negotiated for settlement the particular items of negligence for which we considered deductions should be made, as, for instance:—In protecting and caretaking: (a) delay well into wet months before roofing and screening was effected; (b) covering by tarpaulin instead of roofing by ordinary method of g.e. iron; (c) failure to patch or sew burst bags; (d) insufficient and inefficient screening; (e) bad stacking with insufficient ties, dunnage, and drainage; (f) not taking prompt remedial measures in re-stacking, re-roofing, etc., after damage once caused, whether by weevil, flooding from below, mice plague, or fire, etc. In re-conditioning, re-bagging, etc.: (g) extravagant use of sacks; (h) undue cost of secondhand sacks; (I) protracted delay in work of reconditioning; (j) exorbitant rates for labour; (k) lax supervision. Where no negligence has been alleged by the Scheme to the agents, and the working costs and re-bagging percentages are responsible, the agents' claims are paid in full. After duly considering the first year, in wheat handling for the Scheme, we have fixed as a limit of country stacks the following rates as the maxima which we should not allow as being excluded from the charge of negligence (any-thing over these rates we regarded as being the causes of negligence in one or other of the directions indicated above):—Working costs of re-conditioning including price of sacks, 3½ d. per bag, or alternatively price of sacks purchased, 7s. 9d. per dozen, with working costs 2¼ d. per bag. Percentage of bags in stack to be re-bagged, 21 per cent. At the port of Fremantle the maximum rate that we propose paying to an agent for re-conditioning is 1.3d. per bag of the total quantity of the wheat handled there. The cost at the ports of Bunbury and Albany are considered reasonable. There were about half a dozen claims made for re-conditioning of country stacks prior to 30th September, 1916. These claims were made by the agents under the original 1915-16 agency agreement. The claimants alleged that these costs arose from damage caused from flooding from below, weevils, plague of mice, or other factors for which the agent was not responsible under his agreement. The Advisory Committee have all along taken up the attitude that they do not admit the existence of a mice plague, but, in view of the excessive damage cause by the mice in 1916, they would agree to pay such costs provided no substantial loss was occasioned through negligence on the part of agents. (See resolution of Committee, 16th August, 1917.) The same difficulties as I have indicated arose in dealing with these claims, and we were compelled to deal with them as with the re-conditioning claims arising out of the continuation agreement. The recommendations to pay which are being made on the individual agents' files are subject to this minute. Before the Minister approved of this minute, the principles of which I had previously discussed with him, to enable certain claims to be settled I suggested to him that as he had not a general manager to advise at the time of those settlements it would not be unwise for him to seek to opinion of Mr. Keys as a general manager. In response Mr. Keys said this:— Further to Mr. Hall's minute in regard to the settlement of claim under the 1915-16 continuation agreement, I desire to state that the basis set out in the minute is my opinion fair and reasonable. I settled up with the Scheme for Louis Dreyfus & Co., and agreed to a number of allowances being made whilst I was sure that I could have forced the Scheme to have paid the full amount by going to arbitration. I did not think the Scheme would not be able to prove that Louis Dreyfus & Co.'s work had not been done with due economy. The main motive prompting me in agreeing to reduction of certain claims was that I was of opinion that the sub-agent carrying out the work had been lax in supervision.