705. Does the present audit take place month by month?—The men are continually on it.

706. Do you know when a report was first furnished to Parliament, since the initiation of the Scheme?—I could not say.

707. Would you be surprised to learn that it came only a week or two before Parliament closed?—Do you mean the balance sheet?

708. Yes?—Numerous reports have been given through the Press from time to time on the financial position. But it is impossible to furnish a balance sheet even now. The 1915-16 balance sheet is misleading now to the average farmer, because it is not complete.

709. Does not the Act provide that an auditor's report shall be delivered to Parliament?—Yes.

710. Is this (produced) the first report we have ever had?—I could not say.

711. It is difficult to realise that the audit has been taking place in accordance with the Act when this report came before Parliament only just before the session closed. You know there is a feeling in the country that the farmers should have a direct audit of their own?—I have observed that on the part of a few, but I do not know that that is the feeling of the average farmer. There is a small section in Perth, and particularly one man, very keen on this special auditor being appointed. But, outside of that, I have seen no evidence of the farmers themselves wanting that audit. The agitation of the few does not prove that the farmers require the thing. Personally I believe the farmers are quite satisfied with the audit of the Auditor General. I should think they would be, too. As a grower myself, I should feel quite satisfied with the Auditor General's audit, even if I had nothing to do with the Scheme.

712. That report which you have before you was laid on the Table of the Assembly on the 16th May?—Yes.

713. Do you think it possible to save cost in administration by having the whole of the acquiring done co-operatively?—Certainly not, because, if it were done co-operatively, there must be a check.

714. Could it not be done co-operatively by fewer officers than those at present employed?—There might be a saving it it was done by the Scheme; a slight saving.

715. Is not all the work really done by the acquiring agents?— Certainly not.

716. What have you to do, then, besides accept check?—That is only the commencement of it. We have to carry on the whole of the business of the Scheme.

717. The acquiring agent gets the wheat and gives you records, which are passed on to your department. It is not true, then, that you could dispense with the services of your officers if the agents were responsible only to the Minister and the Treasurer for the finance?—No. There would still have to be the additional organisation. We must have a check, and the organisation would be needed to work the other part of the Scheme.

718. You are not duplicating any of the work?—No; only the checking. The checking must be gone over.

719. There is a feeling that duplication takes place between the administration and the acquiring agent, which duplication could be dispensed with?—That is not so. The only saving which could be made in that direction—and I doubt whether it could be made—would be the Government handling the wheat. I do not think any great saving could be effected in that way. I certainly consider that for good and safe working the present method of the acquiring agents working under the check and control of the Government is the best system under which the Scheme could be carried on.

720. Was Mr. Berkeley dispensed with entirely from your work?—Yes.

721. That was not on account of any want of ability?—No.

722. Did Mr. Grogan follow Mr. Berkely?—No. Mr. Child.

723. And Mr. Child is with you?—Yes. He has control now.

724. By the CHAIRMAN: As regards gristing, I note from the files that some Geraldton wheat was gristed at Northam for 6d. per bushel, or that that was the price arranged. I believe 7d. is being paid now?—Yes.

725. I suppose that is the lowest price you could get?—It was the best I could do with the millers. Mr. Sibbald himself, before he left, pointed out that wages have increased since that gristing was done, and that the price of coal and all overhead charges are much higher.

726. But one penny per bushel is a big difference?—Yes. When arriving at the agreement Mr. Sibbald in the first place sent long a minute asking my concurrence to paying the millers 6d. a bushel. On going into the matter, however, Mr. Sibbald himself found that he had made an error. He said afterwards that 6½d. would be a fair amount. After talking the matter over with the millers, he said to me before leaving for the East, "I think we should be quite justified in making the price 7d., because whereas the large millers would do well out of 7d., the small millers would not be able to work at less than that price." Weevils were coming on fast, and there was an outbreak of Dominica pest at Fremantle—a thing to be afraid of in this State. I wanted to get those pests under control as far as possible. I could not get the millers to agree to anything lower than 7d., and I had no option but to fall in with that, because I considered that the time lost in bargaining, two or three months, would represent a tremendous loss through the weevil gaining on us.

727. You had to fix the price on the small mills' cost of output?—Yes. I did not think I could make any differentiation between the millers. Therefore I thought I had to pay the 7d. right through to the whole of the millers.

728. But you had to fix the price on the cost of output of the small mill?—That is the position.

729. Does the Pool get as much out of the wheat gristed by the mills as out of direct sales of wheat?—No. It invariably follows that the wheat sent into the mill has been affected to a certain extent by weevil. Therefore one does not get out of it the same quantity of flour per bushel.

730. Most of the wheat you are having gristed at the present time belongs to the British Government?—That is so.

731. The, how does the Pool lose by it?—Speaking in that connection, I do not know that the Pool would lose. That is something I shall have to look up.

732. The gristing price is high because the wheat is badly damaged?—Yes.

733. As to the difficulty which has arisen in the past regarding the payment of millers for supplies of wheat from the Pool to fill their own orders, could not arrangements be made whereby the millers could take the wheat out of the Pool under the same conditions as those under which they used to take it from the farmers—I do not mean as regards price—that is, paying for less the millers had some big advantage. The arrangements we could not allow the millers to take any wheat on their own account at all. The mills are being run entirely for the Scheme.

734. By Hon. J. F. ALLEN: All the mills in the State?—No. The exceptions are the Toodyay Mill and the Bunbury Mill. Three or four small mills are not under the Pool. It would be hardly worth while bringing them under it; they are so small.

735. By the CHAIRMAN: But will they be engaged on the gristing scheme immediately the British Government order is completed?—If we are still in difficulties then with the weevil, our best arrangement will be to keep them. The late manager advised that we should appoint a board of valuators to assess the damage done by weevil. There was to be a representative of the Wheat Scheme and a representative of the millers, and one of the agents; and the mills would take the wheat on that assessment. But you can readily see that the millers' representative would not agree unless the millers had some big advantage. The arrangement would not work well. It is not working well in the Eastern States. I told the general manager at the time—and finally he fell in with my view—that we should get the millers gristing on our behalf. Say the damage from weevils was assessed at 4d. per bushel; the millers' representative would want 5d. or 6d. per bushel dockage. The miller might think the wheat was very weevily indeed, too weevily to take it into his mill, and we would not care about it at all. Under those conditions he would not take in one bag of weevily wheat. Under our conditions we say to the miller, " You must take in any wheat we