two others were approached, either to pay up the overdraft, or to pay an increased interest. This they were unable to do and consulted me. I said they had better hand their assets over to the Government, that they had not been able to spend a penny on improving the condition of the buildings, and the development in the districts round about did not warrant further outlay on the factory as it stood at that time. I told them that the best thing they could do was to hand their assets over. Just at that time Mr. W.D. Johnson, who was the Minister controlling the Department concerned, brought Mr. Connor into the matter. At that time Mr. Connor did not know that the Government had a lien over the factory, or even that the factory was in existence. He conceived the idea when he learned about it of making a State factory of the business. He interviewed the farmers and told them that the Government were prepared to take it over. My position was that the Treasurer had not endorsed my lease as tenant, and when the State was about to take it over I was simply bundled out, with the result that Mr. Connor and the State collared my 13½ years' of work for nothing, which is a bit of Irish landlordism. That closed my career in regard to the Busselton butter factory and I then went on to Capel. What I wanted was fresh milk supplies, and to manufacture small lines for which we would be able to pay a better price than we could pay for butter fats. This would also give the farmer a better deal and encourage him to develop the industry and be the means of putting more money into his pocket. I could see that the best thing to do was to manufacture lines of cheese and encourage the making of table cream. My idea was to pay a price somewhat midway between butter prices and milk prices. There are no facilities for the carriage of cream in good order. At one time I offered the Railway Department to pay the whole cost of cool storage on the line, and to cover all loss, if they would give me an opportunity of going in for it. I said that after I was reimbursed for the freights, they could have the difference between what I guaranteed and what I would get out of the truck, so that the truck would run free of cost. I was to do all the hunting for the loading, but they told me they would not entertain a contract of that sort, and it fell through. I also protested against their throwing kangaroo skins and carcases on the top of the cream and milk, but that was of little avail. We were carrying the produce under bad conditions and it was no wonder that the industry did not develop. The railways do not run any cool storage cans on the Bunbury line.

9392. If Mr. Connor produces milk at Brunswick, he cannot get special facilities for carrying it to Perth?-- He does not try now. When Professor Lowrie was here I told him that I wanted a milk supply for Perth and that he would do very much better by selling milk than selling butter fats. We entered into a contract, but he was so cautious that he would not buy the cans and hired them from me. What he paid me for the cans more than paid for them. He got a very good return from the State farm, and I was told that the milk which was supplied to Perth made the State farm pay. When the butter factory at Bunbury was established Mr. Mitchell undertook the supply of cream, and the State farm then supplied the factory with butter fat so that it could be given a chance.

9393. What dairy business do you carry on in Perth?-- I buy milk from the outer suburban districts and sell it to the cafes and hotels and also by the glass over the counter. We handle table cream and cream for butter making, which is a separate thing. The amount of cream that we handle varies very much according to the month of supply. I have some figures here relating to the wheat areas, which embrace the Midland, Great Southern, and Eastern Goldfields lines. (Table of figures put in.) These figures embrace a period of 12 months. In connection with these I may say that that I am totally opposed to the method at present adopted by the departments and the Minister generally in handling the question. I think they are putting the cart before the horse and spending public money uselessly. These figures will bear me out in what I say. Western Australia is badly hit by the proclamation in regard to prices. We have to work on the same basis as the older established States of the Commonwealth, although those engaged in the industry in the Eastern States are able to handle their surplus and send it to Great Britain, for which they get a high premium. The figures I have put in show that we have purchased 25,202lbs of butter fat for the 12 months from April to March, of the cash value of £1,823 15s. That is not enough by half to run a factory.

9394. By Mr. VENN: What is the quality of the cream?-- It is not bad, but it is mixed. It comes in under different conditions. At times the condition is very indifferent. One might say that one would make 75 per cent of second quality butter, and 25 per cent of first quality butter under the present railway conditions and the minimum charge now exacted.

9395. By Mr. CLARKSON: Is it impossible to get milk down from the country districts, under the present railway system, from a distance of 100 miles?-- Yes. There must be cool storage trucks and facilities for handling at the other end. The temperature of the milk has to be reduced, and there must be speedy trains. At one time we used to get milk from Grass Valley.

9396. By the CHAIRMAN: Apparently you are only getting cream from about 200 cows from the whole of the wheat areas?-- There is only a season of about five months, from August to December, during which we get any cream from those districts.

9397. By Mr. VENN: If the farmers applied themselves properly to the industry they would be able to milk their cows for a longer season than five months?-- The average period during which a cow should be milked is 280 days. I should say that 75 per cent of our supplies would come from the Dowerin and Korrelocking lines, and the rest from the Midland and Great Southern lines.

9398. By Mr. PAYNTER: Do you get any supplies from the Eastern line?-- We get some from Clackline and Grass Valley, Kellerberrin and Tammin. It is a poor proposition. It is only throwing away public money to establish butter factories in these districts before the farmer is in a position to support them. Mr. Connor is wasting his time. He should instruct the farmer what to do, and how to do it, and get the herds into the district before establishing factories. We have been trying to push along the industry. Until the high price of 1s. 9d. a lb. came in, there was no stimulus for people to go in for the industry. When the high prices did come along