duties of the Minister are—that he tables documents; that he has to table the balance sheet and the profit and loss account and reports. Copies of these reports are given to every member. They have the opportunity to ask questions. They have the opportunity under the Vote of the Minister or even in the Budget debate or during no-confidence debates to deal with any matter in this connection. There is the fullest opportunity therefore to discuss these matters. I was asked why Dr. van Eck could not appear here. Well, in 1940 the Act was passed by Parliament, but now the hon. member for Kensington says that he should have liked Dr. van Eck to have been here so that he could ask Dr. van Eck what has happened in regard to the take-over bid by the I.D.C. of Cuthberts. But the hon. member put that same question to the Minister in 1961. I have here a copy of his speech as reported in Hansard and I find that he had this to say—

So he did put the question to the Minister. The hon. member made use of his right to ask questions. He held the Minister responsible for that action.

What was the reply?

He gave the reply. But the hon. member wants to put that question to Dr. van Eck. I want to tell the House what Dr. van Eck’s reply was. The hon. member himself quoted it from the annual report—

It is well known that the footwear industry was not in a very sound position in 1959-60 and this was an attempt at rationalization. But let us look at the 1940 Act which was passed by the United Party. What were the powers that they gave to the I.D.C.? In the statutes of the I.D.C. we read the following (translation)—

It is clear therefore that circumstances did exist at the time from which it was apparent that better organization and more rationalization was needed in the footwear industry and it was within the powers of the I.D.C. to make that offer. The hon. member was given that information officially; he quoted it himself and the hon. member did ask the question that he wanted to put to Dr. van Eck in this House.

That will not help you; you will have to do better than that.

The hon. member for Port Elizabeth (South) asked for a select committee. He asked that a select committee of inquiry be appointed to make certain recommendations. He felt that there was not sufficient control. One at least expected the hon. member to justify his request for a select committee. One expected him to mention facts to justify that request. But what happened? As one of the shareholders, he is entitled to make suggestions but one at least expected him as a responsible shareholder to tell us what was wrong and to put forward suggestions to rectify the position. But what did the hon. member do? He simply shrugged his shoulders and said quite innocently that he did not want to tell us either what further information should be given to the House or how the procedure should be changed. This motion suggests that there is something wrong and that it must be rectified. But the hon. member did not mention one single fact to prove his contention. What were the arguments that he advanced? He quoted in the first place from the report of the commission of inquiry into the nationalization of industries in Britain.

There was an investigation.

I know there was an investigation but the hon. member only quoted one small portion of the report. He says that the chairmen of one of these institutions said that they should have liked to have had the opportunity to remove the misconceptions that there were. When the report was framed in Britain in 1950 a start had just been made with the implementation of the policy of nationalization after the war and after the Labour Party had come into power. It was a political struggle.

In 1952.

Very well, in 1952; it makes no difference. The question of nationalization was the burning issue in the political struggle at that time. Elections were won and lost on that issue. There was a sharp difference of political opinion and they wanted to make use of the opportunity to put their point of view in that regard. But the important point which the hon. member omitted to mention was that each one of the chairmen of those organizations stated before that commission that he deprecated the fact that there was interference in their administrative and domestic affairs. They did not want that. Surely the hon. member also knows that the finding of that commission was—that they did not advocate it.

You are not stating the position correctly.

As far as we are concerned no chairman of any industrial corporation can say that there are misconceptions or that he wants to give evidence in order to remove any misconceptions about his actions. If there is anything which has to be rectified, it will be done here by the Minister concerned.

What is the second reason which is given for the inquiry? It is the tendency towards modernization and more supervision. He referred here in the first place to financial institutions. It is true that certain steps have been taken to place financial institutions under stricter control. They have trust funds that have to be invested and there were good reasons for the steps that were taken. Recent events have justified the taking of those steps. But there is no justification for taking those steps as far as the I.D.C. or any one of the other corporations is concerned.

The hon. member then refers to the parliamentary rules which have been improved and modernized. I do not know what the question of the parliamentary rules has to do with his motion. The hon. member says that he feels that this is a further reason why the select committee should have the power to take evidence and call for papers. Does that mean that every document can be called for? Does it mean that any document or any contract that is involved, or any money that has been spent, must be discussed by this committee and that the committee has to report upon it? It would take days and days to achieve that and it would only have a restrictive and hampering effect upon the activities of these undertakings. Must they appear before this select committee before they undertake anything, or must they come along later on and make their reports? A further point which has been mentioned is that a minimum amount of information is available in connection with the I.D.C. The fact remains that members of Parliament, as shareholders in the State corporations, receive more information in this regard than any shareholder in South Africa receives from his company directors.

Nonsense!

There are legal obligations imposed upon them and they receive more information and have more opportunity of discussing matters than is the case at any annual general meeting. It is now said that more information must be given. The fact is that as far as the I.D.C. is concerned it occupies a position of trust in respect of many of its activities. Those companies which are assisted financially have to disclose their whole financial position, and the decision as to whether to grant loans or not is taken with due regard to securities. When we are asked for more information does it means that that information about the companies must be given here? I can only reiterate the attitude of the I.D.C. which is reflected in a letter written by them recently in pursuance of this motion—

I think that this is an attitude which is quite justified and fair. I can therefore see no reason why the I.D.C. should submit information such as this, even though it be to a select committee.

But the hon. member for Port Elizabeth (South) went further and said that they wanted to know whether there was any justification for incurring certain expenditure. Here I want to ask again whether hon. members opposite want to be given information regarding further expenditure before a decision is arrived at in that regard or afterwards, and if it is afterwards, must it be possible to revoke that decision? It is perfectly clear that action of that kind would greatly hamper the activities of the I.D.C. If these transactions and decisions are to have the approval of a select committee then I agree wholeheartedly with what a professor at one of the British universities wrote in this connection. He was referring to modern industries and the techniques and problems connected therewith, and he also referred to Parliament. This is what he had to say in connection with Parliament—

I agree wholeheartedly. If Parliament is to have full control of this sort of institution it can lead to no other result.

The hon. member also referred to expenditure and he said that the Government had announced plans for expansion amounting to R2,000,000,000 in connection with these corporations. But the hon. member is basically wrong because each one of those plans for expansion has been decided upon by the boards of directors of those corporations. They decide on the plans for expansion. For example, Escom decided that it was necessary for an amount of R320,000,000 to be spent to increase power distribution. Iscor decided to increase its output from 2,500,000 to 4,500,000 tons a year and that over a certain period its plans for expansion would cost R600,000,000. It was they who made the decision, with the approval of the Government. It was their responsibility in the first place, although it could only be done with the approval of the Minister concerned.

Those bodies acted correctly. Is there anybody who can say to-day that Iscor’s expansion is not necessary or that the investment in Iscor to increase steel production has not been justified? I can just imagine what would have happened if this proposal had been submitted to a select committee of which those hon. gentlemen were members. Not one of them would have approved of it. The hon. member for Constantia (Mr. Waterson) would have been the first to say: “No, do not continue with this expansion; the future of South Africa is too uncertain; it is not necessary.” But I can visualize something else. If Escom had not incurred this expenditure, if it had not made provision for increased power consumption and if Iscor had not made provision for increased steel production, hon. members opposite would have been the first, under the present circumstances, to criticize the Government and the Minister, not Escom, on the ground that the Minister failed to ensure that South Africa’s needs were met.

But the hon. member went even further. He referred to the scope of the activities of the I.D.C. and he mentioned ship-building and other programmes. I say again that the I.D.C. has very wide terms of reference—I quoted them just now—and not one of their activities exceeds the limits which they are permitted by law. They have wide powers. They usually tackle something new but it is precisely that fact which is the greatest justification for the I.D.C. Think of the spinning and weaving industry. The I.D.C. was one of the first to start it and to-day there are numbers of mills but now the I.D.C. are being blamed because they are competing with other firms. Ship-building was also a new venture. Take the synthetic rubber industry. Nobody wanted to try it. When the I.D.C. started making inquiries they were told that it would not pay, but when the I.D.C. decided that Sasol should go ahead with that plan, all those people who had said “No” were even prepared to invest capital in it and have a share in it. I can also mention the nylon factories. Nobody was interested in manufacturing nylon here. It was argued that one needed a large market for it and that the cost would be too high. The I.D.C. made investigations but when they wanted to start it themselves, private enterprise also wanted to come into the picture. They said that it was a paying proposition and that they would continue with it themselves. Think of car engines. People said that those engines could not be manufactured here. The I.D.C. made a special investigation in this regard and when they decided to go ahead with it, the private sector took over and to-day considerable numbers of car engines are being manufactured here. I mention these facts because all the matters which the hon. member had in mind fall within the framework of the I.D.C. But if a decision to expand first has to be submitted to a select committee of this House …

We do not say that.

But the hon. member referred to ship-building and the activities of the I.D.C. The fact is simply that if this type of activity had to be subject to the decision of such a committee, then many activities of this kind would never have been started. It would have retarded development. The hon. member referred to Iscor and said that Iscor was both co-operative and competitive. Because that is so, he feels that there are certain aspects of Iscor’s policy which should be submitted to a select committee of this kind. But the fact is that when Iscor started, it was not competitive. Just think of the difference. If from its inception Iscor’s expansion had been subject to the approval of a select committee, what would have happened? It was a political issue. Hon. members opposite opposed it from the start and for years they had no confidence in it. One can just imagine what would have happened if an undertaking of this kind had to be subject to the approval of a select committee or if it had to report to a select committee. As one hon. member said quite correctly, it would have dragged that corporation into politics. The fact remains that it is being suggested here that there should be no interference in the domestic affairs of these corporations but it is clear that this sort of thing would hamper and restrict their activities. All these bodies have very good boards of directors. Nobody can point a finger at any of them and the fact remains that the success of any undertaking depends on the management and if it is well managed it is better to leave things in the hands of the management.

Against this background therefore, I do not see that any justification exists for the appointment of a select committee.

I think that the whole country will note with deep regret the fact that the hon. Deputy Minister instead of agreeing to an investigation of this very serious problem has decided to draw a granite curtain over this very important part of our economic life, namely the work of these state-sponsored corporate bodies. The hon. Minister made certain statements with which I cannot wholly agree. He mentioned to us that the balance sheets and the profit and loss accounts of these public corporations were placed before Parliament and that these particular balance sheets contained all the information that was necessary. Has the hon. Minister really studied these balance sheets? Has he studied the balance sheet and the profit and loss account of the South African Broadcasting Corporation? Can he honestly say that those balance sheets give a full and a clear and a concise picture of what is going on in these particular corporations? It also seems to me that the hon. Minister is even confused about the wording of the motion of the hon. member for Port Elizabeth (South), because the hon. Minister spoke about him asking for a commission. He is not asking for a commission, he is asking for a select committee. It is a matter involving the powers of Parliament and the right we have to investigate the way in which public money is being spent, or wasted. Therefore we are asking for a select committee of this Parliament, not an outside body.

I was amused to hear the hon. Minister say that we, members of Parliament, are actually the shareholders of these corporations and that we have the same rights as shareholders.

Mr. Speaker, in an ordinary public company any shareholder can investigate everything that that company does. He can by going to that particular company demand to see certain of the books.

Certain books.

Yes. Here we can see nothing. Furthermore, in a public company you have every year an annual general meeting where the members of the board can be questioned by the shareholders. If we are shareholders in these public corporations, when do they hold their annual meetings? Does the South African Broadcasting Corporation hold an annual general meeting where we can question the chairman of the Broederbond and the S.A.B.C. and its directors?

You can question Albert Hertzog here.

The hon. Minister himself does not know the answers unless he gets them from the S.A.B.C.

The hon. Deputy Minister complained about the fact that the hon. member for Port Elizabeth (South) had mentioned Questions in Parliament and he asked what they had to do with the motion. Again I ask him: Did he not read the motion? The motion asks that the present methods afforded to members of Parliament to obtain information concerning the affairs of these state-sponsored corporate bodies should be investigated, and surely one of the best methods of obtaining information on all topics is through the medium of Questions in Parliament. Questions in Parliament are vital to this particular problem. The hon. Minister said that a discussion in Parliament on the work of these bodies would take up too much time. It did not seem during the past few days that the Government was extremely pressed for time, or am I mistaken? Surely time can be found for discussing a matter such as this. After all if one sees the time taken in discussing the affairs of the South African Railways, surely there should not be too much complaint on his part if a few days are taken for a discussion of these reports. I believe that in the House of Commons a few days every year are set aside for the discussion of reports of an allied nature.

The hon. the Minister tried to defend the I.D.C. I have no desire to attack the I.D.C. as such, but he said that if a mistake is made by the I.D.C., must that mistake then be undone; must the deed perpetrated be altered? I say that the ordinary procedure can be followed which is followed in connection with public companies, and if the mistake is a glaring and flagrant one obviously the members of the board responsible for it could and should be dismissed by the Minister himself. The Minister complained about the interference there would be in the work of these corporations if their affairs were to be investigated by the select committee on Public Accounts. For years and years it has been a tradition of the British House of Commons that if anything is tabled in the House it can be discussed in a select committee on Public Accounts also. In other words, if a report is tabled it can be discussed, the only disadvantage being that the Auditor-General is not allowed to investigate those reports beforehand, but the report itself can be discussed and questions have been asked in the select committee in regard to these public bodies. If I may read from the book by A. H. Hanson, “Parliament and Public Ownership”, on page 44—

(Quorum.) When this problem was realized in the House of Commons it was decided to appoint a special select committee on nationalized industries, which was empowered to investigate the reports and to put questions on them. Surely if that could be done in Britain without interfering with the work of those industries, why cannot something similar be done in South Africa?

We are asked in the motion to consider the methods afforded to members of Parliament to obtain information concerning the affairs of the various state-sponsored corporate bodies. Several of the previous speakers have shown some of the faults attending many of the operations of these corporations. There is, however, one particular state-sponsored corporation which in itself is the epitome of all the mistakes made in connection with all the other corporations we have in this country, and that is the corporation established by Act 22 of 1936, the S.A. Broadcasting Corporation. Most of the complaints that we have about other corporations can also be found in the complaints we have in regard to the S.A.B.C. and the information concerning it which is made available to Parliament.

That board has extremely wide powers. It can acquire movable and immovable property, raise loans, establish funds, acquire and direct broadcasting and television stations—very wide powers, yet all we have annually under that Act is a report which has to be tabled before 30 April, a report which is utterly incomplete in all its aspects. Here we have a corporation with liabilities and assets of more than R17,000,000, into which the taxpayer pays more than R5,000,000 every year in licence fees, and yet when it comes to us so-called shareholders discussing the problems and the deeds and misdeeds of that corporation, we are told by the Minister that our powers in that regard are limited and that we are not allowed to have the information we want.

As an indication of how incomplete the information is that Parliament gets, one only has to take that particular corporation and look at Section 24 of the Broadcast Act. In it we see that although the Act demands that particulars should be given on at least ten different topics in the annual report, and although the Act specifically says that the Minister should do so, Parliament does not get the information which I maintain that Act compels the Minister to give. Clearly there is something wrong, and clearly here is a matter for the select committee to investigate. We are supposed, according to the Act, to get all the information regarding the extent and value of all classes of property owned by the corporation. We do not get that. We get a short statement: Land and Buildings, Value R5,000,000. It may mean anything. Where are these buildings? We know of a semi-country club that the S.A.B.C. had in Johannesburg at one stage, but it was never mentioned in any of the reports.

We are supposed to have information, particulars—I stress that word—regarding the expenses of management and administration and all the other expenses of the S.A.B.C., but what do we have in the report? It says: Administration, R960,000. Are these particulars? Is Parliament receiving the information it should get? Surely an elementary piece of information that we should have about the S.A.B.C. is the amount paid out in wages and salaries, but we do not get that from any of the corporations. The total amount is included in a broad figure for “administration” and no particulars are given, except that in the case of the S.A.B.C. it is stated that the Governor’s salary is R23,000 a year. In the same way I could point out how we do not get the information required by the Act. Questions in Parliament were mentioned as one of the means by which we can obtain that information. I am not criticizing the procedure of the House in any way. I believe that Questions in Parliament are excellent and that they are and can be used to extremely good effect where we are allowed to inquire into the works of particular Government Departments. There is, however, a provision at present which excludes the Minister from giving information to the House on the S.A.B.C. Those provisions are wrong and are preventing Parliament from knowing what is going on. I have heard the excuse made that in Britain questions are not allowed on the British Broadcasting Corporation, but that is not so. In one year alone I found that there were no fewer than 16 such questions asked about the B.B.C., on its charter, on its school transcription services, on its finances, on the jamming of programmes, on television, etc. Questions in Parliament, this splendid instrument, fail when it comes to dealing with these public corporations, and it is time that we had a select committee such as this to investigate what can be done to give Parliament the information to which it is entitled.

I believe it to be vitally necessary that Parliament should control expenditure through the medium of the Select Committee on Public Accounts and the Auditor-General. After all, investigation into the work done by the Land Bank by the Auditor-General has not led to the frustration of the work done by the Land Bank. If the Land Bank can be investigated in Parliament through the medium of the Select Committee on Public Accounts, surely other corporations can also be investigated.

We have had a commission sitting on this matter which reported that it is absolutely essential that there should be provision that these annual reports should be investigated by Parliament. I am referring to the Commission of Inquiry into the Broadcasting Services in 1948, in which it was said—

In 1948 already it was realized that the reports were incomplete. The select committee criticized the incompleteness of the report, yet since then there has been no improvement whatever in the position. Things have gone from bad to worse. The report said further—

I say the position to-day is unsound and that it has already led to administrative extravagance. But I want to challenge the Government and to ask them why they are afraid to tell the country and Parliament exactly how the administrative expenses of the S.A.B.C. are met and how the money is spent. I think R190,000 is spent a year on motor vehicles. Is the Minister satisfied that that money is well spent and that there is no wastage? If the Auditor-General can discover wastage in regard to the use of motor transport in nearly every Government Department, is the Minister going to tell me that in regard to the use of motor transport particularly by the S.A.B.C. there is nothing wrong whatsoever? And if nothing is wrong, why is he afraid to investigate it?

I have proved here that the Minister’s colleague was wrong when he said in the past that the Select Committee on Public Accounts in Britain does not investigate the B.B.C. I have the proof here. I have a list of 110 questions put on one occasion by the Select Committee on Public Accounts in regard to the B.B.C., and I have here a recommendation made in regard to the B.B.C., and I wish we had a similar recommendation in regard to the S.A.B.C. here. In the sixth report, for the year 1955-6, it says—

Obviously the select committee on Public Accounts in Britain found something wrong with the method by which funds were raised and used by the B.B.C., and they were not afraid to say so. Why cannot we have the same in this country in regard to the S.A.B.C.? There are matters in regard to administration and huge new efforts, on F.M. stations, new A.M. stations, Radio Africa and Paradise Station, all matters on which we cannot get information which I believe we should have in this House.

It is therefore essential that when the select committee is appointed, as it should be, it should take cognizance of what is happening in regard to this one corporation, the S.A.B.C., and the quite independent way in which it is able to handle these millions it gets from the public every year. What I am suggesting is not interference in their direct entertainment programmes or with their judgment on minor matters, but I say there must be control over the way in which the money coming from the public is spent, and that is what the Minister and the Government refuse to do.

I think the following matters should be investigated by the select committee in regard to the S.A.B.C. Firstly, its accounts should be made subject to control by the Auditor-General, and secondly Section 9 of the Broadcasting Act should be enforced. That section says that the Minister has the right to apply such sections of the Companies’ Act as he thinks are suitable to the corporation, and according to the information I have, not a single paragraph of the Companies’ Act has yet been applied to the S.A.B.C. I say that the same provision might also apply to some of the other corporations. Therefore it is necessary for that committee to find out to what extent the S.A.B.C. has not been giving, in terms of the law, the reports required by the Broadcasting Act. I would not object if that select committee were to investigate another matter also, but I think that if I were to elaborate on that I would not be given too much leeway. I refer to the fact that such a select committee, when it investigates the S.A.B.C., should also investigate the Broederbond.

The hon. member for Orange Grove (Mr. E. G. Malan) tried to resort to delaying tactics here because he suffered such a tremendous defeat during the debate on the Broadcasting Corporation, but he let the cat out of the bag. While the hon. member for Port Elizabeth (South) (Mr. Plewman) said that he wanted to strengthen the responsibility of Parliament without detracting in any way from the powers of any of the utility companies, the hon. member for Orange Grove proved by his speech that the whole thing was just a witch-hunt. That was all it was. He wanted to know the salaries of the various people appointed to the boards of these companies so that he could attack them in their personal capacities. Unfortunately, time will not permit me to analyse this whole motion and to reply to the various statements that have been made but I want to ask this question at the outset: When the hon. member for Port Elizabeth (South) and other hon. members, including the hon. member for Orange Grove quote the British Parliament and the Commission of Inquiry appointed by it, why do they not quote the true details and give the House the correct information? I want to make this quotation because the hon. member also did the hon. Deputy Minister an injustice by saying that he did not have the true facts in regard to this Commission of Inquiry. This commission was appointed in Britain on 4 December 1951. What did it report? Its report dealt with the various organizations mentioned by hon. members and stated—

The hon. member is very concerned about the fact that they do not receive adequate replies to their questions from Ministers. The report continued—

It went on to say—

The report went on to say that it was not right that members should ask improper questions in connection with these organizations.

The Committee stated most emphatically that this should not be done and it arrived at this conclusion—

They found that it was vitally necessary that these directors should be able to act without being handicapped by a parliamentary audit. The report went on to say—

If I have the time I want to show how Iscor and Sasol have served South Africa. We will then see that we cannot better these organizations with a parliamentary knee-halter. I want specifically to quote the chairman of this commission in Britain. Mr. H. Morrison. What were his findings? He had this to say.

The debate having continued for 2½ hours, the motion lapsed in terms of Standing Order No. 30 (4).

I move—

1. (a) the threat this expansion may constitute to our entire distribution system and the continued existence of the small trader; and
2. (b) the undesirable monopolistic conditions that may arise as a result thereof.

I want to make it clear at the outset that this is not a declaration of war on the chain sores.

I do not think there is anyone who wants to wipe out the chain stores. They play a very important role in our whole system of distribution and in our economic life. Chain storeshave succeeded in making people aware of the advantages of cash buying and of the advantages of what is generally known in the trade as “cash and carry”. They have succeeded in offering certain things more cheaply to the public and in lowering the cost of living to a certain extent therefore. I think it would be entirely unrealistic even to think of wiping out the chain stores. I think we should accept that the chain stores have come to stay, and when we talk about the protection of the small trader then we must do so against the background that the chain stores have come to stay. There is nobody who would suggest that chain stores should be done away with but just as little as we want to wipe out the chain stores, so little can we allow the chain stores to wipe out the small trader, the family grocer, the family butcher, the family clothing merchant, the family chemist and the shop around the corner. But unfortunately that is precisely what is happening to-day. We are faced here with an enormous economic problem and a social problem, something which is changing the whole nature of our distributive trade.

I am the first person to admit that in this case it is much easier to state the problem than it is to suggest a solution, and that is why I ask for this matter to be investigated by our best economists. This problem has so many facets that it would be impossible in a debate such as this to try to arrive at any final solution. Let me just say in parenthesis that in studying this matter I could not help being struck by the fact that so far throughout the world, and here in South Africa too, very little research has been done into the system of distribution. In the Parliamentary Library I could find only two books dealing with this matter, the latest of which was published in 1948. Here we have an economic sphere therefore in which there is tremendous scope for research, and I want to make a serious appeal to students of economics at our universities to give their attention to this matter. There is tremendous scope here for research for a thesis for the M.A. degree or a doctor’s degree. The fact that we are dealing here with a serious problem is borne out by quite a number of things. On the same day on which I gave notice of this motion, the hon. member for Orange Grove (Mr. E. G. Malan) gave notice of a similar motion, and we knew nothing about each other’s motion. I want to pay the hon. member for Orange Grove this compliment that if anything his motion is better worded than mine. His motion which sets out this problem very tersely reads as follows—

I think it is well worded. My only difference with the hon. member for Orange Grove is that I cannot see how one can discuss this problem of the protection of the small traders without specific reference to the growth, the rise and the expansion of the chain stores in view of the fact that they form the very basis of this problem. Mr. Speaker, on the same day on which the two of us gave notice of this motion it was announced that a conference was going to be held in Bloemfontein to discuss precisely the same matter. I had no knowledge of the proposed conference and I doubt whether the hon. member for Orange Grove knew about it, and in any case the organizers did not know that we intended moving a motion. This conference was to be attended by retailers throughout the whole country, retailers belonging to all language groups, all political parties, members of the Sakekamers and members of the Chambers of Commerce. This conference was to be held under the chairmanship of Dr. A. J. Visser and under the patronage of a number of English-speaking and Afrikaans-speaking small businessmen throughout the whole Republic of South Africa and South West Africa. These people are seriously perturbed about the threat to their means of livelihood. They regard their means of livelihood as being in danger. They are responsible people, and I should like to quote from the circular which they sent out to retailers—

It is perfectly clear therefore that we are dealing here with a serious and a material economic problem, and in these circumstances it will not avail Mr. Sam Cohen of the O.K. Bazaars to say cynically, “Show me where there is any unemployed retailer,” as he stated last Sunday in the Sunday Times. He knows as well as I do that this is a real problem, and for him to pretend that there is no problem at all, simply because he is interested in his own business, strikes me as rather childish. I have great respect for Mr. Cohen; he does a great deal for this country, but he must not close his eyes to everything except the future of the O.K. Bazaars; he should look at the broad interests of the whole of the distributive trade in South Africa. I want to say here that it is of equally great importance to the economy of South Africa, to our distributive trade and to the large chain stores that our distributive trade should remain healthy and that the small traders should be able to continue to exist in South Africa. I think this is the opportune moment to say that I am not pleading here at all and would not dream of pleading for the incompetent and the inefficient trader, who will go bankrupt in any case, whatever the Government does. This motion represents a plea and an attempt to give assistance to the hard-working, competent, efficient small trader who because of keen competition to-day—in many respects unfair competition—and because of the huge capital resources of chain stores, simply cannot manage to continue to exist, however industrious he is, however hard working and however efficient he is. This competition arises mainly from the enormous capital resources of the chain stores and the small trader’s lack of capital to make the necessary adjustments at this time when adjustments are called for. I should like to make use of this opportunity to make an appeal that as many traders as possible should attend the conference in Bloemfontein because in the last resort the small traders will have to save themselves, whatever help the Government may possibly be able to give in the future.

Further proof of the very real nature of this problem is afforded by the fact that five years ago Assacom drew up a memorandum in which they discussed this threat to the small traders by the chain stores. If that was the case five years ago then it is even more true to-day, because in those five years there has been what I would describe as an eruption of chain stores. You will recall, Mr. Speaker, that in the past chain stores were limited to the bigger cities such as Johannesburg, Pretoria, Bloemfontein, Cape Town, Port Elizabeth, etc., but over the past five years there has been an eruption of chain stores. There is not a single town on the Rand to-day where there are not two or three chain stores. There is hardly a suburb in the whole of the Witwatersrand and in Pretoria where you do not find one, two or three chain stores. One finds chain stores in a small town like Upington. Not only has there been an eruption of chain stores but there has been a revolution in the whole of the retail trade; we have had the rise of supermarkets, of self-service markets, and in addition to that we have had this competition between these gigantic organizations, between the large chain stores, who have brought about price wars and have cut prices to such an extent that the small man has been almost ruined in that process of competition.

What about the consumers?

I am coming to the consumers; that is a very important point. Sir, in October 1962 the Prime Minister issued the following statement after a meeting of his economic Advisory Council—

Mr. Speaker, if this problem has already attracted attention at that high level, then I do not think it is necessary for me to enlarge upon this matter to show that a very real problem has developed in this regard in recent years. But let us look at the hard facts, the hard statistical facts. The Bureau of Census and Statistics gives the following remarkable and I would almost say shocking figures: From 1952 to 30 June 1960 the turnover of what they call “department stores”—and in the main these are the chain stores—increased by 61 per cent. Over that same period the turnover of grocers remained entirely static. Sir, it must be borne in mind that over that period the price of groceries increased considerably and that the chain stores entered the grocery trade on a large scale. In other words, if the turnover of grocers remained static, then in actual fact the turnover of the family grocer dropped enormously. During these nine years ending on 30 June 1960 the profits of retail businesses which are not companies, that is to say, the profits of one-man businesses, dropped from 112.8 to 88.9 taking 100 as the basic figure for the year 1957. But during that same period the profits of companies, of the bigger shops, mainly the chain stores, increased from 84.5 to 96.6. It is as clear as a pikestaff therefore that the small man is gradually being ousted altogether. In this connection I just want to read out what Harold Fridjohn, the financial, economic correspondent of the Rand Daily Mail had to say in this regard on 22 June 1962—

Mr. Speaker, yesterday I led a deputation of all the small butchers throughout the whole of the Republic of South Africa to the Minister of Agricultural Economics and Marketing. These people are finding that they simply cannot make ends meet. After an investigation instituted by the Meat Board they pointed out that in order to be able to make a living a butcher must sell at least 600 lbs. of meat per week. The average quantity of meat which is sold by all the butchers in Central Johannesburg is less than 300 lbs. of meat per week, and the chain stores are now also entering the meat trade. I want to mention the case of Vereeniging only. In Vereeniging there are three chain stores which are now applying for butchers’ licences, and if those licences are granted then there is not the slightest doubt that three old family butchers who have had butcheries in their family for years and years will have to close down. I think I have proved incontrovertibly that the chain store is pushing out the small trader. It is not necessary for me to go into the methods, but the main reason for this is the financial strength of the chain stores. They are able to do it because of the capital resources at their disposal. Take one large chain store; it has its own wholesale department; it orders on such a fantastic scale from factories that it is practically able to force those factories to sell to it at its own price. I want to mention one example to you, Sir. There is one chain store which is able to buy Sunlight soap on such a large scale that it gets a discount as wholesaler, a further discount because it orders huge quantities and a further discount because it buys cash. It buys so cheaply at Lever Brothers that the small trader is able to go and buy Sunlight soap at one of the chain stores at a lower price than the price at which he could buy it direct from Lever Brothers. This only goes to show that these people are unable to compete with the chain stores.

Then we come to the question (and it is a good deal more difficult to answer this question than it is to pose the problem). What is the solution? I do not think it is possible for anybody to put forward a ready-made solution. I can only say what has been done in certain other countries to cope with this problem. The chain stores are able to get much more favourable terms from factories than the small traders. Well, one solution is to forbid factories to give such preferential treatment to the chain stores. Such a step would not be without precedent; it is done in France to-day. I want to quote from the Economist of 1 February what President De Gaulle ruled in France under his Administration—

The small trader here receives this protection therefore that he is able to buy from the factory on the same terms as the chain stores. Whether this is a practical, practicable solution I cannot say, but I definitely feel that this is a matter which should be investigated by the Government. Then, Sir, in the United States there is a whole series of laws designed to protect the small trader. For this information I am indebted to Mr. Witt, the First Secretary of the American Embassy who was kind enough to get it for me. In the first place there is the Sherman Act of the U.S.A., and I want to quote just briefly what the purpose of that Act is—

Then there is the Federal Trade Commission Act. Under this Act a permanent committee has been set up in America and the object of that committee is to guard against developments such as we are finding here to-day in South Africa and, when there are such developments, to devise plans to protect the small trader against what they call “unfair methods of competition and unfair or deceptive acts or practices.” In America therefore we find that a permanent committee has been established to guard the interests of free trade, to bring about healthy competition and to protect the small trader. Then there is the Small Business Administration Act. Let me quote what the purpose of this Act is—

In America therefore, where this situation has developed much further than it has in South Africa, they found it necessary to make provision for all these things in the Administration for the protection of the small trader.

Mr. Speaker, in other spheres of our economic life we are faced with more or less the same problem. The problem of the small industrialist is to a very large extent the same as that of the small trader. The problem of the small farmer is very much the same as that of the small trader. Their problem is precisely the same and that is that the concerns with vast capital resources are ousting and pushing out the competent but smaller man with less capital at his disposal. Sir, what have we done in South Africa not only to assist large industries but also to help and to protect the smaller industries? We have for that purpose the Industrial Development Corporation which in the last few years has been concentrating not only on the establishment of large industries but which has been giving assistance for the establishment of small industries and to keep small industries which have financial problems on their feet. As far as the small farmer is concerned we have the Land Bank, the State Advances Office and the Land Board all bodies which are designed to keep the small efficient, economic farmer on the land. But when we come to this other sphere of our economic life, namely the distributive trade, we find that the small trader has no body at all to whom he can turn for assistance. He has to rely on the banks, and let me say at once that the banks are not very anxious to lend money to those people because it is a risky business. The result is that when those people want money they have to go to other financial institutions which charge a considerably higher rate of interest than the commercial banks. There is no body therefore to which these people can turn for financial aid. Sir, we established the Bantu Development Corporation in South Africa to assist the Bantu trader and the Bantu industrialist; we established the Coloured Development Corporation with the same aim as far as the Coloureds are concerned, but there is nothing of this kind for the small trader, and I want to ask the hon. the Minister to consider very seriously whether in order to assist the small trader the time has not come for us to establish the equivalent of the Industrial Development Corporation, the equivalent of the Bantu Development Corporation or of the financial institutions which assist the small farmer to-day. Sir, what is the problem of the small trader to-day in this revolution which is taking place in our distributive trade? The whole trend to-day is towards super-markets, towards self-service stores. The days when the trader took goods out of the drawer or from the shelf and sold it over the counter are gone, because to-day the consumer wants to walk into the shop, look at the goods on display and help himself. The whole trend is that direction and the chain stores have succeeded to a very great extent in encouraging that trend. But the difficulty is that it costs anything from R3,000 to R10,000 to convert the shop of the traditional grocer, of the traditional clothing dealer, into a self-service store, and those people simply do not have the money to convert their businesses, and if they do not have the money to convert their businesses then they must inevitably go under. The only institutions from which they can borrow money to-day are the banks, and unless that position is changed I think this dangerous and unhealthy trend will develop more and more.

I want to conclude by saying that in South Africa, as in the whole of the free world, the small trader is the backbone of a free economy. He is the backbone of the law of supply and demand. The hon. member for Turffontein asked a moment ago, “What about the consumers?” Sir, both the consumer and the industrialist must ask themselves very carefully whether the benefit which they are getting today from chain stores is not in fact a very temporary benefit. Those people are able to push out the little man by offering lower prices, but when the little man has been pushed out you are left with two, three, four or five cartels which then control the whole of the distributive trade, and then it is the easiest thing in the world to bring pressure to bear upon the consumer and the industrialist. The only protection for the industrialist is an absolutely free economy with thousands and thousands and thousands of small traders instead of having three or four large cartels; and the only protection for the consumer, the only way to ensure that the consumer has the benefit of free trade, is to have thousands and thousands of small traders instead of having four or five large cartels which are able not only to exercise enormous political pressure but which are able to manipulate prices as they like. In order to have healthy industrial development what is needed is a healthy distributive trade, and I think there is no doubt that one cannot have a healthy distributive trade without the continued existence of the small trader, the small butcher, the small grocer, the small chemist, the small clothing dealer, etc., etc. This development of huge chain stores holds out great dangers to both the industrialist and the consumer. The ordinary one-man business concern creates an enormous reservoir for future entrepreneurs in South Africa. That man trains his son in business; he teaches him the first principles of business, whereas if that young man has to go and work as a clerk in a chain store then he is unable to do so. I say here on the authority of Dr. Visser that the little man creates a reservoir of future entrepreneurs in South Africa and, Mr. Speaker, what does this expanding economy of South Africa need more in the future than more entrepreneurs? There is a tremendous need for more entrepreneurs. Sir, the small trader is not asking for State assistance only; he is not coming to beg; he is not asking to be spoon-fed. He is not pleading for the incompetent, the inefficient and the lazy man, but he says that since he is doing his best, since he is doing everything that one can possibly do to make a living, he is entitled to look to the Government, when he is threatened by this great danger of the development of monopolies, to regulate things in such a way that there will also be a place for him in the economic sun of South Africa.

I believe that everyone who has the interests and the welfare of our economy at heart will welcome those parts of the speech made by the hon. member for Vereeniging (Mr. B. Coetzee) in which he stated the genuine problems facing the small trader in South Africa to-day, and in which he suggested one or two positive solutions. While I can appreciate the concern of the hon. member for Vereeniging for the small trader, I do, however, consider that his motion in this connection is not an adequate one. I believe that it is too narrow in that it refers to only one section of business, the chain stores, as being an evil. Let me say that I do not regard those stores as an evil, although they may be a problem, in just the same way as any other problem that a business has to cope with. I also believe that in a sense his motion is too negative. What I should have liked to have seen is a motion asking for a full investigation into all the problems of the small trader in South Africa’a positive one, so that the small traders could be enabled to compete with the unique advantages which they have, on an equal footing with the large business concerns. I do not believe that the solution lies in an attack on big-business interests nor in pitting big businesses against small businesses, or the other way around. Sir, at a joint conference of management and small business administrations in America it was once stated—

Let us see how big this small business in South Africa actually is. In South Africa we have at least 34,000 of these small businesses of whom 32,000 make a profit of less than £2,800 a year; of these 32,000, 26,000 make a profit of less than £900 a year, and of the 26,000, 20,000 make a net profit on their total sales of less than £600 a year. This shows that there are indeed problems for the small traders and it is necessary that something should be done for them. Sir, if there are 32,0 of them in the whole of South Africa it means that there are 200 of them per Parliamentary constituency.

We know who these people are—the small grocer, the butcher, the “shop around the corner”, as the hon. member for Vereeniging so accurately described them, the florist, the dairyman, the fruit and vegetable merchant, the fish merchant, the cafe, the bottle store, the chemist, the outfitter, the footwear merchant, the bicycle store, the jeweller, the sports store and the furniture store. I believe that a mere recital of each of these different types must have evoked a picture in the minds of most members here of a little shop that they know in their constituency, struggling under difficulties—a little shop whom they would like to help. Sir, let us make no mistake about it; President Eisenhower was right when he said, “The small businessman is the backbone of the American economy”. He is that, too, in South Africa where he is indispensable as a major factor in the distribution of food, goods and furniture, and where he forms a solid, enlightened, conservative block of traders, a body of which any community can be proud.

They have their problems. Let us see what some of those problems are. Many of these problems were thoroughly and accurately stated in a memorandum adopted by a congress of the Associated Chambers of Commerce of South Africa. This memorandum was drawn up by a special committee. That committee reported to the full congress of Assacom and its report was unanimously adopted. It was incidentally a committee under the chairmanship of a prominent economist, Dr. Freddie von Biljon. On that committee also served people such as Mr. Dennis Mosenthal, Mr. A. Stuart-Findley, Mr. R. Campbell, Mr. L. A. Snyman and Mr. Mannie Bradlow. Some of the problems which were outlined by this committee were the following: Firstly they said that there were problems arising from the unrestricted nature of trade channels such as direct dealings by the public with wholesalers, the growth of the chain stores, over trading, inroads by co-operatives and trading activities of municipalities. You will see therefore, Sir, that while chain stores are not mentioned as an evil, they are actually mentioned as a factor, a problem, with which small businesses have to compete. A second problem is the problem arising from licensing laws, such as the abuse of licenses by hawkers and itinerant traders. A further problem of the small businessman is one arising from inadequate trading margins, whether under price control or under competitive pricing practices. The fourth problem—and these are all problems which a big organization does not have—is the problem of finding adequate capital resources for development.

There are many other small problems that the small trader has to contend with which the big man does not have. He has the problem of a small turnover; of keeping large stocks; very often unsuitable accounting methods; he has the problem of a lack of proper channels of information in regard to the law, markets, and so on. Interestingly enough, there is one other problem, which is no fault of his own, and that is estate duty. Estate duties do not seriously affect a big business in the distributive trade, but they can cripple a small business for a very long time.

Without attaching any blame to either the big businessman or the small trader, the latter has problems of his own. These problems are so serious that there has been a decline in the fair returns and profits of these small businesses. Unfortunately the statistics of the last census will only be coming out next month, so I have to rely on older statistics. But these statistics show a trend, which I believe has not altered, of steadily declining profits to the small trader. I have the comparative figures here for 1952 and 1958. Here I have the net profit on total revenue, and total revenue, Sir, as you know, in the case of small businesses is largely derived from sales. In the case of a general outfitter his profit on total revenue declined from 1952 to 1958 from 3.7 per cent to 2.4 per cent; in the case of dealers in electrical goods from 8.9 per cent to 4.4 per cent; in the case of jewellers from 8 per cent to 2.5 per cent; overall, Sir, there was decline from 6.7 per cent to 4.2 per cent. I do believe that we must ask ourselves what can be done.

There are basic principles in regard to our economy which all reasonable people do accept. The first is that competition must be free and that any measure in restraint of trade is wrong. We are, therefore, not asking for any legislation or any measure which will restrain trade either by the small businessman or by the big businessman. We realize, also, that there cannot be measures which would imperil the cost of living of the ordinary man in South Africa. I believe that if we give the small trader what he deserves, what he asks for, we shall lift him to that level where, with his unique advantages, he will be able to compete on an equal footing with these larger chain stores. Because although it might not always be possible for the small trader to compete, in regard to prices, with the chain store, he has some unique advantages. For instance, he can grant credit which the big business usually does not grant. Secondly, he is flexible in his decisions. He is a one-man business. He can take a decision within 24 hours whereas a big corporation, quite rightly too, takes time to change its basic policy. Thirdly, your small trader has the personal contact with his clients and his customers which, in the nature of things, the big corporation cannot have. So they have these unique advantages, Sir. Even though we cannot expect that their prices should in all respects be the same as those of the big businesses, these other advantages off-set the slightly higher price that you sometimes find. What is to be done? The hon. member for Vereeniging has mentioned certain possibilities. I agree with some but I am a little dubious about others. I should like to give at least ten possible solutions which could be considered by a select committee of the nature I suggested in my motion which the hon. member for Vereeniging was so kind as to quote and which, as you know, Sir, according to the Rules, I had to withdraw in order that a discussion could take place on the motion of the hon. member for Vereeniging.

The first proposal that such a select committee could investigate is that there should be a special small business section of the Department of Commerce and Industry. As Assocom says in its memorandum—

It is such an obvious argument, Sir. You can compare the small farmer with the small trader. The small farmer is well-served with information, with extension officers. I do not begrudge him that. A small farmer will find it impossible, and the hon. the Minister will agree with me, to do the research which is necessary. He needs assistance of the nature that he is receiving. I see the hon. the Minister of Agricultural Economics and Marketing is in the Chamber. I do not want to digress, but one can make a comparison between the small farmer and the small trader. I only hope the small trader will be better treated by this Government than the small farmer is.

In America you have a Small Business Administration. It is actually part of the Government itself. No one can complain about a section of the Government helping small businesses in that way by suggesting that it is a socialist measure. After all, America is the biggest capitalistic country in the world and if America can have a Small Business Administration I believe the hon. the Minister should also be able to consider whether a special section of his Department should not deal with the problems of the small businessman. There are in fact no less than 54 field officers of the Small Business Administration. These field officers deal with the local problems in the U.S.A. of the small business in each State.

Secondly, I believe it should be considered to what extent the small trader can be assisted in his problems with regard to capital formation. The small trader is not asking for subsidies; he is not asking for anything along those lines. But he very often has difficulty in obtaining the necessary capital, just as your farmer has genuine problems in obtaining the required capital. What does the farmer do? He goes to the Land Bank, but it is not possible for the small trader to obtain, on the same advantageous conditions, the capital he so often urgently needs for his development. There is assistance for the Bantu small business. He has the Bantu Development Corporation. The small Bantu businessman can apply for a loan, and if all other factors are in order, he is granted one. I notice from the latest report of the Bantu Development Corporation that 75 per cent of the applications actually dealt with concerned general dealers, butcheries and eating houses. Those are the very businesses similar to the small White businessman I am talking about to-day. An amount of more than R600,000 annually was made available by that Bantu Development Corporation—I believe the amount is now close on R1,000,000—to assist Bantu businesses. I know it is argued that the Bantu small businessman cannot get money anywhere else, whereas the small White businessman can go to the bank. But however valid that argument may be I say that it is wrong that it should be made more difficult for your ordinary small White businessman to obtain funds than it is for the Bantu small trader when he goes to his Bantu Development Corporation; it is wrong that the conditions should be more stringent.

The I.D.C. assists industries. The Viljoen Commission reported that it was essential that the I.D.C. should also assist small industries, and not only big ones. I should suggest that the I.D.C. should be expanded so that it need not only follow the recommendation of the Viljoen Commission in regard to small industries but that it should also do the same in regard to the small trader and the small businessman. The hon. member for Vereeniging suggested a parallel I.D.C. Whether that is a better solution or not, I do not know. I think that is something which could be investigated by a select committee. I might mention that what I have just suggested is also a recommendation of the Associated Chambers of Commerce.

Such assistance to the small businessman need not necessarily involve large capital amounts. One method which the Small Business Administration of the U.S.A. uses is this: They grant what is called participation loans to the small business. A participation loan is simply this: A small business applies for a loan to the Small Business Administration in the U.S.A. and the S.B.A. says: Very well, you can go to a bank; you can get that loan from a bank and we are prepared to underwrite 90 per cent of that loan. In other words, Sir, the whole 100 per cent of the capital is not needed; only a small amount of capital need be given by the Government itself in order to help small businesses on the basis of participation loans. They also grant limited loans in America through the S.B.A. The S.B.A. supplies 75 per cent and the banks 25 per cent. They grant pool loans to groups of small businesses to obtain supplies and equipment and to further research.

Canada has an Industrial Development Bank as well as provincial lending agencies to provide Government funds for small businesses who are unable to obtain them through the normal channels. Australia has a special division under the Prime Minister for giving financial assistance. We know what is being done in France and in the Scandinavian countries. All these, Sir, are positive measures which can be adopted to assist the small businessman to meet his problems and to meet the competition from those larger businesses which are more fortunately situated.

Thirdly I believe it to be essential that ordinary information in regard to business should be made more freely available to the small businessman. Unfortunately it has always been the custom that if there was any information which the Government, this one or any past Government, felt the small trader should have, it was published in the Government Gazette. After that the Department washed its hands off the matter and say: “Well, he should have known about this regulation; he should have known the law on this and that.” It is impossible for the small businessman to obtain all the information that he requires. I have here a booklet called “List of Federal Government Publications of Interest to Small Businesses Issued by the Small Business Administration of the United States Government”. It is fantastic to see the large numbers of publications which are available to the small businessman in America. There are pamphlets, books and surveys in regard to such widely divergent matters as accounting, advertising, stock-control, labour laws, credit, markets, health regulations, office management, purchasing, tax laws, labour requirements, increased productivity, business ethics, packaging, cost control, the cutting of paper work, personnel management and so on. An endless amount of literature is available to the small businessmen in America. I think that, even on a smaller scale, a great deal of this material could be made available to the small businessman in South Africa to-day. Let me put it this way: It should be made available to every businessman, so that big business will also be able to benefit by it. I do not think one should exclude any particular section from information of that nature, although the large organizations have their own research departments and are probably not as much in need of that information as the small man.

It is believed that one of the main reasons for the terrific production boom in Western Germany during the past decade is that they have something similar to the Small Business Administration for German businesses and industries. Actually, Sir, anyone wanting to start a little business in Germany to-day can go to the Government and get all the necessary information that he needs on markets and bookkeeping, on labour, on everything that can make it competitive in its particular market. That has led to the formation of more small business than ever before.

Fourthly, I believe that the possibility of special courses in management should be investigated. It should be a kind of summer school, open to all businessmen, not only to those who may need it the most, namely the small businessman. The Small Business Administration in the U.S.A. organizes nearly 200 of these special courses every year. I should like to see commerce take a lead and that Chambers of Commerce and the SuidAfrikaanse Handelsinstituut make available their expert knowledge for such particular courses. Certain expenditure may be involved and in such a case it would not be unreasonable to ask the Government to assist to some extent. Fifthly, training grants are made available for management training, not necessarily for one small business, but for a group of small businesses. In Ireland the Government meets 50 per cent of the costs of approved schemes designed to increase management efficiency.

Sixthly, the possibility of financing research should be investigated to a greater extent. Just as a farmer cannot himself undertake a vast research and experimentation programme so also the small businessman cannot do it. The Small Business Administration in America, in fact, gives pool loans, which I have mentioned, and these pool loans can also go “to establish facilities for research and development or/ and to obtain the benefits of research for members”.

Seventhly, I believe that small businesses should receive fuller information in regard to how they should go about to obtain Government contracts. I am not asking for any special provision in regard to the small businessman in the shape of concessions, I am asking for better information. The Small Business Administration Act in America actually goes further than what I have suggested here. That Act says that a fair portion of Government contracts should be placed with small business enterprises often small contracts involving repairs or maintenance. There should be further information in regard to what surpluses are being disposed of by the Government; how to go about finding out when those surpluses are to be sold. A notice in the Government Gazette is not enough. The small businessman should get a fair share of that particular part of trading.

Eighthly, I believe that the existing legislative measures should be investigated for their effectiveness. Some people might say we should have a Small Business Administration Act in South Africa; others might say “no”. Some may advocate a Fair Trade Law for South Africa; others not. I believe that is a matter which can be investigated.

Ninthly, Sir, I believe that other Government Departments should offer their assistance and channel their efforts to the Department of Commerce and Industries. For instance, the Department of Agricultural Marketing can make information on markets available, the Department of Housing can assist when it comes to the expansion and the improvement of the buildings of a small business.

Then, tenthly, Sir—and I can assure you this idea does not come from me, but from the Associated Chambers of Commerce—it is believed that the South African Broadcasting Corporation, too, can play an important role. Assocom says—

[Interjections.] It will be an improvement on some of the programmes, Sir, I can assure you.

Sir, the small businessman does not ask to be spoon fed. We believe that the status of the small businessman should be raised, instead of attacking his larger brother. In fact, Sir, big business is also necessary. Big business contains many large and responsible organizations in this country who realize their civic duty to the public and to the country. They have contributed magnificently to culture, to art and to education. The small business is not afraid of competition. He welcomes it. All that he asks is that the competition should be fair. He does not beg, Sir. He is acting on his own behalf already with courage and fortitude. The Chambers of Commerce and the Handelsinstituut are trying to form the equivalent of Better Business Bureaux in this country and they are succeeding. Assocom is having a Small Business Manual drawn up by experts. The Durban Chamber of Commerce has published an excellent Code of Ethics for its businesses while the National Development Foundation is doing pioneer work in studying the problem. Its booklet “Profitable Management for the Small Business” is an outstanding bit of work. Sir, the small business is the backbone of our economic life. Without it, free enterprise will not survive. Therefore, all that we ask is: Give these 34,000 small businesses, and the hard-working conservative people who run them, the chance they deserve and not only they, but big business and the country as a whole will benefit.

I rise to support the hon. member for Vereeniging (Mr. B. Coetzee) in the motion that he has moved here to-day. The hon. member for Orange Grove (Mr. E. G. Malan) tried hard to keep this matter out of politics. He did succeed to some extent but nevertheless he tried to get in a left here and there—and sometimes a blow slightly below the belt!

As one who is also interested in business I want to tell the hon. member to-day that the Department of Commerce and Industries is really going out of its way to assist the small businessman in solving the various problems that arise from day to day. It goes out of its way as far as contracts are concerned, as far as trade is concerned and as far as all the various facets of commerce are concerned. I want at the start to ask the small businessman not to try to continue on his own initiative but to become a member of one of the various Chambers of Commerce. He will find that the Chambers of Commerce will do invaluable work for him. He will receive valuable information if he becomes a member of one of these Chambers of Commerce.

The great problem in our business life is that the small businessman wants to try to go it alone, and that is where he often makes a mistake. It is wrong to contend to-day that if there are certain people who have been ruined it is the fault of the Department of Commerce and Industries. On the contrary, the Department makes a wonderful contribution to the building up of the strong economy that rests upon our retail business. When we look at the Republic of South Africa to-day we find that democracy, freedom of religion and free trade have always been the three basic principles of which we have been very proud. We find that they continue to be the cornerstones of our national history, of our national life as well as of our social life. We find that South Africa still generally recognizes the fact that we have free trade here. In three of our provinces we find ordinances which make it unnecessary for an existing business to be taken into consideration when anyone applies for a licence. Anyone can apply for a licence provided he thinks that he can make a success of the business and provided the Minister of Justice has nothing against him.

What was the trade pattern in the Union of South Africa just before the Second World War? Just before the Second World War we found that South Africa depended chiefly on imports for her consumer goods. At the time when we were dependent on imports for our consumer goods, the wholesale merchants of Market Street in Johannesburg and in our coastal cities played a very important role in our distribution system. The wholesaler was a very important link between the overseas’ manufacturer and the retailer in South Africa. That is why we find that he has played such an important role in our economic system. In the old days we found that the wholesaler sold his consumer goods to retailers at the same prices and on the same conditions. There was no preferential treatment given. The prices and the conditions were the same for all and it was left to the ability, the skill and the ingenuity of the retailers to compete against one another from that stage and to build up their businesses. But since the Second World War we have had an unprecedented industrial development in this country. We find now that 90 per cent of our consumer goods are no longer imported but are manufactured locally. Because of the manufacture of our consumer goods in the Republic, we find that the pattern of trade is changing very rapidly. Up to the present, retail trade has been in the hands of the retailer, the one-man business, the independent business. We have heard that there are 34,000 retailers in the commodity section in the Republic to-day. There are more than 6,000 retail butchers; there are more than 12,000 persons selling petrol. All these people in the retail trade have a very important role in our society as well as in our economic life. Progress in every sphere in the Republic of South Africa has depended upon the enterprise of these retailers. These retailers have always been prepared to serve on church councils, school boards, hospital boards, road boards and city councils, and it is that retailer who is prepared to-day to sacrifice his time to come and sit in this Parliament to serve his country. He is prepared to contribute to all the various funds collected in his area. He has had to do everything for himself. The responsibility has rested upon him. The retailer has contributed to the general prosperity of our country. But to-day we find that a new and changing trade pattern is emerging and that concerns with a great deal of capital at their disposal are destroying the small man in their search for more business, not by their own initiative, not by their own ingenuity, not by their commercial skill, but simply because they possess the capital and because they can use price discrimination against the retailer in an unfair manner. We find that the large chain stores are forcing one retailer after another into bankruptcy. The persons who at one time formed the backbone of our economy are becoming a canker in our national economy today. Slowly but surely the chain stores are driving these people out of trade. We already hear of chain stores calling themselves “multimillion rand retailers”, chain stores with more than 70 branches in the Republic and with an annual profit of more than R4,000,000; chain stores with stocks on hand amounting to more than R2,000,000 and boasting about daily purchases in excess of R60,000; chain stores which have more than 3,000 vehicles and, last but not least, which pay about R10,500,000 annually in wages. We also read in the newspapers of the tremendous expansion that has taken place in regard to another chain store organization which in the next two years or so is going to open a chain store every fortnight under a R17,000,000 scheme.

We all feel very proud of the fact that this financial giant has such tremendous confidence in the Republic of South Africa. As the hon. member for Vereeniging has said, we do not want to take action against these people. We are grateful for this tremendous expansion. These chain stores also have their advantages. In the first place, they have taught the public to buy for cash and to save by so doing. They have also assisted in lowering the cost of living. We are grateful to them for this. But in spite of these aspects these 34,000 retailers of whom we have heard are anxious about their position. There is anxiety in the mind of the retailer and there are certain questions which come to their minds, and not only to the minds of the retailers but also to the minds of various bodies; questions which come to our minds as Members of Parliament, to the minds of local authorities and so forth. One of these questions is: Is the tremendous power which these chain stores have acquired to the advantage of our economy? Does it not constitute a great threat to a stable economy? Will our trade structure not shortly be in the hands of a few undertakings and will this not rob the retailer of his business completely? Will these mighty chain stores not be in such a position of power at a later stage that they will even be able to dictate to the manufacturer, and will free competition not then be a thing of the past? Will the consumer, the person who at the moment is deriving all the benefit, not eventually become the victim? Although these chain stores are to-day bringing joy and happiness to thousands of people, they are becoming a monster which is devouring everything before it and creating poverty in a certain section of our national economy. We are trying to find a solution to this problem. The hon. member for Vereeniging and the hon. member for Orange Grove have told us what various governments in various countries are doing in connection with this problem. All that this motion asks for is that a commission be appointed to investigate the question as to whether this movement constitutes a threat to us or not. Are we prepared to allow the retailers, the backbone of our economy, to disappear before our eyes? Are we not concerned about their livelihood? Are we satisfied that things should go on in this way? The problem is a tremendous one; it is one which cannot be lightly investigated and easily solved. It is a problem that requires a thorough study, that requires the attention of the State. If we look at the Handelaar, the periodical which is published every month and which serves the retail trade, we find that from June last year to January of this year concern was expressed in every issue of this periodical in regard to the development of the chain store movement. These people are not sitting still. They tell the retailers what to do. They advise them how to overcome these dangers. Here we have an annual report of one of the wholesalers in which it is stated (translation)—

The injustice that I see in this whole matter is this: If the pattern in our grade changes to such an extent that the manufacturer will sell direct to the retailer then that will be all very well. If the only function of the wholesaler is to collect his profit merely for handling those goods then I have nothing to say about him. But then the manufacturer must be fair towards all retailers, then he must not sell his products only to certain retailers and give those retailers a discount if they have shares in that company, a discount if they buy in wholesale quantities and a further discount if they buy for cash. If the manufacturer imposes conditions of that kind, then he must not tell another man, “You cannot buy from me; you must buy from the wholesaler”, with the result that the retailer then has to pay far more to the wholesalers than he would have to pay if he could obtain his goods direct from the factory.

We find, even in America, as far as chain stores and departmental stores are concerned, that experience has shown that the cost of these departmental stores has gradually risen to such an extent that they can no longer keep their prices at the level at which they are to-day. Their prices have risen gradually and we now find that another kind of business is coming to the fore in America. They call them “discount houses”, and to-day we also find that these “discount houses” are beginning to come into being in South Africa. There is one being established in Johannesburg at the moment. We find that they have also proved very successful. But the point is that they also co-operate with the large manufacturers and they also constitute a threat to the retailer. The retailer is concerned because, as has correctly been said here, he is very directly involved. But he is not the only one who is concerned. We find the following in a circular issued by the Suid-Afrikaanse Handelsinstituut in December under the heading “Chambers of Commerce” (translation)—

The hon. member for Vereeniging referred to the Retail Butchers’ Association which the hon. the Minister addressed yesterday. What is their memorandum about? I have here a memorandum from the Federation of Fish Dealers dealing with a dangerous tendency in the distributive trade and with monopolistic tendencies in the retail butchers’ trade. They are frightened and they fear that those trends which are emerging to-day will destroy them. We also find a statement by Mr. Pauw, chairman of the Afrikaanse Handelsinstituut, that these problems can be solved. He says they can be solved provided certain requirements are complied with and provided protection is given against economically unjustifiable price discrimination. These people must be protected against unfair price discrimination. They cannot combat it. One may have all the initiative in the world and have all the ingenuity and all the capital too as a small business man, but if one is discriminated against as far as prices are concerned one will not be able to carry on.

I want to conclude by expressing my agreement with the words of Mr. W. A. Pauw, vice-chairman of our Handelsinstituut, who had the following to say when he addressed the Chamber of Commerce of the Handelsinstituut at Potchefstroom (translation)—

No retailer is afraid of healthy competition but no dealer can continue to make a living if there is price discrimination. That is why I want to support the motion of the hon. member for Vereeniging in which he asks that a thorough investigation be instituted into this great problem that is threatening the economy of our country.

The motion of the hon. member for Vereeniging (Mr. B. Coetzee) is, I think, in its wording a very unfortunate one, and the hon. member will be the first to agree that, after what he has said this afternoon, his intentions and the wording of the motion are very far apart. I for one cannot support a motion which says “that the chain stores and their expansion is a threat to our entire distribution system and that undesirable monopolistic conditions are likely to arise as a result thereof”.

While I agree with the suggestions this afternoon of the assistance that might be given to the small stores, and while I, like most members of this House, am keen to see the continued existence of the small stores, and while I can subscribe to a large extent to the proposals of the hon. member for Orange Grove, I think there has been some hazy thinking in this House, which should be cleared up in regard to chain stores.

Firstly, the chain stores arise out of the opportunity that exists under our system of unrestricted private enterprise. It is against the background of unrestricted enterprise that we have in this country, that the rise of the chain store is possible, and secondly, they arise from the fact, that has been mentioned here many times this afternoon, that the chain store can offer to the consumer and to the producer a more economical and effective system of retail distribution. I would like to ask the hon. member for Brakpan whether he is prepared to recommend that the consumer of this country should be forced to pay more by clipping the wings of the chain stores.

No.

That is the situation: Nobody in this country wants to deny the consumer the benefits he is receiving from the chain stores.

That is not the point.

Listening to some of the speeches this afternoon, one would imagine that a successful chain store (I use the word “successful” advisedly) consists of a sort of octopus who has suddenly come down and spread his tentacles and ensnared within them all the retail business that is available. But what are the facts, Mr. Speaker? What are these chain stores? They are businesses which were started many years ago in many cases, not so long ago in other cases, by hard working, farsighted, energetic men, who with no greater advantages and nor more capital than their competitors were prepared to challenge established business, try out new ideas and have progressed so far to-day that we look upon them as some monster—the chain store! Mr. Speaker, it is said that every soldier has the baton of a field-marshal in his knapsack, and if one honestly investigates the situation of the chain store in this country and how it has arisen, one can say that every small storekeeper has the possibility of becoming a chain store tycoon.

The chain stores have made a vast contribution to the welfare of this country. They have provided better stores, both in appearance and in facilities, they have provided quality goods in a great variety at low costs. They have made goods previously only available to the wealthy available to the man in the street. They have reduced prices, not only for the benefit of the consumer, but for the benefit of the producer and the manufacturer. Now there has been quite a lot said this afternoon about the manufacturer and the possible change in the distribution system and one builds up a mental picture of the manufacturer routing all his goods to the chain stores only, nobody else being able to purchase goods. But that is not the picture at all. The picture is: What has the benefit been of the chain store to the producer? By low pricing and efficient organization the chain stores have reduced that gap we are always hearing about between the producer and the ultimate consumer. Whenever there is a debate on farming products in this House, we hear much about the gap between the producer’s price and the consumer’s price. The chain store has broken that down and is continuing to break it down. The chain store has provided a proper outlet for manufactured products and has been a stabilizing factor in our economy by the way it operates, by pre-payment purchases, by enabling, by intelligent pre-ordering, the factories to manufacture in their off periods, in the periods of their low production levels and so keep down the price of goods. It has provided the factory with new items to be manufactured. The chain store with its output goes to the manufacturer and says: Here is a new item not manufactured in this country, can you manufacture it for us? These are the benefits. But another interesting fact is that the independent store itself has reaped great benefits as a result of the advent of the chain store. The chain store has had the effect of forcing the small store-keeper to modernize his store. It has forced him to adopt new pricing policies, to revitalize his marketing outlook and his management methods; it has forced him to evolve similar organizations where, without losing his identity he also can buy in bulk. I do not want to mention names in this House, but we know there is at leat one, and others are coming, overseas organization and also local organizations, set up to provide bulk-buying facilities for the small stores. It is the advent of the chain store that has made these things happen. The sentimental attachment to the small storekeeper which we have heard about this afternoon is not factual. The small storekeeper has got to live with the times. I have every sympathy with the small storekeeper. I hope he will get every assistance that the hon. member for Orange Grove has suggested this afternoon, but, Mr. Speaker, the advent of competition, the advent of the chain store, the advent of business efficiency can no more be stopped than one could stop the steam engine or the spinning-jenny. These are things of our times and it is up to the small storekeeper, with Government help if necessary, to take advantage of the situation and improve his own position. And if you look round at some of the small storekeepers, the improvement in their stores as they are to-day in comparison to what they were ten years ago is quite remarkable.

It has been said that the small man is being forced out of business and figures have been quoted from the United States. But what is the situation in the United States? In the United States to-day 30 per cent of the total business is being conducted by the chain stores, and this is what a survey said in 1954 by three university professors—

So if you are envisaging a situation where the chain store is going to wipe out the small storekeeper, it is not factual.

What is the position in South Africa? In 1950 there were 58,000 general dealers’ licences; in 1961 there were 71,428 general dealers’ licences. I do not know how many of those licences were held by chain stores, but I think the hon. member for Vereeniging will say that I am being liberal if I say that 5,000 or 6,000 of those licences were held by chain stores. So what is the factual position in this country? That in addition to the chain stores there are certainly over 65,000 independent retail operators. It is no good telling this House that the retailer is being forced into the ground, that he is being made to disappear. It is not true. There are 65,000 retail outlets still in existence in this country. And in talking about help to these retail stores we must get the background and the facts correct. If you look at the licences issued, you find that in a place like Cape Town 6,300 licences were issued. How many chain store licences are included? I doubt whether there are 200 or 300. In Johannesburg 12,000 licences. How many chain stores? 1,000 at the most. That leaves 11,000 private operators. Do not let us lose our sense of perspective in this matter. The other interesting fact is this, Mr. Speaker, that as soon as a chain store opens, the independent retailers flock around him like destroyers round a battle ship. If you open a new chain store in an area, the independent retailer cannot get there quick enough, even if he is selling lines in competition with the chain store, because he knows the chain store brings business to the area.

We hear and have heard this afternoon that the small businesses are going to be wiped out. Now there have been investigations into the reasons why small independent businesses fail. One must not lose sight of the fact that every individual is not a good businessman. I have listened to many speeches in this House in the few years I have been here, and even in this House there are many people who are not very good businessmen.

I suppose you are a good one?

I suggest that the hon. member for Cradock should keep quiet and listen.

He knows about sheep.

“Sheep are meant to be shorn”, is a good business saying. One must not be misled by what happens in the case of the small businessman, one must not read statistics and find that certain small businessmen have failed and then throw up one’s hands in horror and say “The reason for it is the chain stores”. Because what are the actual facts in the failure of small businesses? There have been two surveys done One was done by the National Cash Register Company in America, and 81.5 per cent of the failures that this survey found were due to the following: 34.5 per cent due to incompetency; in other words, it is an unhappy thing to say, many people going into business are not competent to run those businesses and they fail, and that is one of the fundamental reasons for the failure of many individual storekeepers; the others do not fail despite competition, they grow and they stay. The second reason: 5.2 per cent due to inexperience. And one of the major factors, a fact that the hon. member for Orange Grove touched on: 34.9 per cent were on account of lack of capital. And if means can be found to provide capital for the small trader, you may avoid the 34.9 per cent. One of the basic reasons is that too many people go into business with hope and not sufficient funds. Competition, in terms of this survey, was the cause of only 2.4 per cent of the failures of small businessmen in the United States. Only 2.4 per cent as the result of competition! There was a second survey done by Dunn & Brad-street. According to Dunn & Bradstreet it is relatively rare for a retail business to fail because of reasons which are beyond the realm of managerial control, which in simple English is: Not beyond good personal management. In one analysis it was reported that more than 85 per cent of total retail failures could be attributed to specific factors, broadly grouped under the classification “inefficient management”. These are the facts. I am sure all members on this side of the House sympathize with and understand the problem of the independent storekeeper, but for heaven’s sake, do not let us go and take action which is based on fallacious evidence, which is based on sentiment and not based on the true facts of the situation. I am quite certain that this House does not want this resolution. Whatever the reasons of the hon. member for Vereeniging and however good they might have been. I think we will admit that this is a bad proposal to bring before the House.

Did you read the motion?

I read the motion very carefully. It is quite impossible for me, and I am sure most members of the House to accept this motion. We can and do subscribe to the point of view of the hon. member for Orange Grove, because while we believe that the community benefits from the chain store and that we would be doing harm to the community if we were to deny the chain stores any rights or try to restrict their activities at the same time we can agree that with capital and good marketing methods and adequate credit control and all the other factors that make for success in business, the small man can very easily continue to exist.

The hon. member for Parktown (Mr. Emdin) dealt with the question of chain stores with so much conviction that I must say that he was more successful than any of the persons in the Sunday Times last week. But we are not dealing here with the merits of chain stores and the hon. member for Vereeniging (Mr. B. Coetzee) also made that point clear. We are not dealing here with the question of their existence or with the question of efficient service. The problem as he put it is that certain things are happening and their effect is such that we cannot remain disinterested. The hon. member for Vereeniging asked that the problems of the retailers should receive sympathetic consideration. This is not a factor that is peculiar to our country alone It is also a characteristic of the pattern of trade abroad. It started in the U.S.A. and then spread to Britain. During the past 10 years that pattern has also revealed itself on the Continent. It is not yet universal but it is a pattern in that we find in cerain countries throughout the world. There are various reasons for the progress of this development. The hon. member for Brakpan referred very succinctly to one important factor that has contributed towards this evolution in the retail trade, an evolution that we cannot stop, an evolution that has come to stay. He pointed out that with the upsurge of our own industries and increased industrialization, this pattern has changed, and the wholesaler no longer plays the key role in our distributive trade that he played previously. The industrialist sometimes found it difficult to sell his goods through the wholesalers and so he started approaching the retailers direct. In this way a direct contact arose between the industrialist and the retailer which is still there to-day. The fact is too that the wholesale trade to-day handles less than half of all our industrial products that are sold to the consumer. This industrialization has brought about a change in that pattern but apart from this fact the concentration of the population in our cities, the increased buying power that is concentrated there, has resulted in the fact that the old one-man business has begun to experience more competition. This urbanization has resulted in the coming into being of departmental stores, bazaars, and self-service stores but this pattern has not yet reached finality in our country. The discount houses have only just started to come into being. We will probably have more of them before this pattern reaches finality.

Apart from this fact, there is a further tendency that we have noticed, particularly in recent years. In the recent past it was the practice for people living on the outskirts of the larger cities to go to the centre of the city to make their purchases. That pattern has changed radically. One finds that departmental stores have come into being in each of these municipal areas around the larger cities to-day. The small store which made a living in the suburbs is now experiencing competition from that type of shop and we find that pattern everywhere. We also find that parking problems in the cities have assisted this process. But this increased buying power has resulted in the coming into being of these departmental stores. More capital is required in this regard. This capital is easily obtainable on the money market. Their strong financial position has resulted in the fact that loans at a reasonable rate of interest are easily obtainable. But it is also a characteristic of the latest tendency that trade is becoming modernized. It is not only the chain stores but private stores as well that have become modernized. They have begun to use better trained staff. They have set up self-service systems requiring a smaller staff but a better trained staff. Their expenses have been reduced and their wage bills have been reduced. They have provided better display facilities and they have not made more deliveries. Expenses have therefore been cut and the buildings are better. They concentrate on a quick turnover and most of them do not give credit. All these factors have contributed to the fact that these modernized shops are able to lower their distribution costs. This fact has of necessity had a very important effect. Experience abroad has also shown that where these modern shops have come into being, costs have fallen and they have been able to pass this advantage on to the consumer. It has been found that in countries like Spain and Greece and Italy where these modern shops have not yet come into being to such an extent, the distribution costs are higher and that living costs are higher than in other countries. We cannot get away from the fact that this modernization has resulted in reduced distribution costs and it has made the article cheaper to the consumer. It has also had its effect upon the producer because if a dealer sells the industrial product more cheaply, his turnover rises. The fact remains that in our country the turnover of the one-man businesses has fallen considerably. The hon. member for Vereeniging pointed out that the turnover of the chain stores rose by 52 per cent between 1951 and 1957 as against only 17 per cent in respect of grocery shops, 12 per cent in respect of men’s outfitters and 18 per cent in respect of ladies’ outfitters. This is an indication of the turnover that was made. But I also want to point out that in spite of that tendency the fact remains that the number of one-man businesses has increased.

When we compare the number of one-man businesses in 1952 with the number in 1961, we find that the number of these businesses increased from 19,220 to 23,515, an increase of 20 per cent in these 7½ years. As far as partnerships were concerned there was a small increase from 4,313 to 4,355. The number of private companies increased from 4,493 to 6,220, or by 35 per cent. As far as public companies were concerned, during these 7½ years there was a decrease in their number from 1,673 to 1,570. I want to say immediately that this decrease in the number of private companies must not give the impression that their number has actually decreased because one single company remains such, even though it might have increased its branches by 100, so that these figures do not give a completely correct reflection of the position. When the 600 unclassified dealers are added, it appears that from 1952 to 1961 the total number of businesses increased from 30,000 to 36,500, or by 22 per cent. It cannot therefore be said that in spite of these chain stores and the question of modernization, the small man has not been forced out completely. That has not been said, but in spite of the facts I have just mentioned the number of one-man businesses has increased.

When we look at the number of insolvencies, it is quite interesting to note that of the total number of insolvencies in 1962, 202 were businesses. For the 11th month in 1963 there were 141. Proportionately therefore there have been fewer insolvencies during the past year than in the previous year in this sector, but the number increased from 1959. The fact remains that insolvent businesses make up about one-fifth to one-sixth of all insolvencies. I take it that there are a number of one-man businesses which close down without becoming insolvent but it does indicate that up to the present the insolvency figure has not increased disproportionately as a result of these chain stores. It would however be wrong to say that there is no problem. On the contrary, we do have a problem and that problem was noticed in 1962. The problems of the retailer and the small man were submitted to the Government at that stage by the Economic Advisory Council. That was why the following remarks were made by the hon. the Prime Minister at the time (translation)—

It was as a result of the representations that were made to the hon. the Prime Minister at the time that he gave instructions that the question of the retail trade should be investigated. This matter was in the first place referred to the I.D.C. and as a result of those representations the I.D.C. established a special division for the small-scale industrialist. But the I.D.C. also received instructions to investigate the financing of the retailer. There appears to be a considerable number of problems connected with this matter and up to the present it has not been possible to determine finally the scope of these problems. This aspect is therefore still in the hands of the I.D.C. But the congress which has already been referred to and which has been arranged for next month, will be virtually the first of its kind giving the retailers an opportunity to discuss their own problems and to try to help themselves. The convener of that congress, in a statement issued to the Press, had the following to say (translation)—

I want to say immediately that it is encouraging to see that they realize that the answer to this new tendency lies in their own hands. I am convinced of the fact that they will find, just as has been found in other countries, that they will have to adapt themselves in the first instance to these new tendencies. That is what has been done abroad where the result has been that these small businesses have not disappeared. They have had to resort to specialization and modernization. The answer is therefore in the first instance in their own hands. Reference was made here to the Monopolies Act and hon. members pointed out that dangerous monopolies could arise in this regard. As the Monopolies Act reads at present, action can only be taken against a monopoly if that monopoly is contrary to the public interest. The fact is that the coming into being of these chain stores—modernization and these larger stores—has generally resulted in the fact that prices have fallen. It will therefore be difficult to use the provisions of the Monopolies Act to counteract this tendency. These shops compete with one another. There is a group of them trading in the same sphere. Competition between them is fierce and it will therefore be difficult to say that they form a monopoly. But there is another aspect of the matter and that aspect is particularly disturbing. It appears that a number of these larger stores sell goods to the consumer at prices far below the prices for which the small man can even purchase those goods from the manufacturers. To my mind this is a very disturbing aspect of the matter. Complaints have already been made to the Department in this regard and an investigation is under way at the moment. If it appears that these complaints are justified, further action will be considered. Reference was made to the fact that these small traders should organize themselves. We already have the S.P.A.R. movement; there is another one too and still others are being considered. I think that one of the answers is that the retail trade should organize itself along the lines of combined buying. From the nature of the case, we must accept the fact that when a large order is delivered, the costs connected with it are lower than in the case of small orders. There is justification for a cost factor there but when it appears that that cost factor cannot be justified, then it means that there are other factors at stake, and if it appears that this capitally powerful concentration in the distributive trade is misusing its power to force economically unjustifiable concessions from manufacturers, it will be wise to restrict it in such a way as to restore healthy competition. We can investigate some of these practices and if any of these dealers want to bring these practices to the attention of the Department, they are free to do so. There is the Trade Restrictive Practices Act which is applicable in other countries. Reference was made here to laws in the U.S.A., and to bodies like the Federal Trade Commission which deal with this aspect. If it appears necessary to introduce legislation in order to eliminate unfair practices, we shall not hesitate to do so. Reference was also made to financing and particularly to what is being done in the United States in this connection. As a result of representations made to the hon. the Prime Minister, the Department of Commerce and Industries was instructed last year to investigate the question of the financing of these one-man businesses. Circulars were sent out at the time and sample tabulations made of retailers on a sample basis. I agree that sample tabulations such as this do not give a true and full reflection of the position but they do give us some indication. In spite of the fact that the Handelsinstituut and the Chambers of Commerce urged their members to complete these returns, it appears that only 37 per cent of them completed their returns and sent back their forms. Of the 37 per cent who did return the forms more than half indicated that they were not interested. If the number of White retailers who did not return their forms is to be estimated by the number of those who were not interested, it means that 83 per cent do not need a state-financing institution. Of the balance of 17 per cent, only about half indicated that they were experiencing difficulty in obtaining loans from existing institutions. The reasons that they gave for their difficulty were divergent in substance and varied from a lack of financial institutions or adequate security to the fact that a State institution would create more confidence for longer term loans at lower rates of interest. If this sample tabulation is applied to the total number of White dealers it is estimated that this group, which for the reasons already mentioned is experiencing difficulties in obtaining loans, numbers about 1,850, that is to say, 6.9 per cent of the total, and that its requirements amount to R21,000,000 of which R11,500,000 is required for the financing of fixed assets. There does seem to be an indication that a requirement of this nature does exist. But this matter has still to be investigated further. The question is, if we do resort the making available of some form of financial assistance, as has been advocated by the hon. member for Vereeniging, what form should it take? Should it be handled by the I.D.C.; should a new institution be set up or should institutions already making this assistance available be financed to some extent in what they are doing? If so, in which cases should this assistance be given? Should it only be given in cases of modernization and so forth? There are other problems connected with this matter which must be investigated. But the fact remains that this inquiry proved that there was a need for capital for these bodies. The Department is at present investigating what is being done in other countries to help the small-scale businessman. Certain steps are being considered in Australia at present. I notice that the Chamber of Commerce decided at Paarl this week to appoint a committee to investigate this matter.

I want to refer again to this congress of retailers that is to be held next week. The problems that they are experiencing will probably be thoroughly analysed there and I also expect positive suggestions to be made. It is hoped that the Department will also be represented there so that we will have a first-hand knowledge of the problems from the retailers’ point of view. They will probably be more organized after that conference and therefore better able to make representations. The fact remains that the retailer has a problem, a problem of which the Government is aware and to which it is already giving attention. Because the retailers are now starting to organize themselves for the first time, I believe that they will shortly be able to bring more of their problems to our attention. In the meantime the Department will continue with its investigation to ascertain whether unjust trade practices do exist and, if necessary, legislation will be introduced in this regard. In the light of these things we feel that it is advisable as far as the investigation itself is concerned to wait until such time as this conference has taken place. We may then possibly be able to take more positive action.

The very cautious statement which the hon. the Deputy Minister has just made indicates quite clearly, I think, that he does not intend to appoint a commission, as requested in the motion. He has referred to various investigations, some of which have already been undertaken and others still to be undertaken, in order to assist the small businessman, but he has not said that he agrees with the request in the motion to appoint a commission to investigate what the hon. member for Vereeniging (Mr. B. Coetzee) calls the threat posed by the expansion of chain stores to our entire distribution system, and to the continued existence of the small trader. Therefore, Sir, I do not think that I need to follow the hon. the Deputy Minister in his statement, which was rather a detailed one, about administrative matters arising out of requests made to his Department, and I would therefore prefer to deal with some of the points raised in the course of the debate by other speakers so far. The hon. member for Vereeniging said to-day that he was not against the chain stores. Sir, I was interested to read in the Sunday Times of 16 February the following headline: “Big Trade Battle goes to Parliament.” It was not on the front page but it was a very prominent headline, and this appeared in a panel—“I am not fighting chain stores, says Blaar”. Of course, it is very interesting to see, in view of the statements which that hon. member makes from time to time about the Sunday Times, that he is not averse to getting very good publicity from the Sunday Times.

They can do with that publicity what they like.

Anyway, I take it that the hon. member is not suing them for giving him this publicity. He says that he is not looking for a fight with the chain stores. All he wants to do is to investigate a vast social problem, and when you come down to it, Sir, what is this vast social problem?

Blaar.

Yes—correct! But I do not want to deal with that. The vast social problem appears to be the hardship suffered by the small trader, and the hon. member as well as his supporter, the hon. member for Brakpan (Mr. Bezuidenhout) presented the House with an idealized picture of the small trader. They say in effect that these 34,000 small traders are men who are dedicated to their vocations, as, for example, doctors are supposed to be, and that all they ask of life is that they should be allowed to remain small businessmen which, of course, is not true.

What about the hon. member for Orange Grove (Mr. E. G. Malan)? What did he say?

What they had to say in effect was that these people, having made up their minds to follow a certain vocation in life, which happens to be that of the small businessman, they want nothing better.

You are being absolutely silly about it.

I could not possibly be as silly about it as the hon. member was, but I do not want to be diverted. The small businessman, who is a small businessman to-day, is one merely because he has failed in his efforts to become a big businessman. Is that right or not?

No.

In other words, what we are being told is that all a small businessman asks is to remain in his small circumscribed, struggling business for the rest of his life. He does not want to expand; he does not want to grow bigger; he does not want to build up reserves; he does not want to have a branch anywhere. He wants to remain a one-man small business. I would have expected a better case and a better argument even from the hon. member for Vereeniging. Sir, I am not going to waste any time on this aspect of the matter—because I think it is a waste of time—beyond saying that if the Government can find ways of assisting any sector of our economy and any individual who trades legally, that assistance should be given to him; but when people come along with the suggestion that we should set up another corporation—and here I must differ from the hon. member for Orange Grove—then I am horrified at the prospect of a corporation being set up on the lines, as was said, of the Bantu Development Corporation, to assist the small trader. Is the White man in business in South Africa so backward now, that he needs the kind of assistance which we are giving to the Bantu trader? I do not believe that.

I did not say that.

No, but the point was developed on the other side, and it appears that there is a great deal of enthusiasm for this idea that a state-sponsored corporation should extend financial assistance to the small businessman.

What about the Industrial Development Corporation?

What about it? Sir, we heard in the debate this morning about the difficulties which the public and the taxpayers of South Africa have, at this time, in getting any accountability even to Parliament of the activities of these state-sponsored corporations; when I, for example, ask the I.D.C. through the Minister to give us some details as to how much money it has advanced to people producing films, whether they have been paid, how long these loans are for and what the conditions are, then I am told that it is not in the public interest to tell us. What the hon. member for Vereeniging is trying to create is an expansion of a system of using public funds without any accountability to either Parliament or the taxpayer, which in my view can only lead to unhealthy practices, and can only lead eventually to the subsidization of the inefficient and uneconomic business and businessman, to the detriment of the consumer and the public.

Now I want to deal with the public aspect of this matter. Has there been a call from the public, from the consumer, for an inquiry such as that asked for by the hon. member for Vereeniging? We were told here as recently as this week, I think, that there had been a call—it was called a “roepstem van die volk”—for rent control. Has there been a similar call for this type of investigation into the expansion of the chain stores?

What about the conference to be held next week?

I am talking about the public, who are the consumers. For example, have you had such a call from any consumers’ organization?

This is common sense—which you have not got.

Well, Sir, if that is not a case of the pot calling the kettle black, then I do not know!

You remain Mr. Finkelstein.

Wait till we get to the subject of sheep! Sir, the consumer is very, very vociferous when it comes to criticizing any aspect of public business in this country, or trading conditions—or complaining about high prices and rent increases and so on. To this day you cannot point to a single instance where the consumer, the public, through any one of the numerous organizations which exist, have made any call on this or any other Government to curb the expansion of the chain stores. The reason is a very good one. The reason has been given by the hon. member for Brakpan (Mr. Bezuidenhout), because despite the fact that he has sympathy for the small man—we all have—he has gone out of his way to say the chain stores perform a public service. Yes, they are performing a public service—so what are you going to investigate? Are you trying to investigate all the good things that are happening in this country? You should investigate a lot of other things which are evil and unnecessary, but not enterprises that perform good service. The suggestion that something good should be investigated as if it were evil, goes beyond all reason.

The argument was advanced by the hon. member for Vereeniging that the small businessman had trained the people who were eventually taken over by organized commerce and industry. What does he think the chain stores are doing? Are they not training people to manage businesses? In fact, they specialize in it—and I hold no brief for them.

Who attacked the chain stores?

Well, Sir, the hon. member must read his speech. He says he did not attack the chain stores, but his entire plea for an investigation into the threat of the chain stores, is tantamount to an attack on the chain stores. I have his motion here, so he need not think that I have not read it. It says “… the threat that this extension of the chain stores may constitute to our entire distribution system and the continued existence of the small trader”. Is that not an attack on the chain stores?—because you know they are responsible for a very large part of that distribution.

Mr. Speaker, on a point of order, is it in order for the hon. member for Cradock (Mr. G. F. H. Bekker) to refer to my colleague as Mr. Finkelstein?

What is wrong with that?

The hon. member for Vereeniging himself had said that in every town on the Reef—he can correct me if I am wrong—you have these chain stores to-day. Clearly, Sir, these are the people who are in fact responsible for the distributive system. Wherever there are people who have to eat, to live, the chain stores are there. What is wrong with expanding such a distributive system? The trouble with the hon. member for Vereeniging is that whereas he says he is not attacking the chain stores he is, in fact, in attacking a certain system of distribution, attacking the people who are responsible for the greatest proportion of the distribution of consumer goods in this country. And he knows it. He must therefore make up his mind. If he wants to attack the chain stores openly, then he is entitled to do so. I do not hold a brief for them. But then he must come here with chapter and verse and show (a) that they are evil, (b) that their expansion constitutes a monopolistic tendency and (c) that it is necessary to investigate them. And until he does that, I submit that this argument holds very little water.

The hon. member for Brakpan who supported the hon. member for Vereeniging says the development of any area in the Republic has been due to the initiative and enterprise of the small trader. In fact, I do not disagree with him. But then he must not deny that in that particular development, the chain stores can and do also play a very important part. What does he think will happen to those people who are now employed in the towns of the platteland, where there are already chain stores wherever their existence is warranted? Where will those people get employment? This complaint that we always hear about the depopulation of the platteland would be a far more serious one, because the boy who lives for example in a town like Pietersburg, and wants to work there and learn something about business, could never have worked there had it not been for the chain store. He could never have worked in those one-man business enterprises, because the essence of the one-man business is that it hardly employs anybody. That is why it is called a one-man business. Thus I maintain that in that respect, as well as the fact—this is fundamental, but the hon. member for Brakpan would not understand it”that modern buildings are being erected on the platteland and they are attracting more capital to the platteland, the chain stores have provided a certain amount of development, and should therefore not be dealt with in the way the hon. member for Vereeniging has suggested.

Finally, I want to deal with the point made by the hon. member for Brakpan—that these chain stores swallow everybody up. Apparently he has forgotten that from time to time a chain store organization has closed down. I can remember one—Publix. They operated in his town. They operated in every town on the Reef—and yet they closed down!

They never closed down; they were taken over.

They closed down, Mr. Speaker. I happen to know more about it than he does. It so happens that they were not efficiently run. Therefore, the operation of a chain store is by no means the royal road to success that these hon. members think it is. You still have to run a business efficiently. I can think of another one which in the last two years has compromised with its creditors. I do not want to drag it into this debate. So you can go through these cases one by one, and you will find that in every case the so called chain store was founded by one or two or three people who had the necessary acumen—and the good fortune—to develop a very large organization, but who nevertheless took every business risk, and even greater ones than have to be faced by the small trader. I feel, therefore, that whereas we may, in terms of human sympathy, say: Let us see what we can do for the small trader, I would prefer, firstly, that the small trader be regarded as a member of the community who will never be eliminated by the chain store, which does not in any way seek his elimination; and that, secondly, if any assistance is given to the small trader, it should be on the lines, for example, of the Small Business Administration in the U.S.A.—I have seen that for myself—which provides technique, know-how and advice, but not capital. I hope the last thing the Government will consider doing—any Government in this country—is to go to 34,000 small traders—their numbers may be greater or lesser in the next few years—and say to them: If you find yourself short of capital, you can always come to us. Where is the incentive that those hon. members talk about so often? Where is that self-reliance which they always bring up when we say, “establish a national contributory pension scheme?” Then they say a man must stand on his own two feet; but the moment he runs a small business, apparently, he must no longer stand on his own two feet: the State must use the taxpayers’ money, your money and mine, Sir, in order to spoon-feed him, so that he can then stand up on his own two feet!

I think that this particular motion cannot possibly be considered as being reasonable, or even necessary in the circumstances, and for that reason I am very glad the Minister does not intend appointing a commission. I sincerely hope that he will confine the investigations of the position, as he has said, to ways and means—other than direct financial assistance—of assisting the small trader in South Africa.

It is very clear to me from the remarks made by the last two speakers on the other side of the House that they have, as usual, been very easily caught out. They thought that the mover of this motion and his supporters would launch a strong attack upon the chain stores in the Republic, but this was not done. Nevertheless, these hon. members still had to make their speeches this afternoon which they had prepared fairly well and which were probably inspired by sources outside of this House, and that was what they dished up to us here.

I just want to ask the hon. member for Hospital (Mr. Gorshel) whether he does not think that the possible disappearance of or interference with the livelihood of 34,000 licensees in the distributive trade, their staff and dependants, will not create a social problem? I am absolutely convinced of the fact that the hon. member for Hospital will be the last person to accept responsibility for all the nonsense that he spoke here this afternoon in reply to the speech of the hon. the Minister. Out of respect for this House and before I become guilty of that same kind of despicable action, politically speaking, I would like at this stage …

(Mr. Pelser): Order! The hon. member must withdraw those words.

I withdraw them, Mr. Speaker.

I want to move—