Order! I have to announce to the House that I have, on behalf of Parliament, accepted a small bronze statue of Confucius which was presented to me yesterday by a delegation representing the Sino-African Amity Association of the Legislative Yuan of the Republic of China.

The statue will be placed in the library of Parliament.

Order! Pursuant to my statement on Friday, 7 August, in regard to the person who interrupted the proceedings of the House from the public gallery on Thursday, 6 August, and the subsequent personal explanation by the Minister of Transport Affairs, the Committee on Standing Rules and Orders requested me to furnish the particulars in connection with the matter to the House in a further statement.

*The person who interrupted the debate from the public gallery on 6 August was found, after being questioned by the police, to be a Mr. Duckworth. The police officer in charge of the security arrangements for the Parliamentary building then sent a police sergeant to the office where the tickets are issued to obtain the form which had been filled in by that person.

While the official who issues the tickets was looking for the form, the hon. member for Pretoria Central (Mr. D. J. L. Nel) also entered the office.

The official was unable to find a form for the date 6 August, but found a form with Mr. Duckworth’s signature on if under the pile for 3 August and gave the sergeant a copy. The sergeant returned shortly afterwards and said that it was the wrong form because it had been dated 3 August. The official told him that it was the only form on which Mr. Duckworth’s name could be found, and repeated that there was no form for 6 August.

†Let me say at once that the parliamentary official acted quite correctly in giving the form to the police. In terms of a resolution adopted by the Committee on Standing Rules and Orders in 1966, the police are, subject to such provisions as may be prescribed by the Speaker, responsible for the internal security in the parliamentary building and for the maintenance of law and order in all the public sections thereof. In terms of this resolution the officer in charge of the police at Parliament controls the security measures for the parliamentary building.

*At a later stage, after the form had been handed over, the Minister of Transport Affairs said in the House: “Mr. Speaker, I want to be very convivial this afternoon. I have just been informed that, while we are seated here in the House of which we are proud, the gentleman who made the interjection from the public gallery was a guest of the hon. member for Sea Point.” The points of order which were subsequently raised were concerned with the truth or otherwise of the assertion made by the Minister of Transport Affairs. As a result of the expression “Is the hon. the Minister allowed to tell a lie about another hon. member in this House?” which was used by the hon. member for Sea Point, I accepted by implication that he was categorically denying the assertion that he knew anything at all about the person concerned. On the basis of the fact that a member must under such circumstances accept the word of another member, I then directed the hon. the Minister of Transport Affairs to withdraw his assertion concerning the hon. member for Sea Point, with which the Minister complied. As far as I am concerned, the question of the accuracy or inaccuracy of the assertion was thereupon disposed of.

†However, the hon. the Chief Whip of the official Opposition went further and asked me to consider the appointment of a Select Committee “in view of the fact that the rights and privileges of an hon. member have been abused”. Subsequently, while a point of order was being discussed, the hon. member for Pretoria Central said the following: “Mr. Speaker, I just want to say that the information I received from the control office was that the person in question was in fact a guest of the hon. member for Sea Point and that the form was signed by his secretary.” The hon. the Chief Government Whip thereupon supported the request for a Select Committee, because, as he put it, “because I have good reason to believe that the hon. the Minister’s allegation is correct”.

The next day I stated in the House that a ticket had not been issued to Mr. Duckworth on 6 August and that the inference that a ticket had been issued in the name of the hon. member for Sea Point, had been based on information furnished by the office responsible for the issuing of tickets.

It appears that Mr. Duckworth was in fact in the gallery on 3 August, and his ticket which had been issued on that day was taken by the officials at the entrance to the gallery.

The form for 3 August which was handed to the police shows that the application for a ticket had been made in the name of the hon. member for Sea Point and had been signed by a secretary/typist of the official Opposition. The form was accepted by the parliamentary official on the assumption that the secretary/typist had been authorized by the member to sign it. As has been stated, the hon. member for Sea Point categorically denied any knowledge of the person and he also subsequently confirmed that he had not authorized a secretary to sign the form.

*There is no documentary evidence to prove that Mr. Duckworth had applied for a ticket on 6 August or that a ticket had been issued to him. A ticket was handed in by him at the entrance to the gallery, and the only inference which can be drawn is that he had received a ticket from someone else.

In the light of these facts I stated in my explanation of 7 August that a Select Committee was not necessary because the Minister of Transport Affairs would furnish a personal explanation and because departmental action would be taken in connection with the release of the information. I wish to emphasize that the Select Committee that I had in mind was the committee requested by the Chief Whip of the official Opposition, viz. a committee to inquire into the abuse of a member’s rights and privileges. A Select Committee to inquire into the accuracy of the assertion made by the hon. the Minister, as was requested by the Government Chief Whip, was no longer necessary because the hon. the Minister had withdrawn his assertion. In addition, the facts in this connection were readily ascertainable.

I now wish to deal with the personal explanation given by the hon. the Minister of Transport Affairs in the House of Assembly on 7 August.

It is clear that the information initially supplied to the Minister was based on the form which was handed in on 3 August for a ticket which was used on that day and not on 6 August, as was incorrectly supposed. The Minister accepted this information in good faith as being authoritative, and by withdrawing the assertion, this aspect of the matter was disposed of. As regards the confidentiality of the information, the Minister unwittingly acted controrary to the customs of this House, as he did in fact make clear in his personal explanation on 7 August. I wish to emphasize that my statement on that day was concerned with this aspect, viz. the confidentiality of the information concerned, and that there was no reflection on the Minister implying that he had told an untruth.

In the light of these facts, and after a candid discussion by the Committee on Standing Rules and Orders, I am pleased to be able to say that the matter is being viewed in a clearer perspective and that there is understanding for the actions of the Minister. I wish to express my appreciation to the Minister for his consideration for the Chair. With that I consider the matter to be disposed of.

†The other matter I wish to deal with is the procedure followed in issuing tickets.

In terms of the rules in the Guide for Members the application forms for gallery tickets have to be signed by members themselves. Because of practical problems experienced by Ministers, Deputy Ministers and the Leader of the Opposition there has been an arrangement in recent years that their private secretaries may sign forms on their behalf on the explicit understanding that they have been duly authorized to do so. In the course of time forms were also signed by the secretaries of other members, but this has in all cases been accepted on the understanding that this was done with the knowledge and approval of the members concerned. Instructions have now been issued that except in the case of Ministers, Deputy Ministers and the Leader of the Opposition this procedure be discontinued immediately.

*Furthermore I can inform this House that the Committee on Standing Rules and Orders has appointed a sub-committee to inquire, in conjunction with the hon. the Minister of Police, into the security measures for Parliament, with special reference inter alia to the issuing of gallery tickets. If hon. members should wish to make any suggestions or recommendations in this connection, or in regard to security measures in general, I should be glad if they would lodge them in writing with the Secretary as soon as possible and before Tuesday, 25 August, for submission to the sub-committee.

In the meantime I wish to make an appeal to hon. members to comply strictly with the directions in respect of visitors contained in the Guide for Members on pages 102-104.

Mr. Speaker, we are now halfway through the budget debate for this financial year. I have listened very attentively to most if not all of the speeches made here and I have asked myself what the aim of this discussion is. I should like to single out two and then discuss one of them.

The first aim is undoubtedly to have the budget accepted by Parliament so that the State can continue with its activities.

The second aim of this discussion is to afford this House, the hon. members of the Opposition, the hon. members on this side, the electorate and the people in the outside world the opportunity to ascertain whether the budget can serve as a yardstick as regards the economic realities we as a country are confronted by and also as regards the influences of the outside world on us. It is therefore our task to test the budget to ascertain to what extent it complies with the economic realities we are faced with from day to day. It is important that when we draw up a budget we take these economic realities into consideration.

The second reason is that we must give the chief spokesman on finance of the official Opposition, who is the shadow Minister of Finance—the official Opposition is after all the alternative Government—the opportunity to test this budget from their standpoint against the economic realities of South Africa and the influence of other economic structures from the outside world. However, to use and test this yardstick we must identify certain economic identification factors to serve as norms, factors to serve as master gauges with which to test this budget. I want to identify and enumerate a few of the factors and then I want to use these factors to test the reaction of the official Opposition, in the person of their chief spokesman, as regards his speech on this budget.

The first factor to be taken into account is most definitely that cognizance has to be taken of the economic trends in South Africa in the period preceding the budget. The budget must therefore take cognizance of and make provision for the economic trends existing in the management sector of South Africa. I contend that it has repeatedly been proved on this side of this House that the budget has succeeded in accommodating these economic trends which existed in our economy in the period before the budget. One can enumerate a few of them. One can consider the extra credit granted and the growth in the supply of money.

The second factor to be taken into account is the needs of the national economy. A budget must meet the needs of the national economy and we say that this budget has in all respects met the needs of the national economy, financial and otherwise. We maintain that the official Opposition has failed to test this budget against the needs of the national economy. We can speculate as to the extent to which it meets this requirement. But meanwhile the Opposition has occupied itself with trivialities such as diamond rings, etc., instead of testing this budget against the needs of the national economy.

The third factor I want to mention in this connection, is that the budget must make provision for the priorities in South Africa, the priorities as regards the needs and the extent to which these priorities have been satisfied. I think we can argue with one another across the floor of the House as to whether we have our priorities right and whether we have our priorities straight, but we did not hear a single one of these arguments from that side of this House. Everything was criticized, but from their side of this House not a single priority change was singled out which could be used as criticism of the priorities as set out by the hon. the Minister in his budget. Whether the needs for the specific priorities has been met to a greater or lesser extent, is something we could have argued about, but the official Opposition was not able to argue about whether the specific priorities satisfied the requirements.

I now come to the fourth point I wish to touch on, and to me it is an important point. I refer to the taxable capacity of the people and businesses of South Africa to provide the finance to satisfy these requirements. We could argue about this, too. What is the taxable capacity of the South African individual and business to provide the funds so that the priorities can be met? We could have argued about whether taxes could be increased or reduced and, if so, which taxes could be increased or reduced in order to be able to meet the requirements. But from that side we again had only negative criticism, and I shall refer to a few examples.

The fifth point is that our number one enemy in South Africa—it would seem to me this is the only matter on which we are all agreed—is inflation. We must use this debate to test the extent to which the budget succeeds in combating South Africa’s inflation problem. I think we should have discussed how we can bring about changes in the budget to enable us to combat inflation to a greater or lesser extent.

We have another problem which is closely linked to this one, and that is the question of growth. I think we are agreed on both sides of this House that we must have growth in South Africa. But the problem with the Opposition is that if we take anti-inflationary steps they say we are hampering growth, whereas if we take steps to encourage growth, they say we are fanning the flames of inflation. They failed to make a positive contribution towards striking the critical balance between anti-inflation and a realistic relative growth.

What does the Opposition do? In his speech the hon. member for Yeoville attacked the hon. the Minister by alleging that the hon. the Minister is not able to control the build-up of the money supply in South Africa. I think the hon. the Minister himself acknowledged that we experienced problems in keeping the build-up of the money supply in South Africa within limits. However, what did the hon. member say in the same breath? In the same breath he criticized the hon. the Minister for sterilizing certain amounts of the supply of money in the Stabilization Fund. He said that the hon. the Minister should not have done this. He said the hon. the Minister should have spent that money. I think the hon. member for Amanzimtoti also said so. [Interjections.] If we were to do so, that would surely have been inflationary in the extreme. We are told to do something, but when we do it, we are criticized.

What did the hon. member also do? [Interjections.] I think the hon. member had better go and reread his speech. The hon. member’s problem is that he had so many advisers who each wrote a bit of his speech that he was unable to collate everything. That explains the inconsistencies!

Who wrote your speech?

I wrote mine myself.

Let me refer to the hon. member’s next point of criticism. He criticized the Government because the Government did away with the ceilings on credit granting by financial institutions. He says that in this way we created credit on an unprecedented scale, and we should not have done away with the ceilings at that stage. He did not tell us at what stage we should have done away with them; he only said we should not have done away with them. This means, therefore, that the hon. member wants credit ceilings.

But that is untrue.

The hon. member should rather keep quiet; he had an opportunity to speak and I did not interrupt him once, [interjections.]

Order!

What did he say in the same speech? He criticized the issue of higher interest rates and cast suspicion on the interest rates of the financial institutions in the eyes of the public. But he does not tell this House and the public that this is the mechanism which must be used in a free market situation—and I believe the hon. member supports this—to restrict credit granting automatically.

Yes, but he closed down his bank.

He closed down his bank but he still uses those luxury offices which his bank built. I want to have done with the hon. member for Yeoville. He criticizes the increase in excise duty and says we must not raise more money in the form of taxes to defray State expenditure, and this is where he became involved with toothpaste and rings. But what did he do at the same time? While he tells us not to raise more money by means of taxes, he tells us at the same time to grant bigger subsidies on bread and to incur greater expenditure in a whole series of State activities, while neglecting to tell us where we are to find the necessary money. [Interjections.]

Order!

When he realized that he had fallen into a trap, what did he suggest? He said we should borrow the money to finance the expenditure. [Interjections.]

Order! The hon. member for Yeoville does not like interjections to be made when he is speaking, and I therefore ask him to make fewer interjections when another hon. member is speaking.

The hon. member for Yeoville knows as well as the rest of us that those loans and interest rates will eventually have to be repaid by means of taxes. I now cast the hon. member’s accusations back at him because by proposing that we finance this major expenditure by means of loans, he is advocating the policy of “smile now and pay later”. This is the sort of budget policy he advocates.

At least it is better than “die wet van Transvaal”.

I think all the hon. members on that side of this House tried to pretend that this budget is not relevant to the actual economic realities of South Africa. They tried to make out that it is a haphazard and undisciplined budget. I should just like to give them an example. The day after the budget was tabled, the hon. the Minister and I had the privilege of discussing the budget with final year economics students from every university in South Africa, from the North to Cape Town. As a matter of fact we spoke with not only the cream of the students from all the universities, but also with the professors and lecturers of the economics faculties of those universities. I made notes of the comments made by those people in connection with the budget. One of them was: “Begrotingsprosedure moet skakel met die ekonomiese reali-teite van die land.” They came to the conclusion that this had happened here. They also said: “Die investerings en verbruikersbestedingspatroon is deur die jare met gedissiplineerde begrotings vanaf die Staat oorgedra na die private sektor.” They all acknowledged that this budget is along those lines. The following remark was also made: “’n Goed gebalanseerde begroting,” and they asked the hon. the Minister not to allow the money supply to be reduced too rapidly, because a reaction could occur which would tend in the opposite direction. They then congratulated the Minister on the budget and on a monetary and fiscal policy which does not reduce the supply of money too rapidly. They also said: “Daar is ’n balans by die beperking van owerheidsuitgawes omdat die beperking van owerheidsuitgawes nie so ver gevoer moet word dat dit die skepping van infrastrukture in Suid-Afrika sal vernietig nie.

That, in broad outline, is the criticism which experts in the field of economics voiced on this budget, and how widely it differs from the criticism which came from the other side of this House! In contrast with what came from the other side of this House, this was positive criticism. I wish to give the hon. member for Yeoville a bit of advice. I think the hon. member should pay a visit to the University of the North and discuss budget procedure with the senior lecturer in economics at that University. He is a Black man and his name is Mr. Mogale. He should go and learn from him.

Is he entitled to vote?

At a gathering we attended one of Mr. Mogale’s students, who is also a Black man, received the prize for the best analysis of this budget by the hon. the Minister of Finance. I wish the hon. member could have listened to that Black student for four minutes, because then the hon. member’s speech on this budget would have been quite different. [Interjections.] But now I come to the worst of the matter. After his budget speech, this hon. member was so worried about his image of loyalty that he immediately began to tell a few nice stories—I have the word “sob-story” written down here. And whom did he quote? In the first place he quoted the chairman of the President’s Council, the Vice-State President. How illogical can an hon. member get? After all, they are the people who are boycotting the President’s Council; nevertheless he quotes from someone in the President’s Council to build up his image of loyalty a little. What else did he do? He also quoted Bishop Tutu, to show by means of sob-stories how Whites act towards Blacks. Is this so strange to that hon. member and the Opposition as a whole? From my own life on my small farm north of Pretoria I could mention dozens of examples of how my wife and I have treated Black people compassionately, much nicer stories than those he told, and I can also mention examples of how Blacks have acted towards Whites in the same area. We on this side of this House do not find this strange. The cloak of loyalty with which the hon. member for Yeoville tried to cover himself by means of these quotes is very transparent to those of us on this side of the House.

There is a further matter I should like to call your attention to. This is a matter raised by various hon. members on our side of the House and by the hon. member for Yeoville. Basically it concerns the financial problem or dilemma of provincial councils and local authorities. I think this is important and it is intimately bound up with the theme of the speech of the hon. member for Algoa. I would like to congratulate this hon. member most sincerely for his very illuminating speech concerning the problems of local authorities. I know the hon. member has made a substantial contribution towards achieving what we have already achieved by way of the Croeser work group in settling the problems of local authorities. However, since this matter has been raised not only by him but by various other members as well, I feel it is important just to take a brief look at the problems, because the eventual finding of the Croeser work group could drastically change the character of local authorities in South Africa. Their findings may have very important implications. In my opinion, therefore, it is important to explain to this House briefly how the Croeser work group was composed. The work group consists of representatives of the Commission for Administration, the Office of the Prime Minister, the Department of Co-operation and Development, the four provincial administrations, the United Municipal Executive and a few of its advisers, and other officials of the Department of Finance.

For the record, allow me to mention briefly the committee’s terms of reference. They are, in the first place, to analyse, evaluate and process every recommendation of the Browne report, as well as the comments thereon, and, where necessary, to institute additional investigations; to couple every recommendation with the guidelines laid down in the Government’s ongoing rationalization plan; to formulate final recommendations for submission to and approval by the Government; to determine priorities; to draw up an implementation programme with due regard to specific priorities; continuously to monitor progress in the execution of the implementation programme; to institute an investigation into the procedures and requirements followed in regard to township development and the financing of services in new towns, and related matters. I want to agree with the hon. member for Algoa that the Browne report is probably the most scientific document ever compiled in South Africa analysing the affairs of local authorities. We have already accepted 97 of the 133 recommendations. As a result of the time which has elapsed from 1976 to 1980 many of these recommendations have been withdrawn because they were no longer relevant, but many new investigations have also been instituted since then. I could briefly explain what the three categories of recommendations are which have been approved, but I am not going to do so, except to say that the three categories of recommendation concern control mechanisms to be applied to the financing and expenditure patterns of local authorities.

I should like to mention four additional recommendations investigated over and above the Browne report, and already accepted by the Government. The first of these is that the United Municipal Executive be recognized as the central association of local authorities acting on behalf of independent White local authorities, conveying their view of matters concerning municipal authorities to the Government and at all times keeping a watchful eye on the development of White local authorities. The second recommendation that has already been accepted is that after the completion of the work of the Croeser work group, a permanent liaison committee will be established to undertake the permanent co-ordination between local authorities and the Government at that level with the same representation. I now come to a very important recommendation, and I wish to make it quite clear that this is the crux of our recommendations over and above the recommendations already approved. It is that greater co-ordination be effected in financial expenditure at various levels of government and that for this purpose overhead control will in future be exercised over the expenditure pattern of both the current and the capital expenditure of all local authorities. This is an extremely important recommendation and has already been approved by the Government and we shall be looking at this very carefully in future.

The Croeser work group has now reached the final stage in its programme of investigating the very important aspects of local authorities, as regards financial matters. A series of specialist sub-work groups have been appointed. I wish to conclude by saying, for the record and for the information of this House and local authorities, that once the work of the following specialist work groups has been completed, the Croeser work group will have completed its task: (a) The determining of additional sources of revenue for local authorities—in principle the work group has already recognized that local authorities cannot rely solely on rates as a chief source of income and that the creation of additional sources of revenue is essential; (b) applying a reasonable basis in terms of which the amount proposed in the budget for the payment of rates by the State and the provinces is to be divided among the local authorities, and the determining of a fair basis in accordance with which rates may be levied on property belonging to the S.A. Railways and Harbours and the Department of Posts and Telecommunications; (c) the procedure and requirements to be followed for township development and the financing of services in new towns and the determining of acceptable standards for this; (d) the financing of the expenditure of the various levels of government on the provision of infrastructure for road transportation facilities; (e) the determining of simple criteria in accordance with which the accounting systems of administration boards and community councils may be operated; and (f) the determining of simple criteria regarding the determining of salaries and conditions of service of officials in the public sector as a whole.

On my own behalf and on behalf of the hon. the Minister I wish to conclude by sincerely thanking the Croeser work group and the people who assisted them so loyally for their hard work. They worked day and night to make it possible for the hon. the Minister to make the announcements which he has already made in his budget speech. We thank them most sincerely. We hope that they will complete their work in the near future.

With these few words I should like to support this excellent, neat and realistic budget and heartily congratulate the hon. the Minister on it.

Mr. Speaker, I listened very attentively and with approval to the hon. the Deputy Minister of Finance. I trust that he will listen to my contribution with the same measure of understanding.

It is already clear to all that the hon. the Minister of Finance showed he had the right touch by managing not to fan the flames of inflation further nor, to put a damper on further growth in a downward phase of the economy. It is a delicate exercise to reconcile with one another these two conflicting economic situations in our economy. I am convinced that this budget, seen as a whole, contains the elements to make the basic concepts “consolidation” and “adaptment” a reality in our future economic development. There are great expectations and even excitement, particularly concerning the role which the envisaged investment bank for South Africa is to play in any future dispensation for all the nations of Southern Africa.

On this occasion, Sir, I should like to turn to a small subdivision of the Budget—small in value as against the budget as a whole, but at this juncture of vital importance and of strategic value for the wine farmer as regards his future planning. Yes, hon. members surmise correctly: I am referring here to the increased excise duty on fortified wine and spirits. It is here that my problems as a wine farmer begin. It is true, Mr. Speaker, there is nothing unusual in a wine farmer having problems with a budget speech. However, when one has to simultaneously thank and warn—must basically warn and at the same time think and plan for the stability and security of an agricultural region, a region with a fine heritage and a proud past of independence and disciplined action, then, Sir, one finds oneself in a situation which reminds me of a good old friend of mine in the wine trade who always concluded a discussion of problems in the wine industry with the following words: “Old friend, we need two things very badly: time and a little mercy.” I believe that what I need today is a little time and a great deal of mercy.

As a wine farmer I wish to express my sincere appreciation to the hon. the Minister of Finance for not having increased the excise duty on unfortified wines. I really mean this sincerely. However, it is of the utmost importance for the wine farmer that the hon. the Minister of Finance should note that the consumption per capita of unfortified wine has stagnated for the past 10 years and that in fact there is a slight drop in consumption. For example, we find that the per capita consumption of unfortified wine reached a height of 8,75 litres per capita in 1970, gradually dropped to its lowest point of 6,75 litres per capita in 1978, after which it began to recover during the strong growth phase of 1979 and 1980, and in 1980 reached 7,12 litres per capita. Therefore the consumption per capita is still lower than it was in 1970.

The liquor trade assures me that the fact that the excise duty on unfortified or natural wine has not been increased, will cause the sales of this product to increase by a maximum of 5% in the retail trade. However, the wine farmers are very grateful for this very important ray of light in an otherwise uncertain future. Great uncertainty and concern prevails among the wine farmers due to the increase in excise duty on unfortified wine and spirits. This is something that is deeply felt by wine farmers everywhere, and as a wine farmer I should be neglecting my bounden duty if I were not to express their uncertainty and concern here frankly and very clearly.

Although wine farmers accept without question that they are farming with a semiluxury or luxury product, and that ultimately the consumer will pay the increased excise duty on their product—although the wine farmer readily accepts all this—it nevertheless remains a hard fact that the profitability of wine farmers, the security of their survival as wine farmers, rests purely and solely on the acceptance by the consumer of their product. This acceptance is largely based on consumer preference, standards of quality and a reasonable price for the product. I want to state very clearly here and now that the standards of quality of South African wine products compare more than favourably with the wine products of the rest of the world. This is surely a fact with which hon. members of this House ought to be well acquainted. Therefore the only bottleneck that remains is the factor of reasonable price. It is the difficulty of a reasonable price that causes the wine farmer worry and uncertainty as regards the road ahead. Wine farmers argue as follows. The State has become one of the most important trading partners with regard to the determining of the price of the wine farmer’s product. This is a valid viewpoint if we note that after the latest increase in excise duty of 23%, the share of each trading partner in the price of brandy in the retail trade will be as follows. That of the wine farmer will be 11,8%, that of the wholesale and retail liquor trade, 45,6% and that of excise duty to the State, 42,6%.

Now the wine farmer asks himself the following questions. These are the really troubling questions. Does the State adequately take into account the problems he encounters with his products in the market place? Does the State adequately take into account the financial implications for the wine farmer if the sales of his products drop still further? The third question is whether the State adequately takes into account the competitive position of the wine farmer’s products as against imported products. The final question is whether the State adequately takes into account the fact that the wine industry, together with other agricultural industries, form the anchor, the basis from which the economic development of the Western Cape must expand. I could ask more similar questions, but on this occasion I shall let these suffice. The wine farmer has certain background information with regard to these questions—background information which the KWV has already circumspectly made available to Government departments. Now we come to the first question: Looking at the marketing situation of unfortified wine and brandy, we find the following: The per capita consumption of fortified wine dropped from a high point of 3,07 litres per capita in 1974 to 1,86 litres per capita in 1980, i.e. a drop of approximately 39%. Since the high point of 0,64 litre per capita in 1975, the per capita consumption of brandy has dropped to 0,54 litres per capita in 1980, viz. a drop of 15,6%. Like the per capita consumption, the volume of sales of these two products has been absolutely stagnant over the past five to six years. Now the question arises: How is the increased excise duty going to influence this situation? It is calculated by experts in the wine trade that fortified wine will drop by another 5% and that brandy and rectified spirits will drop by a further 10%.

Looking at the second question, the financial implication for the wine farmer due to the increased excise duty, I want to state two aspects very clearly. In its price adjustments or price recommendations over the years, the KWV has followed an extremely conservative pricing policy due to the unfavourable marketing situation of unfortified wine and brandy. For example, in 1981 the wine farmer obtained a mere 10% increase in his producer price, which is 19,5c per litre, in comparison with an announced excise increase of 156c per litre of absolute alcohol. In the period 1975 to 1980, the total wine harvest grew from approximately 6 million hectolitres to approximately 7 million hectolitres. As already indicated, the market for natural wine has been virtually stagnant over this period. The result has been that the increase in the wine harvest has for the most part been delivered in the form of distilling wine, which is distilled into brandy and rectified spirits. Due to the stagnation in the sale of these distilled products, the surplus of distilling wine, which cannot be sold on the domestic market, has risen sharply. In 1980 the distilling wine surplus was 39% and in 1981, 38%. The result has been that surplus supplies of rectified spirits and brandy have been building up. These products have been offered for sale on the world market, where there is cutthroat competition from other wine-producing countries which, due to direct or indirect state aid, have forced down the prices to levels at which it is impossible to make a profit.

A further drop in the domestic demand for brandy and rectified spirits can have only one result, namely bigger surpluses of these products, with necessarily detrimental consequences for the wine farmer.

The third question concerns the competitiveness of the position of brandy as against imported spirits. Due to the GATT agreement, equal excise duty increases have had to be imposed since 1974 on local as well as imported spirits. In the process the preferen tial tariff position of brandy as against imported spirits, expressed as a percentage, has effectively been reduced from 240% in 1974 to 30% at the present stage. During the same period our trading partners, who were co-signatories to this agreement but who also market wine and spirits, have built up effective tariff walls around their domestic markets. I therefore urgently request the hon. the Minister of Finance to implement immediately the recommendations by the KWV and the liquor wholesale trade, viz. to extend the maturation rebate on rebate brandy and make it applicable to the spirit component of mixed brandy—to grant such aid to brandy as a local and characteristic product.

This brings me to the final question, really a statement, and it is that the agricultural industry of the Western Cape forms the anchor—the foundation on which the development of the Western Cape is based. I also wish to make certain further statements. This anchor is becoming dangerously loose, and we must waste no time in ensuring that it is firm. The neck of this goose which has traditionally laid the golden eggs for the Western Cape, but also for the Treasury, has suffered a nasty twist. Why do I make this statement? I have already dealt with the problems of the wine industry. The deciduous fruits industry, an industry which is now finked to the wine industry, also finds itself in a problem situation in that it has paid out 35% less to its producers than it did during 1980. The canning industry, a different industry which is also closely bound up with the wine industry, is battling with an extremely serious, critical problem. For this industry it is in fact a matter of life and death. I therefore maintain that the economic anchor on which the Western Cape is built, is pulling loose. Since these three industries are interlinked and in fact form a broad interest group; since the growth or decline of one directly affects the others but will also have an overall effect on the growth or stagnation of the Western Cape; since the Western Cape has a rapidly growing Brown population and an industrial development which does not meet expectations, the conclusion suggested by all these factors is the following: An intensive long-term investigation and planning for these three agricultural industries. The State will necessarily have to play a leading role in this regard. In the short term there must be more effective Government aid in the form of purposeful export promotion, because that is the one bottleneck at the present moment.

Mr. Speaker, I hereby support the budget.

Mr. Speaker, I should like to congratulate the hon. member for Ceres on what was obviously a very well researched speech. Obviously, the hon. member was a very angry man and I think it took courage on his part to tackle the hon. the Minister in the way that he did in relation to the recent increase in the excise duty on wine. I take my hat off to him for his courage. I only wish that more members of his party had that same sort of courage.

I should also like to congratulate the hon. the Minister of Finance, not on his budget, but on, as I understand from the press, his recent re-election as the leader of the NP in Natal. I should like to extend our congratulations to him in this regard and tell him that we in the opposition benches are very pleased! [Interjections.]

Before going any further, Sir, I want to deal with an interjection that I heard yesterday while my colleague the hon. member for Wynberg was speaking about increases in basic foodstuffs. He happened to quote from the Weekend Post of last Saturday. He quoted from an article that appeared in that newspaper in which the prices of food in Tampa, Florida, were compared with the prices of food in South Africa by a housewife who had just returned to South Africa after having spent some time in Tampa. I distinctly heard the hon. the Deputy Minister of Development and of Land Affairs telling her to go back to Florida. I believe that this is precisely the type of attitude that we should not get from an ordinary Nationalist member, let alone a Deputy Minister. This was a perfectly logical comment made by somebody who had just returned. She was subsequently asked if she was glad to be here. She said she was but that she missed the cheap prices that she paid in the States. I think that the hon. the Deputy Minister owes this lady an apology and I would like to inform him that I believe that her family is a family that is to be much admired. Her husband is a lecturer at the University of Port Elizabeth and his visit to the States was as a visiting lecturer at an United States university. I think that for an hon. Deputy Minister to suggest that this lady should go back to the States, as if she was not wanted in South Africa simply because she states that prices in America are lower than those in South Africa, is not correct. So I do believe that the hon. the Deputy Minister owes the lady an apology.

I would like to react briefly to two previous speakers. The hon. the Deputy Minister of Finance said that we in the official Opposition talked about diamond rings, etc., and not really about household commodities. The hon. the Deputy Minister must either be deaf or must have a remarkable lack of comprehension. I would like to refer him to the speech of the hon. member for Wynberg. He spent 20 minutes discussing basic foodstuff prices in South Africa. He did this at very great length and very effectively. I would also like to refer the hon. the Deputy Minister to the speech of the hon. member for Walmer, who discussed housing and the ability of Administration Boards to provide housing, and I would like to refer him to the speech of the hon. member for Edenvale, who made a very long and good speech in connection with pensions. If these are not household items, I do not know what are. Yet he takes one tiny portion of one speech and then suggests that the whole Opposition’s argument is based on this.

This brings me to the speech of the hon. member for Florida. He said that we should tell this House where we would find the extra money to spend on all these things that we suggested money should be spent on. He asked what tax should be increased. The answer is very simple, and I am surprised that the hon. member should have asked such a question in view of the fact that we have constantly complained in this House of the high cost of apartheid and separate development. I think it was in the censure debate in this very session that a figure of R13 000 million per annum was quoted as being the cost of apartheid. I did not calculate it myself but simply refer to what was mentioned in this House. But whatever the actual figure is, is actually unimportant. It is in any event a remarkably and extremely high figure and we could save millions and millions of rand and spend it on more important items, such as basic foodstuffs, a matter which that hon. Deputy Minister who interjects so much is very fond of laughing at. This is basically where the money should come from.

Do they have apartheid in Tanzania?

What on earth has Tanzania got to do with the Republic of South Africa?

What is their economy like?

What on earth has Tanzania got to do with Natal or with the Republic of South Africa? Absolutely nothing. We have our own economy here. When I first came to this House four or five years ago I pleaded in my first speech in the budget debate with the hon. the Minister of Finance for a number of tax concessions and improvements. I pleaded that marginal rates for individuals should be no more than 50% and for companies, 40%. I secondly pleaded for a much improved taxation situation for wives who work. I asked for a planned reduction in Government employment and also a planned reduction in the number of Government departments. I pleaded for a better balance between indirect and direct taxation and I finally appealed to the assistance of the hon. the Minister’s colleagues in fighting inflation. I do not think the batting average on these have been bad. Since that speech rates for individuals have come down from 66% to 50% while the rates for companies have come down from 49% to 42%. We certainly had a drastic reduction in the number of Government departments. So the batting average has not been bad. There have, however, been notable failures, but I think they are more to do with the hon. the Minister’s colleagues than with the hon. the Minister himself. However, I think the hon. the Minister of Finance is himself to blame for the situation for the working wife still being poor. The last increase, from R1 200 to R1 600, an increase of 331/3%, is to be phased in over two years, by which time the major portion of the benefit will have been wiped out by inflation. Hon. members will be interested to hear that in President Reagan’s latest economic package he allows that by 1983 a married couple may deduct 10% of the smallest salary to a maximum of $3 000, and this he has done after phasing in a 25% federal tax cut over the next three years. In America they argue that this should encourage more non-working wives to enter the labour market. In South Africa this would be particularly beneficial in view of our shortage of skilled workers. Such a scheme would make a vital difference, I believe, in our current climate, and the cost to the State coffers could be offset by the additional tax revenue from more working wives. It might be a fairly small figure, but it would be an offset to a certain degree.

The second subject I wish to raise—something which has of course not happened—is that although we have had a planned reduction in the number of Government departments, I fear that this has been a matter of name only and that there has been no planned reduction in State employment which should have followed naturally from a planned reduction of the number of departments and is in fact the real bottom line of the exercise. We have too many rules and regulations. We are bound around with far too much red tape. I am not suggesting for a moment that the Public Service is doing work at a slower rate or that they are inefficient, but I am suggesting that they are being given too much work to do, and the game is not worth the candle. They are being given work to do, such as getting statistics out, filling in of forms and getting the public to fill in forms, and the ultimate result does not, in my opinion, add anything to the financial or any other well-being of South Africans in general. Staff is needed to administer, control and police these rules and regulations.

I believe therefore and I should like to recommend to the hon. the Minister that he should set up a committee—not simply a departmental committee—comprising members from universities, such as professors in economics, and perhaps people from private enterprise. Perhaps he could call it a free enterprise committee. Its function should be to examine the workings of every department, together with the rules and regulations that it has to enforce, and to make recommendations to a body such as the Prime Minister’s Advisory Council as to which rules and regulations should be abolished or modified with a view to reducing manpower in the Public Service. Whenever one suggests that manpower in the Public Service should be reduced, there is the immediate outcry of: “Who are you going to fire?” I do not believe that this will be necessary at all. We are aware that at the moment there are staff vacancies of approximately 22% in the Public Service. I think the figure quoted by the hon. member for Yeoville was 17 000 out of a total of 77 000. That being the case, there could be a reallocation of personnel and a restructuring of jobs to enable the number of posts to be reduced without physically reducing the staff complement at the moment.

This brings me now to my third point. It has been said that inflation is public enemy number one. I do not actually happen to share this viewpoint, because I think it is public enemy number two. Public enemy number one, in my view, is what I have already mentioned, and that is the high cost to South Africa of administering apartheid and the policies of this Government, whatever one might call them. If the hon. the Minister of Finance did listen to my plea in 1978, he nevertheless failed to control his colleagues. He himself did not do too well with his general sales tax on basic foodstuffs, but the first prize must go to the then Minister of Economic Affairs, the present hon. Minister of Internal Affairs, who panicked over the fuel situation and slammed the public with a huge increase in the fuel price in 1979. He then became Minister of Transport and also announced some notable increases which, if I remember correctly, were blamed on the high cost of fuel. Fortunately for us he is now the hon. the Minister of Internal Affairs, where hopefully he cannot influence the inflation rate as markedly as before.

You would be surprised.

Yes, one never can tell, because perhaps he will introduce a high price for passports, books of life and birth, death and marriage certificates.

Since 1978 we have had a consistently high inflation rate. The figure for this past year has been 14,6%, the highest in South Africa for many years. I do not believe that this can, any longer, be blamed on imported inflation, since the United States and several Western European countries have inflation rates running at lower levels than South Africa. The main point I want to make, however, is that we do have inflation, that we have had it for a long time and that it does not show any signs of going away. I therefore believe that we must make allowance for inflation in our tax set-up and cater for fiscal drag, or as the Americans would call it “bracket creep”. There can be no doubt that this problem is with us and that the hon. the Minister is smiling all the way to the Treasury. Without lifting a finger to increase individual taxation he has nevertheless increased his collections massively year by year. This last year is a good example. The latest estimates, tabled last Wednesday, show that tax on the incomes of individuals will rise by R904 million this year, as compared with the revised estimates of last year. This is an increase, taken from the body of individual taxpayers, in excess of 50%, and that without raising the tax rate whatsoever. I do not believe that the hon. the Minister is paying sufficient attention to the disastrous effect this has on the average individual. The hon. the Minister has told us that we must consolidate and adjust, but I believe that what he means is that he consolidates his income and we adjust our standard of living. The hon. the Minister himself has told us that wages and salaries rose by 18% last year. There has also, of course, been an increase in the number of wage earners, but there has nevertheless been a massive R904 million taken from the body of individual taxpayers. The inevitable consequence is that in real terms the individual will have less to spend. As the years go by, it is becoming more and more imperative for attention to be given to this problem. It is a bonus for the Government but it is a burden on the taxpayer.

I therefore ask the hon. the Minister to have another look at the latest package of tax proposals in the USA. With a lower rate of inflation than ours, they have nevertheless recognized the problem, identified the taxpayers’ burden and proposed a solution that has been accepted. This goes under the title of indexing. Briefly, the idea is to index taxes to changes in the CPI, the consumer price index. If, in a year when the CPI rises by 10%, a man has a salary increase of 10%, he pays no additional tax. This could be applied to all taxpayers, or only those who earn less than the figure at which maximum tax rates are applicable. If the latter is adopted, the figure at which the maximum rate is paid should be increased annually by a percentage equivalent to the percentage rise in the CPI. If such a system were adopted, at least the individual would not have the destructive effect of inflation compounded by taxation, and the hon. the Minister and the Government as a whole would not benefit at the expense of the individual because of a monster the Government purports to be fighting. I hope that the hon. the Minister will give this very serious consideration because I believe it to be very necessary in South Africa.

This brings me to the fourth point I wish to deal with. I am referring to the Government’s total lack of a realistic policy for solving the housing problem in South Africa. The housing policy applied by the Department of Community Development is absurd. The increase of only R25 million provided this year amounts to an increase of fractionally more than 10%, and this at a time when building costs have escalated by approximately 25%. In real terms, therefore, this means a deduction of probably 10% in the number of houses that will be built from the funds provided this year. This has been dealt with and will be dealt with more fully by hon. members on this side of the House. The point I wish to make is that the Government does not do enough to encourage home-ownership through financial incentive. For example, the State is reckoning on receiving R120 million in transfer duties on the sale of houses, estates and farms during the present financial year. Yet the cost of running deeds offices amounts to only R5,5 million. This sort of figure makes the greediest, most unscrupulous trader in the private sector look like a paragon of virtue. What is more important is that the Government does not encourage home-ownership by allowing interest paid on mortgage bonds to be tax deductible. If only this step could be taken, the benefits to the South African society would be widespread. Every home-owner would then have a built-in hedge against inflation. How many retired people have blessed the fact that they have a bond-free home to live in? When they become too old to run a home, the funds realized from the sale are often sufficient to keep them in comfort for many more years. It encourages savings and would add to the real wealth of the country. Detractors say it would benefit the wealthy more than the poor, and this is very true. However, as the wealthy are, percentage-wise, taxed far more heavily than the poor, any form of tax relief would obviously help them. Secondly, any savings made by the wealthy are more likely to be invested in the economy and would thus create growth and new jobs. I agree that it would be open to abuse by some, but I believe the great good done for so many more, would more than outweigh the disadvantages. I would suggest to the hon. the Minister that a book of 25 certificates should be given to the taxpayer on application when he purchases his first home. These certificates would be returned, one each year, together with his tax form, signed and certified by the bondholder as to the amount paid in interest. After 25 years there would be no further benefits and the man who has saved and paid off his home in that time would have no further problems. It would be expensive for the Exchequer, but it would without doubt be beneficial to the country as a whole.

In conclusion I should like to say that I believe the fields of taxation I have touched on, as well as many others, require revision and up-dating. The hon. the Minister of Finance has neglected a number of these. Estate duty, for instance, particularly for the farmers, has not been dealt with nearly sufficiently. Gift tax, in terms of annual gifts to children, should be escalated by the inflation rate. I hope the hon. the Minister will exercise greater diligence and application in the tax years ahead of us.

Mr. Speaker, the hon. member for Port Elizabeth Central, who has just sat down, touched on a very important matter, viz. the whole question of providing adequate housing for the population of our country. However, the hon. member, as is usual with hon. members on that side of the House, has failed to give credit where credit is due. Before I go into the matter any further, I should like to draw the attention of the House to the enormous achievements of the State in the field of housing during the period 1976 to 1981. For example, with regard to White housing the Department of Community Development built 18 584 houses, while the private sector built approximately 121 000, a total of 139 702 houses. For Coloureds, the total was 82 264 houses, and for Asians, 26 180 houses. For Blacks the total was 37 248 houses. The combined total is 285 394 houses, of which the State built 48,6%.

Was it enough?

I will deal with that. We have also seen that the number of accounts under the State home ownership scheme, in other words people who are assisted by the National Housing Commission through that scheme, have increased from 1 284 on 30 June 1978 to 13 965 on 31 March 1981. These accounts total more than R38 million. I mention this just in passing, because if there is one field of human endeavour of which this side of the House and South Africa can be proud, it is the field of providing housing, community facilities, old-age homes and so on.

How many houses did the Government build in Soweto in the course of last year?

Is that your constituency?

I shall deal with that problem too. [Interjections.] The hon. member can put his question on the Order Paper. [Interjections.] Sir, I take that from whence it comes. That hon. member is a member who in this House has the singular achievement of having produced nothing positive for South Africa in his term in the House. I cannot recollect one constructive comment or complimentary utterance that has fallen from the lips of that hon. member in describing anything that has to do with this country of ours.

The answer is nil, not one.

The hon. member for Yeoville, when he spoke of this year’s budget earlier this week, likened the hon. the Minister of Finance to Mr. Micawber. He said he was a well-spoken gentleman and a great speechifier and that the budget was full of fine phraseology. Then he said that, like Mr. Micawber, the Minister is waiting for something to turn up. He went on to say that, in fact, Copperfield left his country and emigrated to Australia, and that he hoped and trusted that that would not be the lot of this Minister of Finance.

No, it was Micawber.

Yes, it was Micawber. He said that Mr. Micawber had left his country and emigrated to Australia. He went on to say: “I am not suggesting what the future of the hon. the Minister might or might not be.” I want to say that, given the enormous international prestige of the hon. the Minister of Finance, and the importance of that prestige to South Africa, that was an absolutely uncalled for remark …

Disgraceful.

… particularly as it comes from the emigré party in the House. The hon. member for Port Elizabeth Central who has just sat down is on record in the Hansard of the Cape Provincial Council as having said that he and his family were considering leaving the country.

Get that Hansard and read it again.

Helen, do you not want to go too?

The point is that we have a budget which has been described as workmanlike and to which has been applied every glowing adjective one can imagine by almost every financial observer in this country. Had we followed the advice of the opposite side of the House last year, we would really have been in trouble, because the corrective measures the hon. the Minister of Finance would have had to take would have made things very difficult indeed for South Africa.

[Inaudible.]

Let me quote what the hon. member for Yeoville said last year. (Hansard, Vol. 86, col. 3837)—

Hon. members on that side of the House went on to tell hon. members on this side, the hon. the Minister and his department just how the Minister should spend the “gold bonanza”—I think that that was the term that was used. Had we not had a disciplined approach of growth from strength we would not have been able to have this kind of budget this year, a budget which is essentially one of strength from strength, a budget which reflects a strong economy, still in a growth phase but also in a consolidation phase. We have experienced growth in our society, whilst economic growth in the world today is a rare thing. In a world of falling standards our society has still remained one of rising standards.

I should like to return now to some points made by the hon. member for Port Elizabeth Central. Not everything he said was wrong. I believe that some of the things he said were in fact a reasonable contribution towards this debate. It is true that the single biggest problem which we in this country face is the whole phenomenon of urbanization. There is no question about that. It is what we plan and what we build and what we construct, and the way in which we allow these great new urban concentrations to develop now, which will determine how we and other South Africans will ultimately live, the quality of life and the kind of stability that we and future generations will enjoy. It is true that we are living in times of great change. We are living in a time when all the great institutions of this country are in a reform phase—if you like—a time in which we are looking again at the way in which our society is structured.

The building society movement, for in stance, which is an important movement, an important movement in our country, can also pause at this moment and reflect and look at itself again. It can indeed ask itself how best it can utilize its enormous power in the years ahead in respect of providing housing in our country. For that reason I should like the hon. the Deputy Minister of Finance to know how much I welcome the Building Societies’ Commission that is sitting at the moment under the chairmanship of Dr. Du Plessis. I believe nothing could have been more timely than that commission, and I am also sure that a lot of good will flow from it. It is true that the providing of housing is not merely an engineering problem, nor is it only a social problem. It is an enormous financial problem as well, and we are going to have to establish how best the building society movement can be utilized in assisting us regarding the enormous problems which will have to be solved in the future.

I should like to tell the hon. the Deputy Minister how much the building societies’ movement welcome the new tax rate which has been increased from 8,25% to 8,75%, and also the increase from R10 000 to R20 000 in the amount an investor is allowed to invest in tax-free indefinite period shares. This, I believe, will to some extent help the building society movement, which is at the moment experiencing some difficulties in finding the necessary finances to meet all its obligations. The fact that the bond rate will go up by 1% on 1 October, I believe, will also assist this movement.

When talking about the building society movement one can also not forego the opportunity of complimenting the movement on the massive investment it has made in the field of housing, and the wonderful work it has done in that regard in South Africa. If we look at what has taken place over the past 18 months, I believe, there is some reason, not for concern but for reflection. The fact that over the past 18 months money has been dished out by building societies as though it is going out of fashion …

It is going out of fashion. [Interjections.]

Well, to some extent money was really treated like monopoly money. Certain institutions even lured people by mentioning in their advertisements that people who borrowed money could skip a month’s instalment and take a holiday, because that instalment would be added onto their bond. This type of thing creates a kind of sense of unreality about money. I think that that kind of action on the part of such responsible institutions as building societies should not be encouraged. It is something I do not welcome at all.

Furthermore, I am of the opinion that building societies took money that really did not belong to them in the sense that they used money to finance long-term loans, money which they had actually received from big institutions, money which was actually wholesale money, money which was seeking a temporary resting place while awaiting other investment opportunities. These were large amounts of money that had found their way into the building societies’ movement and which gave rise to a practice which, I hope, will not occur again. I believe this was unfortunate. I think it was one of the big causes of the big problems the building societies’ movement is experiencing at the present time. I think it is time that they reflect a bit on how they operate their business.

I also want to say that I think we are going to have to be a bit more imaginative in finding ways and means to finance new housing. The traditional methods that are being employed are, I think, insufficient. In my view there are many things one can do. For example, one can have a greater interest differential than exists at the moment. In my view large bonds should be much more expensive than they are now and very small bonds on a low-cost housing could perhaps be cheaper. I say this because it is true that when there is lots of money about, the building society movement finds itself in the position where people raise big loans and are even encouraged by building societies to take large bonds, money which is then really used for investment purposes by those particular bondholders. I do not think that is the function of the building societies, and therefore I think there should be, I would not say a punitive measure, but some kind of discouragement so as to prevent the size of bonds going beyond reasonable levels.

What ought to be the limit? R20 000, R30 000 or R40 000?

I would say that it would also create a more fluid situation because many people would have an inducement to repay their loans more quickly.

Will you answer my question, please?

Unless we can get the feet of our young people on the first rung of the housing ladder as quickly as possible, a backlog will develop which might be very difficult to catch up with later on, because the scale of finance needed for housing is so vast that once one falls behind, it is almost impossible to correct the situation. Furthermore, with the inflation rate being what it is, it is very hard for young people to save quickly enough, taking into account the fact that the cost of building rises at the rate it does. Therefore I think we should be more imaginative. For example, in my view we could allow young couples who buy homes for the first time to have lower rates of payment during the first, second and third years so that if they have, say, an 80% loan, the interest is capitalized for the first three years. In any event, payments should be very low simply in order to allow them to get into a home. Then, if the surplus interest is capitalized, it may be that the amount of the bond will increase, perhaps even, as a percentage of the original purchase price, to say 90% before repayments and interest become market related, say after three or four years. The fact is that by that time the replacement cost of the house itself will have risen by 40%, 50% or 60%, but if that person had not moved in when he did, he might not later be in a position, on a normal savings basis, to buy a house at all. There are a great many young people today who simply cannot and will never be able to buy a home unless we come with some kind of imaginative system of financing, something along these lines.

The hon. member for Bryanston asked me how many houses were built in Soweto. 108 000 houses have been built.

In the last year?

The whole of Soweto has only 108 000 houses, you silly man.

That is the point. The hon. member asked how many houses had been built in Soweto.

In the last year. [Interjections.]

Unless we are going to allow some sort of steady growth in the building industry we will also have the problem that if we try, for example, to turn it on and off like a tap or we have the situation where the building industry is at one stage a very large employer and at another stage a smaller employer, we will experience the situation where thousands of workmen, the skilled artisans in the building industry, will leave it because of the vicissitudes of the industry at a time when activity in the building trade is at a low ebb and they will never to return to that industry. I can tell hon. members that in the Western Cape there are perhaps tens of thousands of people, particularly of colour, who were formerly in the building industry and who will not return to the building industry because they have the fear that if they do return they will lose their jobs when times are bad and, because of this fact, do not have the benefit of steady employment.

With these few words, Mr. Speaker, I have great pleasure in supporting the very fine budget and this Bill before the House.

Mr. Speaker, it is a pleasure for me to follow the hon. member for Maitland in this debate. It is not often one has the opportunity to follow a colleague and therefore be able to relax and listen to him as I was able to listen to the hon. member for Maitland. The hon. member did not fail this part of the Government’s plan and I trust that I, too, will not let the side down.

Mr. Speaker, there are two hon. members of the Opposition with whom I wish to quarrel right away, because with a few disparaging political remarks they dismissed this budget as if it were uninspired and lacking in enthusiasm. The disparaging remarks with which this budget is being dismissed have nothing to do with the merits of the budget but spring from political preferences and political prejudices. I refer to the remark by the hon. member for Yeoville that this budget is aimed at ideology and not at bringing about stability in this country. In an interjection the hon. member for Port Elizabeth Central said that the reason we have such a high inflation rate “is because we do not reduce the cost of apartheid”.

I did not only say that by way of interjection. I said it in my speech as well.

Yes, I know. I shall come to your speech. I am now referring to your interjections. You never learn!

*The hon. member made this interjection yesterday. Today the hon. member had plenty of time to explain why he says that the number one enemy in our economic approach is apartheid and not inflation, as is generally maintained. Without actually going into details he put his case and disparaged this budget. The implication of the remarks of these two hon. members is that political peace and the economic bliss of no inflation, full employment, economic growth, housing for everyone, training and education will descend upon us when the Government accepts the political philosophy of that side and implements it by means of its economic programmes. This is obviously not true. We on this side of this House are convinced that we must maintain an average growth rate of 5% over a period of 20 years and that in this way we can ensure the necessary employment, ensure that every family will experience economic security and in such a climate the Government need not hesitate to appeal to the private sector to make a contribution to the financing of those essential aspects such as, for example, training and housing. This is such a formidable task that the State cannot take it upon itself. In that specific economic climate the counterargument also applies, namely that the private sector can demand that the Government give it the opportunity to participate in the economic processes. Moreover the private sector can protest when there are certain restraints and difficulties which hamper its activities, preventing it from reaching its full flow by means of its participation.

I charge the Opposition with totally ignoring two particularly prominent external factors in evaluating the budget. By implication they are tacitly acknowledged, but they do not acknowledge that these two external factors over which the Government has no control, play a formidable role in the economic policy and in the drawing up of the budget. I am of course referring on the one hand to the gold price as a source of income and on the other to the formidable defence expenditure as an item of expenditure.

As a result of the drop in the gold price and a trend towards recession, the value of our net gold production, which totalled R10 000 million in 1980, dropped to such an extent that the seasonal adjusted value for this year totals approximately R8 000 million. For this reason the appeal made by the hon. the Minister to consolidate and adjust, is justified. On the one hand we must consolidate those positive elements in our national economy, but on the other we must also bear these factors in mind and adjust to the factors which are influenced by external events.

Looking at the expenditure budgeted for, one notes that about 30%—this amounts to an increase of approximately 15%—of this will be spent on defence, but no one is prepared to see the defence expenditure in harmony with the expenditure on national education. The total expenditure in this regard comes to 18,2%, and over a period of five years our expenditure on national education has increased by 158%. These are indeed impressive figures!

I wish to return to the initial remarks made by the hon. members of the Opposition. By these remarks they insinuate that the policies of this side of this House endanger stability and that economic confidence is being undermined as a result of political actions. It is an undeniable fact that there is a close correlation between politics and the economy. A weak economy shakes political confidence and a strong economy leads to political confidence.

In South Africa the creation of political confidence means negotiation and participation in the various decision-making processes of the country. Now the PFP are claiming they are the party which has the copyright on the concepts “negotiation” and “accord” or “agreement”, generally referred to as “consensus”. I think it is presumptuous of them to claim the copy-right on these concepts. The record of this side of this House attests to our irrevocable commitment to the processes of negotiation and political accord in our decision-making processes.

Those are your own terms.

That hon. member is brave enough to whisper that this takes place on our own terms, but where was he when this side of this House entered into one treaty after another, altogether about 180 treaties, with independent States by means of the process of negotiation and accord? The hon. member is a Rip van Winkle who was asleep when these important processes were taking place. [Interjections.]

You are now back to first year at university; I thought you had reached second year.

The hon. member who just referred to me as someone who is back in first year university politics, was also napping when his leader publicly expressed his pleasure at the American Government’s having intimated that they follow a policy of constructive involvement in South Africa.

He was caught napping, because an important moment passed him and his party by when the Government decided to consult in a specific way and to launch decision-making processes in order to introduce a constitutional set-up for the Coloureds and Asians in our country.

When was that?

Hon. members on that side of this House are at liberty to mumble interjections, but when these important historic occasions pass them by, they are unable to understand their importance. The hon. members are convinced that there is only one method of negotiation whereby to achieve accord. I refer to the hon. members’ policy of consulting and reaching accord by means of a convention. They do not, however, take into account the realities involved in the lust for power of those people with whom they want to sit around the conference table. To create confidence and to bring about agreement they advocate an entrenched constitution, incorporating a bill of human rights and a constitutional court, and they do so without taking into account the fact that constitutional instruments must be the product of confidence. One does not use constitutional elements to gain confidence.

I do not wish to disparage the instruments I have referred to because they play a useful role in a specific cultural-historical milieu. Therefore, to tell the Whites or this side of the House that those instruments will guarantee the safety and security of the Whites in South Africa, is to misinterpret the facts. When we negotiate, therefore, we do not do so in a spirit of fatalism. We create these opportunities in order to achieve something positive.

Another “verligte” bites the dust!

By means of that interjection the hon. member wants to hang a political label around my neck, one which I shall not even try to reject and in respect of which this side of this House will support me with great patience. I am convinced that I shall survive the label he is trying to hang round my neck, but whether he will survive the label attached to his party is another matter, because his party stands branded as one which boycotts; a party which is not interested in participating in the creative processes under way in the country.

There are three elements in any negotiation process which must be taken into account by everyone, no matter where one is negotiating. There are three basic rules. It is like two people playing cards who want three specific basic rules to apply. In the first place, they want order. A third person must not interfere, knock over the table and mix up the cards, because the game must go on. In the second place, the stakes they are playing for must not be so high that one feels that if one loses a round one loses everything. In the third place they must realize that one sometimes wins and sometimes loses. Why play against someone if you always lose? The approach of evolutionary negotiation, as set out by this side of this House, complies with all three of these basic rules. Negotiation by means of a national convention does not, however, comply with these rules, because the stakes are too high.

A sell-out.

The hon. the Leader of the Opposition himself torpedoed the chances of orderly negotiation.

Why does the entire Cabinet boycott your speech?

Why did the hon. the Leader of the Opposition remark dejectedly at the end of the censure debate that he has his doubts about constructive debating, even in this House? What would the situation be in an open national convention where one is threatened by a group of people filled with the lust for power? [Interjections.]

I wish to say a few words about those whom I shall refer to as the paper tigers of South Africa.

Printer’s devils.

Everyone in this House is committed to the process of peaceful reform in South Africa. It is a precious jewel which we must guard jealously. We can allow ourselves the luxury of differing from one another in South Africa, but we cannot allow ourselves the luxury of not condemning those who are not prepared to oppose violent change with conviction and determination. In South Africa, across the colour line, there is a specific feeling that change can only be brought about by means of force. I am not dealing with the merits or otherwise of that argument. I am now referring to those who see others openly advocating violence without actively condemning it.

I also wish to refer briefly to the AWB. They have informed us that they want to take on the task and responsibility of assisting the Government in combating terrorism. It is the leader of this organization who has announced that he wants to maintain discipline at meetings by using his storm troops. There is, however, one important aspect which should not be lost sight of by anyone in South Africa and that is that it is the responsibility of the State to maintain order, using its security forces and its police. I say this because certain hon. members reacted in a very flippant manner when I mentioned negotiation. To those men I admitted without hesitation that the Government has committed itself to a process of negotiation and that it is not pleasant for me to know that after 32 years, my party must battle to solve the constitutional problems of the Coloureds and the Asians. I do not refer to this to be cutting, however.

You created it.

I refer to it with compassion and respect. I agree with the hon. the Prime Minister that the time has come for us to reach an agreement with these people. It is only this side of this House which can create the political stability and confidence which will enable the economy of South Africa to prosper. It is a pleasure for me to support the Second Reading of the Appropriation Bill.

Mr. Speaker, the hon. member for Krugersdorp discussed a number of points here this afternoon. I am not going to react directly to them, except to say that I do agree with him that the economy and politics go hand in hand, and so, if we were to stumble in the economic field it would naturally affect political stability as well, and then things could only deteriorate. For the rest the hon. member mainly discussed the attitude of hon. members of the Opposition to a new dispensation in South Africa and their feelings in that regard. I trust, therefore, that the hon. member will forgive me if I do not react directly to what he said.

†Mr. Speaker, my plea to the hon. the Minister of Finance this afternoon is of a twofold nature. In the first instance I should like to draw a very important and rather disturbing development to his attention. It is a development which is likely to play itself out in the next few weeks in South Africa. I am raising it as a matter of considerable public concern, and it is of the utmost importance that the hon. the Minister of Finance, as a senior Minister in the Cabinet, draws the attention of the whole Cabinet, and of the House, to this particular matter. I am referring to a rather unfortunate development in the Press world in South Africa. It is well-known that there is a move afoot at the moment for a certain well-known newspaper group in South Africa to engineer the collapse or demise of a very old and trusted Press institution in South Africa, namely the S.A. Press Association. We in this party are very concerned about what the effect would be if that particular organization in the media structure of South Africa had to be collapsed deliberately. We believe that from the collapse of Sapa—an organization which has done a sterling job over many years in South Africa—would follow that the Press would finally be on the irretrievable road of polarization in South Africa. In those circumstances the Press would inevitably become purely the mouthpieces and organs of political parties. We do not believe that the interests of democracy or fair and objective journalism would be enhanced in that way. I draw the hon. the Minister’s attention to this because he is a senior member of the Cabinet and also by reason of the fact that he has recently indicated that he, too, is concerned about the direction which the media structure in South Africa is taking. One of the positive aspects of political report writing by an organization such as Sapa—and I am not referring to any particular individual, but to the group of individuals concerned—is that primarily because they do not owe allegiance to any particular editor or any particular newspaper managing director, they are in a position to exercise objective journalism. I believe it is in the best interests of all parties concerned that democracy be perpetuated by virtue of the fact that voters are well-informed about the full spectrum of legitimate opinion in South Africa. I particularly wish to ask the hon. the Minister whether he and his colleagues would take a personal interest in any move in this direction. I ask the hon. the Minister for his assurance that he will do so. I believe it is in the interests of all parties in South Africa that an organization such as Sapa be retained.

Then I want to turn to the question of the budget. At the start I should just like to say to the hon. member for Port Elizabeth Central, who unfortunately is not in the House at the moment, that whilst he was away doing something else after his demise in East London North, the question of interest being paid on mortgage bonds on private dwellings …

He was quite alive.

Whilst that member was away, the hon. the Minister, on the initiative of this party, did refer the matter to the Standing Commission on Taxation. It is in the record for hon. members to have a look at. We look forward with great anticipation to a positive result from the recommendations of the Standing Commission on Taxation. No doubt, after a few sessions the hon. member for Port Elizabeth Central will have caught up with what is happening in Parliament.

Never!

Then I should like to draw the attention of the hon. the Minister of Finance to a further rather negative development in the South African economy to indicate that we believe that some fairly drastic rethinking will have to take place regarding fiscal policy. In introducing the fiscal matter I am going to discuss, I should like to say to the hon. the Minister that we in South Africa, as South Africans, have a very proud track record for being the first in the world to introduce innovations in many instances. The hon. member for Florida mentioned yesterday, as many other hon. members have done, that South Africa has a unique population, a unique society. We are a combination of First World and Third World peoples. Yet, despite this, in many fields we have been able to innovate and actually lead an innovative development in the First World. I need only remind hon. members that the first heavier-than-air flying machine was flown in the Drakensberg in Natal in the late 1890’s, long before the Wright brothers took to the air. Our surgical firsts by way of organ transplants are legion. Then there is the technological development in the field of railway engineering. The Schaffle bogie system was a first in the world. In addition to that we have other firsts as well, such as tellurometry in land surveying, which was certainly a first in the Western World. So one can go on illustrating that we in South Africa, because of our unique situation, have been forced to be innovative and have met that challenge admirably. In many ways we have become leaders in the Western World.

The reason why I tell the hon. the Minister of Finance this is that we are going to ask him to take a new look at fiscal policy and direction. We ask him this in particular in the spirit that we believe it is unnecessary always to follow the classical models of fiscal and economic theory which were developed in the highly industrialized Western World. I want to say to the hon. the Minister of Finance that we believe that a new look must be taken at the underlying assumptions of fiscal policy if we are ever to achieve a reduction in the inflation rate and an increase in the productivity of the individual worker. Without those two component parts, we do not believe it is possible to achieve the political stability the hon. member for Krugersdorp spoke about. Unless there is a general improvement in the quality of life of all South African citizens, I believe it will be impossible to implement even the finest constitutional proposals.

I refer here specifically to a very disturbing feature which has been revealed over the period 1980-’81 by the Statistical Review produced by the hon. the Minister’s department. I should like to refer the hon. the Minister to page 8 in particular where the statistics indicate that for the first time in many, many decades and, I believe, possibly in the history of South African fiscal development we have had a negative development. We see from past records that in private enterprise remuneration of employees has always exceeded the gross operating surplus by at least 10%. Yet, in 1980 we find that that trend has now been reversed. In other words, operating surpluses of companies in private enterprise are now greater than the total package of remuneration of employees. This is a very, very disturbing feature. It means in essence that one of the underlying causes in this regard has been decreased productivity and increased expenditure owing to the formation of credit. If one considers what has happened to surplus income generated within the company one could see in what difficult situation the private individual is going to find himself in the next few years, if this trend should continue.

One only has to look at further tables in this publication, for example the ones on page 11, in order to understand why it is that the operating surplus in private free enterprise has increased at the expense of employees’ salaries. If we look at page 11 we will see that corporate savings have increased to the staggering figure of R7 338 million, as compared to R4 541 million in 1979, a year earlier. If we look at savings of the private individual, which we find on the table on page 12, we will see that these have been reduced. The individual’s personal savings have been reduced from R2 815 million to R2 221 million. The reason for this is pretty obvious. What has happened is that companies have expanded and increased their share of the total money supply at the expense of the private individual. This trend is not going to be reversed unless we take up a totally different attitude towards the question of taxation.

We should like to recommend to the hon. the Minister that if he is serious about and intent upon increasing personal productivity and reducing inflation, he will have to change his basic assumptions regarding personal income tax. What we are pleading for here is a review of the income tax structure in terms of which a private individual’s income is taxed and not his expenditure. We are recommending to the hon. the Minister that direct taxation of profit remain with companies. It is obvious that they can well afford it. The private individual, however, is not going to survive and keep his head above water unless there is a change in fiscal policy.

What I am asking of the hon. the Minister is that he and his department should apply their minds in the following way. They should consider reducing direct taxation on personal income. We are aware of the fact that it only represents 7% of total income earned by private individuals, but it also has a dampening effect on personal productivity at higher levels, and it also means that the individual’s personal income is declining by 7% a year in addition to the 15% inflation rate.

What we are suggesting to the hon. the Minister is that he reviews his approach in this respect. He should certainly retain company taxation on profits earned, but when it comes to personal income tax I believe that over the next few years that 7% tax on personal income should be reduced as far as possible, and preferably to the figure nil. The reason why I say this is quite obvious.

What would you put in its place?

I am coming to that presently. I am going to make a recommendation to the hon. the Minister. I shall also deal with what will probably be the main objections to this. I am recommending that the private income tax structure be changed so that income tax will be reduced over the next few years to a point where the private individual will in fact pay no personal income tax at all. The reason for this is very simple. What can an individual do with his money? He can either spend it or save it. These are the only two things one can do with one’s money. It is legend that one cannot take it with one. Therefore these are the only two things one can do. What happens if the individual spends his money? It goes into circulation. It consumes products. The hon. the Minister collects general sales tax on it, and if there is a sufficient growing expenditure as a result of personal spending the amount earned by way of general sales tax is of course going to grow, the demand for goods will grow, and the hon. the Minister’s Treasury pocket will grow as well. What is more important, however, is that if we want to reduce inflation it is essential that we encourage individuals to save.

We notice from the statistics provided here as well that the building societies are in desperate trouble at the moment because people are unable to save. In fact people are living on credit. That is all the private individual is living on at the moment. The building societies are suffering because people are not saving their money. Therefore, if individuals do not spend all their income but save some, I believe that the building societies will get a very large slice of those personal savings thereby enabling building societies to stabilize the interest rate on mortgage bonds and to grant loans for more homes and in that way creating more work in the building industry. Therefore, if one looks at it quite rationally, there is no sound argument why we should not reduce direct income tax on personal income to zero. The economy, productivity, savings and the fight against inflation will only benefit from such a step. The hon. the Minister asked the question: What do we replace it with? Well, we replace it with increased turnover by making the cake in the commercial and industrial sector greater, a greater turnover of goods for sale, greater consumption, and then one taxes the individual’s consumption or expenditure and not his personal income directly. I believe that the multiplier effect will be operative here and we shall be able to solve many problems at once, not the least of which will be the creation of a greater number of jobs. The pressure from urbanization, particularly from Blacks in South Africa, is going to be so great in respect of job demand that we are going to have to satisfy that need as well. I should like to know from the hon. the Minister what objections he would have to this type of approach to personal income tax.

Do you want a consumption tax?

I want an expenditure tax, a consumption tax. It is the same thing. I should like to point out to the hon. the Minister that the fiscus would probably benefit from reduced personal income tax. Obviously there will be objections, particularly that certain individuals will be amassing fortunes and that a redistribution of wealth will not take place. However, there are other measures, e.g. death duties and estate duties, which can be applied to prevent that from developing, although I am very doubtful whether that would actually happen, because an individual can only save his money or spend it, and both will be in the interest of society at large.

Let me say to the hon. the Minister that I do not think that he should just reject the proposition I have put to him outright. We are going to require innovative and unique actions to solve our unique and difficult situation in South Africa. I also believe that, it will be in the interest of motivation, because the 23% spoken about earlier on in the debate as being the main payers of income tax, are also in the main our entrepreneurs. The hon. the Minister and his department are probably as aware as all hon. members in this House are of the fact that marginal tax is killing personal incentive and motivation. Therefore I think the hon. the Minister will do the whole of South Africa a favour if he reconsiders the classical approach to personal income tax and seriously consider taxing expenditure and not personal income.

Mr. Speaker, I should not like to cross swords with the hon. member for Durban North. During the election in Bloemfontein North the chairman of the NRP in the Free State stood as a candidate against me and I told him that I was sorry that I had to oppose him in an election because by the time the next election had to be held they would have joined us in any case. That is why it is futile to cross swords with the hon. member for Durban North. He usually has positive ideas and he will be welcome in the NP.

I should like to discuss the President’s Council today and I am very grateful that the hon. the Leader of the Opposition is here because I should like to refer to him as well. I want to talk about this body which is at present so prominently in the political limelight in this country and on which the gaze of the people of this country is fixed. What a great pity it is that there are those who wish to obstruct this body. It is a forum which has the sole aim of trying to effect a reconciliation between the people of this country in order to safeguard South Africa. However, there are forces at work that wish to wreck the President’s Council and its work and wish to place obstacles in the way of peace, reconciliation, sound relationships and peaceful coexistence in this country. South Africa’s enemies are stirring up feelings between Whites and Blacks in this country and creating hate and tension between people. They wish to cause polarization between colour groups and in so doing are playing into the hands of international communism. The hands of our enemies are being strengthened by the HNP’s politics of hatred that knew no bounds in the recent election. I want to mention just one example to hon. members. A meeting held by Mr. Jaap Marais in the Bloemfontein City Hall was a demonstration of hatred and offensiveness from start to finish. Mr. Marais spoke disparagingly of the Blacks, as though they were the outcasts of the human race. In that way he elicited from his audience the most shocking interjection and the crudest insults. Mr. Willie Kuhn wrote a report about this in Die Volksblad, such an excellent report that I should like to recommend that all hon. members should go and read it. I think he deserves a journalistic prize for that report. After having written about the meeting, he drew, inter alia, the following conclusion. He said—

One gains the impression that the HNP reveals in the politics of insult and offence. This is dangerous politics, Sir. With politics of this nature moderation and sound relations in this country are stifled. In that way South Africa can be plunged into a bloody conflict and that is precisely what our enemies so badly want. The serious question arises whether we can continue to tolerate blatant racial incitement and polarization of this nature in this country.

However, polarization is not only being fanned by the HNP in this country. During the election it was significant that the PFP and the HNP never attacked each other but always aimed their big guns at the NP. Both of them fired at the same target. They were hand in glove during the election. What was very amusing was the fact that the English newspapers dealt so gently, almost lovingly with the apostle of hatred, Mr. Jaap Marais. He was held up to the readers and voters in an extremely sympathetic light and it was this very Mr. Jaap Marais who said at the HNP protest meeting in Pretoria that they were going to do everything in their power to cause the recommendation of the President’s Council to miscarry. He called out histrionically: This is the one specific time to wage the mightiest struggle against the proposals of the President’s Council.

Mr. Speaker, the trouble in this country is that there are always forces waiting to destroy whatever is positive and constructive. I want to tell you that the PFP is trying just as hard as the HNP to undermine the fine and important work of the President’s Council. Only, they are doing so far more subtlely; they are doing so less blatantly than Mr. Jaap Marais. The hon. the Leader of the Opposition boasts that it is due to pressure from his party that the Government is now pursuing a policy of negotiation. Now the hon. the Leader of the Opposition is putting a spoke in the wheel of negotiations with his boycott of the President’s Council. The hon. the Leader of the Opposition has begun to develop a boycott mentality. He now wants to boycott official guests of the Department of Foreign Affairs, too, when they come to South Africa. Fortunately I see that his caucus has repudiated him in this regard. As far as the President’s Council is concerned, the PFP has chosen a cowardly course. The President’s Council is seen by the Government, the Coloureds and the Indians to be an extremely important forum for discussion. In the first place it was established for dialogue and negotiation across the colour bar in an exercise such as this country has never experienced before. It is a breakthrough, but the PFP is boycotting the President’s Council. If the PFP is sincere, it must make its contribution in the President’s Council and not sulk in a corner. What is more: It must not continue to pursue a boycott policy; it must participate in this process. [Interjections.]

In conjunction with the far-rightists, the PFP is playing a negative and destructive part in this affair which is not in the interests of South Africa and which is, moreover, going to boomerang on them.

If one goes too far to the left, one eventually ends up at the right.

The HNP wants to enforce a unilateral White solution, but that cannot achieve any solution in this country and will inevitably lead to conflict.

Your policy is one of domination.

I want to tell the hon. member for Bryanston that the PFP is following the same course as the HNP. The only difference is that the PFP wants to force a Black solution on this country. In that way it wants to sell out the White man. Surely we know that this will strengthen racism and destroy the opportunity for a settlement, that there will be chaos in South Africa when this happens.

The White person in this country cannot want to hold onto everything for himself alone, as the HNP wants to do, for then he is going to lose everything. Nor will he be prepared to throw everything overboard as the PFP wants to do. The White electorate has expressed its opinion on this in the past and once again on the occasion of the recent election. The White electorate refuses to accept an open community as the PFP wants to do.

In an interview with Die Burger the hon. the Leader of the Opposition said that he was not sorry about his party’s decision to boycott the President’s Council, but in the same breath he said that his party’s most important task this session would be “the need to emphasize fundamental reform”. In the President’s Council in which the hon. the Leader and his party can participate in reform, they are conspicuous by their absence because the far-left Suzmans and Boraines in their ranks have told them: Stay away from that place. [Interjections.]

The hon. the Leader of the Opposition is constantly trying to impress on one how honest he is, how good his intentions are, how constructive he is, etc. The hon. the Leader is forever coming forward with the finest offers of almost brotherly co-operation just short of coalition. But when he really has to pull his weight, he “chickens” out. [Interjections.] The hon. the Leader of the Opposition is the one who indulges in mocking politics. This is politics which leads to nothing. He has no alternative; there is only vagueness. [Interjections.] The farmers will tell you that a ewe teaser (koggelram) is incapable of anything.

During the recent election the NP received a massive mandate to continue its search for peace and happiness for all the people in this country. In this process the President’s Council is an extremely important instrument. The fires around us are blazing ever higher. Our options are diminishing. Neither the Whites nor the people of colour in this country should make light of the warnings which the hon. the Prime Minister and other hon. Ministers issue from time to time. The focus will in future have to fall increasingly on a common destiny against forces from outside, as well as those inside this country. Against the background of the most recent internal bomb attacks and the things which are boiling up in Angola and elsewhere on our borders, it is becoming a growing necessity to establish a partnership in South Africa against the onslaught which is building up against us. The focus will have to fall on the possibilities of and conditions for joint survival and victory, but also on the terrifying alternative in the event of our not succeeding. The focus will also have to fall on the fact that the constitutional future of South Africa will primarily be determined by ethnic relationships in this country.

The President’s Council is a very important instrument in the democratic process of plotting a course of linked destinies and peaceful coexistence for Whites, Coloureds and Indians. The people of this country, and specifically the Whites, will have to prepare themselves to accept reform and a new constitutional dispensation. The President’s Council is going to make recommendations about this within the forseeable future. We shall have to await the results of the negotiating process of the President’s Council peacefully and calmly. Those who are already indicating their opposition to recommendations which still have to be made by the President’s Council are not doing this country a service.

The Prime Minister dictated to them.

The hon. member for Bryanston so often speaks out of turn. If he were prepared to listen he would hear what was going on.

Structures must be built in this country for those peoples and population groups that do not yet have them, to lead them to political self-realization. A clear vision of the future must be outlined for everyone in South Africa and it is in the interests of everyone in this country that this should not be delayed for very much longer. For this reason the gaze of the people of this country is increasingly being fixed on the President’s Council, on this structure which has to pave the way. Moreover it is for that reason that the proposals of the President’s Council are being awaited with bated breath.

Political realists in this country increasingly realize that the Gordian knot must now be cut in respect of the Coloureds and Indians. The Government received a strong mandate from the voters to finalize certain issues that are dragging on. The NP will now have to break through and get certain things off its back, and with the strong leadership we have we can depend on making a break-through as far as these tasks are concerned.

The most urgent matter which must receive attention is that the Coloureds and Indians must be given more meaningful control over their own affairs, and the President’s Council is already working on this. Consequently I am asking today that the President’s Council should please not be denigrated. Hon. members should rather contribute to creating a sound and positive climate for the activities of the President’s Council. Come and help; come and make a contribution. Any advice and positive idea which will contribute to the creation of a workable constitution will be welcomed. However, the official Opposition is conspicuous by its absence. It is boycotting this body that wishes to bring about peace and reconciliation and promote sound relationships in this country.

The proposals of the President’s Council must not be rejected before they have been tabled.

They will then be rejected.

I make an appeal to Whites, Coloureds and Indians to give the President’s Council a fair chance. A constitution cannot be put together within a month or two, for it is a major task. We can expect nothing from the official Opposition. They do not want the President’s Council to come forward with a plan which will work, for they want to scuttle the Government’s initiative. Even now one can predict with certainty that they will join Mr. Jaap Marais in denigrating the recommendations of the President’s Council, regardless of what they may turn out to be.

Finally I want to ask malicious people to stop casting suspicion on the President’s Council, as though this body would sell out the right of self-determination of the Whites. There is the fixed guarantee for Whites that abdication or selling out has no place on the agenda. The success of the President’s Council will be the guarantee that the perception of “one man, one vote” of hon. members such as the hon. member for Pinelands and the hon. member for Houghton will not become a reality in this country. It will also be the guarantee that revolution will not succeed in South Africa, for the way will be prepared for give and take, for meaningful political self-realization for everyone as well as for sound relationships. To those Whites in South Africa who are doubtful I want to say: The Government’s plans for reform do not mean that the Whites will be dominated. The new South Africa which is going to be created will in fact safeguard the future of the Whites in this country. However, we know that this can be done only by accommodating the fair aspirations of all the national groups in this country.

Mr. Speaker, it is a privilege for me to be able to deliver my maiden speech in this House after a speech of the calibre of the one by the hon. member for Bloemfontein North, who has just resumed his seat. I consider it a privilege to be able to take my seat as a representative of my constituency in this highest legislative assembly of our country, here where the last word is said about the weal and woe of all our people.

I should like to pay tribute to my predecessor this afternoon. The hon. Punt Janson represented the Witbank constituency for a period of 15 years in this House. He is a person with special qualities who was prepared at all times to use the talents and gifts that he was given, not only in the interest of his own community, but also in the interest of our country as a whole. He first took his place here as an ordinary member. Later he became Deputy Minister, and when he retired he was a Minister. I should like to wish him strength and vigour on behalf of the constituency of Witbank for the important, responsible task that rests upon his shoulders in the President’s Council.

The Witbank constituency is an important constituency in the Republic of South Africa. One of the richest deposits of coal is to be found in the Witbank constituency. At the moment one of the largest power stations in the Republic of South Africa is being constructed in the Witbank constituency. As the hon. the Prime Minister announced in April this year, an industrial growth point on the developmental axis from Rustenburg to Middelburg, is situated in the Witbank constituency. When one has to choose a subject for one’s first speech here in the House, one finds it very difficult, because so many ideas come to mind. In spite of various speeches concerning the aged in our country, I too have decided to make a contribution in this regard this afternoon, without repeating what has been said in this debate or in previous debates regarding the position of our aged in this country.

This afternoon I should like to pay tribute to the honourable people throughout the length and breadth of our fatherland who had a share in building the fine things in this country, because it is a fine country indeed. The aged in our country are suffering a great deal. I should like to express my gratitude and appreciation towards the hon. the Minister of Finance for the fact that he too saw his way clear this year to increasing the pensions of our aged. I want to thank him for seeing his way clear to paying them a bonus in October this year as well. Concessions are also being made with regard to the taxes payable by the aged. I want to thank the hon. the Minister for that too. However, what is really important in connection with our aged, is the sum that they had at their disposal at the end of a month, and on which they have to live. This is important. In my opinion, that sum is inadequate. I have appreciation for the fact that concessions have been made over the years. If there ever was a Government that really did its share with regard to our aged, it is the Government of today. I want to address a friendly request to the hon. the Minister of Finance, viz. that since 1982 is going to be the Year of the Aged, we should make that year a happy one for our people. I am not only speaking on behalf of the person who receives a social pension. I am also speaking on behalf of those, as the hon. member for Florida said yesterday in the House, who have saved a sum of money over the years, who now have to manage on the return from that sum and are now experiencing problems. I should like to quote a few statistics.

In the first place, we must take note of the fact that in the year 1970 there were 291 million aged people in the world, and it is anticipated that by the end of this century there will be 585 million in the world. Let us look at the position in our own country. The average life expectancy has increased over a period of 50 years by nine years in the case of men and 13 years in the case of women. In 1904 the aged people in our country comprised 2% of the population. According to the latest statistics at our disposal, at the moment they represent 7% of the population. We must take note of this. In addition, we must also take note of the financial burden that it entails for the State. Social pensions amounted to R132 million in 1978. In the present financial year R340 million has to be voted for this purpose. We must also take note of what the position is going to be at the end of the century. Furthermore, we must also take note of the fact that for the past three years the Government has made R52 million available for the construction of old-age homes for the aged. In addition to that, there has been an increase in the subsidies that are paid to welfare organizations who accept responsibility for the aged. We are grateful for this increase and for the concessions that are being made for the aged, because that amount has doubled over the past three years. We must take note of that.

I want to address a friendly request to the hon. the Minister of Health, Welfare and Pensions today to consider appointing a commission in order to conduct an in-depth investigation into the situation in which the aged find themselves today. In 1934 a national congress was held in Kimberley. Some of the older hon. members of the House will remember it very well. Tribute has been paid to the late Dr. Verwoerd in this House and outside too on many occasions, for the statesman that he was. However, I think too little has been said about the contribution that he made in another sphere. When our people were very badly off during the ’thirties after the depression, he played his part as chairman of a continuation committee. This ultimately led to the creation of a full-fledged Department of Social Welfare in 1937. I should like to pay tribute to him for what he did in this regard. The ’thirties were depression years for our people; in 1981 on the other hand we are dealing with inflation. We must take that fully into account.

Whilst I am addressing a request to the hon. the Minister to appoint a commission of inquiry, I should like to point out a few things that are important to me. To be sure there was the national congress of 1934, the conference in Bloemfontein in 1950 and the national conference in Pretoria in 1971, but I think that we should take a fresh look at the policy in this regard. The policy is to keep our aged in the community, but I do not think we are doing enough to keep them there. Taking into account what is being made available and utilized annually with regard to the problem of the aged, we must take a fresh look at whether this cannot be revised.

I am of the opinion that the second level of government, i.e. the level of the provincial administrations, should also do its share with regard to the hospital services and medical services that must be provided. I am also convinced that with regard to the third level, i.e. the level of the local authorities, responsibility should also be accepted with regard to the aging people in the community. I have no objection whatsoever to the fact that civic centres should continue to be erected throughout our country. Nor do I have any quarrel with the fact that sport stadiums are being erected. However, I think the third level of government should also take note of the fact that it too must play its part in the care of our aged. I do not have any doubt about this.

With regard to salaries, a vicious circle is in motion. We cannot overlook this. In the process, our people are making a sacrifice. I want to say that our community is a youth orientated community. However, we must avoid becoming a community that fears growing old.

I want to make a final remark. The Department of Manpower, for which I have a high regard, will have to take a fresh look at employing our people for a longer period. It is in the interest of the country that people should not retire suddenly, but that this should take place over a period of time. I should like to content myself with these few ideas.

It is my sincere prayer that I shall be granted the courage at all times to change what I can change, the composure to accept what I cannot change and much more important, the wisdom to be able to distinguish between the two.

Mr. Speaker, we listened attentively to the hon. member for Witbank. I should like to take this opportunity to congratulate the hon. member on his maiden speech in this House. He made a thorough study of the aged and one can see that he has the interests of the aged at heart. As far as his request for a commission of inquiry is concerned, I can assure him that that request of his enjoys the full support of this side of the House. May the years that lie ahead be very happy and rewarding years for him. The hon. member and I have known each other a long time. We both served on the Transvaal Provincial Council and it is clear that the hon. member will make a valuable contribution in this House.

†Turning to the budget now, I should like to point out that it is a remarkable coincidence that the rosy picture painted by the hon. the Minister of Finance only a few months ago has changed so dramatically in this post-election period, and that we are now experiencing a situation in which we have to tighten our belts. We now have to contend with taxation proposals by which those in the lower income groups will be hurt most. If I may say so, this is a typical British type of budget, aimed at hitting beer-drinkers and cigarette smokers. Of course, it is not that I am saddened by the fact that the excise duty on cigarettes has been increased. I mention this fact although my approach in this respect differs vastly from that of the hon. the Minister of Finance. He is only interested in people’s money. I am concerned about their health, however. I am also concerned about the financial implications, not only for these people and their families but for the country as a whole. I only hope that by referring to the matter, I can succeed in pricking the conscience—if that is possible—of the hon. the Minister of Health, Welfare and Pensions, who has shown very little concern in this connection in the past.

The slogan “Vote now, pay later” has proved very appropriate and the day of reckoning has arrived. Therefore, if taxes are to be spread in this way, the following question arises. What can we look forward to in next year’s budget? As far as the current budget is concerned, we were very worried about the effect the drop in the price of gold could have in this respect. Surprisingly enough, however, when one looks at the figure of the income from mining taxation, it appears that it has only dropped by R230 million on an estimated figure of R1 850 million. On the other hand, what is remarkable is the phenomenal increase in personal tax to R904,2 million and the increase in company tax to R722 million.

I do not know where the hon. the Minister of Finance is at this moment, but I should like to ask him whether this is not a gross underestimate of revenue. If that is the case, my submission is that he has taxed us unnecessarily in the past, and I believe he should account to us for that. The hon. the Minister has also chosen not to increase personal and company tax at the present moment. For this we commend him because if he had done so it would have resulted in higher taxation scales that would have been effective until December this year. On top of that it would also have compounded the effects of the current economic recession and made the trough excessively deep. I fear therefore that the slogan “Vote now, pay later” will become even more significant when the hon. the Minister casts his hungry eyes over the tax tables in March next year in search of added revenue. I believe that economic prospects for the next twelve months do not really look rosy at all.

According to the fundi’s the growth rate is estimated at between 2% and 3%, in contrast to the 5% referred to by the hon. the Minister. Moreover, inflation may raise its ugly head beyond the level of 15%. The predicted higher interest rate inherent in a low growth rate will increase unemployment even further, with the consequent socio economic and political implications.

The answer, of course, is compulsory education for all and increased training facilities to which more attention should have been given and for which more money should have been provided in the current budget.

I should like to deal now with the problem of inflation. Inflation will make it even more difficult for people in the lower income groups especially pensioners, to make ends meet. The increase of 12% in social pensions in October, together with the newly announced bonuses for social pensioners, will, in the hon. the Minister’s own words, result in an increase of R17,50 per month for Whites, R12,50 for Coloureds and R9,25 for Blacks. This, however, has to be viewed against the background of increased food prices. A loaf of bread, for instance, now costs 42 cents, a litre of milk costs 51 cents, and the price of meat has also gone up by 30%. Furthermore, while Sapoa recommended a rent increase of 10% landlords are raising rentals by between 50% and 100%, and rent boards are granting increases virtually as requested by landlords who base their applications on higher assessment rates, higher electricity costs, higher water costs and the higher costs of other services provided by local authorities. The rent increase alone is sufficient to wipe out this little bonanza, this little gift the hon. the Minister is dishing out. So all these people will have to contend with the same old difficulties.

We must be realistic, not like the hon. the Minister of Health, Welfare and Pensions who apparently does not appreciate the significance of his portfolio in relation to his role in public life in South Africa. He must tell us why he called for a survey in the first place. Must I assume that he was trying to justify the low amount paid to pensioners? How could a Minister responsible for health matters tell an old person that he can eat on R20 a month? Let us examine exactly what the hon. the Minister did say. I quote from a tape recording of the interview recorded by the Rand Daily Mail on 25 April 1981. The hon. the Minister said—

He commissioned it; he started it. He said further—

Indeed it was; it was very interesting to see. The hon. the Minister went on to say—

Thank you on behalf of the younger people. However, the hon. the Minister went further and I quote—

The hon. the Minister went on to say—

Not only must one eat on R20 a month, one must now clothe oneself on the same amount as well. That would be two Lapas a month. If the hon. the Minister of Finance is going to accede to the request that the R20 note be called a Lapa, then we shall be living on two Lapas a month. Is the hon. the Minister of Health, Welfare and Pensions dealing with cattle or is he dealing with human beings? Is this an exercise in survival or living as a human being with a reasonable interest in life and perhaps even enjoying a meal? Does the hon. the Minister want to feed the nation on tablets? I should like to ask the hon. the Minister what efforts he has made to persuade the hon. the Minister of Finance firstly, to pay equal bonuses to all races; secondly, to eliminate the gap in pensions; and thirdly, to consider a national contributory pension scheme. Has the hon. the Minister worked out the financial implications thereof? Let me then ask the hon. the Minister of Finance what approaches he has received from the hon. the Minister of Health, Welfare and Pensions in regard to the three matters I have mentioned.

In addition to that the hon. the Minister of Health, Welfare and Pensions says that as far as nurses are concerned there is a 76% shortage in the Transvaal.

That is not what I said. I said 76% of the posts were filled.

Sorry. 76% of the posts are filled.

Say the right thing.

Quite right. 76% of the posts are filled. However, Dr. Latsky, the MEC in charge of hospitals in the Transvaal, said on TV—I wrote the figures down quickly—that there was a shortage of 49% Whites and 21% Blacks in respect of nursing sisters. In addition there is a shortage of 49% in respect of White student nurses and 33% in respect of Black student nurses. How can the hon. the Minister of Health, Welfare and Pensions reconcile these figures with his own? Perhaps the subcommittee that he has appointed to go into this matter will give him more information and then he can pass it on to us.

The hon. the Minister could feed 200 people on his salary.

Another problem raised by the hon. the Minister of Finance is, and I quote, “the rising level of interest rates which inevitably is a concomitant of the policy of monetary restraint, has also affected building societies”. The position at the moment is that building societies are only able to lend about 10% of what they normally lend to the private sector to enable them to carry on. The relief granted by the hon. the Minister by increasing the interest rate by ½% and raising the limit per taxpayer from R10 000 to R20 000 in respect of tax free shares is negligible and will not in any way arrest the outflow of capital from the building societies and promote the inflow of capital that is necessary to generate sufficient capital to enable the private sector to build. What is even sadder, Sir, is that we begged the hon. the Minister of Finance not to phase out the revolving fund and at least to let it remain as far as existing schemes were concerned. However, he persisted in doing so and phased out the scheme by cutting down the amount of R150 000 per taxpayer to R50 000 per taxpayer and the result was a flight of capital.

In his budget the hon. the Minister also referred to the problem of housing—he was dealing here with the provision of housing by the private sector and the public sector—and he said that the country’s housing problems simply could not be solved by the Government alone. He said that there had to be concerted participation by the private sector in this including the building society movement and others. I want now to ask the hon. the Minister how he expects the private sector to tackle the housing problem when he denies it capital and refuses in his budget to aid them.

You are talking absolute nonsense.

Can the hon. the Minister obtain a bond without a back-to-back? Can he obtain a bond from a building society?

Is that my fault?

He does not need a bond; he has two houses.

Of course it is his fault. Why does he not assist the building societies to obtain more capital? [Interjections.]

I suppose you want me to halve income tax?

As far as the public sector is concerned, the hon. the Minister increased the amount available to the National Housing Fund from R231,7 million to R256,7 million. Quite frankly, this is a joke! In the statement presented by the hon. the Minister as far as housing is concerned it is stated that 73 670 units are required annually for all the population groups. This will require an amount of R882 million as an average annual investment. This amount is 3½-times larger than the amount that the hon. the Minister has provided in the budget. We have to tackle this problem realistically.

Last year you said that I should abolish income tax.

The hon. the Minister of Finance was able to find an additional amount of R537 million for defence. The defence budget was increased from R1,8 billion to R2,3 billion. No one denies that this is not necessary. No one denies that this money should not be spent on the defence of our country. However, if the hon. the Minister of Finance was able to find this amount of money for defence surely he could have found more money for housing. Surely housing is just as important as defence. After all, what are we fighting for, Mr. Speaker, if we have nowhere to live?

Another difficulty in regard to housing experienced by the public sector is the fact that it takes five years to get a scheme off the ground. Hon. members can ask any local authority concerned with housing whether or not this is true. Firstly, the township has to be established and one has to go to 52 departments in order to bring this about. Further requirements in this regard are: The approval of the Surveyor-General; registration in the deeds registry; a scheme has to be set up by the local authority and approved by the Department of Community Development; the rent structure has to be approved; the whole project has to be approved; the money has to be voted; the money has to be allocated; tenders have to be called and then one has to go ahead and build it. By that time a minimum period of five years has elapsed before one can get such a scheme off the ground.

Mr. Speaker, we have to be realistic. If there is a crisis, we have to tackle it as a crisis. There are lessons to be learned in history in regard to this matter. We can go back to the 1939-’45 war when countries were flattened—England, France, Germany and Holland. What did they do? They did not provide a figure like this; they provided 500 000 units per annum in each of those countries that I have mentioned in order to meet the crisis, and they built those houses. In this regard, I say that we have to consider preconstruction methods of building as opposed to conventional methods of building. Even though this may be more expensive, it may be speedier if we wish to provide this housing in time. If those countries could provide 500 000 units per annum, why are we scratching around here with 74 000 units?

A further difficulty in this regard is the Group Areas Act. The initial difficulty in this regard is that one has to find the land and fit it in to the group areas scheme. What is the policy of the NP in this regard? The hon. member for Langlaagte says that a group area for Indians should be established in Mayfair and also in Hillbrow.

Not Mayfair, Hillbrow.

Very well, Hillbrow. The hon. member for Johannesburg West says, no. Is it, however, the policy of the NP to establish group areas in White areas? Is that their policy? The hon. member for Langlaagte does not appreciate that in terms of NP policy today, any Coloured or Indian can live in a residential hotel in a White area for up to three months. Blacks, of course, can also live in international hotels in White areas. He should bear in mind that there are 90 000 Blacks living in the White city of Johannesburg and probably 10 000 Blacks are living in Langlaagte. I am trying to illustrate that the Government finds itself at a loss over the whole issue of the Group Areas Act, and the only solution is to abolish that legislation.

Since local authorities are responsible for this, I believe that the hon. the Minister has taken a positive step in making the State pay assessment rates. The hon. the Minister has, however, qualified this because he says there should be a rebate of 20% for State departments. It is rather amusing to see his motivation. He says the motivation is that the services of the central Government and the provincial administrations are of a social nature. I ask you, Sir, with tears in my eyes whether the services rendered at John Vorster Square and Caledon Square are of a social nature. What about the prisons and the Fort? Are the services rendered there of a social nature? What about the offices of the Receiver of Revenue? The Receiver takes all our money; does he render services of a social nature? No, I do not accept that at all.

In so far as married women are concerned I want to say that they should be taxed separately. The time has come to face up to the position squarely. A married couple earning R20 000 each will pay R12 000 in tax but, were they not married, they would pay R8 000 in tax. I do not think that this is the correct way to tax them. We should tackle the problem properly. When it comes to the taxing of Blacks, I want to ask the hon. the Minister whether a Black married woman who is taxed separately from her husband will now be taxed together with her husband.

I want to make a plea in so far as additional income is concerned. Millions of rands leave South Africa for the casino’s. Should this position not be looked into properly? We have bonus bonds and millions of rands go into those bonds, but one’s chance of winning with a R5 bonus bond is one in 94 million. There are the race meetings which bring in large amounts to the provincial administrations. The hon. the Minister of Co-operation and Development gets a portion of the income derived from the sale of liquor in the townships. He uses that portion to subsidize the Black urban authorities, but is that type of transaction moral? If that is the case, has the time not come to face up to this question squarely? We do not begrudge those areas obtaining finances but should we not investigate the possibility of permitting casino’s to be run in South Africa? If that were to be permitted, we in South Africa would be getting the revenue and those millions of rands could be helping our country. I think we should be honest about this whole business and we should tackle the problem realistically.

Mr. Speaker, the hon. member for Hillbrow discussed everything from old people to casinos. He covered such a wide field that if I had to reply to everything he said, I would have to devote my entire speech to that.

He does not want to smoke, but he does want to gamble.

I believe there are two points to which we must draw their attention. In the first place, there is absolutely no need for the Government to apoligize for what it has done for the elderly and the poor in South Africa. We have no need to apologize.

Have you never heard …

The hon. member for Durban Point must just be patient for a while; I shall come to him. I shall also deal with the remarks made by the hon. members for Bryanston and Yeoville. We shall give them what they deserve this afternoon!

It is very easy for the Opposition to talk about housing, because they have no planning in mind. All one has to do to solve the housing problem at Nyanga is to give every Black man two split poles and a plastic bag—and lo and behold, the housing problem will be solved! That is the attitude of the Opposition.

At least we put them in tents.

I actually want to discuss the policies of that side of the House this afternoon. In the course of the censure debate, and during this debate as well, the Opposition has avoided the subject of their policies in South Africa. It is time we chased them into the open …

We?

Yes, we.

The hon. member for Bloemfontein North made a splendid contribution this afternoon concerning the President’s Council and the constitutional development which the hon. the Prime Minister has initiated in South Africa. I suppose the Opposition is slowly starting to feel jealous about the fact that they are not involved in this programme of discussion which is gaining ground in South Africa.

Are you a “verligte” now?

The hon. member for Pietermaritzburg North recently said that when he came back to this House, he found that there was a new Speaker here, a new Prime Minister and a new Official Opposition, a so-called enlarged Opposition. When I was last in this House, the Opposition was sitting in the benches opposite. What has become of them? [Interjections.] The Opposition in this House suddenly began to disappear. Since Mr. Kowie Marais and the Young Turks got hold of the Opposition, they have dwindled to the few who are sitting over there. What has become of the Opposition? Opposition politics is paying the price today. In the days after 1970, when moderate conservatism was abandoned, radical liberals began to take over the Opposition in South Africa. What has become of the traditional Opposition seats such as Benoni, Jeppe, Rosettenville, Turffontein, and even Transvaal Provincial Council seats, such as Boksburg, Springs, Westdene and Randburg? Those seats are in the hands of the NP today, and some of them are even safe NP seats. When the Hon. Marais Steyn joined the NP, I was serving with the hon. member for Yeoville in a candidate committee, and he felt very bad about having to take over Mr. Marais Steyn’s seat.

It was a bluff.

He then offered to exchange seats with someone else, and I offered him Turffontein. However, he was too scared to take that seat. [Interjections.]

In spite of the fact that about half a million White voters voted for the Opposition, a large percentage of them are not pro-PFP, but simply against the NP, and they do not agree with the PFP.

What has become of the Opposition? I want to try to answer that question. Perhaps I have enjoyed a privilege which many hon. members have lacked. It is not pleasant to lose a seat and to be excluded from this House, but it is a privilege to observe the political spectrum in South Africa from outside active politics sometimes and then to take a fresh and objective decision about where one’s true loyalties lie. I had to take a decision, namely whether I should join the NP or the PFP. [Interjections.] I could not consider the party of the hon. member for Durban Point, for in the days of the fighting between the old guard and the Young Turks, those hon. members were the ones who sat on the fence and did not take a stand. They, too, are faced with the question of what is becoming of their political future in this House as well as outside. Observing the situation from outside, I was deeply impressed by the fact that there is no alternative to the NP Government in South Africa. Over the past few days we have been listening to the budget and censure debates, and all we have got from that side of the House have been negative arguments. They have not produced a single positive proposal of how South Africa should be governed.

I said you should resign.

The question is: Who gave South Africa freedom and independence? Who gave South Africa a sovereign Parliament, its own flag and its own national anthem? Who ultimately succeeded in fully uniting Afrikaans-and English-speaking people in South Africa in one party?

Go and talk Afrikaans in Soweto.

I say this …

You worked against the Republic.

I did not work against the Republic. I was still at school when the Republic came into being.

You definitely worked against the Republic.

That hon. member does not know what he is talking about. In 1960 I was in Matric and I was not participating in politics in South Africa. [Interjections.]

Who was responsible for South Africa’s unprecedented prosperity, for a standard of living in South Africa which is the highest on the whole continent of Africa? Who made South Africa the safest and most attractive country for foreign investments?

You need not apologize; we forgave you long ago.

Who gave South Africa the ability to defend itself against the outside world? Who gave South Africa a military fist which strikes fear into the heart of the outside world, including Africa? [Interjections.]

Order!

South Africa is one of the safest countries in the world to live and work in today, thanks to the NP Government. South Africa is an industrial giant.

With a bomb a day.

It is one of the most prosperous countries in the world. We have only to look at Sasol and Iscor. Has the hon. member for Yeoville, who is so concerned about the Black people in South Africa, ever looked at the per capita income in the rest of Africa? Is there a Black man in this country today who is starving, who does not have food to eat?

Yes.

I am not talking about the bread price now. Is there a Black person in this country who is starving?

Yes.

Hundreds of thousands.

This party has an unequalled record of success in South Africa, and for that reason it is a pleasant privilege for moderately conservative people, who grew up in good United Party families, to be able to sit on this side of the House. [Interjections.]

However, that lies in the past. What about the road ahead? I chose the NP, and it was the easiest and happiest decision I have ever had to take in my political life. [Interjections.] However, the question is which party has the soundest philosophy concerning future constitutional development in South Africa. Which party guarantees the survival of the Whites and creates similar opportunities for all communities, races or ethnic groups in South Africa? In 1976, in the days of the Kowie Marais Commission, I was accused, among other things, of being prejudiced against the Progressive Party. A man called Dan Neser, for whom I have a great deal of respect—he is now sitting on the President’s Council and is no longer a member of that party—asked me what I had against the Progs. I asked him to make an appointment for us with Dr. Zac de Beer. So we went together to Dr. Zac de Beer’s office, and Mr. Steve Meintjies, who is now a member of the NRP, was also present. That was in the days when the Kowie Marais Commission had been appointed. Dr. Zac de Beer then asked me what the purpose of the meeting was. I said I wanted to show those present why Dr. Zac de Beer and I could not sit in the same political party. “Because you are so honest and so frank,” he told me, “I shall go and fetch the file on our submission to the Kowie Marais Commission by Mr. Max Borkum.” He said I could read the document, but I could not remove it, for he alleged that I would put it to improper use outside his office.

Quite right too.

What was the first point that was made in that document? I quote—

The people who were there with me got such a fright, because they realized then what the Progressive Party actually was. This is the point I want to deal with today.

But that is a basic principle of this party.

There is a question which the hon. member for Bryanston, who has such a big mouth, and the hon. member for Yeoville must answer today. I want to quote now what the hon. Chief Whip of that side of the House said in the Other Place when the Senate was still in existence.

Why talk about all that old rubbish?

It is not old rubbish. We want to know where those hon. members stand. I quote (Senate Hansard, 1976, col. 2177)—

Does the hon. member for Bryanston agree with that? [Interjections.] Does the hon. member for Yeoville agree with that?

The answer is “no”.

He said “no”. He says he does not agree with that. [Interjections.]

†I want to ask the hon. member for Houghton whether she agrees with that. [Interjections.] The hon. member for Pine-lands laughs. Does he agree with that? [Interjections.]

*I want to come back to the hon. member for Yeoville. [Interjections.]

Order!

I was astonished …

Do not scold Harry; he may walk out.

The hon. member for De Kuilen said in last week’s debate that the hon. member for Yeoville should be the last one to talk, because he was in favour of Coloured people on a separate voters’ list.

That is not true. He knows that and you know that.

The hon. member says it is not true.

*I collected a lot of brochures from my archives when I went home one weekend.

[Inaudible.]

One of these brochures is entitled ’n Handleiding vir beter rasseverhoudinge. The last time the United Party, to which that hon. member and I both belonged, talked about one community council or one political institution for the Coloured people and the Whites was in 1963. Here it is for the hon. member to read. What happened then? In 1970 the United Party changed its policy.

What happens to an hon. member who knows that what he is saying is not the truth?

In 1970 the United Party issued another brochure.

Marais Steyn issued it. [Interjections.]

I shall presently come to the brochure which the hon. member issued. [Interjections.] In this brochure it is said—

That was the policy of that hon. member.

That is not true.

The hon. member says it is not true. Was the hon. member ever a member of the United Party? [Interjections.] I come now to another brochure. The hon. member for Yeoville bragged of having written this brochure entitled Federasie. The United Party was no longer satisfied with the brochure which had been published in 1970. [Interjections.] The hon. member for Yeoville bragged of having written this green brochure. [Interjections.] The hon. member no longer remembers that. Hon. members must make no mistake. In this brochure it is spelt out unequivocally that there will be separate community councils for each community group in South Africa: for the Whites, the Coloureds, the Asians and the Blacks.

It is a policy which you forced … [Interjections.]

So it was a policy which was forced upon those hon. members!

I want to come now to the hon. member for Durban Point. [Interjections.] I have great respect for this hon. member, as well as for the hon. member who is sitting next to him, the hon. member for Umhlanga. They are people who I believe have the interests of South Africa at heart. I do not doubt that. However, they are faced with two realities, just as I am. The first is the position of the urban Black man. The hon. member for Yeoville runs away from his past and is ashamed of it, but I am prepared to say that I was wrong. The political rights of the urban Black man must be channelled towards the national States.

Oh!

The hon. the Prime Minister has made it quite clear that there can be participation for the urban Black man in the future in terms of the confederal system or the constellation of States. That is quite clear. The hon. the Prime Minister has said so. So what is there for us to be ashamed of? There is a second point, and that is what I want to say to the hon. member for Durban Point. It is that …

Do you support White domination?

… one cannot bring about a federation in this country and have a central body with the situation as it is at the moment. That is the reality which the hon. member for Durban Point will have to recognize. He also deviated from his course and began to move to the left in an attempt to keep the people who were going over to the PFP. I have here a pamphlet which was published in 1974. It says, with regard to the proposed Federal Council—

That was a clear formula. What does the hon. member for Durban Point say now? During the recent election he made a statement—I quote from The Star of 26 March 1981—

The formula has been thrown out. Now it is to be done “by way of negotiation”. I want to ask the hon. member where this will take place.

Our policy is …

Will it take place in Geneva or in Lancaster House? That is what the hon. member must tell us.

Do you accept the policy of the NP of 1948?

I want to conclude by coming back to the PFP. I want to tell those hon. members that the radical leftist elements, the hon. member for Pinelands and all the old blue-blooded Progs, do not care whether it is a unitary system or whether it is a federal system. They just believe in the idea of a qualified franchise. That is all they believe in. All they did to satisfy the hon. members who came over to their party with the hon. member for Yeoville was to call it a geographical federation. Now they are going to draw new boundaries. They are going to create new geographical units in South Africa. The question is on what basis they are going to do so. Will it be on a racial basis, on a cultural basis, on a historical basis, or on what basis? The end result remains exactly the same, in any case, i.e. Black majority rule in South Africa. I know the hon. member for Yeoville feels ill at ease in that party, but where must he go? I just hope he does not come here, for then I shall really have to leave by the back door.

Mr. Speaker, it is a special occasion and a great privilege for me to be able to say a few words in the House for the first time. Of course, it is common cause that this is accompanied by butterflies in the stomach and other related nervous conditions. The only source of support for me in this regard is that every other hon. member has had to go through this at some time or other too.

I should like to pay tribute today to my predecessor in the House, Mr. J. G. Swiegers, who represented the Uitenhage constituency here for 15 years and provided valuable service to the voters of Uitenhage.

Today I should like to devote myself to a matter which means a great deal to me. I should like to break a lance for my constituency in its regional context as an integral part of the Port Elizabeth-Despatch-Uitenhage metropolitan area. These three towns alone comprise the entire area and their interests and needs are closely intertwined with the result that one cannot speak about them separately when one wants to discuss future development in this area. This area, together with the three other large metropolitan areas, viz. the P.W.V. area, the Durban-Pinetown area and the Cape Peninsula, are recognized as such in the National Physical Development Plan. The economic artery of my constituency and this region is undoubtedly the motor industry and related industries. It may be unnecessary to emphasize that these industries are sensitive and capricious and have a very high profile due to the strong ties with countries abroad. Any occurrence in these industries draws foreign attention to this region to a much greater extent than may be the case elsewhere. Mr. T. G. Lochner, who is affiliated to the Planning Research Institute of the University of Port Elizabeth, described the way in which this industry dominates the local economy in the following way last year—

The institute went on to say that, apart from this trend, the growth potential of this area is now intertwined with the growth of the motor industry and related industries which is responsible for 60% of all economic activities.

This is an industry that has already proved itself to be a strong catalyst for growth, but at the same time as a very unstable industry due to its excessive sensitivity to trends in the economy and in politics. A factor which makes the economy even more risky, is the transition of the motor economy from an assembly line to a manufacturing industry, which means that to a large extent Port Elizabeth has lost its establishment benefits.

Although I have said this, it still remains an industry of which we in that area are very proud, because according to the latest available figures, the three manufacturers in that region have captured more than 55% of the sales of new cars, and if the sales of commercial vehicles are included, they have obtained 39% of the total trade. Therefore, in recent times this industry has experienced a tremendous boom and it has given rise to optimism in the entire area.

I am not one of those who bemoans the fact that the economy of the area is based largely on the motor industry, because it is due to this very sensitivity of the industry to the economic and political climate that it reacts quickly in both directions. Nevertheless, the advantages far exceed the disadvantages, particularly if we take note of the fact that this industry represents large investors and employers, in South African terms. Of course, additional advantages are that the latest technological and scientific developments are obtained from the USA and Europe. It is precisely because of their multinational characteristics that these companies are far advanced when it comes to labour matters, and the situation must be dealt with in the international limelight, as it were, which is not always beneficial for negotiations of this nature.

This obliges both the workers and the management to act extremely carefully and in good faith, particularly if we take note of the long-term interests of that region, in the sense that a stable labour situation is essential for confidence as well as for further growth.

However, it remains an insurmountable fact that when it is compared to the other metropolises in the country, the Uitenhage-Port Elizabeth area, stands out, not only with regard to its size, but also with regard to its industrial basis. This is also the reason why I am suggesting that this area is the most vulnerable, since it is by far the smallest and the poorest endowed. Growth is an accepted and integral part of the pattern of life, and economic growth is the cornerstone of stability, particularly stability in the labour situation, in the sphere of the provision of labour. If this predominant motive is borne in mind, the socio-economic conditions in this area at the moment are much more delicate and vulnerable than is generally accepted, in spite of the strong upswing in the motor industry. At the moment, motor sales are almost unbelievably good, and the industry is riding the crest of a wave. However, this may be the very moment when we must look at what is happening here under the existing optimum conditions.

Now we find that the unemployment position was as follows in June this year. The number of White unemployed was 595, Coloureds 1 417, and Blacks 26 289. This situation is already alarming and as soon as a levelling off occurs in the sale of cars, which is not only a strong possibility, but is in fact a reality, it will immediately create a situation which will be very delicate because instability can step in rapidly. Therefore, I should like to suggest and request that if the metropolitan areas can be spoken of in the sense of planning, it should be very clearly borne in mind that our area does in fact differ drastically from the other areas.

It is impossible for this area to bring about and generate the necessary economic growth from within. Our area is quite correctly expected to continue on its own and to be responsible for its own salvation and its own growth as far as possible. This standpoint is quite acceptable and correct, and we are also doing everything possible in this regard. There is an on-going programme in terms of which the economic affairs of the area are being investigated, in an attempt to identify additional possibilities and growth areas.

In August last year a large-scale attempt was made by representatives of this House and of the provincial council, by way of proposals submitted to the economic planners of the Government, to bring these very matters to their attention. It is still being followed up by further investigations. The hon. the Minister of Industries, Commerce and Tourism has already announced that the Government is very much aware of the factors that inhibit growth in our area, and that the matter will enjoy sympathetic attention. Therefore, the area is not sitting back and approaching the Government with a mendicant attitude. However, on the other hand it is a fact that this area has characteristic problems when compared to the other metropolitan areas. Considerable expansion of existing industries was recently announced, and it is true that the majority of these expansions that were announced include expansion outside this area too. This is being done for purely economic reasons of manufacturing and marketing. With reference to the interest-provoking statement of the hon. the Prime Minister regarding decentralization, I should just like to quote what he said—

Then the hon. the Prime Minister went on to say—

I have tried to indicate that we do in fact differ a great deal from these “bigger metropolitan areas”. I think that this has been said by the hon. the Prime Minister too. As a result of this difference I should like to request that the existing industries there be helped and protected so that they can remain there and expand there. This will only be able to take place if the disadvantages of the situation of our area, far from the markets and the natural resources, are set off with the aid of the Government in some form or other as the hon. the Prime Minister mentioned.

This region has an excellent existing infrastructure which includes a modern harbour, air and rail connections, a university and so on. The full utilization thereof is essential and extremely desirable, because it would be a waste not to use these at their full potential.

In conclusion I just want to say to the hon. the Minister of Posts and Telecommunications that we listened with a great deal of appreciation to last week’s announcement. As a result of decentralization a section of his department, viz. the Audit Division, has been placed in Port Elizabeth. I hope that this is a taste of further advantages to come from this decentralization, and I am thinking in particular of the placement of the Accounting Division of this same department. It is a tremendous boost for our area and it is a recognized and successful way of bringing about stimulation with little or no unpleasant consequences for the department concerned. We have a great deal of appreciation for what the hon. the Minister has done.

I want to conclude by saying that we may not be in the same league as the other metropolitan areas, but with a little encouragement we too can play our part in the future.

Mr. Speaker, it gives me great pleasure to be able to congratulate a former colleague from the Cape Provincial Council on his maiden speech albeit only a few days after making my own in this House. I know the hon. member well from the Cape Provincial Council where he had a reputation for making extremely constructive contributions, particularly in the field of nature and environmental conservation. I think his maiden speech today, in which he eloquently expounded the needs of the Uitenhage area in the economic sphere and particularly the implications of Uitenhage’s dependence on the motor industry, augurs well for his career and the contributions that he can make in this House.

I cannot say quite the same thing about the hon. member for Turffontein. He obviously thoroughly enjoyed himself delving into history and into his political archives. Perhaps he forgot that the issues of the 1960s are not necessarily the issues of the 1980s. If he had instead addressed himself to the problems of 1981, he might have had less cause for self-satisfaction. It was that very arrogance and self-satisfaction that was a major factor in the loss by the NP of seats in the recent election.

I want now, Mr. Speaker, to come to the budget for this year. I should like to discuss the problem of inflation because inflation is a threat to all of us and it must be brought under control before it destroys the fabric of our society. In his budget speech the hon. the Minister of Finance said—

Unfortunately, when it comes to the question of combating inflation, the Government has very little credibility left. When one looks back over the years and reads the speeches of the hon. the Minister of Finance in presenting his various budgets one finds that in 1976, the first year in which he had compiled the budget entirely on his own, he said—

Incidentally, this was when the inflation rate was 10,4%. In 1977, he said—

He said this although the inflation rate had risen to 11,9%. In 1978, he said—

Subsequently, he added—

In 1979, he said—

Later on, in the Senate, in col. 2467 of the Hansard for 1979 he said—

In his budget speech last year in this House he said-—

What has actually happened, Mr. Speaker? The hon. the Minister has been claiming that he has been fighting inflation, controlling the money supply and restricting Government expenditure. However, if we look over these past five years during which he was in charge of financial affairs and we look at each of those financial years, we find that the real growth in the gross domestic product amounted to 16,1%. While the GDP grew by 16,1%, the money supply grew by 96,1%. While the money supply was growing, Government expenditure grew by 110,7%. Against this, the consumer price index increased by 89,2%. The hon. the Minister has boasted time and again over a period of time that he was keeping the money supply under control. As far as Government expenditure was concerned, time and again he would say that there was hardly any real growth in that regard as against the growth in the CPI. In actual fact, however, that was not the position.

In the most recent financial year, 1980-’81, the consumer price index which he told us was “to be curbed” ended up at 16,2%. The money supply which he told us was “to be somewhat below the rate of inflation” was in fact 34,5% and, in this latest budget, Government expenditure increases by 21,3% as compared with the previous budget in March 1980. Mr. Speaker, I do not accept that comparing the March budget with the revised expenditure is a valid comparison when one is working on percentages. I say this because if one does this, one is assuming that there is not going to be an additional appropriation in the following year which, of course, there is every year.

One of the questions one needs to ask is: Who is to blame for this state of affairs? The major share of the blame undoubtedly lies with the Government. In March of this year the hon. the Minister himself told a conference on inflation that “the Government must bear the major responsibility for curbing inflation.” I say, Sir, that the Government has failed to control the money supply, to prevent massive and inflationary rises in administered prices over a period of years—maize and cement are two examples—to take action to eliminate inefficiency and to eliminate wasteful expenditure on its apartheid policy.

Last year, the present Governor of the Reserve Bank, Dr. Gerhard de Kock, referred to the existence of what he described as structural inflationary features in the South African economy. He listed these as artificially controlled employment, an obsession with self-sufficiency and the concept of “strategic industry”, the monopoly control of markets either by the State or by private sector organizations, and the administered price system. These structural features—as they are now described—are all a direct or indirect result of Nationalist policies and actions. Until the Government takes steps to remove the artificial obstructions that inhibit our economic development, inflation will remain at disastrously high levels. Technical and financial control are not enough. We have, however, heard precious little from the Government about what it plans to do about these aspects. No wonder this Government has little credibility when it comes to fighting inflation. The man in the street sees this as just another example of plenty of talk and very little action.

The effects of inflation have been commented on a number of occasions in the course of this debate, including such aspects as the cost of living generally, housing, education, pensions and other areas in which inflation causes acute problems. Of course, there is at least one man in South Africa for whom inflation does not cause acute problems, and that is the hon. the Minister himself when he is having to balance his budget, because thanks to a large extent to inflation, without having to announce any changes in individual tax rates or any changes in the general sales tax rate, individual tax will be up by 50% this year and the general sales tax by 39%, yielding an extra R1,5 billion. A large part of this is a direct result of inflation. This is where the secret taxation lies in this budget.

I should like to look at one particular foodstuff in regard to which the effect of inflation has been dramatic. I am referring specifically to the price of bread. The enormous increases in the price of bread from the beginning of this month is scandalous. At a time when pensioners, the unemployed and the poor in our community are struggling desperately to make ends meet, it is disgraceful to increase the prices of basic foodstuffs by 33⅓% and 40% in one fell swoop. Is this the example the hon. the Minister of Finance is setting when he tells us that combating inflation is the highest priority? Is this the example he wants the private sector to follow?

Increases such as these, at more than double the current rate of inflation, give another nasty twist to the inflationary spiral. White bread has doubled its price, and the price of brown bread has increased by 75% in five years. Again we have the situation, which the hon. the Minister himself acknowledged in his last three budgets, that administered prices have been fueling the furnace of inflation.

What justification is there for this massive increase in the price of bread?

Let us look at the administration of the Wheat Control Board. Costs increased by 22%, according to the most recent report, whilst inflation was only 15%. Such costs have therefore obviously got out of hand. The hon. the Minister mentioned the fact that despite all this, South African bread was still the cheapest in the world, and to that extent he is quite correct. One only has to look at the price of a 900 gram loaf of white bread in various parts of the world, especially some of our major trading partners. Tokyo has the highest price, R1,29. In Bonn it is R1,23 and in Washington R1,14. In London the price is 76 cents as against a price of 42 cents in Johannesburg. Looking at figures like that, however, without looking at the average incomes of the people who have to buy the bread, is a meaningless exercise. If one adjusts for per capita incomes, what does one find? One finds that the price in Johannesburg is the highest of all the five trading partners I have mentioned. The prices are then as follows: 42 cents in Johannesburg, 38 cents in Tokyo, 34 cents in London, 21 cents in Washington and 20 cents in Bonn. Those of us who have travelled, know that the quality of white bread in most of those places is generally better than it is in South Africa. [Interjections.]

I query that.

That may well be a matter of opinion. Admittedly, I have not been to Tokyo but I have been to many of those other places and the white bread there is considerably better than it is here. Furthermore, there is a more even distribution of income over the whole population in those countries than in our country. The result is that even on a straight per capita basis our bread is relatively expensive. With our distribution the section of our population with the lowest income are very much worse off. The hon. the Minister also “rejected suggestions that the Government is hitting the poor” when increases of this nature in basic food prices are announced. This, quite honestly, almost puts him in the R20-per-month-for-pensioners category. Does he not know that the consumption per capita of many basic foods has been dropping? Does he not know that more than 70% of the population of South Africa live below the poverty datum line? How can he question our allegation that they are causing hardship to poor people?

There is talk that wheat may have to be imported, as if that is a factor in the price when in fact it is not, because imported wheat is cheaper than the local product and has no inflationary impact.

It is not.

The hon. member for Malmesbury says it is not, but the source of my information, the authorities, maintain that imported wheat is cheaper. That statement is typical of a man who does not know what is going on.

We must get our priorities straight. People cannot be left to starve because they are unable to afford basic foodstuffs. The Government says it cannot afford an additional subsidy of R71 million out of a budget of R16 billion. Those members seem to forget that it is the Government’s racially discriminatory laws and practices that condemn millions of South Africans to live in poverty. It is immoral to expect the poorer sections of our population to contribute towards the implementation of policies that they hate.

I appeal to the hon. the Minister to take action: To increase the subsidy by the same amount as the overall increase in Government expenditure; to use the full subsidy for brown bread; and to plough back GST on bread sales into the subsidies. If he were prepared to do this, brown bread could drop in price from 28 cents to 22 cents per loaf and millions of South Africans could go to bed with a little more food in their stomachs. I would remind the hon. the Minister that the security of South Africa depends more on having a well-fed and contented population than it does on having billions of rands spent on defence.

Mr. Speaker, I consider it a great privilege to be able to speak in this House for the first time today. I suppose I am not expected to comment on what was said by the previous speaker.

In the first place, I should like to convey a word of thanks to the two previous representatives of the constituency which I now represent. To Mr. Wilkens, who is still sitting in this House, I wish to convey the sincere thanks of the voters for the wonderful work he did there. I also want to convey my thanks to the hon. member for Rand-burg, for a part of my constituency was formerly in his care. I can assure these two gentlemen that the voters have asked me to convey their thanks to them as well.

In the two weeks I have been sitting in this House, one thing that has often been referred to is gold, and occasionally diamonds have also been mentioned. Gold undoubtedly forms the backbone of the South African economy. I wish to outline briefly the activities in my constituency. When the gold mines were beginning to close down, people were still frantically searching for the gold reef which had disappeared between Klerksdorp and the Witwatersrand. It was only after Goldfields had appointed Guy Carlton Jones, an engineer, and Dr. Kramer, a geophysicist, to look for the gold reef, that it was found in the ’thirties. I can only say that it is the richest goldfield which has ever been discovered in the world. As a result of the gold which had been discovered there, and the problems which were experienced in mining it, the two towns of Westonaria and Carletonville arose. Today those involved in the gold-mining industry are proud of what they have achieved there, of the traditions which have been built up in the gold-mining industry and of the recognition which the man in the gold-mining industry enjoys internationally because of his great skill as a shaft-digger.

In spite of this discovery of gold, the metal remains very scarce. This can be illustrated by the following: Since 3 900 years before the birth of Christ up to the present time, only 116 000 metric tons of gold have been mined, three-quarters of it during the past 80 years. Since the discovery of gold in South Africa, 36 000 metric tons have been mined here. I am proud to say that South Africa is today the greatest gold producer, for we supply 51% of world’s gold production. We produce 72% more gold than the country with the second-highest production, namely Russia. Therefore, as the world’s biggest gold producer, the future production capacity of the Republic of South Africa is of the utmost importance to the gold markets of the world.

The revival in the economy which was stimulated by the exceptional earnings from goldmining has surpassed all expectations, and the growth rate of 8% over the past year is the second highest in the post-war history of our country. The value of gold sales has increased by 78% over the past year. After all, it is known all over the world that hard coin currencies are better than paper money. I quote what President De Gaulle said as far back as 1965—

The two major elements in the demand for gold is, firstly, industrial purchases for the manufacture of jewellery and equipment in the field of electronics, dentistry and so forth, and secondly, the investors’ demand for gold bullion and gold coins. In this connection we know what an important role Kruger rands and the great international demand for them is playing at the moment.

The methods employed in the mining industry have by no means remained static either. Attempts are continually being made to make the gold-mining industry better and safer. One of the greatest problems experienced in the mining industry is the shortage of trained staff. This is something which has often been emphasized in this House, but I cannot help mentioning it again. There is a shortage of more than 1 000 artisans in the mining industry at the moment, and a shortage of approximately 700 holders of blasting certificates. Since the mines are now planning further expansions of R12 milliard, one can hardly imagine what the situation will be when they have to employ a further 100 000 workers. It has also been proved that a well-trained person is much better motivated to serve. It means that there are fewer accidents and that a higher level of productivity is maintained.

Having mentioned the problems in the mining industry, I should also like to refer to the problems experienced by the worker in the mining industry. There are two problems which are very important to the mine-worker and which are a source of great concern to him. The first is that as soon as he enters the mining industry, he immediately realizes that he is exposing himself to an occupational disease. That is the reason why he has to undergo regular medical examinations. However, it has also happened that some persons have been certified for the first time after their deaths, and this worries the workers in the mining industry. I see no reason why, if there is any doubt, the worker cannot get the benefit of the doubt and be warned in time.

The second problem which a person in the mining industry has to contend with is the meagre pension he receives when he retires. Perhaps I should explain briefly how the mine-workers’ pension scheme works. The stoper, in other words, the rock-breaker in the mining industry, works on a contract basis, but his pension is calculated on his basic wage. However, his basic wage is sometimes only one-third of his true earnings. A person may earn R1 500 a month, for example, but his pension is calculated on his basic wage of approximately R600. From this one can see that when he reaches retirement age, such a person can hardly exist on the pension he receives. By this time there must be a considerable amount of money in the pension fund of the mining industry. I would be glad if something could be done to improve those pension benefits of the person in the mining industry. Here I am thinking especially of the person who has already had to retire. He really cannot meet his basic needs. While the payment of his pension is not the problem of the State, I do feel that this House will surely be sympathetic towards that man who is working in the mining industry, an industry which forms the backbone of the South African economy, so that he may also receive a decent pension when he retires.

Mr. Speaker, I want to congratulate the hon. member for Carletonville on his maiden speech. All of us are very pleased that gold was found where it was found and that there was so much of it. The hon. member put his case very well and for us in the Cape it is gratifying to know that there is so much gold there that when we here in the South need some of those treasures, we might be able to approach them. Furthermore I want to express the hope that the rest of his plea on behalf of the mineworkers will be as successful as the search for gold was.

I want to congratulate the hon. the Minister of Finance on his budget. He did his best, I believe, to make as many people as possible happy and to hurt as few people as possible. Without going into too much detail—I am sure other members will also discuss this matter later this year, if not during this debate—I once again want to advocate the abolition of estate duty today. Estate duty is a monstrosity. It is a tax on the defenceless deceased. It could almost be described as desecration. It is a socialistic and communistic egolitarian process by means of which the assets of the hardworking, enterprising, ambitious and thrifty individual are alienated after his death. This is the very thing for which the Third World is making propaganda today and agitating at the UN: The world’s wealth and assets should be shared among everyone; the masses must share in what the hard-working and enterprising man has accumulated—everyone must be equal.

England is a fine example of how foolish this egalitarian process is. The power of the once mighty Britain was vested in its landed aristocracy. After the Second World War the socialistic Labour Government completely eradicated this class of Britisher and his estates, in particular by means of estate duty, to be able to provide services and further idleness for the lazy good-for-nothing individual. What do we find now, after that egalitarian process has almost been completed? We do not find a stronger and better Britain, but a pitiful stumbling nation of loafers, strikers and demonstrators who all want to live off other people’s hard work and thrift.

Although estate duty in South Africa is being applied on a smaller scale, it is definitely eroding the foundations of our rural population as well. Although estate duty only amounts to approximately R45 million, that amount is aimed at the Achilles heel of South Africa: The entrepreneur, the businessman and the farmer.

The hon. the Minister and his advisors can argue until they are blue in the face, but this fact is as plain as a pikestaff. [Interjections.] I want to appeal to the hon. the Minister to display the ingenuity of finding an alternative to this R46 million which is at present being collected by way of estate duty. This taxation is an impediment to our society and its progress. It has a strongly negative effect on agricultural production. Here, as in England, estate duty is also alienating the individual land-owner from his land. South Africa will still pay dearly for the loss in agricultural production, in foodstuffs in particular. Surely there are many other ways of obtaining this miserable R46 million, ways which will be more equitable and less damaging to the future of our country. It can be done, for example, by increasing sales tax to 5%, i.e. 1% above the existing 4%. Accordingly it will amount to one twentieth part of four cents.

How do you want to implement this in practice?

It is very little. In any event sales tax brings in more than we originally budgeted for. Consequently we could increase or decrease this tax by 1% at will. [Interjections.] We could also buy a computer. [Interjections.] The computer could work it out for us.

Be that as it may, it would be an absolutely minimal, insignificant portion of sales tax for example. In the same way it would be an absolutely insignificant portion of income tax for example. If we were to shift the burden of estate duty and to place it on sales tax, income tax or any other taxation, we would find that it would not burden our entrepreneurs as it is in fact doing today, and that in addition more employment opportunities and greater revenue will be generated in our country and our community.

We must simply abolish estate duty. We could, for example, impose a higher tax on Coca Cola. [Interjections.]

No! No!

There is nothing wrong with that. [Interjections.] Just as long as we do not increase the price of wine. [Interjections.] Estate duty normally comprises approximate 1,14% of income tax. This would, for example, mean that a person who pays let us say R20 000 in income tax, will have to pay only an extra R228 if we were to shift this burden from estate duty to this taxation. Once again this is a minimal amount.

However, I do not want to prescribe to the hon. the Minister where he must obtain this money. I am just asking him please, pretty please to look for alternate sources so that estate duty can be done away with. I maintain that estate duty is almost like nassella tussock; a creeping death here in South Africa. [Interjections.] Like every other plague, I think we should eradicate it completely. We must do this as soon as possible.

I know that there are many arguments in favour of estate duty. There are many sound arguments in its favour. The hon. the Minister knows all those arguments. He also knows most of the arguments against it. However, if he makes a study of all these arguments he may find a few more arguments against it which will convince him that other people and I are correct. The agricultural unions, too, are particularly concerned about its influence on the agricultural sector. They, too, from time to time make strong representations in this regard.

I want to quote to this House what an economist, a certain Johan Willemse, had to say about it. I quote from The Farmer—

This is now the agricultural sector—

He then goes on to focus on another point—

This, I know, the hon. the Minister will never do, I also make this appeal to him.

I now have a new constituency, viz. that of East London North. It is the only seat which was taken away from the Opposition during the past election. And that, without “bragging” is the third successive opposition seat I have taken away from them. When it became known that I may be standing in East London North, the previous PFP representative got such a fright—like Hans Rabie’s ghosts of yore who, in their terror fled back to the wrong holes—that he ran all the way to Port Elizabeth Central. How can someone run away from a place like East London, probably one of the most beautiful cities in our country?

What about King William’s Town?

Where do you live?

East London is the most beautiful place to which anyone could go to do business, to live, or to have a holiday. It is not a dead, bankrupt place such as the Progs are trying to imply it is, but a living, growing city which is expanding by the day across the green hills. It offers its inhabitants the finest beaches, the best fishing, schools, golf courses and climate that anyone could wish for. It offers the investor, the entrepreneur, the industrialist, the necessary infrastructure—fine dual carriage ways, railway connections, harbours, water in abundance, inexpensive land and abundant labour and concessions of which most people are not even aware. It is a paradise which still has to be discovered by the rest of South Africa.

Why do you not go and live there then?

As in any other paradise there are, however, a few things lacking. There are no raw materials or minerals, electricity is expensive and as a result of this and other factors growth was and is not rapid enough to create sufficient employment opportunities for the Black population of the surrounding Ciskei. Consequently there is unemployment, and of necessity, famine, among the people, which consequently drives them to crime. I am not going to drone on about our problems. The Government is well informed and knows what the situation is. I just want to express the hope that this responsible Government will implement its plans to eliminate the existing impediments quickly and efficiently. The tasty dish is already cooking. Only the salt and spices must be added by way of decentralization and the necessary adjustment of electricity rates.

The industrial area of Berlin is still lying stagnant. The PFP members of the East London City council are incapable of ever bringing about growth there. They are only interested in breaking down and not in building up. If we want Berlin to grow we shall either have to remove it from the jurisdiction of the PFP-dominated East London city council, or we shall have to convince the city council that the development of Berlin, as in the case of Queenstown, must be left to private developers to be able to do it on a commission basis. [Interjections.] Yes, the race track will also be established still.

I want to conclude by saying that I support this budget.