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Reorganisation, not abandonment, of settlement in the Lake King and Lake Carmody area is recommended in a com nrehensive report which the chairman of

the Agricultural Bank Commission made available yesterday. The report was made by the senior branch manager of the bank (Mr. C. D. Mitchell) who, until his promotion to this position recently, was manager for the institution at Nar rogin. His report followed a personal inspection of every holding in the lakes wheatbelt district, extending over three months. He has suggested the linking of holdings to provide settlers with an area to enable them eventually to carry between 800 and 1,000 sheep, deferred interest payments and a reduction of land rents, and holds the view that the country is too good to lose and will be come a valuable asset to the State in the future. Mr McCallum, when releasing the re porfsaid that Mr. Mitchell's recom mendations involved questions of Govern ment policy as well as Agricultural Bank policy, so that before they could be ac cepted a conference would most Ukely be requested by the Agricultural Bank Commission with the Minister for Lands (Mr. Troy) as representative of the Gov ernment/The settlers in the lakes coun try would have to know what basis they would be working under in the future, and this information they would require before the harvest. He expected, there fore that efforts would be made to try to arrange the conference as soon as pos sible after the return from Canberra of Mr Troy, who would leave Perth nex Saturday night to attend a meeting of the Australian Agricultural Council.

Isolation of the District. Mr. Mitchell reported that the lakes wheatbelt district was approximately 15 miles east of Hyden, extending in an easterly and southerly direction to within 25 miles of Ravensthorpe. The country contained an area of approxi mately 1,400 square miles. The land was thrown open for selection in 1928, and was far from a railway, being 55 miles from Kondinin at the western end of Lake Carmody, 50 miles from Lake Biddy as regards the central portion and 40 miles from Newdegate at the Lake King, or southern end. At the time, however, land was readily taken up and the best blocks quickly applied for. The distance from a railway was in a great measure discounted, of course, as the settlement was opened under the 3,500 farms scheme, and it was anticipated that, among other concessions, railway facul ties would soon be provided. Generally speaking, the area was settled by men of a splendid type. The lakes district settlement, with as sistance from the Agricultural Bank, made excellent progress until 1931, when Dr. Teakle's adverse report on the alkali position was announced. As a result of this report, the Agricultural Bank ceased making any advances except on safe, low alkali properties as defined by Dr. Teakle. These advances, however, were restricted to £50 for clearing, which had to be performed by the settlers themselves. This, of course, retarded progress. It was also decided to transfer settlers from condemned holdings on to abandoned properties in other districts and to link up remaining settlers, with the object of giving each one a sufficiently large area of low alkali forest country to en able wheatgrowing to be continued safely. He (Mr. Mitchell) was sent to investi gate the proposed Unking scheme, and spent a lot of time in the district, but for some reason or other the proposal was not carried into effect. A few settlers took advantage of the offer to transfer to other holdings, which were also better situated, and left the district. Quite a number of others, who had only limited resources, were forced to abandon their properties, as they were unable to carry on. The majority, however, had such faith in the future of the district that they refused to leave, and had carried on in spite of handicaps under which thpv were working. At Dresent. active

bank clients numbered 101, active iree clients 8 and abandoned properties 51. Dr. Teakle's Adverse Report. 'If Dr. Teakle's report is accepted as to the salinity of the soil being too high for wheatgrowing, the whole of the dis trict lies condemned,' Mr. Mitchell's re port proceeds. 'The area analysed by him, and the subject of this report, was 174,331 acres, classified as under:— Low or safe alkali . . 71,486 acres. Medium alkali .. .. 3,635 acres. High alkali ? 99,210 acres. 'The same area classified by myself was as under: — First class ? 114,051 acres. Second class .... 30,559 acres. Third class ? 29,271 acres. 'It must be pointed out, however, that I have included Dr. Teakle's lake country and sandplain as high alkali. The low alkali country, as defined by Dr. Teakle, is so broken and scattered that it would be impossible for settlers to crop only that country. I am not in a position to judge whether the conclusions reached from Dr. Teakle's report are right or wrong, but up to date very little salt is rising, and then only where it might be expected. The area that has been crop ped up to the present includes both high and low alkali country, and I doubt if there has been any difference in the yields. 'I venture to say that if the Newdegate area had been analysed by Dr. Teakle, he would have found that the same soil salinity existed there as in the Lakes King and Carmody country. In Newde gate salt is rising in many places, but I am of the opinion that it will not be sufficiently troublesome to ruin the dis trict. Newdegate has been successfully farmed for approximately 15 years. The Rainfall. 'The belt of first-class country in the lakes district extends as a long narrow strip hi a southerly direction, widening out a little in some places. It is bounded on the western side by a chain of lakes and on the eastern side by sandplain with patches of timber and mallee coun try. The soil on the whole is very good, mostly limestone, with brown loam, and timbered with salmon gum, morrel, gim let, mallee and boree. The rainfall throughout the whole of the country is sufficient for the growing of cereals. The records for five years show an average of 13.45 inches. 'One of the worst features of the dis trict is the absence of an adequate water supply. The rainfall is distributed well over the year, and it is on rare occasions that the falls are sufficiently heavy to fill the dams. The Government, however, has built rock catchment tanks at King Rocks (1,000.000 gallons capacity), Holt Rock (250,000 gallons). Rock on location 1673 (250,000 gallons), Lake Newton (1,000,000 gallons, and Lake Pallarup (250,000 gal lons). In addition to these, a dam with cement walls to hold approximately 250,000 gallons is being excavated at Lake King. There are also five Government wells, four of which are in the Lake Carmody area and the other at Mt. Mad den. These water supplies bring every settler to within 10 miles of permanent water. I am of the opinion that if it is decided to carry on with the district, we should insist on dams of not less than 2.000 cubic yards capacity, and they should be excavated as deep as possible and coVered. The capacity of the dams already excavated is averaged at 1,334 cubic yards, but I am sorry to say that at the date of my visit most of them were dry. Cost of Wheat-carting Subsidy. 'A glance at the map will show how isolated the district is, and it is difficult to see bow a railway can be built to serve tins area and pay even interest on principle outlay. If the district were fully settled, and Forrestania opened up, it might warrant a railway line from Hyden to Ravensthorpe, connecting with the Hopetoun line. This, however, would presuppose tho provision of harbour facili ties at Hopetoun. Since the opening of the settlement, the Government, in order to compensate settlers for the long dis tance they have to cart their wheat, has paid a carting subsidy, which is now at the rate of eightpence a ton, per mile, outside a radius of 15 miles. The cost of this scheme to date has been £3,306 in the 1930-31 season, £6,109 in 1931-32, £10,621 in 1932-33, £6.010 in 1933-34, and approximately £5,000 in 1934-35. It is my considered opinion that if this subsidy had not been given, very little interest would have been collected by the Agri cultural Bank. 'In the absence of railway facilities, the continuance of this subsidy, coupled with the building of good roads, appears

to be essential. There is one splendid road running east from Newdegate to Lake King, thence to Ravensthorpe. The road running from Hyden in a south easterly direction to Lake Carmody is really only cleared, very little forming having been done. This applies to roads leading from Lakes Fox and Varley to Lake Biddy and Newdegate. If these roads are properly formed to cany heavy traffic, and the wheat carting subsidy continued, I think present requirements in the way of transport would be met. Recommendations. 'As regards the future of the district, I have given the subject serious thought and consider that the following alterna tives suggest themselves: — (1) Repatriation of settlers to aban doned Agricultural Bank holdings In other districts and abandonment of this area. (2) Continuation under the present Act. (3) Continuation of relief from interest payments and land rents for a period of, say, five years. (4) Linking properties with the ob ject of making each property suffi ciently large to carry stock. 'If it is decided to close down this dis trict, the bank will Immediately be in volved in a loss of -£125,000. being the amount of principal and interest out standing. All existing improvements would rapidly deteriorate, and most of the clearing would, in turn, revert to nature. It must not be forgotten, too, that the settlers took up this land rely ing on certain promises made by the Government, and some of them expended quite a considerable amouut of private capital. The abandonment, too, of such an area of country must react unfavour ably against the State as a whole. As it is, the district is revenue-producing, and the railways must also derive some benefit from the activities of settlers. On the other hand, the Government would be relieved of the necessity of spending any further moneys in the district and also relieved of the fears raised by Dr. Teakle's report. Again, abandoned properties in other districts, better situated, would be taken up and made interest-earning. It must be stressed, however, that even if it were decided to carry out this idea. I firmly believe that quite a number of settlers would refuse to depart and try to carry on without any assistance what ever, such is their faith in the district Continuation Expenditure. 'If it is decided to carry on the dis trict and to improve each farm suffi ciently to make it a decent working pro position, the following expenditure will be necessary: — Active. Foreclosed. £ £ Clearing ? 25,912 23.809 Dams ? 2,600 2,350 Fencing ? 12,997 6,166 Machinery .. .. 18,335 20,400 Horses ? 10,830 12,240 Total ? 70,674 64,965 'It will be noticed in my estimated ex penditure that no provision for the supply of sheep has been made, but when the country is prepared for them by fencing, water supply, etc., I feel sure that no difficulty will arise in obtaining sheep from the stock firms, provided we agree to liens being given. I also consider that all stock provided by the depart ment should be breeding stock (ewes and mares). In working out the above I have based my calculations on providing each settler with 800 acres of clearing, eight working horses and sufficient ma chinery to enable him to work his farm in a proper manner: also, the provision of an adequate water supply and fenc ing. I have allowed for the following costs: — Clearing, at £1 an acre; dam, at 1/ a cubic yard: horses and harness, at £30 a head; and fencing, six wires, boun darly only, at 5/ a chain. I have valued machinery already in possession of set tlers at secondhand prices, but have al lowed for further requirements at cost. The values given are well on the low side, and settlers would have to do most of the work themselves and provide for buildings and for internal fences. If the settlers are allowed to carry on, transport facilities will have to be pro vided, as previously indicated. Another point that must not be lost sight of is that additional expenditure is to be faced by settlers in the near future, inasmuch as the land rents will soon be falling due. Relief From Interest and Rents. 'If the above suggestion for a con tinuation of relief from interest and

payments and land rents for a period of years is adopted, the position can be reviewed at the end of five' years, when the prices ruling for primary pro duce might be suffclently high to war rant the department expending further moneys and also claiming the interest. The period should be sufficient to estab lish the validity of the conclusions de rived from Dr. Teakle's report. Another point in its favour Is that present Im provements would be fully maintained and the department relieved from fur ther financial responsibility. The bank's jurisdiction over settlers would need to be clearly defined, and if improvements were not maintained and added to. ac tion would have to be taken immediately. Thirdly, a bad season would probably re sult in further abandonments, as set tlers would find difficulty In financing future operations. Unless buyers are found for abandoned properties in other districts, interest and land rents, which would be paid if settlers were repatriated to them from this area, would be a dead loss to the State. Unking of Holdings. 'The linking of holdings would entail the joining together of one or more pro perties with the idea of providing set tlers with an area sufficiently large to enable them to carry between 800 and 1,000 sheep. The total number of pro perties which I consider could be linked is 76. of which 28 are abandoned, three vacant, one free and 44 occupied. After linking, 38 properties would remain, six of which are abandoned. Therefore it win be seen that 12 of the present sett lers would have to be removed. Six of these could be given the abandoned linked properties, and I would suggest that six of those whom I consider weak clients should be dispossessed. Those properties which I have not linked com prise mainly those at the northern end. where the blocks are larger, others that I consider are not worth developing and some which adjoin vacant lands, from which the present holdings could be built up. 'I am in favour of this proposition, combined with deferred interest pay ments over a period and reduction of land rents, which should be sufficient to cover survey fees only. I consider the .present prices far too high, running as they do from, in some cases, up to 16/ an acre. The value of the farms today I consider only to be the value of exist ing improvements. The country is too good to lose. I am firmly of the opinion that it will make excellent stock and mixed farming country, cereals being grown and fed to stock on the holdings. The cleared land at present will carry one sheep to three acres, and when grass becomes dense It should carry one sheep to two acres. Unfortunately, until cleared and burnt, it grows no grasses at all. Owing to the limestone forma tion of the country, all classes of stock do particularly well. There are also on the eastern side of the lakes large areas of saltbush, but the stock out there are not doing any good on it. However, they may become acclimatised in time and this would serve as a useful standby at lean periods.' Mr. Mitchell concluded his report by reiterating that he considers the lakes district will be a valuable asset to the State in the future.