Mr. Speaker, when the debate was adjourned last week, I had reacted briefly to the hon. the Minister’s Second Reading speech by saying that apart from a few pieces of tinsel, the hon. the Minister had presented a very grim package of budgetary proposals to the South African public.

I said then that the budget was highly inflationary and that it would add significantly to the burden of the ever-increasing cost of living for the man in the street. I want to say now that I believe that I understated the situation on that occasion. After having had time to study the hon. the Minister’s proposals and their effect on the economy, I see them in an even more serious light today.

In these circumstances I now move the following amendment on behalf of the official Opposition—

1. (1) the increases in Railway goods tariffs, harbour tariffs and passenger fares are excessive and highly inflationary;
2. (2) the increased tariffs represent a further move away from the principle of cost related tariffs;
3. (3) the Administration has failed to arrive at a reasonable formula with the Treasury relating to the burden of financial responsibility for uneconomic passenger services necessitated by the political policies of the Government:
4. (4) the Administration, in conflict with the principles of private enterprise, persists in extending its operations into fields where it comes into unfair competition with the private sector; and
5. (5) it is not satisfied that the Administration has achieved adequate levels of efficiency in the operation of its services.”

Mr. Speaker, it is easy to say, as I said in my first and spontaneous reaction last week, that the budget is inflationary. In fact, however, when one studies the proposals, they have a much more positive effect than merely being inflationary; they actually actively feed the inflation rate patently and directly.

The hon. the Minister conceded in his speech that the inflation rate in South Africa was presently some 13%. He then proceeded to tell the House the revenue of the S.A. Transport Services would have to be increased by 15%, by raising goods tariffs, passenger fares and other tariffs; in other words, an increase of already 2% above the existing inflation rate, because let us remember that the increases announced by the hon. the Minister are across the board increases, involving rail passenger fares, commuter fares, air fares, goods tariffs, for all commodities, and harbour tariffs as well. I must say that, on examination of the effects of all this, I doubt whether the increase will indeed be as little as 15%.

The hon. the Minister, in telling us of the escalating losses on the railway passenger services, amounting to an estimated R690 million during 1982-’83, added that the State would contribute a total amount of R314 million, which in his own words, was not nearly enough. Then he went on to say that the balance of the deficit would have to be made good by cross subsidization from other profitable services. He then also added that the service which had to bear the brunt of this burden was unfortunately the rail goods service. This, however, is only half the truth.

Certainly, goods services will bear a portion of the burden, but by no means all of it, and even then it will not be limited to a mere 15% increase in tariffs. Figures which have been given to me indicate otherwise. For example, railage increases in fairly basic commodities, in terms of existing tariff regulations and the new percentage increases, will mean, for example, that in terms of regulations, tariff No. 1 items, which includes items like toilet preparations, these will be increased by 16%. Tariff No. 3 items, which include the transport of tea, coffee, etc., will increase by 17,2%. Tariff No. 6 items, which include packed products, like oils and canned fish, will increase by 17,8%, while tariff No. 8 items, including margarine, will increase by 18,1%. Meanwhile tariff No. 11 items, including sunflower seed—and the hon. the Minister will certainly be interested in this—will increase by 20,7% and parcels tariffs by 20%.

If that is not going to add to the inflation rate of 15%, and push up the cost of living as far as basic commodities are concerned, then what is? It is, however, not only the rail goods service which will bear the brunt of the cross subsidization process in respect of the unprofitable passenger services. The hardest hit of all in this regard are the harbour and pipeline services. Here the hon. the Minister has proposed increases of between 17,5% and 25% in respect of harbour services and related services. In respect of pipeline services increases of 75 cents per litre of petrol and 5 cents per litre of diesel, will mean increases of approximately 19%. One must then look to the hon. the Minister’s expectations in regard to the revenue from these two sources. In the working estimates he tells us that harbour revenue for 1982-’83 is estimated at R798 million, and he then says that the estimated surplus of revenue over expenditure from harbours is expected to be R330 million. In other words, as a businessman the hon. the Minister, in looking at his harbour business, is estimating that he is going to make a profit, a surplus, of 40% in the coming year.

As far as pipelines are concerned, the estimated revenue is R216 million and the estimated surplus, R172 million. In other words, in this case it amounts to a surplus, a profit of 79% on pipeline services. Yet, these are the two services which are the subject of increased tariffs now as a result of the cross subsidization process. What is the effect of all this going to be on the economy?

As far as harbour services are concerned the increased tariffs and dues must have effects on the prices of imported and exported goods, again to the detriment of curbing the inflation rate and the costs to the consumer. They will also, however, have ancillary effects on the productivity and the profitability of our harbour services. One of these will certainly be in the field of transhipment services. Shipping companies and those connected with the harbour services have for a long time looked to the economic prospects of building up transhipment of cargo in South African ports, from ships plying between the East and the West.

Already we are told that the cost of transshipment of cargo at a port like Durban is four times as much as that at a port like Singapore. With these punishing tariff increases announced by the hon. the Minister last week, increases relating to harbour services and the handling of cargo, these can only price us further out of that market.

As far as pipeline services are concerned—where the hon. the Minister anticipates a surplus of 79%—some will say that the increased tariffs are not as bad as they might have been. This is, however, surely a superficial viewpoint because the increases must be viewed against the major background of the cost of fuel to the South African economy. This is a matter with which I shall deal further at a later stage.

Looking, however, at the expected profitability of harbours and pipelines—40% and 79% respectively—and the increased tariffs applied to these two services, I want to ask the hon. the Minister where the principle of cost-related tariffs is which is expounded by the Administration. Where is the principle of cost-related tariffs when services of this kind are attacked so viciously in order to enable the hon. the Minister to balance his budget? Services which are running at considerable profit are now being subjected to further increases.

To revert now to the increases in mainline and commuter passenger fares and air fares to which I referred briefly last week, I want to say again that these will be particularly punishing to transport users. Here again I understated the position when I reacted spontaneously to the hon. the Minister’s speech last Wednesday. The percentage increase is in fact far greater than the 50% which I indicated was the overall increase in passenger fares and air fares over the last two years as a result of the hon. the Minister’s proposals. The percentage is in fact greater because the successive percentage increases over the period must be compounded and therefore while the separate increases of 15% in 1980, 15% and 10% in 1981 and now further increases of 10% and 12% add up to 50%, the overall effect over two years, if one takes a base of 100, is that air fares, for example, have increased by over 80% over the period, and other fares are not far behind. But why are these massive and perennial increases necessary? I think there are two major reasons which stand out for all to see, in this budget and in the budget of last year and the year before, and both have their roots directly in the political policies and ideologies of the Government. And both also run totally counter to the notion that the S.A. Transport Services should and are in fact being run as a business organization, which is claimed in this budget and which has been claimed so often before.

The first reason is that the Administration is faced with an impossible burden in regard to the operation of totally uneconomic passenger services made necessary by Government policies. The second reason is that the enormous increase in the price of petroleum products, for which South Africa is being compelled to pay at a much higher rate almost than any other country in the world, places an impossible burden on our Transport Services. With regard to the first reason, the problem of passenger services, one has only to read the hon. the Minister’s speeches and those of his predecessors to see that in the provision of these passenger services, necessitated by Government policies which dictate that in all our major industrial areas the labour force, i.e. our workers in South Africa, are compelled to live long distances from their places of employment, the S.A. Transport Services are being compelled to perform a socio-economic function which conflicts with the tenets of a business operation. And so the Administration has to rely, and it does, on hand-outs from the Treasury to alleviate the losses. This year the estimated loss is R690 million, and the State’s contribution is R314 million, which the hon. the Minister, quite correctly, says is not nearly enough. Of course it is not nearly enough. Last year the loss on these services was R628 million and the external compensation payable was R285 million, leaving a balance of R343 million to be made up by cross-subsidization, i.e. by punishing the economic services.

This is the major part of the hon. the Minister’s dilemma in budgeting. I sympathize with him in this respect. It is an ad hoc arrangement which forces the hon. the Minister to stumble from one uncertainty to the next, year after year, in trying to plan and balance his budget. One wonders where it is going to end. When is there to be a finality in regard to the Government’s attitude to the recommendations of the Franzsen Committee? I want to ask the hon. the Minister to deal with this specifically when he replies to this debate. Why are they dragging their heels? The hon. the Minister in his speech last week used almost a direct quote from another speech, without even acknowledging it. It was a case of Schoeman quoting Schoeman.

A very good point.

Well, it may have been a good point, but he did not acknowledge it. It did have a very familiar ring to it when I listened to it. This year he used the following words in dealing with this issue—

Last year, and I quote from Hansard, col. 3889, on 16 September, he said—

The same words—

That was six months ago and these are almost identical words. What is happening? Where is the sense of urgency? The hon. the Minister told us six months ago he was negotiating and trying to find a solution as soon as possible. What has happened in the intervening six months? I believe the hon. the Minister owes the House and the country an explanation as to what is taking place in these negotiations and what progress is being made.

The second major problem at the root of the hon. the Minister’s difficulties in regard to his budgeting and the reason for losses on the operation of our transport services, particularly in the Airways, is the unpredictability relating to the cost of fuel in South Africa. The hon. the Minister has again given this as a reason for some of his problems. However, why are the prospects so gloomy? This is what we have to ask ourselves. World oil prices have slumped and the spot prices is now below $30 per barrel but despite all this, we in South Africa are facing yet another increase in the price of fuel. It may be argued that this is due to the reduced buying power of the rand but I want to ask: Is this the whole story? We know that more than half of the existing price of fuel in South Africa which, as I have said, is one of the highest in the world, is accounted for by Government taxes and levies. I want to ask this: Can it be that South Africa is perhaps in fact locked into a long-term oil purchasing contract at rigid prices which means that we can expect little benefit from lower international prices? These are questions that need to be answered. If this is so, if there is such a contract it is time we were told what the duration is of such a contract and for how much longer we are going to be burdened with this problem. It is having a major effect upon the level of inflation in this country and in particular, in this instance, on our transport services. These are some of the answers we require from the hon. the Minister.

I also wish to deal briefly with the question of rail goods traffic and road transport. A disturbing feature of the hon. the Minister’s speech last week—I must say that most of his speech was disturbing—was that high-rated traffic had decreased by 6,6% in so far as rail goods services were concerned. As we know, the high-rated traffic is the money spinner as far as our rail goods services are concerned and this is bound to have a very bad effect upon the revenue of rail goods services. However, the hon. the Minister seemed to have accepted the inevitability of this decrease in high-rated traffic because he then went on to say—

I want to ask the hon. the Minister: Why this abject surrender? Surely there is a need to search for other methods of coping with the problem? Surely there is a need to try to make the rail goods services more efficient and more competitive rather than now to threaten further competition with the private sector in the field of road transportation? I think, for example, of our container transport. Experience has shown that the length of time taken by rail to transport containers is the main reason why users are switching to road haulage. Because of these delays, business is being made to carry three and four weeks’ higher stock levels than their counterparts in other parts of the world. If they could be assured of speedy transit times, particularly between Durban and the Reef, they could cut back on their stock inventories. During 1981, transit times for containers show that they took anything between two and 20 days to reach their destinations. If one compares these times with transit times in France, Germany and the United Kingdom, one finds that over similar distances, transit times are virtually over night from the time that the container leaves one point and arrives at the next. These factors also point to the need for greater efficiency in the operation of our transport services.

Finally, I wish to deal with a few plus factors in the hon. the Minister’s budget and that is the “tinsel” to which I referred earlier. They are to be welcomed for what they are. There is firstly, the extension of the “40 off” scheme for elderly people which is a welcome move by the hon. the Minister. Secondly, there are the concessions to servicemen on Railways and Airways which will be generally welcomed. Thirdly, there are the increased pensions and, particularly, some recognition at long last of the plight of the pre-1973 pensioners for whom we have been pleading for years. That is also to be welcomed. Fourthly, there is the increase in wages and salaries. This was inevitable, but these increases are hardly enough to keep pace with the inflation rate. These are the few pieces of tinsel which the hon. the Minister produced with his package. I must refer to them and say that we on this side of the House welcome them.

Nearly R500 million. Where do I get it?

It is only a very small part of the hon. the Minister’s package. All of this, however, I want to say in conclusion, is of little comfort when one looks at a budget with the effects of Government policies on the economy and the consequent inability of the Management to run the S.A. Transport Services on sound business principles. It is for these reasons that I have moved the amendment.

Mr. Speaker, last week already the hon. member for Berea gave us an indication of what criticism he wanted to level at the budget, and on this occasion today he did not say much more than he said during the 10 minutes he spoke for last week. The hon. member also ascribes all the problems the hon. the Minister has with his budget to the political policy of the Government. This was a new point he raised today, in comparison with his speech last week.

He maintains that the fact that the South African public, be they Black or White, have to reside so far away from the industrial areas is one of the most important reasons for the high transport costs in South Africa. As far as I know there is, for example, no apartheid on the Airways, and yet the Airways in South Africa is running at a loss. I, therefore, do not know where the hon. member’s argument applies because the problem with those hon. members is that they see the budget completely in isolation and do not, therefore, take anything into account which has taken place in the economic field inside or outside South Africa over the past year or so. This is the problem hon. members have. If the hon. member had a broader vision, he would realize—that has also been spelt out to him on previous occasions—that the S.A. Transport Services are to a large extent today the captive of the situation which developed with regard to inflation, and unless the hon. member can grasp that point, it is very easy to criticize the budget. The hon. member should really take the circumstances surrounding the budget and the fact that there is a recession outside South Africa into account.

The hon. member tried to conjure up a spectre with regard to the petrol price, but the hon. the Minister made it very clear in his budget speech that the petrol price had increased by approximately 1 200% over the past nine years. Does the hon. member think that something like this has no effect on transport services in South Africa? Of course it has a tremendous effect. The South African Transport Services is one of the largest consumers of petrol in the country and could not, therefore, escape the increased costs. However, I want to come back to what the hon. member said last week.

†I must say that I followed the remarks made by the hon. member last Wednesday very closely. His main attack on the budget proposals was that these were highly inflationary. He repeated the same argument today. The definition of “inflation” that I have heard and learnt over many years of inflation, has always been that a situation of inflation develops when too much money is chasing too few goods and services. The hon. the Minister of Transport Affairs is in no position to create too much money. That does not lie within his functions. The hon. the Minister of Transport Affairs has to cope with an inflationary situation in the general economy of South Africa and he has to adjust to a world-wide phenomenon. He does not create inflation. His contribution to inflation is a very mild and a very modest one. This world-wide phenomenon has for the last decade or so occupied the best economic brains in the world, but so far they—and for that matter any economist of any repute in South Africa—have not produced a solution which can keep inflationary tendencies within reasonable limits. The hon. the Minister needs an additional 15% in income in the coming year to balance his books and then he will still have a shortfall of some R10 million.

The hon. member for Berea strongly objects to increases in tariffs and fares. Surely, his knowledge of the S.A. Transport Services cannot be so limited that he does not realize that to pay for salary and wage increases additional funds will have to be found. The S.A. Transport Services today spends 31 cents in the rand on labour costs. Surely, the hon. member agrees with the wage and salary increases, as he actually admitted this afternoon that the increases in pensions were absolutely necessary and should be welcomed. If one has to pay these increases at this juncture, why did the hon. member in his first reaction to the budget say that this was “no more than their due”? The hon. member made the further point that the increases in salaries and wages would be negated by the increase in the cost of living resulting from this budget. I think it would be a fair deduction to make from this remark by the hon. member that he is in fact in favour of higher increases in salaries and wages to employees of the S.A. Transport Services. Am I correct in saying this? The hon. member says employees are merely getting what are due to them at the moment.

*The hon. member said it does not even make provision for the large inflation figure. It is therefore evident that the hon. member is in favour of larger salary increases.

†I now want to ask the hon. member where he would have found the money to pay for higher increases, and would the hon. member tell the House what further increases should be given to employees of the S.A. Transport Services? I believe in that case either the hon. the Minister of Finance would have to subsidize further, or higher tariff and fare increases would have to be imposed. If the latter, then let me suggest that if the increases in tariffs and fares now being proposed are inflationary, then it would be even more so if the hon. member for Berea had been running the S.A. Transport Services instead of the hon. the Minister. I believe the S.A. Transport Services have to remain solvent under all circumstances. It belongs to the public of South Africa and we are all shareholders. It must continue to render efficient services to all economic sectors of South Africa. When the hon. the Minister becomes the prisoner of an economic stranglehold, which it must be noted is not of his own making, he has a very narrow field in which to operate and manoeuvre. I want to admit that nobody likes increases in tariffs and fares. If one could avoid it, so much the better; but increases are unavoidable under present day circumstances.

The hon. the Minister and his department softened the blow by spreading the additional burden as widely and equitably as possible, and the effects on the inflationary situation in South Africa—i.e. too much money chasing too few goods and services— will be minimal, seen against the background of an annual inflationary rate of between 13% and 14%. One can only hope that organized agriculture and industry, and all the other sectors of our economy, would hesitate to use the increases to push up consumer prices to exorbitant levels. We have to be highly disciplined under present circumstances in South Africa, and the hon. member for Berea should realize that.

*Surely he knows that when you have a drop in the gold price and when a recessionary situation prevails overseas so that we earn less for many of our exports, we in South Africa should try to live within our means.

*One is encouraged, I must say, by the initial public reaction to the hon. the Minister’s proposals. In the first place, it was expected that the hon. the Minister would be faced with a difficult situation.

*Under the present circumstances, therefore, I believe that the hon. the Minister’s budget is a very realistic one. When the largest undertaking in the South African economy, just like any other, is faced with increased labour costs, high financing costs, increased fuel and coal prices and increased electricity costs—at present the railways and other transport services are paying more for all these things—the user of the railways and airways cannot expect to escape increased costs completely.

However, all is not lost if the Transport Services have higher costs. The public must not view all the increased expenditure as money which is blown, but I think that that is what the hon. member for Berea tried to imply. He tried to imply that all the increased expenditure was money down the drain, which could only have bad or grim consequences for the economy of South Africa because no one could derive any advantage from it. However, this is not the complete picture. In fact, it is not the picture at all. When one looks at everything the Transport Services do, what does the picture really look like? How much rolling stock is not being purchased? How many industries do the railways not keep functioning? How many new industries are not being stimulated? How many job opportunities are not being created? After all, some of the R2 225 million we are now spending consists of capital assets. Surely it is not lost to South Africa. That is why I say that a huge percentage of our expenditure is converted into capital assets which are virtually indestructible. Or put it more conservatively, which at least have a very long life. We are continually expanding the infrastructure of the country, and planning is again taking place and more is being spent for the next economic revival. Therefore, to create the impression that everything is lost with this budget and that the hon. the Minister is simply asking for more and more money because he goes about things in an inefficient way and because his department is run inefficiently, is completely wrong. I find it strange that the hon. member for Berea had to suggest that the planning of the hon. Minister was not scientific enough.

Last week he mentioned in his speech that the hon. the Minister had quoted the wrong figures—first he said one thing and then later he said something else. If the growth rate in South Africa is lower than a few years ago, the hon. the Minister would be foolish not to take this into account. He must take the decline in the growth rate in South Africa into account. As far as I am aware, top management as well as the hon. the Minister remain in constant touch with experts who make projections of future economic development and complications. One should allow the forecasters a certain measure of leeway, a certain margin for errors of judgment.

I have here a few cuttings which I have collected during the last few hours and which contain predictions on the economic position in South Africa. I have here one of 5 February this year under the headline: “Voorspoedgolf kom”. It is a report of what Dr. Jan Marais said. “Negative growth for South Africa in 1983”, says Mr. Frank Shostak of Santam Bank “who made his new economic predictions for 1982 available yesterday”. Then I have another article which reads as follows—

Another tells us that the Minister of Finance is going to have a very difficult budget. Yet another says: “Shares reflect confident start to the new year”. And this one says: “Slow down but no call for panic”. One after the other they produce different predictions of what is going to happen. In an Argus of December last year one reads: “1982—will it be as terrible as forecast”? Here are a few more: “Little relief seen in outlook for 1982”; “South Africa’s economy—the worst is on the way”; and “South Africa is fit enough to leave a boom behind”. And yet the hon. member said there was something wrong with the Minister’s crystal ball because he was unable to forecast the future clearly enough. He said that the Minister should get a new ball to gaze into. But just listen to what all these experts had to say. How are their balls? Here I read: “Revival: Higher growth rate forecast”. Here we have an interesting one: “Not all economists are gloomy about 1982, and certainly not those at the School of Economics at the University of Cape Town”. But the hon. member blames the hon. Minister for his predictions and planning not being scientific enough. When economists all over the world and in this country is making different projections, one should also allow the hon. the Minister and his department a margin when they thought that the growth would be so much and it had not worked out exactly as they had thought it would. Therefore, if a mistake was made here, I do not find it strange at all, because all the predictions differ. I could quote some more of them. The one says that things are going exceptionally well and the other says that one should be very careful.

Who could have dreamt that the price of oil would increase so abnormally over the last nine years and would make such an abnormal contribution to production costs throughout the world? In 1980 we had a growth rate of 8%. Last year it was more than 4%. There are experts who predict that the growth rate this year will be 2%. Others, just as clever, think that there will be no growth. Others even think that the growth could be negative. I wish to repeat that one should therefore not expect the Transport Services, which should surely take careful notice of the experts, to predict future growth correctly to the nearest fraction of a percentage either. With a capital budget of R225 million and taking the Brown Book items into account, it is clear that the expansion of services is going to keep pace with the expected growth.

The S.A. Transport Services do not budget for stagnation. Consequently this is the right approach, for when major growth takes place again, there cannot be deficiencies in the services. In any event, an exaggerated pessimism about South Africa’s chances of an economic recovery will not do the country any good. So the hon. member for Berea ought not to encourage pessimism by trying to create the impression that this budget holds out only bad prospects for South Africa. Because recessionary conditions are prevailing in many parts of the world, it would be extremely rash to initiate and stimulate every project, however commendable that might be.

I think that the hon. the Minister is busy cutting his coat according to his cloth, and that is why I suggest that this budget was drawn up in a systematic way. The hon. the Minister and his department are acting in a practical way. They are expanding services without stifling the S.A. Transport Services with excessive tariff increases. No “body blows” have been dealt the popularity of the S.A. Transport Services, to the economy of South Africa, as the hon. member for Berea claimed. Private transport cannot in the long run force the services for which the hon. the Minister is responsible from the market. The railways, the airways and the road transportation services still remain the cheapest means of transport in South Africa.

The hon. the Minister was also able to act positively in this budget and grant concessions to the salary and wage earners. They are being compensated and will definitely not be worse off. The concessions that are being made to pensioners will evoke a favourable reaction. Especially for those who retired before 1973 the increase of 18% in their pensions will be more than welcome. It is a social commitment which we in this country cannot escape, the commitment as a result of the decreasing value of money, to be of assistance to officials who retired at a time when money was worth more than it is now. The “tripper card” for national servicemen which involves a discount of 50% for rail and 30% for air fares is undoubtedly a step in the right direction. In most cases the parents of servicemen are still incurring large financial commitments for their sons, and this concession should afford them some relief.

The tremendous loss incurred on passenger services is cause for grave concern. At the moment the loss is more than R600 million, and in the General Manager’s report it is suggested that it could easily increase to R2 000 million in 1990. The hon. the Minister also envisaged in his budget that certain steps could be taken in this regard, and we on this side of the House hope that he will be successful.

Seen as a whole, the hon. the Minister has tried to bend his budget according to the circumstances, circumstances which are, in any event, beyond his control. He acted in the way a financial expert would and kept his gaze fixed on a better future awaiting his undertaking. That is why this budget will not be considered to be a painful one, but one which merely wants to take a breather before the next recovery, and that is why I support the hon. the Minister’s proposals.

Mr. Speaker, to start with I should like to congratulate the hon. member for De Kuilen on his election to the chairmanship of the Select Committee on Railway Accounts. I also want to congratulate him on his speech, and tell him that as long as one works for South Africa and as long as one’s interests lie in South Africa, one’s efforts will be worthwhile.

Today I should like to have a discussion with hon. members. But first, I want to tell that hon. member from Durban—I am never certain which constituency he represents …

We are never sure where you people are either. [Interjections.]

You do not know us yet.

I just want to tell the hon. member for Berea that it is one of the easiest things in the world to criticize a budget. It is very easy, and there are undoubtedly quite a number of things in the budget under discussion that one can have one’s doubts about if one is not at the helm. One cannot do justice to a discussion of inflation and the combating of inflation, in a mere 20 minutes. In these times it is not very difficult to make statements in connection with prices of goods and increases which ought not to have been introduced. However, I believe that the hon. member for Berea had the opportunity to do this last week. He could not really make the grade in the time he had at his disposal today, either. Taking both his efforts together, I should say that they were really not very successful.

Today I find myself in a position in which I want, first of all, to congratulate Dr. Loubser on his brilliant career in the Railways. I worked with Dr. Loubser and I know what he is capable of. Today I want to tell him that he must not feel bad that he did not become Minister. [Interjections.] He must not feel at all bad about this. The odd post should be left open for members of Parliament, too. However, I believe that he would have been a worthy Minister if he had been appointed to that position. He would most certainly have occupied that post with great distinction. Today I want to tell Dr. Loubser, and Dr. Grové, too, that we feel secure in the knowledge that they and the staff of the Railways are performing an excellent task in South Africa. In addition we cannot but think of all the other staff members of the Railways, people whom I cannot mention by name here but who are all doing a fine job.

I need only call to mind, for example, a constituency like Langlaagte and its people. Approximately 60% of the people of Langlaagte work overtime, night shifts, morning shifts, afternoon shifts. They do their work with a smile, and their wives at home are the ones that keep the family together. The men are often away for long periods. These people make great social sacrifices. Their family life is also disrupted. For these reasons I want to put a few requests this afternoon to the hon. the Minister, who is, of course, a very good friend of mine. I want him please to look after these people of mine. There are a few things they have asked me to convey to the hon. the Minister. According to those people, rented houses in Langlaagte are in such a state that they definitely need renovating.

That’s right, Hendrik. You can start right away. [Interjections.]

Those houses need renovating. This is something I bring up every year. However, we know that this year something will definitely be done. As a matter of fact, part of that work has already been done. Many of those Railway people in that area live close to Black residential areas. I have on occasion been to look at some of those houses after receiving complaints. In some cases the doors of the houses will not close properly. This is only one of many things which those people do not feel happy about. I do not want to complain, but I just wish to ask the hon. the Minister please to give attention to this matter.

Then there are a few more minor things I want to ask the hon. the Minister while we are still on good terms. However, I hope this will always be the case. The new hostel I asked for last year and was told I could get, must be built as soon as possible. At present it is impossible to house the people being trained there. The existing hostels are no longer in a condition to accommodate those people.

I also want to refer to the homes of the staff. I have my informants who keep me posted on these matters. I received a telegram from some place or other saying they are inspecting the site where the houses are being built. However, it is essential to have a good manager or supervisor there. I therefore ask the hon. the Minister to see to that as well.

As far as the pensions granted to our people are concerned—I am beginning by conveying all the thanks—I just want to say that we are very grateful for these concessions to our pensioners. There are people in this House, the General Manager and some of the older commissioners, who know that I joined former Minister Lourens Muller in asking that the pensions of those who retired before 1973 be increased. It is a very good thing that these people have now been granted an increase of 18%. I think it behoves us here today to thank the South African Transport Services and its staff for helping these people. Pensioners are battling nowadays. We are not a lot of grumblers. We realize that we must forge ahead and that the country must be built up, but because I am no longer a member of the Select Committee so that I can ask for this sort of thing, I do not want any of us to neglect to do our best for the pensioners as well.

Another problem was that the annual statutory adjustment of 2% was always deducted when a member of the staff received an increase. We are also very grateful that this matter will now be rectified. In the past the position was always that when there was a 10% increase, 2% was deducted so that only 8% remained. I think, therefore, that the new concession will be much appreciated.

Another very important concession I want to refer to is the 30% and 50% discount to be given to our national servicemen. I think it is a very good thing that they, too, are being taken care of. The only thing that is not quite clear to me is whether the S.A. Transport Services or the Defence Force is going to pay for this. This requires some clarification. I do not mind who pays, but for budget purposes it is perhaps necessary that we know exactly who will pay.

When I come to the budget itself and must criticize things a little, I feel that the heavy deficit in respect of passenger services, in this case R690 million is a matter we have discussed at length in the past, but it is not easy to put right. However, I have been pointing out for some time now that we cannot continue to subsidize passenger services.

I am now referring to the suburban services people use to travel to places where they do not have to be. Good planning can bring about a tremendous change. I do not have the time to spell out these matters here, but I have already mentioned them many times in connection with urban transport. In any case I think the hon. the Minister knows exactly what I am referring to. When it comes to cross-subsidizing …

Cross-pollination!

No, I do not think I need cross-pollination any longer. Those people opposite are all on my side. It is just that they have not crossed over yet. [Interjections.] I just want to point out that R314 million now has to come from the taxpayer’s pocket. This taxpayer never even sees a train. He lives somewhere in Middelburg where there are no trains, or he lives in a place like Groblersdal where they still only have a road transport service. The fact of the matter is that that person is paying for a service he will never use in his entire life. People must pay for what they get. If we cannot subsidize these suburban services we will have to make another plan. I am not referring to services that must be used for the development of the country, such as services to the homelands and other places. I am not referring to that. However, in the city there are people who tell you: “I will not go to the homelands because 20 of my boys are coming here on the train in the morning from Soweto. They are subsidized.” It would take that man only five minutes to travel there in his car. We must stamp out that sort of attitude and we must see to it that people who do not want to carry out the Government’s policy for the development of the country have to pay for those services. We cannot countenance that sort of behaviour any longer. A Government must govern. The profitable part of the Railways is being burdened. This is something I want to discuss seriously with the hon. the Minister. That part of the Railways will then no longer be profitable for the person who makes use of it either, and he will simply resort to road transport services. We do not want that either, because we do not want these services of the Railways to fall into disuse. We should like these services to be in good condition when we take them over. I am now referring to our little group here. [Interjections.] At that stage we do not want to have problems with the transport services. We should like these services supplied by the S.A. Railways to be supplied in such a way that they can be extended from day to day. The hon. the Minister of Transport Affairs is a very pleasant man to talk to. I want to thank him because he was one of the people who did not want us to vote in the caucus. He was one of the people who wanted us to discuss these matters instead. I want to thank him for that. That was a great step.

Why, then, did you walk out?

Be quiet. What do you know about walking? [Interjections.] I am sorry. I should have referred to the hon. member. I repeat: The hon. member must be quiet. What does the hon. member know about walking? [Interjections.]

You know, Mr. Speaker, the hon. the Minister has a very engaging manner. He always gets away with those funny short jokes he makes. Do you know what the real joke is? The real joke is that recently people travelling by S.A. Airways have had a 50% fare increase, although food is no longer served. We have therefore had a lowering in services and an increase in fees, and so few people have really noticed. However, that hon. Minister is a good Minister. [Interjections.] Yes, the drinks are free now. That is true, the drinks are now free. I do not want my people to be a drinking people. With all the problems we shall be facing in the future there will be people who will not be able to drink on an empty stomach. I think we must put a stop to the serving of drinks on our aircraft. We must put a stop to the serving of free drinks. If a man wants to drink he must pay for it. [Interjections.]

Looking at high-rated traffic we note that it has dropped by 6,6%. In contrast, the price is rising by 9,9%. The hon. member for De Kuilen and I are very fond of each other but I want to point out to him that the first lesson in inflation is when one gets less service for more money. This is lesson number one. This is something we must learn throughout this country.

The operating costs of the SAA are, of course, a very complex matter. The loss of R43 million cannot easily be recovered and we shall have to see whether we cannot make an effort to improve the fuel situation for the SAA. I think the levy in this connection should not have to be paid by the SAA. Long routes, for example the flight from Johannesburg to London, create problems for us. The amount of fuel consumed means that the profitability of the load is that much less. That is why the Airways has a major problem, and we do not want our Airways to be in difficulties.

I should also like to know whether we should not enter into a new contract with the oil companies. Perhaps we should hold more in-depth discussions with them. Do these people realize that the time when oil was so expensive, is past to some extent? I am beginning to be concerned that the electricity supplied by Escom will in due course be more expensive than oil. This will mean that we have switched over to items that will eventually cost us a great deal more.

Having said all this, I want to ask the hon. the Minister to give us details regarding the very large loans of R700 million that have now been negotiated. Over what period and in what way will those loans be paid back? Then there is also the fact that the S.A. Transport Services finances 50% of its services from its own funds. Probably this cannot be criticized too severely, but we still have a problem, because I am sure it is possible that many of the projects we consider essential for this year may in fact be postponed. I think this is a matter that should be gone into. I do not want to suggest that project A or project B be postponed, because it is impossible for anyone outside the S.A. Transport Services to say specifically what projects can be postponed. There must be certain projects that receive priority, but there must also be projects that can be postponed for the time being.

The hostel at Langlaagte?

If it is in the interests of the country, yes. As the hon. the Minister knows, I vote in the interests of the country and I always do everything in the interests of the country.

We on this side are not going to vote against the bugdet, because if we vote against it and the budget is not accepted, the pension that the pensioners are to have will fall away.

But you will not win.

I think the hon. the Minister is speaking too soon. At the moment the brave people are on our side; there are just as many verkramptes as ever on that side. [Interjections.] Only the brave people are on our side, and I do not blame them, because they are right. I do not want to make jokes about verkramptes now; let us rather say “conservative”. They are all still there. It is just that they do not yet understand when power-sharing is healthy.

Mr. Speaker, since it has fallen to my lot today to be the first member on this side of the House to reply to a speech made by one of the independent hon. members on the other side, I should like to congratulate the hon. member for Langlaagte on his maiden speech in his new capacity. Right at the end he almost spoiled an otherwise good speech, but fortunately his time then expired. However, it is clear that the hon. member knows the people in his constituency well—I know that many railway people live there—and that he has the interests of these people at heart.

The speech of the hon. member was in sharp contrast to that of the hon. member for Berea. The hon. member for Berea is in the habit of doing everything in extremes. All he does is criticize and disparage. I think we should remind the hon. member that we still remember the episode concerning the golf tournament at Sun City. That hon. member is inclined to take shots in the dark which come to naught but I think he will come down to earth before this debate is over.

I said that all the hon. member wants to do is criticize, and today he again made several flippant remarks. He moved an amendment with which he attempted to impose the political bankruptcy of his party on this budget as well, knowing full well, however, that the voters of South Africa would never trust his party to govern the country, and consequently would never trust his party to run the S.A. Transport Services, and knowing full well that the Government—under whose protection the members of the PFP also enjoy the abundance of our country—will always keep the wheels of the S.A. Transport Services rolling. I think it is high time the hon. member, who is living so high in the clouds, came down to earth for a while and tried to show some understanding for the problems one encounters in preparing a budget such as this, and then tried to make a sensible contribution.

Last Wednesday, and today as well, the hon. member for Berea protested vehemently against the fact that tariffs have increased by more than 50% over the past two years. It is true that tariffs have increased; no one is denying this. However, I wonder what kind of tirade we would have had to listen to today if those tariff adjustments had not been made in good time, and if we had had to make far more drastic adjustments today under far more difficult circumstances. But surely one moves with the times, and does not bury one’s head in the sand like an ostrich and acts only when circumstances compel one to act.

The hon. the Minister spelled out the tendencies in the economy of this country and the world very clearly and indicated what effect these tendencies had had on the budget. Surely it is very clear to all of us that factors such as a disappointingly low gold price, high import values, rising interest rates, a high inflation rate, higher financing costs, phenomenal increases in fuel prices, especially in aviation fuel, as well as losses on passenger services are the direct and essential reasons for the tariff increases that were announced. Anyone who claims that the tariff increases are a result of mismanagement, poor management and administration or bad planning, is using an absurd argument. They may even suggest, too, that the concessions in connection with salary adjustments, adjustments to pensions, travelling facilities for senior citizens over the age of 60, and prospective benefits for our national servicemen, should rather have remained in abeyance. The hon. member called these “mere pieces of tinsel”, and referred to them in a disparaging way.

I pointed out that the high inflation rate had also placed heavy pressure on the transport services. However, the hon. member claimed vociferously here today that this budget was inflationary, but inflation is not simply the handiwork of the S.A. Transport Services and the South African Government. The South African Transport Services also have to wrestle with and live with this spectre of inflation, and precisely because of the magnitude of its budget and activities, the S.A. Transport Services are perhaps suffering the most.

I sincerely hope that the announced tariff increases will not inevitably result in a chain reaction of increased consumer prices and will not—as is sometimes the case—give rise to unreasonable and unjustified price increases. I am saying this with all the responsibility at my command. I do not think that is really necessary, nor is it justified in all cases.

I see in this a special challenge to certain institutions in the private sector to exercise financial responsibility and discipline, for this is something we have every right to expect these days from every good citizen.

Let us examine, by way of comparison, the tariff index and the price index of important consumer commodities such as cement, steel, coal, electricity, gas, water and petrol, as well as the general consumer price index. It is striking to see to what extent the tariff index has remained permanently lower than the price index for any of these essential commodities during the past 10 years. When one also examines the tendencies displayed by transport services throughout the world, and cognizance is taken of the tremendous losses being suffered by transport services in other countries, one cannot but conclude that the South African transport services are vital and basically sound and have indeed done well. Remedial measures for certain services, for instance, the cancellation of unprofitable services, the increased revenue and intensified marketing, have been modelled on sound business principles and ought to have the necessary and desired effect. If this is seen in conjunction with a capital programme of essential projects which are geared towards being more streamlined and rendering a better service, we observe that this will give us the necessary boost, which is essential at this stage. I cannot therefore agree with the hon. member for Langlaagte, who advocated that some of these projects should be held in abeyance. If our projections of future economic conditions are correct—and in view of the essential projects which are in fact geared to being more streamlined, and which are also geared to cover certain losses—we cannot willingly omit any of these projects at this stage.

The South African Transport Services is a large and powerful component of our national economy. It is an organization which is not only the largest business undertaking in the country, but also the largest employer, and it therefore has a special place in the cultural history of our country. The S.A. Transport Services has an exciting future ahead of it as the foundation and backbone of the South African economy.

I should like to join the other hon. members in conveying my gratitude and appreciation to Dr. Loubser for many years of faithful service to the S.A. Transport Services. He has most certainly laid a firm foundation on which the people who will succeed him, may build with confidence. I should like to thank Dr. Loubser on behalf of my constituency—by the way, approximately 24% of the Whites in my constituency are directly involved with the S.A. Transport Services as workers or as pensioners. I want to wish his designated successor, Dr. Grové, every success, happiness and job satisfaction in the years that be ahead. We have a great deal of confidence in Dr. Grové and we know that he will do his job well.

I cannot but pay tribute to the other two Deputy General Managers, Mr. H. J. L. du Toit and Mr. H. A. Loots, as well. They are men who have come a long way with the S.A. Railways and to whom we are greatly indebted for the dynamic way in which they, as a management team, assisted Dr. Loubser over the years to build this organization into what it is today. Their responsible and unselfish standpoint with regard to general management, is one more manifestation of the loyalty and the attitude which is so typical of the people in this service. This attitude, the love and dedication of the Railwayman for the service, goes far deeper than is discernible on the surface. All of us who know the history of this service, will know where this originated. Therefore one finds here, more than in any other occupation, that work is not work, but a calling and a joy.

I recently experienced what I have just said in tangible terms. I was having talks with several departmental heads of departments, and we sat talking for hours around a table. There were many complaints, and we spoke long and hard. However, when I got into my motor car and drove away, one thing came into my mind, and that was that not one of those men who had sat around that conference table, had complained about his conditions at work, his house, his salary or his pension. What they had asked for, however, was better and more means to enable them to do their work better. We could go a very long way today with such an attitude among the people and officials in our country.

I remember something that was said recently when the transport group was having tea at a hostel for Coloureds near Saldanha. The Coloured housemother had served us tea and tasty snacks, and when the hon. the Minister asked the lady why she worked so hard, why she put herself out to such an extent, she said: “Sir, I am doing it for my people”. That fine attitude is typical of the people throughout the S.A. Transport Services.

That is why I believe that this House should take cognizance of the exceptional loyalty and pleasant attitude and the dedication displayed by the men and women in this service. We honour and thank them for this. Because this is true, the officials know that they will not be let down by the Government and they know that they have a Minister who will always have their best interests at heart and who, within the limits of the powers delegated to him, and as far as circumstances will allow, will leave no stone unturned to make this corps of officials a happy and satisfied one. I want to state that the officials of the S.A. Transport Services, seen as a whole, are satisfied officials. When bargaining takes place with the management for conditions of service and salaries the attitude of the trade unions is an excellent demonstration of this satisfaction. The general feeling is that the officials welcome the increase in salary of 15% in the case of Whites, Asians and Coloureds and Black employees where parity already exists, and 17,5% in the other cases, and we are grateful that the hon. the Minister was able to appropriate this large amount for this purpose.

The pension increases as announced by the hon. the Minister, fulfil a long-felt need, especially in respect of the group of pensioners who retired before December 1973. In real terms, they are receiving an increase of 20%. Over the entire spectrum, the position of pensioners is being considerably improved, and I sincerely trust that their position will be reviewed on a regular basis. These people contributed their share to our national economy, and we should not allow them to become impoverished as a result of inflation, for in the end that would only place a greater burden on the Treasury.

Considerable progress has been made with housing for all race groups, and 25 378 official residences were occupied during the past financial year, while 5 810 staff members were able to buy houses in terms of the home ownership scheme. I should like to address a friendly request to the hon. the Minister in this regard, viz. that the loan limits in terms of the home ownership scheme of the S.A. Transport Services should be reconsidered. The norm which applies in other cases is that 25% of a person’s income may be spent on housing, and consequently I believe that the loan limits could be extended considerably, for as a result of the tremendous increase in the property prices, officials of the S.A. Transport Services are no longer able to obtain proper housing. I should therefore appreciate it if the hon. the Minister would give his attention to this matter. As far as housing for Coloured and Black staff is concerned, the S.A. Transport Services sets an example which could be equalled by very few institutions, if any.

It is a platitude to say that the staff of the S.A. Transport Services are being well looked after in the spheres which I have mentioned, as well as in many other spheres— to which I was unable to refer for lack of time—and that their interests and needs are being properly attended to. That is why we know that they may be relied on at all times, and I should like to support the proposals of the hon. the Minister.

Mr. Speaker, I suppose it is the right and also the duty of an Opposition party—and I refer in particular to the official Opposition—to criticize the Minister about the budget. But why do the hon. member for Berea and his associates never have a good word for the S.A. Transport Services? Is there nothing in that organization that merits the approval of the hon. members of the official Opposition? Are they not proud as those of us on this side of the House are, of the S.A. Transport Services because they have provided South Africa, and indeed the whole of Southern Africa, with an excellent service in the past, and still do today? I should like to take the hon. member for Berea to my constituency. We could travel along the Richards Bay railway line which runs through my constituency, and it will give him an object lesson on a unique engineering achievement by the S.A. Transport Services. This is a project that has received national and international prizes, a railway line with trains kilometres long, with bridges, tunnels, cuttings and a refined, centralized traffic control system. If the hon. member for Berea could see this, and if he is really a patriotic South African, he and his party colleagues would also we able to show greater appreciation for the achievements of the S.A. Transport Services.

Moreover, hon. members of the PFP should also keep in closer contact with, and talk more to, the Railways’ greatest asset— the railwayman himself. Although in their rich man’s constituencies they probably do not have much opportunity to do so, they ought nevertheless to do so because then they will find out how the Railways treats its greatest asset, its workers, and how those people feel about the organization of which they form a part, and which they serve. That is all I have to say to the hon. member for Berea for the moment.

I should now like to exchange a few ideas regarding the role of the S.A. Transport Services in Southern Africa. An efficient railway network is of the utmost importance to every developing country, particularly in Southern Africa and in our own country where we do not have waterways. In Southern Africa the Transport Services have a threefold obligation, because in my opinion South Africa is a country with a threefold task and calling. In the first place it must serve the interests of its own people and its own country. As the leading country in Southern Africa it must, in the second place, also make its stabilizing influence felt in this sub-continent, and also make its contribution to the continued development of this sub-continent. In the third place, however, South Africa, is also part of the Western bloc of nations, and it therefore also has an international obligation to friendly Western nations in their common fight against Moscow.

Other hon. members on this side of the House will throw further light on the S.A. Transport Services’ first duty to the interests of South Africa. I should like to draw attention to the important role played by the S.A. Transport Services in the African context. We must have as our point of departure the background fact that before the era of independence in the ’sixties, South Africa had many links with Africa, in many spheres, including the sphere of transport. This old concept of co-operation—some people maintain that the efforts by the Government to bring about co-operation with African States is a new concept; this of course is not true— had its origin in the erstwhile colonial set-up. However, as Africa became free, most of those links we had in many spheres in the past were officially terminated, specifically as a result of the freed countries’ strong anticolonial feeling. However, one link of co-operation, that of transport, did not fall by the wayside. This fact has a very particular message for us. It emphasizes the dependence of countries around us and to the north of us on South Africa’s excellent transport network, consisting of railways, harbours, highly developed technology and refined knowledge.

We can surely accept that in the broader political sphere in Africa we, as a Western country, are striving to achieve certain goals. We would surely like to project a more strongly African image from here to the rest of Africa, because we are part of Africa. Accordingly, for many reasons it is essential that we gain the confidence of Africa. We do, after all, want to be seen as a country with a stable Government that is well disposed towards Africa. We are in fact excellently equipped to project that image. We have the knowledge, we have the economic strength, we have the right human material and we have many other attributes to enable us to project such an image. This also enables us, precisely due to our strength in certain fields, actively to assist in the development of the subcontinent, without ulterior motives. We must teach Africa, if it has not yet dawned on them, that their economic and political salvation does not lie with Cuba, Red China or Russia, but with the Western nations, of which South Africa, as a country of Southern Africa, is best equipped and strategically best placed to offer them the hand of co-operation. However, we shall not be able to succeed with a strategy to create a bulwark of stability, peace and order in South Africa if we cannot use one of the most important instruments with which to achieve this. That instrument is an efficient transport infrastructure.

Let us now take a brief look at the important role the S.A. Transport Services has played recently and is still playing in Southern Africa. We have air, road and rail links to all our immediate neighbours. Lesotho and Botswana are totally dependent, for both imports and exports, on our railways, our roads and our harbours. Swaziland, which borders on my constituency, probably offers the best example of sound co-operation in the field of transport, co-operation that is not only in our interest but also in the interest of Swaziland and therefore in the interests of a more stable Southern Africa in general. If we take Swaziland as an example, we find that in the past it only had a rail link with Maputo in Mozambique. However, two years ago a railway line 90 kilometres long was built from Manzini to Golela in my constituency. This was the first link that the South African railway network provided it with. This not only gave Swaziland access to South African harbours and markets in Natal, but also benefited South Africa, in that it brought us additional revenue through the handling of the freight. A few weeks ago this House passed legislation, Act No. 7 of 1982, to establish a further link between Swaziland and the Republic. I refer to the Act authorizing the construction of a new railway line between Komatipoort and Border Gate. This gives Swaziland an alternative route to Maputo, and also gives it access to the PWV and Transvaal markets. At the same time it gives industrialists, the mining industry and the agricultural industry in the far Lowveld, in the Eastern Transvaal, a direct route through Swaziland to the Natal harbours.

There are other examples of co-operation and assistance provided by the Transport Services. The imports and exports of Zambia, Zimbabwe, Malawi and Zaire also pass through South Africa. This is well known. It is also well known that the S.A. Transport Services helped Mozambique to double the railway line between Komatipoort and Maputo and to improve its harbours. This is another good example of sound co-operation in the field of transport in the interests of the development of the entire subcontinent. Not only is this in the interests of Mozambique; it is also economically essential for South Africa, particularly as regards its exports and its competitive strength abroad, that the railway line to and the harbour at Maputo remain at our disposal.

The Administration is also prepared to maintain all normal transport and trade links with African countries. I want to mention a few examples of this. At the request of the countries concerned, our Transport Services agreed to help Zambia to maintain its railway system and locomotive facilities, and we helped Zimbabwe by lending them locomotives. Importers and exporters in Zaïre prefer our railway network because it is more efficient. They prefer us, although it is more expensive to import and export through South Africa. Zambia prefers to channel Zaïre’s goods to our railway network because it is more profitable for them. Another interesting example are the Chinese who run the Tazara railway line. These people would not allow Zaïre’s trucks on their railway line, because they said the trucks were in a hopeless condition. However, we said that those trucks could be sent to us. What did we do with them? We repaired them here and in this way created job opportunities for our own people. We also earned income from them. After we had repaired them, we sent the trucks back to Zaïre.

These few examples show clearly that the basic framework for further breakthroughs in the field of co-operation with African countries already exists. It is at our disposal, but we must exploit it further. This is the challenge of the future, for the S.A. Transport Services as well, because we could earn a lot of plus points in that way, in the political sphere as well. In any case it will have the immediate effect of relieving existing tension between ourselves and some African countries. In addition, it will make Africa a better place for its people to live in.

However, there are certain conditions involved. It goes without saying that we must always give South Africa’s own interests first priority, but we dare not ever lose sight of the broader interests either. If we remember that this co-operation is the result of the interdependence of countries in the field of infrastructure, not one of us should have any difficulty regarding that challenge facing the S.A. Transport Services, because in the process, and on the strength of what I have already said, it is quite clear that the S.A. Transport Services have become a force that stabilizes the political situation in Southern Africa. Sooner or later economic realities will force African politicians to the north of us to get their priorities right and to reconsider their antipathy towards South Africa. Moreover we must not think that we will achieve immediate results. We must not expect immediate results; it will be a long and laborious process, but we shall have to build up our existing links, including our transport links, steadily and patiently, and at the same time we must exploit new links.

There is no doubt in my mind that with the people we have at the helm of this wonderful organization we shall be able to tackle this challenge with courage and we shall be successful. For this reason I wish the S.A. Transport Services every success in the future in the work they will frequently be doing behind the scenes in this field for our country South Africa.

Mr. Speaker, it has now become obvious that with the emergence of the Independent Nationalist we in the NRP shall have to sit in the last wagon in so far as the debate on the S.A. Transport Services is concerned. However, be that as it may, I am sure it is not too late for me also to extend to the General Manager of the Transport Services, Dr. Loubser, the best wishes of myself and my colleagues in the NRP on his impending retirement. We appreciate the fact that he has nearly a year to go but by the time the S.A. Transport Services is again debated in this House he will already have retired. I should like to say to Dr. Loubser that I want to thank him personally as well as those serving under him for the courtesy they have shown me and the great help they have given me during my period of service in this House.

Having listened to the hon. member for Ermelo, I am reminded of a debate that took place some years ago in which I participated when the whole thrust of the then United Party’s argument during the debate on the S.A. Railways was the question of Capricorn Africa and the role which our transport services could play in the Southern Africa continent. I want to tell the hon. member that we in these benches agree with almost everything he said in regard to the role which the S.A. Railways should play. However, I despair at times when I hear hon. members on the Government side speaking because I sense that they fail to appreciate that in order to perform this role which the hon. member mentioned as well as to carry out the function of a sound transport system in South Africa, it is absolutely essential that the S.A. Transport Services should not become a financial burden upon the total South African economy as a whole. I believe that the S.A. Railways and our transport services generally have to face the economic realities of the times. They have to be innovative and they have to adjust their services accordingly. I do not believe that we should be stuck in the mud, if I may use that expression, by simply going from one year to the next supporting the way things were done in our grandfathers’ days. I am not suggesting for one moment that the Railways should be scrapped. That would be a ridiculous statement to make. However, I wish to refer to a major industry in South Africa which, at one stage, had the second largest railway operation in the country. I am referring here to the sugar industry. Changing circumstances and changing economics caused the sugar industry over the past 20 years to scrap their entire railway system because it had become inflexible and uneconomic and because it had also become outdated and obsolete. I repeat that I do not for one moment say that the railways must be scrapped.

Do you want to reduce the capital programme?

Mr. Speaker, I have also listened to the hon. members for De Kuilen and Kroonstad and I want to say that I doubt whether during the eight years that I have participated in these debates I have ever felt as frustrated and concerned about the running of the S.A. Transport Services as I do today. In reply to the hon. member for Berea, the hon. member for De Kuilen asked the following question in regard to the increases in salaries and wages, and this was one of his major debating points: “Where will you find the money to pay for the increases in wages and salaries?” The hon. member for Kroonstad also said that the increases in tariffs were required in order to meet rising costs. That is only partly true; it is not entirely true. One can meet wage increases and rising costs through greater efficiency within one’s organization. There has not been a single member on the Government benches who has spoken one word about the need for greater efficiency in our transport services. [Interjections.] The hon. member for De Kuilen says that I must look at the report. I may tell him that I have already done so and I shall be dealing with this matter in due course. I say again, Sir, that I feel rather concerned at the present time. I have also come to the conclusion that no matter what the state of our nation’s economy, no matter how hard pressed the average citizen is today because of the ever-spiralling cost of living and no matter what may be said during these debates on our transport services, it appears to me that this hon. Minister and the Government choose to go their own way regardless of the cost of so doing to the people of South Africa as a whole. What do we have before this House today? As hon. members have said, we have a budget that proposes a working expenditure of R6 525 million, an increase of 17,7% over that for the previous financial year. This is in order, as the hon. the Minister stated the other day, to cope with an estimated growth rate in our gross domestic product of 2% and an estimated inflation rate of 13%. In reply to this, hon. members opposite have said that the fuel costs have increased. However, when one analyses the estimates in the budget, one realizes that fuel costs only represent 10,4% of the total budget and these costs have increased by 15,3% which is less than the overall increase of 17,7% for which the hon. the Minister is making provision. These figures clearly show that the hon. the Minister has made no effort whatsoever to exercise the necessary financial discipline which, I believe, is demanded of him by the realities of South Africa’s present financial circumstances. His failure to do this has caused him to present a budget which is highly inflationary as a result of the increases in tariffs and is going to do damage to our economy.

Secondly, the hon. the Minister has presented a capital budget of R2 225 000 000 of which he proposes to borrow R700 million on the local capital market. He does this at a time when the central Government deficit before borrowing for the coming financial year is going to be of the order of at least R3 500 000 000. Furthermore he does it at a time when the balance of payment’s current account deficit is at an all time high of almost R4 000 000 000, at a time when the extreme shortage of capital in South Africa has put the prime interest rate to about 20%, at a time when many private businesses are in serious financial trouble because of a lack of finance at reasonable and economic terms and at a time when there is a serious shortage of capital for housing which is urgently needed by our ever expanding population. I have studied in great detail all the estimates and documents which the hon. the Minister has placed before us and I have come to the conclusion—I want the hon. member for De Kuilen to understand this—that something is radically wrong with the way in which the S.A. Transport Services are being run. I intend to prove that.

I believe the operating statistics and the operating estimates will indicate an underutilization of capital assets on a vast scale. And it is not due to the fact that the growth rate has slowed down somewhat during the last year or so. The results of this are placing a financial burden on the economy which I believe we can ill afford at the present time. I also believe the estimates of expenditure in the Brown Book are cause for much concern, especially if one considers the lack of benefits to our economy resulting therefrom. Therefore I want to move as a further amendment—

into, inter alia—

1. (1) the role which the South African Transport Services, as a state-owned multi-model transport organization, should perform as a service to the basically free-enterprise economy of South Africa;
2. (2) the profitability of all operating sectors of the South African Transport Services with a view to cutting unit costs in order to combat the present adverse effect which ever increasing tariffs are having on inflation and the cost of living; and
3. (3) the existing capital structure and capital expenditure programme of the South African Transport Services, with special reference to the cost/ benefit performance of such expenditure relative to the availability of capital and the capital needs of the South African economy as a whole.”.

Do you want us to stagnate?

I want to ask the hon. the Minister to hold his fire. He will have plenty of time to reply to my speech. I now want to show him how under-utilized his capital assets are.

I am sure the hon. the Minister will agree with me when I say that transport is a means to an end and not an end in itself. Transport is a service industry. I believe the S.A. Transport Services serve, or should serve, the transportation needs of our economy and of individual South Africans. I am sure the hon. the Minister will concede the point that the S.A. Transport Services have a total monopoly over vast sections of our entire transport network. As such the South African economy is inextricably tied to the fortunes of the S.A. Transport Services. If the S.A. Transport Services are a success and prosper, then South Africa benefits. If it is a failure, however, or if it is uneconomical, it is South Africa that has to bear the loss or carry the can, as it were. It is for this reason that I moved the first leg of my amendment. The people of South Africa own the South African Transport Services and have invested extremely heavily, in the past, in order that it should provide an economic service to the whole economy. I have the feeling, however, that the South African Transport Services sees itself today as the end rather than as a means to an end. As a result it is becoming the “service parasite”— a term to which I have referred in the past— which I believe is, at this moment in our economic history, sucking the life-blood out of our economy.

Oh no, you cannot be serious.

I shall show that hon. member. I have chosen my words extremely carefully, and I mean every word I have said.

You are looking for headlines.

I shall concede that we, as members of Parliament, are limited in the extent to which we can delve into the performance and profitability of the Transport Services, and it is for that reason that I have moved the second leg of my amendment, and I sincerely hope that the hon. the Minister will listen and think about what I am saying.

I am listening … [Interjections.]

In order to motivate this, I wish to draw upon certain details about what the losses incurred by our Railways and Airways are costing the average taxpayer and the commercial and industrial sectors of our economy. The hon. the Minister himself said that during 1981-’82 the loss on rail passenger services was R628 million. Of this some R285 million would be subsidized by the central Government as so-called socio-economic services. What does this mean? This means that the taxpayer is subsidizing rail passengers to the tune of R285 million. There has been talk of cross-subsidization. If one studies the working figures for 1981-’82, one sees that the Railways’ deficit is R156,5 million. So if the total loss was R628 million, and the Government subsidy of R285 million was added to reduce this loss to R343 million, the actual deficit therefore only being R156,5 million, it means that users of goods trains cross-subsidized rail passengers to the tune of R186,5 million per annum. This means that people using the Railways to transport goods were charged R186,5 million more than they should have been in order to cover the loss on the passenger services. We have heard a lot about cross-subsidization this afternoon. If one studies the figures for the last six years, ending in March of next year, and using the estimates for the current year and next year, one sees that during this six-year period the Railways will have incurred a total deficit of R391,5 million, the Airways a deficit of R194,5 million, whilst the appropriation of net revenue, which is primarily financing costs and miscellaneous expenditure, reached a whopping deficit of R991 million. These deficits have been financed to the tune of R756 million by the harbours over the six-year period and by a whopping R822 million by the users of the pipelines over this period of six years. What does this mean? This means that importers and exporters who are using our harbours, and those people who are using petroleum products that have been pumped through our pipelines, including the road hauliers who are in competition with the Railways, will have subsidized rail and air users to the staggering tune of R1,5 billion over a period of six years, an average figure of R263 million per annum. I believe that the enormous losses being incurred by the Railways, and the consequential ever-increasing spiral in rail tariffs, are largely due, as I have already said, to the Railways being grossly over-capitalized. I also believe that there is a case to be made out for an in-depth study into the efficient—or should I say inefficient?—use of Railway assets.

My time is limited, but to prove my point let me, to whet the appetite of any production engineer in our midst, offer hon. members certain information. If hon. members look at pages 89 to 93 of the annual report of the Transport Services for the year 1980-’81 they will find there addendums concerning coaching and goods stock. Then, if one studies page 15 to 19 inclusive of the Minister’s memorandum, one finds there figures of total revenue earned on long distance and suburban traffic and revenue earned on goods traffic as well as production figures, the number of tons hauled, the number of journeys undertaken and the number of ton-kilometres performed. The optimum utilization of any capital assets, whether it be in industry, on a farm—I am sure the hon. the Minister will understand that—or in transportation, is fundamental to the economic success of its operation. I am sure that the hon. the Minister appreciates this and therefore I am sure he will be concerned at the figures I shall now give him.

My study of long distance 1st and 2nd class coaching stock shows that, excluding dining-cars, kitchen cars, baggage vans and what have you, there are 2 108 saloon coaches which have an average seating capacity of 84,6 seats. During the 1980-’81 year these coaches earned R28,37 million in revenue from a total of 3 423 000 journeys. Thus, the average coach performed 1 624 journeys per year or 4,45 journeys per day throughout the year. In the process the average coach earned a total revenue of R13 462 per year or the measly sum of R36,88 per day. I doubt whether that will pay for the fuel to haul that coach along the railway line. Interestingly, the average revenue per journey was R8,29 on main-line 1st and 2nd class journeys. If one studies 3rd class mainline traffic, one finds that there are 1 842 coaches which perform an average of 60,89 journeys per day and earned on average R45 839, which is R125 per day.

If one makes suburban coaches, one finds that 1st, and combined 1st, 2nd and 3rd class suburban coaches—they are mainly 1st class—earned an average of R38,23 per day and that the average journey costs 22 cents. 1st Class suburban coaches earned on average R43,65 per day. I want to say to the hon. the Minister that I have an 8-ton lorry on my farm which hauls timber and sugar cane and earns far more than that working nine months a year. So I ask the hon. the Minister to look into these figures.

Let us consider goods traffic. The Transport Services have 188 598 goods trucks or wagons. They each earned an average R33,69 per day. May I ask the Minister what is the cost of an average truck? Average revenue works out at 2,33 cents per ton-kilometre, which I believe is too low.

Do you then want all the tariffs and all the fares to go up?

No, I am saying that there is something wrong with the hon. the Minister’s figures. I believe that my brief analysis justifies my claim that the S.A. Transport Services are grossly over-capitalized and that their equipment is grossly under-utilized.

Let us go back to the coaching stock. The total number of coaches to haul passengers is of the order of 3 950, but one finds that there is a total of 5 502 in stock, others being dining-cars, kitchen cars, etc. There are 656 private coaches allocated for what is called “inspection and infectious diseases”, whatever that may mean. Maybe the hon. the Minister can tell us what the coaches are used for.

Having given an indication of the underutilization of railways rolling stock, let me say that if one studies the Minister’s memorandum one will find further that last year the S.A. Transport Services took delivery of 290 new coaches and 2 580 new goods trucks. On page 55 of the Brown Book we find that in 1982-’83 there is an estimated expenditure of R38 million for new coaching stock and R62 million for new motor-coaches, while the programmes that have already been approved call for a further R332 million for coaching stock and a further R311 million for motor-coaches in future years. On the same page one finds that in the coming year the hon. the Minister plans to spend R131 million on new goods stock, and he has on his books a whopping R867 million worth of works to be completed in future years. I want to ask the hon. the Minister how many trucks are standing around South Africa, in sidings or marshalling yards, trucks that are not being used. Either there is something wrong with the hon. the Minister’s figures— and I am prepared to give him all my working figures—or else the figures are right, in which case my claim that the S.A. Transport Services are over-capitalized also is correct.

You do not understand the whole matter. It is spread over three years. You are wasting time.

I am not wasting time. What is spread over three years?

You do not understand this thing.

Let us go further in regard to the hon. the Minister’s capital budget. Under item 352 he proposes the building of a new training centre at a cost of R163 million. We in these benches are 100% behind the Minister when it comes to training, but the S.A. Transport Services employ 155 523 non-White employees, and the training school is going to cost R1 061 in capital for every non-White employee in the service. I want to ask the hon. the Minister whether this is reasonable. What does an average school cost? How does this compare with other institutions? Is it justified at this particular time in our economic history?

On page 27 we find the cost of an administrative building at Pretoria which was originally estimated to cost R,6 million. The hon. the Minister is now asking that we approve expenditure of R69 million for this building, which constitutes an increase of 800%. I want to ask the hon. the Minister what administrative building in Pretoria is going to cost R69 million, while a year or two ago he budgeted for R8.6 million for the same building.

Let us take the non-White hostel at Umlazi. In 1974 it was estimated that this building would cost approximately R6 million. Subsequently the figure was increased to R14 million, and then later to R28.5 million. It is expected to house 9 000 non-White employees. In the Brown Book the hon. the Minister is now asking for approval for an increase in the price for the construction of this hostel from R28,5 million to R58 million, an increase of 105%. I want to ask the hon. the Minister how many non-Whites will be housed in this hostel. Originally it was planned to house 9 000 employees. If it is to house 10 000 men—this building has been under construction since 1974-’75—it is going to cost R5 800 per man to be housed in that hostel. Has the hon. the Minister compared the cost of this building with the average cost of building an hotel?

Item 468—Vryheid East Hostel for non-Whites—was originally estimated to cost R8 million. The hon. the Minister now wants to increase this estimate by 310%, to R25 million. I want to ask the hon. the Minister how many men in Vryheid are going to be housed in this R25 million hostel.

These are some of the concerns that we have in regard to the capital budget, and I believe the hon. the Minister must take a good look at it.

My time has run out, but if the hon. the Minister wants to get enquiries, queries, questions and doubts about the efficiency of the S.A. Transport Services, I can assure him that we are going to provide these in the Committee Stage.

Mr. Speaker, both the hon. member for Berea and the hon. member for Amanzimtoti introduced amendments to the motion of the hon. the Minister. This is not something which we can allow to pass without comment. The hon. member for Berea and the hon. member for Amanzimtoti are both members of an instrument of this House. They serve with me on the Select Committee on Railway Accounts. However, after listening to their speeches on their amendments today, one would have said that they had been excluded from all previous opportunities of participation in the dialogue. They have access to the full bookkeeping system, to the full workings of the S.A. Transport Services. What is more, the bookkeeping system of the Transport Services, and its entire range of activities—large organization that it is—is freely available for inspection by this House and the instruments of this House. The Auditor-General and his staff deal with all the operations of this business as well.

When a private organization of such tremendous magnitude does business, it is normal practice that that institution builds up reserve or hidden funds to provide for its planning and needs in difficult years. The S.A. Transport Services cannot do this. Yet those two hon. members know that the S.A. Transport Services, in fact, form the nerve centre of the economy in the Republic. I see the hon. member for Berea is nodding his head. He therefore agrees with me. Yet this organization cannot build up hidden funds. The acquisition of funds in the planning of the organization must therefore take place either by the creation of self-generated funds, or by means of loans.

The amendment of the hon. member for Berea consists of five main points. The amendment of the hon. member for Amanzimtoti consists of three main points. I shall quote only a few of them, which I intend to come back to during the course of my speech. One of the arguments which the hon. member for Berea raised in his amendment, was that the S.A. Transport Services should be conducted in their entirety in terms of the ideal of a cost-oriented business. He therefore wants the cost-oriented concept to be made an integral part of the structure, in terms of the recommendations of the Schumann Commission, which have already been accepted in principle by the Cabinet. In addition the hon. member requested that the uneconomic services which are being rendered by the S.A. Transport Services, should be eliminated. The final main point in the amendment of the hon. member for Berea—and this links up with the argument of the hon. member for Amanzimtoti—is the objection which they raise that the business is being conducted with a lack of competence and efficiency. This is an indictment against them as well. This means that they themselves are burdened by inefficiency and an inability to make a real contribution in the instruments in which they have representation office. The contribution which they ought to make on that Select Committee, they are therefore not making. I shall refer to this again later during the course of my speech.

The present budget of the S.A. Transport Services, as well as the increase in tariffs, may well be inflationary. We do not want to dispute this.

Of course it is inflationary.

However, those hon. members have thanked the hon. the Minister for bringing relief to the wage earners and pensioners. How can one wish to play these two concepts off against one another? How can one plead the one case and, at the same time, oppose the other? It was necessary for the hon. the Minister to obtain certain funds in order to bring about the relief that was mentioned. He had to do this in order to make those allocations to salary earners and pensioners. The biggest basic effort on the part of the Transport Services to counteract inflation, is the promotion of productivity in the organization as an economic concern, and I honestly believe that the S.A. Transport Services, under the leadership of the hon. the Minister, is making a sincere effort to keep on striving to attain that ideal. One finds this to be the underlying motive in their planning throughout. Let us look at certain aspects of this productivity as it is reflected in the reports before us.

Firstly, there are the decisions with regard to a healthy economic principle. I am only going to refer to certain of these. There is, inter alia, the building of the rail communications network centre at Sentrarand. The hon. member for Berea is sitting here. He had plenty of time at his disposal, but he did not even refer to the ability, the freshness or the innovation shown by that undertaking. I must rectify this. How does this benefit the economy? How does the whole economy of our country benefit from this undertaking of the S.A. Transport Services? In the first instance, the running time of the trains from Sentrarand to Cape Town has been reduced to 60 hours. Another important economic factor is the speed with which goods are delivered. This demonstrates economic efficiency. In the second place, concerning this same aspect, there is better utilization of staff and man-hours. Staff no longer have to sleep over at certain points, but can return to their base to be available for handling other loads. In the third place, the coupling of trucks is such, that there is greater stabilization with regard to the speed of trains, and this, in turn, leads to two things, viz. less wear and tear on trucks and less damage to goods. In the fourth place, and this is an important matter, the hon. member for Berea implied that it was the racial policy of the Government which was causing the congestion in Johannesburg. However, in Johannesburg, there are 100 000 commuters who are conveyed from Soweto to Johannesburg and back every day. The result is that preference is given to the least profitable service, viz. the passenger service, during peak hours, at the expense of the more economic services, viz. the goods service. The Soweto-Johannesburg section is closed to the conveyance of goods from 03h00 to 04h30 and is only open for passenger traffic. One can understand why. The section is closed again from 15h00 to 19h30. These are two congestion periods. The building of Sentrarand, against which much criticism was originally levelled, mainly concerning the site, the location and the cost, now means that trains conveying goods which are not destined for stations on the Rand, do not have to go through Johannesburg station. There are bypass sections which can be used as specific destination routes, so as to relieve the pressure on the line between Johannesburg and Germiston and the East Rand area. I ask the hon. member for Berea: Is this not economic efficiency? Is this not important planning? Does this not demonstrate the know-how and the skill of engineers in running a business? I am speaking of this huge organization with a budget of almost half the size of our national budget. The hon. member for Langlaagte requested that certain capital projects be placed on ice for a time, while the country is in the present phase of an economic levelling off. We cannot delay certain services at all, as the entire development mechanism is dependent on them.

A further factor arising from this planning, is that at Sentrarand the marshalling of trains and trucks is planned in such a way that goods for specific areas and stations, are placed in specific areas and stations, are placed in specific trucks to make effective delivery possible. The hon. member opposite said that he had made an in-depth study of these matters. I want to return just now to the proposal that an in-depth study should be made. Sir, the hon. member is talking through his hat. As matters stand at present, 48% of the goods which move through Johannesburg, are not destined for Johannesburg. The figure at Germiston is 57%, at Springs 65%, at Langlaagte 68%, at Krugersdorp 81%, at Vereeniging 61% and at Pretoria 64%. When this Sentrarand system is in operation, it will mean a levelling off of the figures. This will mean more economical operation as well.

The hon. member also raised the question of trucks. I just want to say that the statistics in this regard are familiar. The Railways have approximately 286 000 trucks in stock. I am referring to goods trucks at a cost of approximately R35 000 and R40 000 a truck. The average turnaround time of a truck from Johannesburg to Cape Town under the system which is at present in operation, is 11 days. Under the system which will soon be put into operation, this time will be drastically reduced. The travelling time will be 60 hours. Apart from this, approximately 13% of the trucks are waiting in a yard somewhere to be repaired, or for other reasons. This Sentrarand system will mean that there will be a reduction in the number of unused trucks.

A further factor in the economic planning to increase productivity, is the substitution of other services, for example bus transport, for uneconomical trains. In my constituency—I do not want to speak about constituency matters now; these can be discussed during the Committee Stage—I received many requests in connection with trains which have been cancelled on the Johannesburg-Durban line. I was able to look those people in the eye and tell them that those services could no longer be offered. I told them that those train services, those passenger services, could not continue to be an uneconomic burden to this undertaking. Hon. members opposite complained about the increased tariffs on livestock. I just wish to tell them that the longer these train services run, the more the tariffs on livestock will increase, for there is the question of cross-subsidizing. Uneconomical services should be eliminated and this is not only an ambition. This is being done and it has been done.

Hon. members opposite have raised another factor as well, namely the question of a lack of efficiency. In his budget speech, the hon. the Minister told this House what was, in fact, being done. He told us about the training and retraining of staff in order to keep pace with the increasing sophistication of the services and to produce good and useful work. The hon. the Minister said, inter alia—

The hon. the Minister also said that an amount of R163 million had been made available for the establishment of a training centre at Kaalfontein. The training of staff is an important factor in causing this concern to function efficiently.

The other aspect which I want to raise with regard to increased productivity, is the question of ongoing research into the application of differentiated scales of tariffs. Commerce and industry should be encouraged to fit in with a seven-day working week. The hon. member represents a seat in Durban, but if he were to go to City Deep in Johannesburg, he would see that containers have have been piling up because the Railways have a delivery service of containers operating seven days a week. Certain dealers and industrialists are selfish, however, and they do not want to accept those containers after hours. The result is that such containers have to accumulate somewhere.

The Administration now has a differentiated tariff service, and the hon. member for Amanzimtoti should listen very carefully to this; he is a man who likes figures. I often think that he works out his figures in the air. I once knew a lady who worked in a shop. Whenever one went to buy sugar and coffee and similar items from her, by the tickey’s worth, in days gone by, she would always work out figures in the air: A tickey’s worth of sugar, a sixpence’ worth of shoe polish, and a tickey’s worth of this or that. Then she would add it all up and tell you that you owed her one and sixpence. Then she used to wipe the figures out in the air; just to do it all properly. [Interjections.] That is more or less how the hon. member works out his figures. He works out all kinds of figures in the air, but he wipes them out before he can verify them.

The tariff scales to which I am now referring are to encourage commerce and industry to fit in with a seven-day working week. As far as containerization is concerned, I just want to say this one thing more to the hon. member for Amanzimtoti. There is a special tariff for containers which are sent to City Deep from the four main coastal cities. The goods which are conveyed in those containers, are usually high-rated goods. I think that the hon. member agrees with this. The goods which are despatched in those containers, are, however, not assessed in terms of the tariff which is usually applicable; they are assessed in terms of a special container tariff. It does not matter what is in the containers, but it is usually high-rated goods. Who is going to pack bricks which you want to send to the north in a container? There is a special tariff for the containers—very well, it, too, has now been increased by 20%. Now the hon. member should listen carefully while I point out the planning and the operation of the Transport Services. If a businessman is prepared to keep his premises open after hours so that the delivery of containers from City Deep can be made, he gets a 20% discount, and this discount is now being increased to 25%. The effect of the 25% discount is that he is, in reality, only paying 12,5%. In order to qualify for this discount, he has to keep his premises open and someone has to be there to receive the containers. Should he go further, open the container and remove the goods out, so that the Transport Services can take the empty container back the following morning, he gets a 33% discount, and this discount is now being increased to 50%. In effect, this tariff is lower, and this means that he pays 2,5% less than usual.

After having made an in-depth study the hon. member asked for an in-depth investigation. What about all those commissions that were appointed and on which competent and knowledgeable people served? The hon. member does not even do good reference work as far as the commission on which he serves is concerned.

The increase in tariffs is not being done in a haphazard way but on the assumption that the gross national product will show a growth rate of 2%. In my opinion, this is an optimistic outlook. Over and above the assumption that the growth rate will be 2%, the Transport Services accepts that the growth in its service will be 2,5% or 3,5% as against expenditure which is estimated to grow by 17%. We can chat about cost structures if he likes. I was a member of a study group which went to Britain and which included a previous member of the PFP in this House, namely Mr. Rupert Lorimer. The hon. member for Malmesbury was also a member of that group, and he can bear witness as to how we were shown how cheaply a certain airline was offering its air travel tickets to Europe, the USA and other destinations. I was truly dumbfounded, and I said that I could not understand how that firm could do it. The airline was that of Sir Freddie Laker. And where is he and his airline today? From far and wide people have had to pitch in and start a “Samaritan fund” to save him. We really cannot allow our airline to go the same way by selling tickets as cheaply as Christmas cards.

Yes, but just think how Sir Freddie Laker forced prices down throughout the world.

Yes, but does the hon. member know how many firms he hurt in the process? The hon. member should keep quiet about the economy and stick to areas which he knows more about. Leave the S.A. Transport Services alone.

We on this side of the House should like to thank the S.A. Transport Services, not only for the upward adjustments of tariffs, but also for a reclassification of goods, which will mean that certain goods will fall into other categories. The S.A. Transport Services suffer because of competition from Road Transport Organizations as well. The road transport organizations are selfish in the sense that they snatch up the high-rated incomes. Figures show that our Transport Services have suffered great losses because of this. In 1972-’73 almost 50% of the income was derived from this source. This has dropped to the present figure of 37%. Tonnage has dropped from almost 20% to just over 12%, as a result of the strong competition from road transport. Now there is a scale and reclassification—good planning, too—with regard to the economic running of this concern. It is therefore with confidence that we are able to thank this wonderful organization, and support the budget proposals of the hon. the Minister.

Mr. Speaker, as the hon. member for Standerton said, it is incomprehensible that one should have to listen year after year to the Opposition’s arguments against budgets of the S.A. Transport Services, the more so since in all the time I have been in this House I have never really heard a positive contribution from the Opposition.

What about Langlaagte?

The Opposition can find absolutely nothing right in what the S.A. Transport Services does. It does not matter what the circumstances are, i.e. that interest rates are higher all over the world, that fuel prices have risen by almost 1 200% during the past few years, that wages and pensions are adjusted every year, and that we in South Africa are faced with tremendous distances over which goods must be transported. Notwithstanding this, we still transport passengers between Cape Town and Stellenbosch for only 3,4 cents a kilometre and from KwaMashu for only 1,7 cents a kilometre. People are transported between Cape Town and Mitchell’s Plain for 1,6 cents a kilometre. I want to ask the Opposition one question: If this is such a poor budget with so many hitches, do they perhaps want to suggest that transport costs per kilometre be increased? Do they perhaps want to suggest that a large animal, that is at present transported at a cost of 3 cents per kilometre should in future be transported at an increased rate of 4 cents or 5 cents per kilometre? Or do they perhaps want to suggest that sheep, which are at present transported at a rate of 0,25 cents per kilometre per animal, should in future be transported at a higher rate? If this is done, the Railways’ losses could be eliminated to a great extent. Of course they are not suggesting this. There is only negative criticism. There are no positive contributions to indicate how the problem is to be solved.

I should like to associate myself with those who have already paid tribute to and expressed their thanks to Dr. Loubser, who unfortunately is not in the House at the moment. Far be it from me to try to tell this House what he has meant to the S.A. Transport Services since he joined the service as an assistant engineer in 1942. Far be it from me, too, to try to illustrate all his good points here. The fact remains that when he joined the S.A. Transport Services as an assistant engineer in 1942, I was not even at school yet. I can only say that it was a great honour and privilege for me to be in his presence in the Select Committee on the S.A. Transport Services. He has left his mark on the S.A. Transport Services and his influence will still be strongly felt many years after his retirement. I want to convey my sincere congratulations to his successor, Dr. Grové, and wish him every success for the future.

From the budget speech of the hon. the Minister it is quite clear that the number of passengers, particularly on suburban services increased by 4,7% in the past financial year, and this remains one of our greatest problems. The loss on passenger services is estimated at R628 million. Although the State accepts the principle of subsidizations, particularly for suburban passenger services, the R285 million voted for this purpose is still totally inadequate. The loss on passenger services for the 1982-’83 financial year is estimated at R690 million, with an expected contribution from the State of R314 million. This means that R376 million must be found by cross-subsidization. As a result the S.A. Transport Services will be even worse off in the 1982-’83 financial year than it was in the 1981-’82 financial year. I am therefore very grateful that the top management of the S.A. Transport Services has indicated that sweeping changes are being planned, particularly as regards the curtailing of unprofitable services—with which I agree wholeheartedly—an increase in revenue and intensified marketing.

The loss in revenue due to fare evasion is estimated at approximately 10%. Against the background of the 1980 tariffs it is estimated that there will be an annual loss of between R15 million and R20 million. This loss could be much greater because the extent of fare evasion cannot be determined with precision. There are various ways of avoiding paying one’s fare. I do not want to go into this now, but what is of great importance is the fact that an experimental electronic gate system is being installed on the Kitalo-Kwesine line specifically in order to control the non-payment of fares. Tenders for the provision and installation of the automatic fare and gate-control system have already been accepted. They total R6,6 million. It is expected that the civil work in connection with the pilot scheme costing approximately R3,3 million will be completed by the middle of 1983. The work involves the rebuilding of stations and pedestrian bridges, the laying of communication and power cables and the erection of concrete enclosures. If everything goes as planned, the pilot scheme may come into operation early in 1984. If the pilot scheme is successful and can be justified economically, a decision will be taken as to the possible extension of the scheme to the other suburban areas, i.e. Johannesburg, Pretoria, Cape Town, Durban, Port Elizabeth and East London. If these extensions are possible, they will cost the Transport Services between R450 million and R500 million to complete in the course of the next seven to ten years. This system is already being used with outstanding success in some overseas countries. I am convinced that the S.A. Transport Services has taken the right step and that this system will lead to great satisfaction and eventually to a considerable increase in revenue on suburban passenger services.

I was also pleased to hear of the success of the marketing scheme involving people over 60 years of age, particularly as this scheme has now been further improved as regards conditions of travel. This is in fact clear evidence of the top management’s intensified marketing campaign. The 50% discount plan for national servicemen on all trains except the “Drakensberg” and the “Blue Train” will undoubtedly earn the Minister the enduring gratitude of every South African. Of course, the same applies to the announcement by the Minister that a 30% discount will be given all national servicemen on nominated flights. As a result of this reduction the domestic passenger traffic on our aircraft should increase considerably, which will mean greater seat utilization or occupation and therefore higher revenue for the S.A.A. as well.

In passing, I should like to congratulate the S.A.A. on the simplification as regards meals on domestic flights. On the other hand, there is also something I find irritating. As far as I am concerned, it is indefensible and incomprehensible. Although the S.A.A. is saddled with a deficit of R43,7 million, we are so generous as to supply drinks free of charge to anyone who wants to drink on the flights. I am not a teetotaller. I have no quarrel either with those who drink or those who do not. Several years ago I asked a previous Minister for the plastic glasses used on aircraft to be replaced by ordinary glasses. At that stage I was told it was too expensive and that the loss would be too great. The plastic glasses are still in use, except for the wine glasses, that are not always available. Nevertheless we have enough money to hand out free drinks. I cannot understand why the S.A.A. took such a step. I had rather everyone paid for his drink on the aircraft as he would pay for it anywhere else, and was given an attractive glass he could take home with him as a memento if he wished.

Or an air hostess!

However, as far as I am concerned, giving people free drinks is going a bit far.

There are three things that are of great value and importance to everyone. Whoever one may be or wherever one may work, it is important to have a roof over one’s head. In the second place, it is equally important to everyone to have pension benefits to provide for his old age. The third thing which I think is important to everyone, is membership of a medical scheme. While one is young and unconcerned, one may not consider it to be of much importance, but later in life, when one has a family, it is vital to belong to a good medical scheme. Of even greater importance is the peace of mind one has if one is covered by medical aid when one is old and unwell. For this reason I want to convey my thanks and appreciation to the S.A. Transport Services for having now switched from the old Sick Fund to a medical scheme. I must admit that the old Sick Fund functioned very well and I did not really have any complaints about it, but many people were often dissatisfied because they could not consult a doctor of their own choice. Under the new medical fund this is no longer the case, and in the short time I still have at my disposal I should like to touch on one or two other points in connection with this scheme because I believe it is worth while to do so.

In terms of the rules of the new medical scheme of the S.A. Transport Services no membership fee is paid, except a nominal sum of R4 a month in the case of employees with dependants, and R2 a month for those without dependants. All beneficiaries have a free choice of general practitioners, specialists, hospitals and pharmacies. They incur no expenses in respect of hospitalization, operations, theatres, ambulance services and blood transfusions, and even private nursing is available. No levy is paid on prescriptions, and the service pays up to 75% of the cost of medicine which a serving member or his dependants are given on prescription. In the case of a pensioner or a widow of a member, 90% of the cost of medicines is paid if obtained from a pharmacy of the medical scheme. It must certainly be most reassuring for all widows and pensioners of the S.A. Transport Services to know that they have these benefits. Beneficiaries can also approach any gynaecologist or eye specialist directly, and there are also other limited benefits. For example, provision is made for dental and orthodontic services and ophthalmic services; as well as for maternity cases, chiropody, clinical psychology, speech therapy, orthopaedic appliances and even artificial limbs and appliances.

I have already said that under the new medical scheme of the S.A. Transport Services, hospitalization will now be virtually entirely free of charge, and it is also worth mentioning that in emergencies, and on the recommendation of a medical practitioner, compensation is even paid for taxi or ambulance fees from or to a hospital, or from one hospital to another. If it is recommended, air transport can even be used.

I shall let this suffice, and I just want to thank the hon. the Minister for the well-considered budget he has submitted here under extremely trying circumstances.

Mr. Speaker, the hon. member for Kimberley South has reacted quite strongly to this new medical scheme. There is a subsidiary question which I should like to put to the hon. the Minister in connection with this scheme. As we understand it the scheme has caused a need for a great expansion of the staff that handle the scheme. We understand that quite a considerable number of people had to be recruited, for example in Cape Town, in order to handle the administration of the scheme. We should like the hon. the Minister to react to this.

A number of hon. members have spoken in this debate since the hon. member for Berea sat down. Of course, the most interesting aspect of it was the first speech in this House by an hon. member of the new independent group of the NP. The hon. member for Langlaagte made what was for him a very quiet speech. One does understand why, however. It is fairly obvious that that group has great hopes of getting a number of additions to their ranks from the Government side. There is one aspect on which I would like to agree with the hon. member for Langlaagte. That is that those hon. members, I believe, were brave hon. members. They took a stand on principle, and whether one agrees with that principle or not, it was nevertheless a stand that can only be admired. I believe that those among them who changed their minds and went back to the ranks of the NP only succeeded in getting the worst of both worlds.

I want to devote my speech this afternoon almost entirely to the S.A. Airways. Allow me to preface my remarks by pointing out that I believe that our S.A. Airways flying crew are amongst the best, perhaps even the best, in the world. We are, of course, fortunate in that our weather conditions in this country are considerably better than those in Europe, particularly during the winter months. Our crews fly regularly into these conditions, and their record, without doubt, is outstanding. I believe that we in South Africa are very fortunate indeed to have such outstanding flying crew. The sort of weather conditions that do occur overseas, I believe, have caused horror crashes such as the latest one in Washington, for example. We are also fortunate, of course, in our weather conditions.

In passing I would also like to comment on a S.A. Airways advertisement that I saw recently on television. I should like to congratulate the S.A. Airways on this particular advertisement. It was more or less a nature programme in itself in that it showed a large variety of birds, and wonderful pictures of those birds. That was then followed by the S.A. Airways punchline. It was a very good advertisement indeed, and I should like to congratulate them on it.

Referring now to the problems of the S.A. Airways, I should like to point out that I consider these problems to be twofold. Firstly there is an increasingly dog in the manger, big brother attitude which I had mentioned in the past in relation to S.A. Transport Services in general, and also more particularly in relation to the Sky Courier and Magnum Airline affairs. The second problem that I have with the S.A. Airways—and that is the matter which I intend to speak to first of all—is the matter of the losses on the bottom line. We must realize that these losses have been made against a background of very large increases in air fares over a period of time. The hon. member for Berea referred to this, and I should also like to point out that with the increases in Airway tariffs, on 1 November 1981 and again on 1 April 1982, these amount to an increase of 32,5% within a period of six months. This, without any shadow of a doubt, is considerably greater than any inflation rate that we have ever had in South Africa, and, I hope, that we ever will have in South Africa.

That is the background. The revised estimates for this year indicate a loss of R65,7 million, and the budget for the coming year for S.A. Airways estimates a loss of R83,3 million. I consider this nothing less than irresponsible.

South Africa cannot afford losses of this magnitude. In fact, we should not make a loss at all as this loss has to come out of the pockets of the taxpayer. If we broke even on S.A. Airways then R83,3 million could help to pay for rail passenger deficits, thus meaning less of a direct subsidy from the Government. S.A. Airways is described as having a dire financial situation, even by its own spokesman, Mr. J. C. van Rooyen, and the actions that have resulted have led, at the least, to the harming of S.A. Airways’ image, to some hard words from travel agents and very obvious raised eyebrows from other international airlines that will not retaliate at this stage. Let me refer to an article in the Sunday Times headed “S.A. Airways blackmail denial”. The article states—

One can take this particular thought further because there was also an article on 15 November in the Sunday Times headed “Export men fly off the handle at S.A. Airways”. They say—

Rightly or wrongly this bad publicity is remarkably like a domineering big brother attitude which will not pay in the long term. The hon. the Minister has said that S.A. Transport Services will be taking a long, hard look at rail passenger services, and therefore the chances of these being reduced in order to improve profitability, or should I say to reduce losses, seem to be good. I believe and would recommend that we take a long, hard look at some of our international services on S.A. Airways with a view to reducing them. Is it a point, I must ask the hon. the Minister, of national pride to have the orange S.A. Airways tail in many major capitals? We do have a fine S.A. Airways record and we are proud of our international airline, but not, I submit, R83 million per year’s worth. Almost every tinpot banana republic in the world today has an international airline, often heavily State subsidized, so having such an airline certainly does not put us in some sort of league of super powers.

Let us now look at some figures which hon. members will find in the memorandum by the Minister of Transport Affairs on pages 3 and 4. On page 4 we see the losses incurred over the past few years. For 1979-’80 they were R54 million, for 1980-’81, R39 million, for April to November 1980, R19,5 million, for April to November 1981, R40 million and for this year an estimated loss in excess of R60 million. This figure does not take into account the appropriation of net revenues. If one looks further one will find that in terms of passenger kilometres flown—hon. members will find this on page 24 of the memorandum—during the period April to November 1981 internal services flew 1 800 570 000 kilometres. The figure for the overseas services is 4 213 571 000 kilometres. Obviously a great number of kilometres are flown on our international services. The hon. the Minister himself told us in his budget speech that passenger traffic from Europe increased only by 1,1% over the past year but that, since 1973, fuel has increased by 1 269% externally and only 1 049 internally. All this indicates that a reassessment of our international service is overdue. We are aware, Sir, that we cannot overfly the bulk of Africa. This adversely affects profitability on all flights to the UK and Europe. The further east the ultimate destination in Europe, the worse this factor becomes. In flying to Heathrow the time differential between SAA and BOAC flights diminishes profits but is less serious. However, let us look, for instance, at flights to various parts of the world. The S.A. Airways flight from Johannesburg to Vienna takes 17 hours 20 minutes while by Scandinavian Airways it takes 12 hours 15 minutes. The Johannesburg-Tel Aviv flight by S.A. Airways takes 19 hours 25 minutes and by El Al, 9 hours 55 minutes, a difference of 9 hours 30 minutes. Here are some further examples. The difference in the flying time from Johannesburg to Rome is 3 hours 30 minutes; Johannesburg-Frankfurt, a difference of 3 hours 25 minutes; Johannesburg-Athens, a difference of 5 hours 50 minutes. Time in the air is expensive as the hon. the Minister knows. These Jumbos—and these flights are, I think, almost entirely Jumbo flights—consume tremendous amounts of fuel per minute let alone per hour so that the costs must escalate enormously. A good travel agent will not hide these time differentials from his customers. He has to provide a service and if one travels 19 hours and then finds out later that one could have completed the journey in nine, one may be very angry with one’s agent and go somewhere else next time—to another agent, not to another country. There can be no doubt that the extra flying time on these flights must cost SAA a fortune. Fuel costs alone will amount to millions of rands. The number of passengers required per flight to break even on direct costs must be sharply increased. I find it impossible to believe that we can be profitable on all these East European flights particularly to Athens and Tel Aviv. In passing, we must also note that SAA have just spent R250 000 on a “residence” in Greece. It must be quite a place!

In view of the aforegoing, why not let El Al operate the sole service between Israel and South Africa? Surely we could negotiate some additional benefits for allowing them this privilege and, even if not, it would still be worthwhile. I believe, Sir, and would strongly recommend attention being given to this factor, that rationalization of SAA’s overseas service is necessary. If we can do this, the spin-off benefit such as a reduction in or at least the levelling off of the number of aircraft in our fleet, will be appreciable. When one looks at the accounts of S.A. Airways and one considers that financing costs have risen to R70 million which has been budgeted for this coming year, one realizes the importance of reducing capital expenditure. In 1982 South Africans will have to tighten their belts in terms of expenditure and SAA should do the same thing. I note with pleasure according to the Brown Book, that in their budget for this year S.A. Airways have at least succeeded in reducing their capital expenditure. I think the figure is something like R76 million.

In conclusion I should like to raise one final point with the hon. the Minister. He has announced a 30% reduction in air tariffs for national servicemen. This we must obviously welcome and we do so with great pleasure, but why only for national servicemen? What about the members of our Permanent Force? What have the members of our Permanent Force done to the hon. the Minister to merit this discrimination being practised against them? The hon. the Minister has told us that he is to have discussions with the hon. the Minister of Defence and I want to recommend that the hon. the Minister discuss this aspect with the hon. the Minister of Defence with a view to achieving a more equitable situation. Why should this 30% discount apply only to national servicemen? One notices that servicemen in other countries receive tremendous concessions in respect of travel. I believe that in Germany they can travel free of charge by rail. Therefore, as I say, I believe that the hon. the Minister should discuss this aspect with the hon. the Minister of Defence.

In supporting the amendment of the hon. member for Berea I want to draw certain comments to the attention of hon. members opposite because hon. members on that side of the House seem to think that comments from the Opposition side are made in isolation, but they are not. People throughout South Africa are slamming this budget. The S.A. Agricultural Union was particularly concerned about the shock increases in the tariffs for maize and livestock, and emphasized that the short term effect particularly would be harmful. This is what the vice-chairman of the P.E. Chamber of Commerce had to say—

The president of the S.A. Agricultural Union, Mr. Jaap Wilkens, said that agricultural conditions were critical. So one can go on. I believe therefore that we in this House should support the amendment of the hon. member for Berea.

Mr. Speaker, the hon. member who has just resumed his seat, carried on over such a wide field that he reminded me of a pebble which one tosses across a pool. The pebble skims across the water, touching the surface now and then. That was the nature of the hon. member’s performance, and naturally it is difficult to reply at this stage to all the points he raised.

In the first place, I do want to point out to him that there are very good reasons why we are going to undertake flights to distant countries. Much more is involved than I am prepared or disposed to spell out today. By means of such flights we have built up relationships and they have helped to prevent us from becoming as isolated as the enemies of our country would like us to be.

The hon. member also referred, among other things, to the provision which is being made for national servicemen and said that he would like it to be extended. Of course I have no fault to find with that, but I do ask myself how far we can go and how we can afford all this. After all, that is actually the problem we are faced with. I shall try to point out some of these aspects in the course of my speech.

The hon. member who mentioned this is not present at the moment, but I do want to mention that I have always thought that the free drink which is offered during flights is just that touch of class. [Interjection.] I really appeal to the hon. the Minister not to comply with that request.

As a practical person, I understand that the budget is a source of pleasure to the Opposition, because it affords them the opportunity of criticizing. Of course, the tariff announcements that have been made were not unexpected. In fact, they were predicted in our news media months ago, and to me they did not come as a surprise at all. What does surprise met is the fact that the hon. members of the Opposition shoot themselves down every time. It is like someone who climbs on a branch and saws off the branch behind him. On the one hand they advocate concessions to pensioners and salary increases, but when we get to the crux of the matter, they refuse to increase tariffs in order to provide for the things which they advocate.

The difference between them and us is that we plead with the hon. the Minister for salary increases and concessions to pensioners. We plead for these things when we are alone, in our caucus and at our group meetings. In this, the members of the party to which I belong are united. After all, it was in response to the pleas of those men that the hon. the Minister made the concessions and granted the salary increases. In him we have a sympathetic Minister. We also realize that since he has been so sympathetic, the necessary funds must now be found so that the additional expenditure can be defrayed. We and South Africa are grateful to him for the concessions he has made.

While no one welcomes tariff increases, it is gratifying to see how moderate the criticism actually is. The hon. member who has just sat down quoted the opinion of the S.A. Agricultural Union. However, let us consider the opinion of the Afrikaanse Handelsinstituut. I quote from Die Transvaler—

I quote further—

The AHI also makes the following very important comment—

Let us see what Assocom’s opinion is—

I quote further—

Let us consider the opinion of the S.A. Federated Chamber of Industries—

The point I am making is that this criticism, which is not destructive, came from people who are fully involved in South Africa’s problems. Their criticism is constructive and not damning. Therefore one is very grateful today for the fact that in the difficult times in which we live, the hon. the Minister was able to let us get away with such a low tariff increase. Hon. members must realize by this time that the activities of the S.A. Transport Services are closely linked to our whole national economy. I do not wish to elaborate on this any further, because other speakers have already done so before me.

In the short time available to me I want to discuss a few aspects concerning the Airways. I should like to convey my sincere congratulations on his new position to Mr. Frans Swarts, who has taken over the control of the Airways. He is a man who knows the Airways and who is following in the footsteps of predecessors who did their work thoroughly. However, he is not walking into his new post as a greenhorn, but as a man who has already completed the difficult course. We have high expectations of him and I want to congratulate him on his appointment. I also want to convey my congratulations to Dr. Loubser and Dr. Grové, and to associate myself with what other members have already said.

It is very important to note the enormous growth of the Airways. I could quote many figures in this connection, but I shall only mention two. In 1965-’66, the Airways conveyed 721 522 passengers and 8 170 metric tons of freight and had a total revenue of R38,2 million. In 1980-’81, more than 4 million passengers and 67 131 metric tons of freight were transported, with a revenue of R694,2 million.

It is true that the operating results of the Airways are unsatisfactory, but there are very good reasons for this. One of the reasons is that the S.A. Airways travels long distances outside South Africa, to territories where fuel prices are the highest in the world. This must be regarded as one of the main factors which has contributed to this financial position. Fuel is still the biggest single item of expenditure and at present represents 38% of the total expenditure, i.e. R345 million. The fuel account of the SAA is around R1 million a day. To this must be added the fact that we cannot fly the shortest routes. In the year just before the crisis, fuel accounted for only 12% of our total expenditure, but today it constitutes 38% of the total expenditure. Since 1973, the unit price of aviation fuel taken in abroad has risen by 1 269%, while in this country it has risen by 1 049%. Meanwhile, double-digit inflation rates are a common phenomenon all over the world which is making the SAA even more vulnerable. It is becoming increasingly difficult to control rising costs, since the Airways has to incur approximately 40% of its total expenditure abroad. The same applies to our aircraft equipment and material. We are forced to import these items from countries where high inflation rates often cause prices to escalate sharply. A Boeing 747 costs almost three times as much today as it cost 10 years ago. In his budget speech, the hon. the Minister pointed out that the revenue for the period April to December was R628,8 million, with an increase of R4 million over the amount which had been budgeted for. However, the expenditure of R682,5 million was R39,1 million more than the amount which had been budgeted for. Consequently there is a considerable loss of R43,7 million.

However, there has been a healthy increase in air freight traffic. The new 747 Kombi aircraft have made a major contribution towards the increase of 29,4% in freight ton kilometres. There has also been an increase of 15% in domestic air freight, while the number of passengers has declined slightly. The SAA will have to give serious attention to this problem. However, I want to point out that it is generally known that the other international airlines are experiencing even bigger financial problems. I made a speech about this in this debate last year, so I do not wish to repeat that speech today.

However, the vast majority of airlines throughout the world have bigger problems than we have. Many of them are bankrupt. The SAA has appointed a special committee to investigate this aspect thoroughly, and a great deal has already been done to curtail costs and to use our manpower, and especially our aircraft equipment, more productively. I shall discuss these planning measures in greater detail at a later stage, for there is another very important aspect that I now wish to deal with.

The speech I actually wanted to make today dealt with the contribution made by the S.A. Airways towards the promotion of tourism to South Africa. The share of the S.A. Airways in promoting tourism is not always realized. In 1981—these are very interesting figures—500 000 visitors from abroad came to South Africa. This does not include visitors from African countries. Approximately 80% of those 500 000 visitors were tourists and it is estimated that they spent R400 million in this country. This makes tourism the fourth biggest earner of foreign exchange for South Africa. I do not think we always realize the part which the SAA plays in respect of tourism.

In spite of all the problems experienced by the SAA in other fields, when it was denied the right to fly over Africa in 1963, it spread its wings, and today—in spite of what the hon. member has just said—it connects South Africa with five continents, i.e. North and South America, Europe, Asia and Australasia. Where Jan Smuts Airport—this is the important point—used to be the last stop on the route, South Africa is today the crossroads for traffic from many parts of the world, thanks to pioneering work done by the SAA. I have with me the SAA booklet which one receives free of charge—I just do not know where I put it—and when one looks at the map in it, one sees that from Jan Smuts Airport a series of routes spreads all over the world. For the Brazilian, the shortest route from Rio de Janeiro to Hong Kong today is via Johannesburg. The Israelis travelling to Australia regard the route via South Africa as one of the safest. Australians can travel to Europe via South Africa at the direct fare or for a small supplementary amount. The introduction of the SAA flight from Johannesburg to Rio de Janeiro in 1969 makes it possible to travel around the world in the southern hemisphere.

Our airline has 34 destinations in 31 foreign countries. This has meant that South Africa’s tourist marketing can take place worldwide. It has also enabled traffic between other countries to go via South Africa so that the country may obtain a share of that traffic. For example, journeys between Argentina and Israel can be undertaken via South Africa at no additional charge. Outside South Africa we have 53 beautiful SAA offices. I have been able to visit some of them and I was impressed by the fine work which is done there. Another office is being opened in the course of this month in Santiago. In those countries where we do not have our own offices, general sales agents have been appointed to look after the interests of the SAA. All the SAA offices are connected with the best, sophisticated booking and communications system by means of which tourist bookings can be made quickly.

Through its membership of IATA, the SAA has thousands of travel agents available to it all over the world, to serve as a link between the SAA and the public. By means of seminars, the agents are continually kept informed of the services and the attractions in South Africa. They receive publicity material and brochures about tours which we offer in South Africa. The Chinese saying that one picture says more than a thousand words is very true. To enable the agents to sell South Africa positively from their own experience, they are brought to South Africa on introductory tours. I have met some of these people. They have gone back and done valuable work for us abroad. Almost a thousand such visitors are coming to South Africa again this year to acquaint themselves with the country and will then go back and attract the necessary tourists for us abroad.

The sales effort of the airlines abroad is handled by a staff of 760 who are highly motivated and well acquainted with the product they are marketing. In order to reach the target market, an extensive publicity campaign is being undertaken which concentrates on portraying South Africa as a unique and popular destination. For this purpose the airline is spending R2,6 million a year abroad. It advertises in every country, and local advertising companies are used to convey the idea in the local idiom. It is a fact that the public attaches greater value to editorial reporting, and to complete the airline’s publicity campaign, almost 180 travel writers are brought to South Africa every year in co-operation with Satour.

I am also involved with Satour in other respects, and I am well aware of the valuable work done by this institution. In co-operation the S.A. Air Force, these travel writers are brought to this country, and the publicity arising from this causes many people who have a negative attitude towards South Africa to go back and do valuable work for us in their respective countries. I have had an opportunity to speak to some of these people, and I could show hon. members letters in which they imply that they do not wish to visit our country only once. Often they come back a second time and many of them end up by settling here permanently.

Through its congress section, the national carrier attempts to bring as many international congresses as possible to South Africa, for example, by persuading local organizations with international affiliations to hold their congresses in this country. All possible assistance is provided in this connection and many successful congresses have taken place in South Africa. The high attendance figures can to a large extent be attributed to the worldwide marketing effort of the S.A. Airways.

Special interest tours which are being marketed range from investors’ tours to agricultural and connoisseurs’ tours and incentive tours offered by organizations as a reward to dealers, employees and communities. Like congresses, this is a further market segment which has great potential and is being developed by the airline.

Of course, tourists have a variety of destinations to choose from and the demand is elastic. In his choice of destination, the tourist is obviously concerned about the total price he has to pay. There is sometimes a tendency to emphasize the effect of rising air fares on the development of tourist traffic and to lose sight of the cost of other services, such services, such as accommodation, meals, car rentals, road transportation, etc., which make up a considerable part of the tourist’s expenses. It is essential that the cost of these services be kept within bounds in South Africa and also that we make sufficient facilities available. In fact, one of our major problems is that we cannot always offer enough hotel accommodation.

The availability of a variety of air fares, such as excursion fares for the individual tourist, group fares and Apex is another factor which promotes tourism. Group fares from Europe to South Africa are sometimes as low as 86% of the single fare.

It would appear to me that the hon. Whip wants me to conclude my speech, and I have not yet finished. However, I shall conclude by saying that tourism is the golden goose in the modern world, and this applies not only to South Africa, but to other countries as well. Increased tariffs are going to have a serious detrimental effect on our marketing of tourism, and I ask that we should understand this. In the USA there are various schemes for promoting tourism to that country. There they also have a 40% off scheme. They also call this a triangular airfare. I should like to suggest that in addition to our existing excursion tariffs, we should also introduce a so-called “visit South Africa air fare” scheme. This should be a scheme available only to visitors from abroad. It should be available to them abroad only, so that when tourists come to this country under that scheme, they can travel from one big city to another here in South Africa in terms of a package deal, as in the case of the US.

I am convinced that such a scheme would not only promote tourism, but could also be used—and this is the most important aspect of my proposal—to fill empty seats which occur on our domestic as well as our overseas flights from time to time.

Mr. Speaker, it gives me pleasure as a backbencher to be able to speak after an hon. member of the calibre of the hon. member for Kempton Park. I fully agree with his remarks about the situation of the S.A. Airways. However, the time available to me does not allow me to express my agreement with what he said in greater detail. I want to come, however, to the hon. member for Berea and the hon. member for Amanzimtoti, who each moved his own amendment to the motion which is before the House.

In the first place, I want to cross swords with the hon. member for Berea, the spokesman of the official Opposition. Just as in the past, the hon. member for Berea once again tried to score petty points off the hon. the Minister and the Government concerning matters to which he himself does not have any answers either. Accordingly I intend to put certain questions to the hon. member for Berea and to the hon. member for Amanzimtoti. Both the PFP and the NRP have further speakers who are going to take part in the debate later on, of course. I want to challenge them to present us with a solution to this problem with which the S.A. Transport Services is faced, the problem of cost increases on the one hand and the resultant tariff increases on the other. Up to now, we have heard only criticism from both Opposition parties. Other hon. members—including the hon. member for Kroonstad—have already referred to this, so I want to agree with it. However, I challenge them to suggest a solution for once. Up to now it has been terribly easy to criticize.

You are in for a very long wait.

The hon. member for Schweizer-Reneke says that I am in for a very long wait. It seems to me that this is going to be the case. I suppose I shall never get a reply. It seems that there is no solution.

I want to know from the hon. member for Amanzimtoti how he regards the free market situation with regard to the transport services. This is a condition which has unfortunately blown over to this country from America. We find that in the USA, people are all aflutter at the moment about the concept of deregulation, and since the introduction of deregulation, it has been presented all over the world—not only in South Africa—as the Utopian solution to all problems connected with transport, especially in those cases where the State participates in the provision of transport services. However, we shall deal with this worldly problem of the hon. member for Amanzimtoti at a later stage. While he is sitting back so comfortably in his bench at the moment, I want to ask him what he thinks the solution will be when we have deregulated everything. It is very easy to allege in this House that everything should be deregulated.

I did not say that.

We shall get clarity about that later on. I should like to read a few quotations, derived not only from political statements, but also from writers on transport. This is what is being said in connection with the problem of competition within a situation of deregulation. At a transport seminar held in Rustenburg, one Mr. Markman began his paper as follows—

After a long argument, he came to this conclusion—

In December 1981, an article appeared in Road Transportation, which read as follows—

Let us examine this matter a little more closely. The problem of deregulation, or of competition in this case, has also been touched on by the hon. the Minister of Transport Affairs. In his budget speech he put it as follows—

This problem of a market situation and cost increases and competition on the other hand may cause the problem of competition in the South African transport market to be increasingly debated in the future, not only in this Parliament, but outside as well, by the people who are directly and indirectly involved in the industry. One of the parties that I expect to enter this debate, as was apparent from the last budget, is the S.A. Transport Services, and I suppose that it is also a good thing that they will convey their standpoint through the mouth of the hon. the Minister of Transport Affairs, because in the Republic of South Africa, the total share of the S.A. Transport Services, measured in ton kilometres, dropped from 61% in 1957 to 51% in 1970, and it is expected to drop to 44% around 1986-’87. This is an indication of the problem we have to contend with. On the one hand, there is a very great capital-intensive infrastructure which has already been created, and on the other hand, there is the demand for new infrastructure. The essential tariff increases which unfortunately had to be announced will further stimulate this debate. When slogans appear in the newspapers such as those which appeared the day after the budget, such as “’n Slag vir die ekonomie”, “Verhogings stook die inflasiekoers”, etc., it can be expected that this debate will become more heated in the future. As an economist, I accordingly want to say calmly that this aspect has to a considerable extent been wrested out of context, because people are only looking at this year’s budget. The present increase of approximately 15% on average must be seen in conjunction with the tariff increases of 9,9% in 1980 and 12,8% in 1981, which were considerably lower than the inflation rate at that stage. Unfortunately, there will have to be a closer link between tariffs and costs at some stage. The hon. member for Amanzimtoti asked why no one on the Government side had said anything about productivity and effectiveness. I should like to reply to that question put to us by the hon. member. Productivity and effectiveness, which can be to a large extent be regarded as the hidden resources, have been absolutely fully utilized over the past two, three and even four years. What follows now is that costs have to be incurred to carry through the aspect of greater effectiveness, and for this, capital will be essential. When the tariff increases are analysed, it appears that a large part of these were also necessary to cover cost increases. But there is a small element of generation of capital, and if anyone has any fault to find with that, he must say so in this House. We challenge them again to say so in this House. Unfortunately, capital is not available at attractive rates in South Africa, nor is it available on the public overseas market at the moment. I shall come back to this point in the course of my speech. In this debate, the school of thought which advocates totally free competition or deregulation in the transport market has only described the benefits which will flow from deregulation or free competition. That is half the truth. The other half is the disadvantages. Why does no one describe the disadvantages of this market situation? Let us consider the advantages as against the disadvantages in practice—not in theory, but in practice. We have all read the American books advocating deregulation. At this state I should like to discuss the disadvantages of deregulation and free competition in practice.

In the short term, deregulation may have advantages. Let met begin by conceding this as a given point and a point of departure, but merely in the short term. In the long and medium term, the advantages are far outweighed by the disadvantages; in other words, who pays in the end? It is the transport sector and ultimately the people who use it. We cannot allow that in this country. The practical effect of deregulation is a multi-faceted problem, and I want to refer to only two points in this connection, although there are many more. The first one I want to refer to is the question of tariffs. Tariffs have risen enormously in America on routes that are not fully booked. On those routes, for example, between New York and Chicago and between Chicago and San Francisco, competition developed after deregulation in 1978 which caused the services to degenerate to such an extent that everyone had to bear losses. The second point is that it led to a supply problem. This was caused by the fact that all the competitors concentrated on the main routes and were no longer interested in the rural areas. The result was that after two years, 24 months after President Carter had introduced deregulation, 132 towns with populations of between 20 000 and 27 000 people no longer had air transport on a scheduled basis available to them. If these are the benefits of deregulation, why are attempts now being made to rectify the matter? I shall come back to this point presently.

The RSA’s attempt at deconcentration, especially after the initiatives of the hon. the Prime Minister’s Good Hope Conference, is not promoted by poor or expensive services. In this country, we are in favour of deconcentration, there is no room for any after-effects of a policy aimed at allowing free competition. In this respect, the Opposition strongly reminds me of the era of the Carter administration which approved the deregulation of transport in the U.S. When the U.S. economy was booming, president Carter and all his friends shouted “deregulate”. Now that they are in a recessionary phase, those same airlines are shouting: Firstly you must please give us subsidies so that we can survive, and secondly you must put our house in order again. This NP Government is not a Government which gives with the one hand and takes away with the other if things are not going well. One must take both the ups and the downs when one is competing in the open market. That is something which the Opposition should bear in mind.

Furthermore, the position in the U.S. forced a large number of these airlines to try to borrow money last year to renew their fleets. After losses of approximately R300 million had been suffered in 1981, the banks decided that they were not prepared to lend money to an unstable market. The upshot was American Airlines had to cancel Boeing 757’s to the value of R600 million last week because the banks flatly refused to invest money in such an unstable market which had been created by free competition in the U.S. The consequences, such as unemployment and the fact that no capital is invested, are known to all.

Stability in the South African transport market is absolutely essential. There are great demands on the available funds of the Government, so the S.A. Transport Services are forced to go to the overseas market from time to time to obtain capital. In fact, the budget provides for a gross capital investment of R1 826 million and a total investment of R2 225 million, of which R450 million—slightly less than a quarter, therefore—has to be found on the foreign market. When that money is borrowed on the foreign market from financiers and international banks, the first thing they want to know is how stable the transport market is and what security there is in South Africa for the money they are being asked to invest in this country. At the moment they are lending us money for those very reasons. Therefore I say that we should allow that situation to continue until the contrary has been proved. Other aspects that are also important are quality of management and the recruitment of staff, but my limited time does not allow me to discuss these aspects at this stage.

I just want to say that the idea of an organized transport market is not limited to the Government and the S.A. Transport Services, but is also applicable to the organized road transportation industry in South Africa. In January 1982, when the new association was formed, the organized road transportation industry in South Africa accordingly came out in favour of this. Their first requirement is stability in the market, and secondly—this is a related aspect—the fly-by-nights have to be eliminated because they destabilize the market. If these two requirements can be met, the organized road transportation service will be able to compete with the railways under balanced conditions.

So those who propagate the myths of a totally free transport market in the RSA are not taking into consideration the practical demands made on the transport industry to enable it to make its contribution to socioeconomic and strategic requirements in the RSA. The principle of controlled competition to achieve the socio-economic objectives would appear to be a more acceptable one, if we regard the position of the country from a practical point of view. It appears to be a more acceptable principle than a situation of total freedom, but with chaos in the transport market.

As long as the S.A. Transport Services have to provide social services, the cost of which has to be borne by them, and they therefore have to make use of internal subsidizing, it is only fair that they should be enabled to make that money in order to expand further those services that are in the national interest. This applies not only to the S.A. Transport Services, but also to the private enterprises which convey large numbers of passengers every day. They also make use of internal subsidizing. Therefore it is important that the State should contribute its share towards creating such a market in which there can be competition.

When the price mechanism, as far as the Administration is concerned, is on a basis of full cost allocation, and there are no longer any social services, “full cost” has to be defined as meaning all costs, including those which the Administration is not paying at the moment, such as licencing fees for road carrier vehicles and GST. I must point out that this can only be required of the Administration when the total situation is balanced.

The idea of a transport advisory board, which was conceived by a former Minister of Transport Affairs and continued by the present hon. Minister, is in my opinion one of the possible solutions which will make it possible to discuss this point more fully, because it will be possible to give representation on the advisory board to all interest groups. It will be possible to ensure that their share of the market is making a contribution to orderly management. Consequently I wish to request the hon. the Minister to investigate once again the establishment of such a transport advisory board on which all interest groups can serve and make a contribution. I am convinced that when such an opportunity is created, tariff increases could be depoliticized, because people could then discuss the problems caused by tariff increases.

Finally, I should like to wish the General Manager of the S.A. Transport Services, who is now leaving us, a pleasant retirement, and at the same time, I want to convey my good wishes to the new General Manager who is taking over from him, and to express the hope that he may find easy solutions to the problems that lie ahead.

Mr. Speaker, I do not have as much time at my disposal as the hon. member Dr. Welgemoed had, but as the hon. member knows, I agree with him about several of his statements relating to the deregulations, as, indeed, I explained last year. One of the major problems faced by the S.A. Transport Services is that it has to pay for its entire infrastructure itself, while the road user, for example, does not have to do so. In this way a degree of distortion occurs which is difficult to eliminate. It can, however, be eliminated if one has sufficient time at one’s disposal.

I do not wish to reply to all the questions put to us by the hon. member Dr. Welgemoed, but in the short time at my disposal there are two matters I want to touch on in connection with staff matters.

Before coming to that, I just wish to make a remark about capital. The hon. member Dr. Welgemoed said that it was difficult to obtain capital. I believe that this is one of the aspects which we in the Opposition are fully aware of, namely that if the Government had not made certain mistakes in the political field, our creditworthiness would perhaps have been better as far as other countries are concerned and we should have been able to obtain overseas capital. In that case it would not have been necessary for us to finance long-term projects from short term or current revenue.

In his speech the hon. the Minister said that the S.A. Transport Services had had a very good year as far as labour peace was concerned. We are of course very pleased about this. In an organization as vast as the S.A. Transport Services it is very important that labour peace should prevail, because this organization comprises such an important part of our overall State economy. We really cannot afford labour unrest to take root in the S.A. Transport Services. Labour peace is, of course, a function of the relationship between employer and employee within the organization on the one hand, and the outcome of factors outside the organization, such as the economic climate, on the other. Of course, we in South Africa have another factor of great importance, viz. the labour revolution. This involves the normalization of job opportunities and, often, the abolition of job reservation. There has always been a basic difference between the attitude of the Opposition and that of the Government as regards the abolition of job reservation. The Opposition maintains that job reservation was and still is per se indefensible. In addition it has also placed an unnecessary burden on the progress of the economy and resulted in a loss of human energy which can never be regained. Job reservation was of course one of the pillars of the Government’s policy and one which the Government was very slow to give up. Nevertheless the Government did eventually realize that it would be economic suicide to persist with that item of their ideological framework. We heard last week that apart from the S.A. Transport Services, there is only one area in South Africa which is still subject to job reservation. It is no wonder, then, that shortly afterwards we heard about power-sharing, because it has always been the Government’s argument that the abolition of job reservation would lead to economic integration and that economic integration would in turn lead to political integration, and I see that this is indeed going to happen, because we are already hearing about power-sharing.

A year ago the Director General of the Department of Manpower, Mr. Cilliers, said while discussing job reservation that 26 of the 28 categories had already been eliminated and that only two remained, one of which was abolished last week. A year ago Mr. Cilliers was also reported as saying—

However, we have not yet heard anything specific from the hon. the Minister concerning the abolition of job reservation, either in the Part Appropriation or in the little budget last year. I therefore hope that the hon. the Minister will be able to tell us something about this, unless things go so well that he is afraid the hon. member for Langlaagte and his voters may get to hear of it. However, I should very much like to hear what the position is, because when one speaks to employees of the S.A. Transport Services, particularly at the technical and artisan level, one hears about acute shortages that are being experienced. I think that this is what remains of job reservation. For example, one hears of a workshop for the maintenance of electric units in which only 33 out of a total of 90 posts are filled. This is a direct result of the old policy of job reservation, traces of which can still be detected in the Transport Services. In this regard I would say that the S.A. Transport Services are in a very good position to carry out the change, because many of the posts are sui generis and in any event, much use is made of in-service training. Therefore I think that it will be easier for the S.A. Transport Services to make up their shortages than for certain bodies in the private sector. I should therefore like to know from the hon. the Minister what progress has been made in that connection.

In this regard I also wish to make mention of the employees’ associations. I find it a great pity that as posts are opened to people of colour, they are not also given access to the same trade union. I know that of all the trade unions, only three have indeed thrown their doors open, but unfortunately the Black employees have already established their own staff associations. I should like to know whether the hon. the Minister has used his influence to prevent staff associations becoming a playground for Black/ White politics. The hon. the Minister is very popular among employees, and I think that if he were to say a few words to them they would be only too willing to accept his leadership. The hon. the Minister need not take over the planning or operational tasks of the officials, but I think the hon. the Minister could really achieve something in that regard as a result of his popularity. Accordingly I appeal to the workers of the S.A. Transport Services of the country to put the “cause” before their own fears and privileges. In the same way as the Afrikaners of the past found a home in the Railways, I appeal to them, too, to hold out their hands to the people of colour, who will have to help make of the S.A. Transport Services an even greater organization than it is at present.

Another matter I just wish to touch on briefly is connected with this. I want to know just what the hon. the Minister is doing in respect of the South West African system. What is he doing to ensure, not only that we hand over a going concern when, in due course, they perhaps become a free Namibia, but also that there will be a specific programme to appoint on this system citizens of South West Africa, who will not hurriedly return to South Africa when that country achieves its independence? We do not wish to be accused, along with all the other colonial powers, of withdrawing our people, thereby causing such a country to decay. Have the transport services in South West Africa achieved the same level as the other authorities as regards doing away with discrimination? I do not believe that this is so on the S.A. Transport Services and I should like to have the hon. the Minister’s comment in this regard.

Mr. Speaker, what was said by the hon. member who has just resumed his seat, virtually amounts to the fact that it is due to political blunders that our Government and South Africa are faced with the financial and economic problems that we are experiencing today. I do not want to drag the names of our good trading partners across the floor of the House here, but what the hon. member has said, is really the most ridiculous thing that we have heard in a long time. Is the world recession, world inflation, due to political blunders that have been made? I think it is an insult to our trading partners. Once again it is simply an indication of a lack of a feeling of pro patria in such a young fellow when he says such strong things here.

When we discuss matters relating to the S.A. Transport Services, one of the finest institutions of our Government structure, one expects hon. members to try to be a little positive, to forget petty politics and to concentrate on this vast institution in the South African governmental structure. It is true that the official Opposition wants to make politics of it and therefore will never realize that the financial and economic problems of South Africa are not of the Government’s making nor of this department, but that the world outside is struggling just as we are to free itself from these tremendous problems.

What is important with regard to this budget, is that the hon. the Minister, in spite of these tremendous problems, still saw his way clear to making enormous concessions towards our men and who have to keep the wheels rolling. It has been said that it is only a small concession, but surely this is not true. After all, the thousands of national servicemen are grateful for the discount plan and the concession of a discount of 30% on nominated flights. The 5 810 Railway people who have been properly accommodated by the Minister this year, are surely grateful for it. After all, it was a mammoth task that was accomplished. Our pensioners received an increase and the men and women of the Railways received a salary increase of between 15% and 17,5%. Then there is the matter of the transformation of the Sick Fund into a proper medical fund at the enormous cost of R21 million. Surely one does not simply mention this in passing if one takes note of the economic background against which the hon. the Minister has done this. But, as I said, this modus operandi of the official Opposition in a budget debate on the Transport Services is not something that originated today. I just want to remind the House of what the hon. member for Berea said six months ago in order to support one leg of his amendment at the time (Hansard, 21 September 1981, col. 4294)—

He went on to say—

Therefore, the chaotic conditions and the programmes that are collapsing are discussed in the most exaggerated fashion. There is no reference to a single problem that arose, but the entire situation is exaggerated. This situation arose six months ago, and the hon. the Minister explained at the time that he was in the process of solving the temporary problem at City Deep. What is the position today, six months later, and has any hon. member referred to it? That problem has already been solved, but what do we have once again today? The hon. member for Berea tried to criticize the container system by comparing it with the system in England which he calls containers in transit. In actual fact it is not possible to compare containerization with England as far as speed of traffic is concerned because in England for instance, the railway lines have been built for a high speed and the topography of that country is also vastly different to that of South Africa. However, we must compare our system of containerization with other systems that are in fact comparable. If we want to talk positively about such an important institution as containerization today and want to draw comparisons, we must at least take the trouble to obtain proper data. What do we find if we compare the South African system of containerization with that of any country abroad? With regard to the handling of containers at our harbours, we find that the record of 39,6 containers per hour is held by the Port Elizabeth harbour. Durban takes second place in the world, with 38 containers per hour, and Cape Town harbour is third, with 29,9 containers per hour. What do we find if we compare these achievements with harbours elsewhere in the world? The harbour at Rotterdam handles 27,5 containers per hour, the harbour at Zeebrugge handles 26, Hamburg 19,3 and Southampton 15,1. Handling containers in harbours is a very important facet of the whole system of containerization.

Tackle them, man! Tackle them! It is high time that they hear the truth! [Interjections.]

However, the hon. member comes along with a second strange accusation. He says the hon. the Minister should now increase harbour tariffs, which are such a profitable component of the S.A. Transport Services. I now want to ask the hon. member whether the Minister should have increased the passenger tariffs in order to keep the less profitable components in the S.A. Transport Services in operation. He simply has to answer yes or no. If the hon. member should answer no, I want to hear from him whether the Minister should maintain the status quo by withdrawing those services? Of course the hon. the Minister would not take such ridiculous steps, because the S.A. Transport Services must carry on. Tomorrow or the day after when we once again have a boom due to the inherent willpower and growth of this country, the hon. Opposition will accuse us of sitting back with our hands folded and doing nothing 10 years ago. The hon. the Minister, together with his brilliant department, will not do that, because the S.A. Transport Services must continually be organized in such a way as to meet the demands of the day.

In actual fact, on this occasion I wanted to talk about the milestones that we could reach and the new eras that we could enter with regard to three facets of this important component, viz. our harbours in the S.A. Transport Services, and our harbour policy in the first place. One of the hon. Opposition members, for instance, referred to the operating results for the 1982-’83 financial year. The large surplus that was planned for this year was mentioned. However, he did not explain why there would be such a tremendous difference in that year in comparison with 1980-’81 for instance, when it was something like R96 million, or even in 1981-’82, when it was R130 million. That is why it is very important, since we are now entering a new era with regard to the harbour policy, that we should also take note of this today. As regards the handling and management of our harbours, the ideal has always been and still is that it should be the responsibility of the harbours themselves; of course, always within the broad framework of the South African national policy with regard to our harbours, as laid down by the S.A. Transport Services.

However, it is true that a dividing line was drawn in 1912, in terms of which it was provided that the first railway line would be on the seaward side of that dividing line between harbour and railways activities, i.e. the harbour activities would begin on the seaward side of that dividing line. On the landward side of that dividing line—this is what was laid down—the railway activities would then take place. Of course that dividing line that was laid down by the old guard, was not a very accurate one, because harbour pilots for instance, open areas, quay areas, etc. did not fall within the jurisdiction of the harbour authority.

Therefore a task group was appointed in 1978 to investigate this entire matter in order to establish what an accurate dividing line would be between the harbour activities on the one hand and the railway activities on the other. This is very important, because only if it can really be done in this way, can the operating results of the harbours, for instance, be established with a fair amount of accuracy, and can it be established whether our harbours are being managed in a profitable way.

This task group published its report in 1979. Therefore, since April 1979 it has been possible to deliberate on this important report that the committee produced with regard to the division of funds, the division of assets between the harbours on the one hand and the railways on the other, the separation of the accounts of these two operations, etc. Therefore the department can now announce that from 1 April this year there will be a proper dividing line between the activities of the harbours on the one hand and the activities of the railways on the other. This is terribly important. In terms of this new dividing line we can now actually properly separate the operating activities and the functions, the revenue and expenditure accounts of the two operations, and we can also establish whether this harbour institution of ours is profitable or not.

This brings me to the second aspect to which I want to refer on this occasion, viz. our tug fleet. Due to the fact that four new diesel tugs were purchased during 1981, we can now really say that the old dispensation in which tug services were provided by steam boats, is something of the past. Therefore, we are now entering a new dispensation, a new era in which tug services will be carried out by 20 diesel tugs. This new tug service is extremely important, particularly in view of international shipping traffic. Therefore, what we can say on this occasion, is that important experts are of the opinion that our new tug services are at least comparable with the best in the world.

Then I also want to refer to the important question of containerization. This aspect was referred to earlier this afternoon as well. However, I am doing so again because containerization is actually an institution that is here to stay. Containerization has a long history. However, we can rightfully allege that the S.A. Transport Services has now completed the introductory phase of the entire system of containerization, and that there will be tremendous expansion in this sphere in the years that lie ahead.

Having said this, one must take note of the fact that containerization has a very interesting history not only in South Africa, but in the world as a whole. For instance, it was the great Dr. James Anderson whose ideal this was in as early as 1801. In actual fact, however, as hon. members all know, it was the well-known transport figure Malcolm McLean who introduced the first containerization services between New York and Puerto Rico in 1956. Of course, that was followed by the international agreement in 1967. Shortly after that we were able to appoint a task group under the guidance of Prof. Steenkamp to investigate containerization for South Africa. One cannot link up with containerization simply by pressing a button; it is a tremendous affair that requires vast changes. Ultimately it was decided, after study groups had been appointed in South Africa to study the implications of the implementation of containerization, that containerization could be introduced in South Africa on 1 July 1977. In this regard it is very important that we should bear in mind that an important world expert in the sphere of containerization said the following in regard to changing over to containerization here—

This evaluation of these tremendous efforts speaks volumes for the hon. the Minister and his department, for having been able to introduce this important system in such a way and for the fact that we can realize today that the introductory phase has been completed and that the following stage of further expansion is now awaiting South Africa. Of course, one must realize that during this introductory phase of approximately 5 years, there were problems that arose, but that is why one is even more grateful that it was in fact in South Africa that the implementation of this important system was so successful that we can compete with the best in the world and that we have been able to obtain so many benefits from it for South Africa. However, if we have to ask ourselves what containerization means for South Africa, we must admit that there are in fact problems and that containerization in itself has its drawbacks too, because it is a tremendously capital-intensive system, because it is less labour intensive and therefore creates fewer employment opportunities. The system also has the drawback that containers are in fact specialized apparatus and after they have rendered a service, they cannot be re-used immediately. However, having said this, we must also say that containerization holds tremendous benefits for South Africa. I just want to point out a few of them. It brings about a more rapid and simpler loading and unloading of freight. It cuts packing costs. The container offers protection from theft, the elements of nature and contamination and it contributes towards the maintenance of established markets.