ton. The 30s. just about covers my mill costs. If we are only going to cover milling costs it is just as well to buy. They would not give us any more for milling weevily wheat than on f.a.q. Of course we recognise that we are working in war times and while under a fixed price neither the millers nor the bakers are making money, but there is no reason why they should be called on to lose money. You will notice from the last letter which I have put in they have declined to discuss the matter. They say "Those are our rates, you can take them or leave them." We have left them. We offered to reduce the price to 6½d. we have already milled 75 per cent. of the weevily wheat, and in the future we shall be on last year's wheat, which is fairly good, and we have said we will do it at 6½d., but their reply is, that will not do.They offer 29s. per ton of flour for the large mills, 32s. for medium and 33s. for others, thus penalising the mills that given them more flour per bushel of wheat.

7501. By Mr. BROWN: You are within three weeks of the termination of your agreement?—Yes.

7502. And if no further negotiations take place you will cease?—Yes.

7503. By the CHAIRMAN: I notice the Cottesloe mill turns out 42.39lbs. of flour, which means the Scheme would get a larger return?—It means that for every bushel of wheat we grind, that we get from one to two lbs. more flour than from some of the smaller mills.

7504. By Mr. HARRISON: What is the difference per ton?—Local flour is £11 per ton and the wholesale price of pollard is £5 5s.; as we grind over one million bushels of wheat, the Scheme get the difference of £11 and £5 5s. on an extra extraction say, on one million lbs. of flour.

7505. By the CHAIRMAN: I see they offer you 29s. per ton for gristing plus commission 2s. on offal?—It amounts to 30s. per ton of flour.

7506. As far as the three mills, Guildford and Northam, which are included under that rate, while their percentage of flour does not come up, you get no advantage?—No, they tell me my flour is too good, so apparently they want a longer extraction even than what I am giving them, although they admit that is higher than under the mills.

7507. In regard to the Perth mill, they offer 31s.?—Because Perth mill is so much smaller.

7508. What is it to do with the Scheme whether the mill is large or small?—That is what I want to know. I want to know whether the Scheme want to get on the best economic basis or wish to act as philanthropists by subsidising some mills against others.

7509. York, Katanning and Perth 31s. per ton?—Yes.

7510. At Kellerberrin, Narrogin, Pingelly, Wagin, Geraldton, and East Perth it is 33s. a ton?—If I am entitled to it at Kellerberrin, I am also entitled to it at Cottesloe. The milling returns indicate that the Kellerberrin mill is pretty well up to the Cottesloe mill, but the milling cost is 25 per cent. higher. During the last three or four months I have put off the Kellerberrin miller and made the Cottesloe miller the superintendent for both mills. This has meant uniformity in running and improved returns.

7511. Your returns show that your cost ran out at about 29s. 9d. That included wages?—It also includes depreciation and interest on the plant and stock, but not administrative expenses.

7512. On the 9th February, 1918, the Commonwealth Royal Commission which was over here reported that the milling expenses, including depreciation, selling and general expenses, were approximately £1 8s. 10d. on the average throughout Australia?—That is a very fair average. The larger the mill the less should be the cost of production, up to a certain point. It is only necessary to have one head miller, there are also other men in the mills beyond whom it is not necessary to go, up to a certain point. Beyond that, it means more packer men and perhaps another storeman or two. Last Easter I bought the complete outfit of a mill at Tumut, and I am now engaged in installing it. With my 340 h.p. gas producer plant I have sufficient power to run the extra machinery at a cost not exceeding 2s. 6d. per ton of flour. This power will pick up the extra milling plant without any trouble. I can reduce my milling cost as a whole when this plant is installed, as it will be in three or four months time.

7513. You are getting approximately 35s. 6d. plus 2½ per cent. on local sales?—That depends on the number of bushels we make to the ton of flour. I lose to a certain extent in comparison with the other mills. Take a 50-bushel yield to the ton. At 7d. they are making 29s. 2d. for gristing. If we take it at 48 bushels—there is no miller who should take more than 48 bushels to make a ton of flour—we find that the figures are 28s. for gristing, 7s. 6d. allowance for bags, and 2½ per cent. on sales, or 6s. commission. That would be a total of 41s. 6d. on local flour, with 6s. less on Imperial, but selling costs of local flour are heavy and sales of local only about one-fifth of our output. The Scheme gets the balance, except our private export trade. They are now offering me 30s., which is a drop of 10s. a ton.

7514. You offered to reduce the rate by ½d. per bushel?—That is because we expect to have better wheat. We will during the next 12 months be getting better wheat than we did during the preceding 12 months. There will not be so much weevily wheat.

7515. By Mr. BROWN: You are asking for the 2½ per cent. commission on sales under the new Scheme?—Yes.

7516. The only alteration then is in regard to the ½d. per bushel?—Yes. Next year I will be gristing 1½ million bushels of wheat with my two mills. One and a-half million half-pennies is a considerable amount of money, and I consider the Scheme are being offered a fair concession. The combined millers will mill about 6,000,000 bushels of wheat. We are offering to them a reduction of 3,000,000 pence. This is a very fair offer.

7517. By the CHAIRMAN: How does the Argentine wheat compare with the Australian wheat you are now gristing?—It is altogether different wheat. It is very hard and difficult to mill. It took us a considerable time to learn how to mill it, and I think the Perth mill did not learn how to do so at all. I think the Australian wheat is the best in the world. It is easier to mill and makes better flour.

7518. Is the output quicker and better with Australian wheat?—Yes. Considerably more machinery is required to mill hard wheat. With hard wheat my output would only be about 75 per cent. of what it is now.

7519. Do you think that weevily wheat is preferable to Argentine Wheat?—Yes, but, of course, the weevily wheat has to be selected. We have had some terrible wheat sent in to us.

7520. Was not an offer made to the Commission to grist Argentine wheat for 7d. a bushel plus 2 per cent. on the sale of the product?—I think that was the arrangement that we made with them. The Perth mill and our mills had the contract for most of it.

7521. There was no allowance for bags?—We got an allowance for bags. The bags that the Argentine wheat came in were very bad, but those from India were good. We had to re-bag in new bags a considerable quantity of the Argentine wheat. We said we could not do anything with the bags. The loss in weight on Argentine wheat was something terrific.

7522. The first tenders submitted included the cost of bags, but later did not two of the mills agree to do the gristing for 7d. a bushel plus 2 per cent. commission on sales?—We were paid for the bags. We had the contract.

7523. Are you sure of that?—Yes.

7524. The bags were added?—Yes. You will see from the profit and loss accounts that we did fairly well out of the contract.

7525. The wages here are similar to those in the Eastern States?—Yes, it is all under the Federal award.

7526. And yet we find the millers in Adelaide offering to grist for 6d.?—I cannot understand it. Every State seems to treat its millers on a different basis. The Sydney millers are not under a gristing agreement at all, and get up to a 4d. a bushel allowance on their wheat. The millers here have never been offered 6d. for gristing.

7527. There is a great difference in connection with the shifts worked?—So far as running full time is concerned, undoubtedly. I should like to contradict the statement made by Mr. McGibbon, who said that none of the mills had ever worked full time. Since I have been connected with milling, for 12 years, my mills have always run full time. I have often had to sell flour at below cost, but this has enabled me to keep the mill running and has reduced the general milling costs.