and that it has been carried out since February, 1917?— I have something here bearing on that question. I would refer you to Mr Hall's evidence given before a select committee of the Legislative Council on the 21st November, 1916:—

The accounts in Western Australia are audited by the Auditor General?—Not at present. They have been audited by own auditor. We have an inspector who audits the different agents' books. Our system is more or less a recording one here. It is just as well to have a power for the Auditor General, and that is why we put it in. the real audit is in the agents' books.

Who does the auditing?— A special officer of our department. We audit the agents accounts.

Turning to the general manager's report dated the 28th September, 1917, you find this:—

Mill audit, gristing book. Ockerby & Morrison have agreed to allow the general manager to examine their gristing book if necessary, but no other officer of the Scheme. The matter is on the agenda.

You can read between the two statements. One is that the real audit is in the agents' books, and Ockerby & Morrison will only allow the general manager to examine their gristing books—no other officer. That shows me, at any rate, and I know the game pretty well, that the millers here are hanging up the Scheme and will not allow anyone to go in and get information at all. The millers are practically defying the Scheme.

2356a. We have been told that the reason why the millers would not allow their books to be examined was that the manager of the Scheme for the time being might probably go back again to his mill, and might get some information which he could use in competition with the other mills. Was that incorrect?—Incorrect. it makes me laugh, because these millers are not in competition.

2356b. The manager at that time was Mr Sibbald?—That kind of statement cuts no ice with me, because I know it is wrong. In the same report of the manager, dated the 28th September,1917, it is stated:—

Perth mill bond. The Western Australian Bank advises us that this has been signed and is being submitted for the seal of his Board this morning. These people were going on and the Scheme never had the bond.

2357. By Hon. J F. ALLLEN: Does not that apply to the present agreement with the Western farmers, Ltd.?— I am not here to defend the Westralian Farmers, Ltd.

2358. I am merely asking as to the matter of fact?—As a business man I cannot understand how the Scheme can allow either the Westralian Farmers, Ltd., or anybody else to start on the work without having the agreement.

2359. By the CHAIRMAN: That might have applied to the millers as regards the gristing; but would it not have been almost impossible to apply that as regards accepting the wheat, seeing that work was taken in hand so late?—I do not think so. I think the cause was the changes in the management of the Pool— Change of Minister and change of general manager. In consequence there was no continuity of thought.

2360. By Mr HARRISON: Would not the fact of an agreement being duly signed have meant, in practice, that both parties, the Government and the acquiring agent equally, would have been more up to date as regards complying with conditions as those referring to dunnage and iron, for example?—Certainly, absolutely.

2361. By the CHAIRMAN: You referred to the agreement entered into with the agent as providing for a certain responsibility which it was impossible to carry out. Are you aware that the information then at the disposal of the Board conveyed to them the impression that the wheat would be lifted much earlier than it was, and lifted before the date on which, under the agreement, the agents' responsibility expired?—Even supposing it was so, a practical man would have known that if it was not, there would be no chance of fixing the responsibility for any loss, because, although the agreement says that all increases shall belong to the Scheme, yet as a matter of fact those increases were as a sort of buffer to the agent before any loss could be placed on him. I refer, of course, to the natural increase by moisture. The agents must have added something to their price of 3 ½d. per bushel to cover their financial responsibility up to certain date. This, having been added, should have been deducted.

2362. According to the information available to the board at the time, they were under the impression that the wheat would be lifted earlier, and that they had left a sufficient margin?—I would be very much surprised to hear it, because the agreement was not signed until January. So far as I can remember—of course it is a long time to go back—the shipping position at that time was not so obscure. I believe somebody worked it out that if Fremantle harbour had been full of boats loading wheat, still the wheat could not have been got away in that time.

2363. Then you think that at the time the agreement expired, there was not sufficient care taken as to demanding from the agents the quantity of wheat they then held?—That could not have been done. Nobody could have demanded that from the agents. Suppose one went to Kellerberrin and said to the agent, " You have only delivered 5,000 bags out of 10,000; where is the balance"? He would say, "There it is." How is one to tell whether there are 3,000 bags in the stack or 5,000 bags? And if one could tell the number of bags, how could one tell the number of bushels?

2364. And then it would be impossible to say what is the quality of the wheat inside the bags?—Absolutely.

2364a. Is not the case rather this: that at the present time, from the previous working of the Scheme, we can see what errors were made as a result of the Scheme having been suddenly created under abnormal conditions?—Do you mean that they have rectified the errors?

2365. Some of them?—They rectify some errors, and fall into others. That is all I have to say. The millers' agreement was entered into only in November of last year. Do you want anything more than that agreement?

2366. You pointed out that this year certain amounts have been set down for certain work, which you say should have been done in the first place. Do you not think it might have been overlooked in the first instance?—Yes. But I do submit that in dealing with the expiry date, and also with the millers' 150,000 bags, not very much of the ordinary commercial man's mind was shown. If I had been in Mr Johnson's shoes when Mr. Sibbald made that statement of 150,000 bags, I would have said, " You are satisfied, gentleman, that that is all"? and I would have fixed it at that.

2367. As a matter of fact, there was too much done by interview, without reporters present to note down what was said?—Even had what was said been put down, the millers would have gone back on it. It may be supposed that after the meeting of the 29th November, 1916, the telegraph wires were pretty busy.

2368. The Act of Parliament provided for that, and there would have been no doubt if shorthand writers had been present to take down what was said?—Those are things which would have occurred to any business man.

2369. By Mr HARRISON: Do you think the Scheme has been adversely affected and involved in loss through non-finality in arrangements at fixed dates?—Undoubtedly. If you make inquiries with regard to the 30th September, 1916, when the agreement ran out, and ascertain what steps were taken to try and place responsibility, at that date on the agents' shoulders, you will find that there was none. If anyone with business knowledge, knowing that that agreement was running out on the 30th September and make arrangement accordingly. He would have the stacks inspected, interview the agents, point out where the stacks were wrong or where allowances should be made, and the agents would have to answer everything on that date. But if all this were done a month