to-day we have a company of our own called the Westralian Farmers. We have now 40 little local co-operative firms throughout the State, and I hope at the end of the year will have 80, and that next year they will be doubled. We wish to try and keep some of the profits that we know are going into the pockets of other people instead of our own. It has been said that Western Australia last year and this year showed great prosperity, that farming must have paid because we grew 18,000,000 bushels of wheat. Although we did that and received from three to four million pounds for the wheat, not much of that money went back to the man on the land, when he had taken out of it the cost of production and distribution. We want to co-operate in our big things. We say that if we co-operate in the buying of bags, we are going to get bags at a cheaper rate. The Industries Assistance Board proved that last year. We also want to get co-operation in our insurances.

8913. I think the Industries Assistance Board distributed bags at 8s. 8d. Did that repay the cost of handling? - They say so but I do not know of my own knowledge. I have very little faith in the handling of things by the Government. I would have everything handled by our won co-operative system if possible. I do not believe in the Government handling insurance. I believe in handling our own business and our own insurance as far as we can. We know that £2,400 was paid in claims to farmers during last year, and that £24,000 was paid by the farmers to the insurance companies by way of premiums. That would be in connection with 2,200 farmers only. If we take this as about a third of the wheat farmers of the State, if all came under it, they would be paying about £72,000 a year in premiums, and the claims in an ordinary year would not amount to more than about £7,200. These figures serve to show that there is a big profit in the business. We want to get some of this business ourselves, and think we can do it by combining by way of co-operation. The New Zealand people thought the same thing, and 15 years ago started a Farmers' Co-operative Co. of their own. To start with, they only touched the safer propositions and did not touch the risky stuff, but they brought the cost down to 12s. 6d. per cent. We ourselves have got down to 17s. 6d. per cent. and during the last fortnight had another reduction of 20 per cent. This has saved about £8,000 a year to the farmers. What we need is organisation and education in our farming communities. The co-operative movement, to be a success, must be run on a cash basis. It cannot be run on other lines. But the farmers through out Australia cannot find the cash to pay for super. and bags. If they could do so we would not have the big firms in the Commonwealth assisting them to the extent of million of pounds, as they are doing to-day. A way has been found out of the difficulty in Ireland, Denmark, parts of England, and in Germany, by way of the credit bank system. Some people smile at the credit bank system, and yet we have it in vogue to-day. The Industries Assistance Board is a board under the direction of the Government owned by the people of Western Australia, who are advancing a certain amount of money to indigent farmers in the State in order to carry them on. They are taking the risk on the security of the personal equation of the man on the land, and on the security of the land. We know that the risk is right, but that, under Government direction, it has not been all that it should have been. We say to-day that we believe in the credit bank system, but think that it is carried out wrongly and that it should be carried out by a big co-operative movement amongst the farmers themselves, with locals, such as we have organised now, throughout the country. Let us take it the case of the local at Kellerberrin. Let us take it that there are 50 men there. Smith or Brown comes along to the chairman of the committee of the local and says he wants £100 for sheep. The local says, "We cannot give it to you. We do not like you, or the way in which you look after your machinery." This method is going to make these people in that local absolutely honest. This is the sort of thing that is done in Denmark, Ireland, and Germany. The only way that we have here to keep our people honest is by means of inspectors. The Commission must know the difference between such a system of inspection and that of the system of locals, and the effect that would be derived from the action of men who thoroughly understand the business saying, "We will not help you." The credit bank system is in existence to-day and we want it to be in existence in the future. We have discussed this matter on many occasions at our annual meetings. Another important this is that the co-operative movement, to be successful, would have to be made compulsory. In dealing with a big body of people such as the farmers, who are never satisfied to be led by one particular set of persons, it is absolutely essential that they should be compelled to come under the scheme. This is done to-day in Canada. The Government of that country supplied the people to the extent, I think, of half a million pounds to start with to carry on their business in a big co-operative way. It was, however, not made compulsory then and it stopped, because many of the farmers thought they could do better outside. It was then made compulsory that every farmer should put a certain portion of his business through the co-operative organisation. We have compulsion in vogue in Australia to-day. We were compelled to sell the whole of our wheat for last year and for this year, and will be compelled to sell it for the next year, to the Ministers controlling the departments concerned in the different States. If we had not been compelled to sell it in this way, we would not have been getting the price for it that we are getting to-day. In order to get the full benefit of co-operation, the farmers have to be compelled to come in under the scheme. We want cheaper money if we can get it. We are certainly getting it cheaper to-day than we have ever had it before, and the men who are under the board are getting cheaper than the people outside. It is a big credit bank system and the State is standing behind it. If we are going to allow the merchants, the bankers, the financiers, and other people who have money to lend to charge up to 15 per cent. for it, the man on the land who has to borrow will never be able to get on.

8914. The great difficulty is to eliminate competition in this matter and still provide all the assistance that is required? - I think that can be done by means of a big credit bank system of our own. I do not think that more than a million pounds would be needed to carry it on. I spoke to Professor Shann the other day about this matter and he agreed with the idea, but did not believe in the Government find-