the benefit of the whole of the farmers. On the 31st December there is a letter from the Minister for Lands and Agriculture as follows:— I am in receipt of you letter of yesterday's date. On the 23rd inst. the Chairman of the State Wheat Marketing Committee wrote to you by my direction that as your company did not think fit to accept the conditions stated in my letter of the 15th inst., the negotiations for your proposed agency must be regarded as at an end. I must adhere to this proposal. I do not object to your offer of a rebate to the farmers on the ground that it is against the best interests of the general scheme, but what I have to require is that such undertaking should be expressed in an agreement as an obligation of your company to the intent that the rebate should be secured in the interests of the Pool. 2161. By the CHAIRMAN: There were many complaints made by the other agents at the time concerning the action taken by the Farmers' Mercantile Union in regard to this matter. These objections were made to Mr. Johnson, who was only the mouthpiece of the agents?—We do not know anything about that. 2162. I find another report which came in 10 days afterwards?—We know that the other agents endeavoured to keep us out, just as they did with some of the farmers' unions. 2163. I find that evidence was given to show that the Farmers' Mercantile Union were still promising rebates in Narrogin, and had acquired a large quantity of wheat which would have gone to another agent if it had not been for the rebate?—That wheat was purchased, I think, before the Act was finalised. 2164. The Act was not finalised for nearly 12 months afterwards?—That was where the trouble came in. They went on purchasing the wheat. Then the Minister said he would prefer the old-established firms, which had been dealing with wheat before, dealing with the wheat again. So the Mercantile Union went on and bought wheat in the full expectation that they were to be in the Scheme; but afterwards they were turned down. 2165. You must be aware that an agreement was made in Melbourne by the various wheat agents and the various Australian Governments that a certain price would be paid for handling wheat?—Yes. 2166. You aware that that was reported here by Mr. Johnson on his return?—Yes. 2167. The consequence was that an undertaking was given that as little as possible would be done to interfere with the business of the acquiring agents, which undertaking applied to your company in the same way as to others?—Certainly. 2168. But your company broke away from that agreement by trying to take advantage of the others through the offer of a penny rebate on the price which you were paid?—That was simply as a suggestion, I think, when Mr. Johnson asked what it was done for. 2169. Was it not a definite offer?—At that time it was a suggestion. 2170. I believe the other agents, or some of them, took the stand that under the conditions which had arisen they could not work with you as agents?—We, of course, had nothing to do with the other agents. It was really a matter for the Minister, was it not? I do not see what the other agents had to do with us. 2171. The agreement had been made by the general body?—The agreement to pay the one penny into the Pool was never finalised. That was Mr. Johnson's intension. Only a little while ago one of our directors, meeting Mr. Johnson in the train, went into the matter with him; and Mr. Johnson then said that we would not agree to put that penny into the Pool and that that was the reason why. 2172. Of course, I do not know Mr. Johnson's intensions beyond what I read here on the files?—Putting Mr. Johnson's objection on one side, we came to Mr. Mitchell, who will tell now that we should be in the Scheme. Again, Mr. Baxter said we should be in the Scheme; and yet he absolutely turned us down. Whether Mr. Baxter turned us down for any reason, I am not prepared to say, but I cannot find out the reason why. One day, meeting Mr. Baxter, I asked him how it was he turned us down, whilst he had asked us for a list of all our chief operating places, on receipt of which, he said, he would see that we were done justly by. The only reply I could get out of Mr. Baxter was, You sent us a list this long, and how could I allow you to operate in all those places? You would monopolise the lot. For that reason we thought we would come here and see if we could get the Commission's sympathy. 2173. You say you have 1,100 shareholders and yours is a limited company?—Yes. 2174. Is your company in exactly the same position as the Westralian Farmers, Ltd.?—Yes, practically. 2175. Is the Westralian Farmers, Ltd., still a limited company or is it a co-operative company?—A limited company. 2176. As far as the Companies Act is concerned, you are both on an equality?—That is so. 2177. And all the shareholders in your company, with the exception of one or two, are farmers?—Yes. 2178. Therefore, you have an equal claim to a share in the handling of the wheat with the Westralian Farmers, Ltd., you contend?—Yes. 2179. Which has the greater number of shareholders, the Central Australian Farmers, Ltd., or the Farmers' Mercantile Union?—I cannot say. I do not know the number of shareholders in the Westralian Farmers, Ltd., or the value of the shares. They may have more shareholders than we have, but the value of their shares may not be so great. Our shares are £25, and theirs are £1. 2180. The only matter you wish us to deal with is that of your company taking a share in the handling of the wheat under the Scheme?—Yes. 2181. By Mr. BROWN: I presume your desire is that this Commission should look into the past action of the Scheme and why you were excluded during the first two years?—Yes. 2182. You contend that you were improperly excluded, and you ask us to make a report on that matter?—Yes. 2183. By Mr. HARRISON: The Westralian Farmers, Ltd., claim that they are now truly co-operative, in this respect, that they are getting an increment of shareholders through the volume of business done for farmers outside. Any outside farmer putting business through, the profit from that business goes to make that farmer a shareholder. You have nothing of that sort in your company?—Only by way of paying dividends. 2184. But you pay dividends only to your shareholders?—That is so. 2185. The volume of business put through with a non-shareholder has nothing to do with creating him a shareholder?—Certainly not. At the end of our balances, we pay to the shareholders dividends according to profits made.

                                                        (The witness retired.)

The Commission adjourned.