The 1920's saw a new wave of settlement for much of the region with the introduction of the federal, state and British governments' Group Settlement Scheme. Sir James Mitchell the West Australian premier at the time, was the engineer of this scheme which has since been described as a 'glorious failure'.
Under the Group Settlement Scheme settlers were to work in small groups to develop a number of dairy farms within Australia's South West, to address Western Australia's reliance on imported dairy products. There was also a prevailing belief at the time that everyman should have a chance to be a farmer and that it was necessary to settle as many families as possible in the bush. This scheme became part of a significant 6,000 family British migration program.
The Groups were numbered in order of establishment and groups 1 and 2 were placed in Manjimup with groups 3 and 4 in Kudardup and Karridale. The Groups were made up of 20 families who were then placed on 160 acre blocks and granted 10 shillings a day whilst clearing and a ten-pound loan for the purchase of household necessities. Families were housed in temporary dwellings constructed of iron, which were 24 by 12 feet.
Following the preliminary clearing of 25 acres on each selection, the blocks were balloted between the 20 families with priority given to married men. Each farm was allocated only six to eight cows which meant that they could not earn enough money for basic family needs and there was little opportunity to diversify due to a lack of local markets and the distance from Perth.
Following the disappointing results with the dairy cows, the government decided that farmers should diversify into pigs. However consideration was not given to the fact that farms that could not grow enough fodder for their cows would not be able to support further livestock. The price of pork was also quite low which meant that the price received for the pig was less than the cost of transporting it to market in Perth.
The group settlement scheme encountered many problems and its participants endured hardship and isolation. The lack of reliable transport was one impediment to the success of the scheme as the railway was not extended into the region until 1924 and farmers were forced to cart produce and supplies along hand cut tracks. The distance from the main market of Perth also hampered the distribution and sale of the milk.
By July 1927, 72 blocks had been abandoned and 124 amalgamated from the 923 blocks in the Busselton area alone. The rate of abandonment increased significantly after the onset of the depression in the 1930's as the number of livestock carried on each farm proved to be too small for economic survival.
The scheme was abolished in 1930 and despite the hardship it placed upon many people it did manage to establish a dairy industry which still flourishes in many parts of the South West. It also saw the expansion and establishment of a number of townships and significant improvements in transport and communication including a rail link with Perth.