we do not, every grain of wheat that we grow we have to hand to some other person, whether we are satisfied or whether we are dissatisfied. If it was not for the wheat that we grow, these mills would be closed down. And yet we have this position: I know for a certainty that as regards my crop growing at the present time, when it comes to be harvested, I shall have to pay for all the costs of doing the work, and I shall have to hand over the product. I can see it go into Ockerby's mill, or somebody else's mill, and I can see the mill running full time, taking no responsibility, accumulating big accounts with the Pool, and not paying those accounts, but selling the flour to Mr. Brown or another baker and getting the money for it. How long is a human being going to take that lying down? If it is good enough in the interests of the nation that under war conditions our wheat shall be taken and that we shall be paid by dribs and drabs for it, because the country cannot do it otherwise, is it not a fair thing that everybody in the industry handling our product should be in the same position? We do not want to see these people making, at our expense, in war time, thousands and thousands of pounds which they never made previously, and the Government and everybody else concerned taking it lying down. I believe that the wheat for ever and a day should be handled co-operatively, or else by a convention or scheme which will give the farmer every penny that his wheat is worth in the world's market. But I have a very strong objection to seeing mills running without any financial risk at all. In pre-war days the millers had to take some financial risks, such as storage, risk of damage, and heavy interest on big overdrafts. All those charges, which were part of the cost of milling, have been eliminated by the present gristing arrangement, and no allowance has been got by the management of the Scheme. Those point to a lack of knowledge and have been overlooked, and we farmers are the sufferers.

2317. Mr. Keys was appointed only in the early part of December?—I think Mr. Sibbald must have left by that time.

2317A. But Mr. Keys was not manager when this agreement was made?—This was a matter of negotiation between the millers and the Scheme, and the millers knew exactly where they had the Scheme. They have a millers' association. It is not as if one were dealing with individual millers. The members of the millers' association have only to say to each other, "Keep quiet, and we have the Scheme where we want it." Had the Government, however, taken over the mills and run them on behalf of the Scheme, I am quite satisfied the Scheme would be better off.

2318. The capital invested would be easily ascertainable from the balance sheets of the mills, and particularly of the milling companies?—Yes; provided you got the audited balance sheets. Under Clause 21, it will be noticed, the miller accepts the del credere risk on all sales under this agreement. The del credere in this business is practically nothing, because it is well known that the bakers' accounts in Western Australia, and particularly in Perth, have been the best accounts financially for years past; and they are sound commercial propositions at the present time. Going back to the remuneration, it will be noticed that under Clause 23 there is to be paid, in addition to the gristing allowance of 7d. per bushel, a commission of 2½ per cent. on local sales of flour, bran, and pollard, and also on sales to Java, Singapore, etc. These latter sales are principally made under letters of credit or for cash against documents. Therefore the del credere commissions allowed is out of proportion to either the risk, or the cost of procuring the business. That is an absolute fact. When a shipment of flour is made to Java, the bills of lading are put through the bank with the invoices, and delivery cannot be obtained at the other end until the cash is paid. This business is mostly done with the Chinese. Under paragraph (c) no commission is payable in respect of Imperial Government business; but paragraph (e) provides that the miller is to get 2½ per cent. del credere commission on the unmilled portion of the miller's quota of the Imperial order. I have put in the words "del credere" there; the section reads simply a commission of 2½ per cent. But on turning back to Clause 21 it will be seen that the miller accepts del credere risk in connection with all things. Therefore that is a del credere commission.

2319. The millers have no risk at all?—No risk at all. The millers never had anything to do with the procuring of the Imperial order. Mr. Hughes takes credit for that.

2320. I want to emphasise that word "credit." The farmers paid £80,000?—That is quite correct, and months after the sale was made. The sale was made on the 13th December, 1916, and it was not until March of 1917 that the Australian Wheat Board considered the question of commission payable on this order. Then they decided to give one-sixth of a penny per bushel to the London agents, and left it to Senator Russell and Mr. Hagelthorne, the Victorian Minister for Agriculture, to settle the details. What I want to press first of all is that there is to be no commission paid on the Imperial order, but they are to be paid, at 2½ per cent. on the unmilled order that they had nothing to do with. This shows that in the drafting of the agreement there has been some clever work done by the millers. You will notice in paragraph (d) "3¾ per cent. on the wheat gristed on behalf of the farmers." That is in addition of course to the 7d. per bushel for gristing, and 7s. 6d. per ton of flour milled. Under Clause 28, in returning to the farmer the milling products of his wheat, the miller has to make due allowance for the railage on the wheat to the mill, the railage on the product to the sidings, the usual gristing charge and the usual bag and other charges. This means that the sum total of these charges has to be deducted from the product of the wheat. Under Clause 23 we find that the miller has to be allowed 3¾ per cent. If I send in 10 bags of wheat to be gristed, the miller mills it and he hands back to me not 10 but eight bags. He has taken off his gristing charge, he has taken off his bag charge, railage to and from the mill, and 3¾ per cent., del credere commission. When the wheat goes in to be gristed the farmer does not get the products of his own wheat. It is simply a calculation. He hands his wheat in at one door and he goes to the other door and picks up his bran and pollard and he is charged 3¾ per cent. for it. Clause 38 of this wonderful agreement provides that the miller shall put up a bond suitable to the Minister in an amount not exceeding £1,000. These men have, without exaggeration, tens of thousands of pounds of goods belonging to the Pool in their mills. They have no one to check their figures until the agreement terminates. That is the difficulty in dealing with wheat and flour; you cannot tell what is in a stack. There is no man on this earth who can say what the weight is or what the number of bags may be. I have tried it and I know it is impossible. You cannot get an actual clean up until you have wiped the floor.

2321. This system might go on for years?—It is bound to do so, and they will take care that they will never have a clean-up. I do not know how they will ever get out of it now they are in it. The only way they can ever take over stocks is to say that the stock is so much, take a tally and go out. But where wheat is coming in and is being milled you have to rely on the honesty of the millowners, managers and employees that the stuff does not get mixed up. I submit that a bond of £1,000 is absurd, seeing as we have writs out against them for £56,000. Take as an illustration the bond which the Westralian Farmers, Ltd., are asked to put up. The Westralian Farmers are handling wheat and they are asked to put up £20,000, and under their agreement "The liability of the agent is limited to a total of one farthing per bushel on the wheat handled." Their total liability could not run to more than £7,812 because the total amount they have handled this year has been 7,500,000 bushels.

2322. This is the first time that ¼d. per bushel has ever occurred in the agreement?—Quite true. There is reason for it; they are doing only a limited agency under this agreement; they are receiving and stacking at country sidings and sending to central depots and then they are clear of it. I am only pointing out the discrepancy that in the one case they have men handling wheat and selling the products of the wheat and getting money for it, and they have only to put up £1,000, while in the other case a bond of £20,000 is asked. If it were vice versa it would be nearer the mark.

2323. I stated that when speaking in the House. It must have been apparent to anyone that if £20,000 was fair, it would be necessary to get 22 million bushels from the harvest. It was impossible. I have