Lyons Government
Encyclopedia
The Lyons Government was the federal Executive Government of Australia led by Prime Minister
Prime Minister of Australia
The Prime Minister of the Commonwealth of Australia is the highest minister of the Crown, leader of the Cabinet and Head of Her Majesty's Australian Government, holding office on commission from the Governor-General of Australia. The office of Prime Minister is, in practice, the most powerful...

 Joseph Lyons
Joseph Lyons
Joseph Aloysius Lyons, CH was an Australian politician. He was Labor Premier of Tasmania from 1923 to 1928 and a Minister in the James Scullin government from 1929 until his resignation from the Labor Party in March 1931...

. It was made up of members of a United Australia Party
United Australia Party
The United Australia Party was an Australian political party that was founded in 1931 and dissolved in 1945. It was the political successor to the Nationalist Party of Australia and predecessor to the Liberal Party of Australia...

 in the Australian Parliament from January 1932 until the death of Joseph Lyons in 1939. Lyons negotiated a coalition with the Country Party
National Party of Australia
The National Party of Australia is an Australian political party.Traditionally representing graziers, farmers and rural voters generally, it began as the The Country Party, but adopted the name The National Country Party in 1975, changed to The National Party of Australia in 1982. The party is...

 after the 1934 Australian Federal election. The Lyons government stewarded Australia's recovery from the Great Depression
Great Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...


Great Depression

The background to the Lyons Government saw Australia grappling with the immense challenges of the Great Depression.

Joseph Lyons began his political career as an Australian Labor Party
Australian Labor Party
The Australian Labor Party is an Australian political party. It has been the governing party of the Commonwealth of Australia since the 2007 federal election. Julia Gillard is the party's federal parliamentary leader and Prime Minister of Australia...

 politician and served as Premier of Tasmania. Lyons was elected to the Australian Federal Parliament in 1929 and served in Prime Minister James Scullin
James Scullin
James Henry Scullin , Australian Labor politician and the ninth Prime Minister of Australia. Two days after he was sworn in as Prime Minister, the Wall Street Crash of 1929 occurred, marking the beginning of the Great Depression and subsequent Great Depression in Australia.-Early life:Scullin was...

's Labor Cabinet. Lyons became acting Treasurer in 1930 and helped negotiate the government's strategies for dealing with the Great Depression
Great Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...

. With Scullin temporarily absent in London, Lyons and acting Prime Minister James Fenton clashed with the Labor Cabinet and Caucus over economic policy, and grappled with the differing proposals of the Premier's Plan, Lang Labor
Jack Lang
Jack Lang may refer to:*Jack Lang *Jack Lang *Jack Lang , former American football player*Jack Lang , American sportswriter...

, the Commonwealth Bank and British adviser Otto Niemeyer
Otto Niemeyer
Sir Otto Ernst Niemeyer, GBE, KCB was financial controller at the Treasury and a director at the Bank of England. He was also treasurer of the National Association of Mental Health post World War II...

. While Health Minister Frank Anstey supported NSW Premier Jack Lang's bid to default on debt repayments, Lyons advocated orthodox fiscal management. When Labor reinstated the more radical Ted Theodore as Treasurer in 1931, Lyons and Fenton resigned from Cabinet.

Foundation of United Australia Party

The stance of Joseph Lyons and James Fenton against the more radical proposals of the Labor movement to deal the Depression had attracted the support of prominent Australian conservatives, known as "the Group", whose number included future prime minister Robert Menzies
Robert Menzies
Sir Robert Gordon Menzies, , Australian politician, was the 12th and longest-serving Prime Minister of Australia....

. In parliament on 13 March 1931, though still a member of the ALP, Lyons supported a no confidence motion against the Scullin Labor government. The United Australia Party
United Australia Party
The United Australia Party was an Australian political party that was founded in 1931 and dissolved in 1945. It was the political successor to the Nationalist Party of Australia and predecessor to the Liberal Party of Australia...

 was then formed from a coalition of citizens’ groups and with the support of the Nationalist Party of Australia
Nationalist Party of Australia
The Nationalist Party of Australia was an Australian political party. It was formed on 17 February 1917 from a merger between the conservative Commonwealth Liberal Party and the National Labor Party, the name given to the pro-conscription defectors from the Australian Labor Party led by Prime...

. Lyons quit the ALP to become parliamentary leader of the newly established United Australia Party, with John Latham, Nationalist Leader of the Opposition, becoming the new party's deputy leader.

In November 1931, Lang Labor dissidents chose to challenge the Scullin Labor government and align with the United Australia Party Opposition to pass a ‘no confidence’ and the government fell. At the consequent election on 19 December, Labor lost all but 14 of its seats, and the United Australia Party commenced its first term in government in January 1932.

Terms in office

With Australia still suffering the effects of the Great Depression, Joseph Lyons’ newly formed United Australia Party
United Australia Party
The United Australia Party was an Australian political party that was founded in 1931 and dissolved in 1945. It was the political successor to the Nationalist Party of Australia and predecessor to the Liberal Party of Australia...

 won a landslide victory at the 19 December 1931 Australian Federal Election, winning 34 seats in the Australian House of Representatives
Australian House of Representatives
The House of Representatives is one of the two houses of the Parliament of Australia; it is the lower house; the upper house is the Senate. Members of Parliament serve for terms of approximately three years....

 against 16 Country Party, 14 Australian Labor Party
Australian Labor Party
The Australian Labor Party is an Australian political party. It has been the governing party of the Commonwealth of Australia since the 2007 federal election. Julia Gillard is the party's federal parliamentary leader and Prime Minister of Australia...

 and 4 for Lang Labor, with a further 6 won by the South Australia ‘Emergency Committee’ and with 1 Independent. The United Australia Party won 15 seats in the Senate and Labor just 3. The new medium of radio was employed by the candidates, leading to the election being dubbed the ‘radio election’.

The United Australia Party went on to win 28 seats to Labor’s 18, Lang Labor’s 9, and the Country Party’s 14, with 5 seats won by South Australia’s Liberal and Country League at the 15 September 1934 Australian Federal Election. The United Australia Party won 16 seats in the Senate, and the Country Party 2. Lyons took to the air at the 1934 election campaign - becoming the first Prime Minister to fly - piloted around Australia in the "Faith of Australia" by Charles Ulm
Charles Ulm
Charles Thomas Philippe Ulm AFC was a pioneer Australian aviator.-World War I:Ulm joined the AIF in September 1914, lying about his name and age to get in. He fought and was wounded at Gallipoli in 1915, and on the Western Front in 1918.Charles Ulm was married twice. In 1919 he married Isabel...

. Following this election, Lyons negotiated a Coalition arrangement with the Country Party led by Earle Page
Earle Page
Sir Earle Christmas Grafton Page, GCMG, CH was the 11th Prime Minister of Australia, and is to date the second-longest serving federal parliamentarian in Australian history, with 41 years, 361 days in Parliament.-Early life:...

. Page became Minister for Commerce.

At the 23 October 1937 Election, the United Australia Party was returned with 28 Seats plus a further 1 ‘Independent UAP’ seat. The Country Party meanwhile won 16 seats and the Labor Party under John Curtin
John Curtin
John Joseph Curtin , Australian politician, served as the 14th Prime Minister of Australia. Labor under Curtin formed a minority government in 1941 after the crossbench consisting of two independent MPs crossed the floor in the House of Representatives, bringing down the Coalition minority...

 made gains, winning 29 seats in the House of Representatives. Labor also won 16 seats in the Senate, against just 3 for the United Australia Party.

According to author Brian Carroll, Lyons had been underestimated when he assumed office in 1932 and as leader he demonstrated: "a combination of honesty, native shrewdness, tact, administrative ability, common sense, good luck and good humour that kept him in the job longer than any previous Prime Minister except Hughes
Billy Hughes
William Morris "Billy" Hughes, CH, KC, MHR , Australian politician, was the seventh Prime Minister of Australia from 1915 to 1923....

". Lyons was assisted in his campaigning by his politically active wife, Enid Lyons
Enid Lyons
Dame Enid Muriel Lyons, AD, GBE was an Australian politician and the first woman to be elected to the Australian House of Representatives as well as the first woman appointed to the federal Cabinet...

. She had a busy official role from 1932 to 1939 and, following her husband's death, stood for Parliament herself, becoming Australia's first female Member of the House of Representatives, and later first woman in Cabinet, joining the Menzies Cabinet in 1951.

Response to the Great Depression

Australia recovered relatively quickly from the financial downturn of 1929-1930, with recovery beginning around 1932. Prime Minister Joseph Lyons was the leader responsible for stewarding Australia out of this difficult period. Lyons favoured the tough economic measures of the Premiers' Plan
Premiers' Plan
The Premiers' Plan was a deflationary economic policy agreed by a meeting of the State Premiers of Australia in June 1931 to combat the Great Depression.-Background:...

, pursued an orthodox fiscal policy and refused to accept NSW Premier Jack Lang's proposals to default on overseas debt repayments. Australia entered the Depression with a debt crisis and a credit crisis. According to author Anne Henderson
Anne Henderson
Anne Henderson is an Australian writer, best known as the Deputy Director of The Sydney Institute and editor of The Sydney Papers....

 of the Sydney Institute
Sydney Institute
The Sydney Institute, founded in 1989, is a privately funded, conservative, Australian current affairs forum. The Sydney Institute took over the resources of the Sydney Institute of Public Affairs which ceased activity in the late 1980s...

, Lyons held a steadfast belief in "the need to balance budgets, lower costs to business and restore confidence" and the Lyons period gave Australia "stability and eventual growth" between the drama of the Depression and the outbreak of the Second World War. A lowering of wages was enforced and industry tariff protections maintained, which together with cheaper raw materials during the 1930s saw a shift from agriculture to manufacturing as the chief employer of the Australian economy - a shift which was consolidated by increased investment by the commonwealth government into defence and armaments manufacture. Lyons saw restoration of Australia's exports as the key to economic recovery. A devalued Australian currency assisted in restoring a favourable balance of trade.

A dramatic episode in Australian history followed Lyons first electoral victory. NSW Premier Jack Lang refused to pay interest on overseas State debts, the Lyons government stepped in and paid the debts. The national Parliament then passed the Financial Agreement Enforcement Act to recover the money it had paid. In an effort to frustrate this move, Lang ordered State departments to pay all receipts directly to the Treasury instead of into Government bank accounts. The New South Wales Governor, Sir Philip Game
Philip Game
Air Vice-Marshal Sir Philip Woolcott Game GCB, GCVO, GBE, KCMG, DSO was a British Royal Air Force commander, who later served as Governor of New South Wales and Commissioner of Police of the Metropolis...

, intervened on the basis that Lang had acted illegally in breach of the state Audit Act and sacked the Lang Government
Lang Dismissal Crisis
The 1932 dismissal of Premier Jack Lang by New South Wales Governor Philip Game was the first real constitutional crisis in Australia. Lang remains the only Australian Premier to be removed from office by his Governor, using the Reserve Powers of the Crown....

, who then suffered a landslide loss at the consequent 1932 state election.

Tarriffs had been a point of difference between the Country Party and United Australia Party. The CP opposed high tariffs because they increased costs for farmers, while the UAP had support among manufacturers who supported tariffs. Lyons was therefore happy to be perceived as "protectionist". Australia agreed to the give tariff preference to British Empire goods, following the 1932 Imperial economic conference. The Lyons Government lowered interest rates to stimulate expenditure. In October 1933, James Fenton, co-founder of the United Australia Party, resigned from Cabinet over the lack of industry protection in the government’s tariff schedules.

Foreign policy and preparation for war

The Statute of Westminster 1931
Statute of Westminster 1931
The Statute of Westminster 1931 is an Act of the Parliament of the United Kingdom. Passed on 11 December 1931, the Act established legislative equality for the self-governing dominions of the British Empire with the United Kingdom...

, passed by the British Parliament on 11 December 1931, formalised legislative equality for the parliaments of the self-governing dominions of the British Empire with that of the United Kingdom and during the Lyons period, Australia remained a loyal autonomous member of the British Empire (not even seeing a need to ratify the Statute). The position of "minister without portfolio in London" was created for former prime minister Stanley Bruce
Stanley Bruce
Stanley Melbourne Bruce, 1st Viscount Bruce of Melbourne, CH, MC, FRS, PC , was an Australian politician and diplomat, and the eighth Prime Minister of Australia. He was the second Australian granted an hereditary peerage of the United Kingdom, but the first whose peerage was formally created...

 in September 1932.

Like around one fifth of his Australian countrymen, Joseph Lyons himself was devoutly Catholic and proudly of Irish heritage. He had led Labor's anti-conscription campaign in Tasmania during World War I. As prime minister, he travelled to London with wife Enid Lyons
Enid Lyons
Dame Enid Muriel Lyons, AD, GBE was an Australian politician and the first woman to be elected to the Australian House of Representatives as well as the first woman appointed to the federal Cabinet...

 in 1935 for the Silver Jubilee celebrations of King George V and Queen Mary - a journey necessitating six months absence from Australia. Lyons faced anti-Catholic demonstrations in Edinburgh, visited his ancestral homeland of Ireland and had an audience with the Pope in Rome. Lyons returned to Britain in 1937 for the coronation of George VI of the United Kingdom, conducting a diplomatic mission to Italy en route on behalf of the British Government, visiting Benito Mussolini
Benito Mussolini
Benito Amilcare Andrea Mussolini was an Italian politician who led the National Fascist Party and is credited with being one of the key figures in the creation of Fascism....

 during the period of appeasement
Appeasement
The term appeasement is commonly understood to refer to a diplomatic policy aimed at avoiding war by making concessions to another power. Historian Paul Kennedy defines it as "the policy of settling international quarrels by admitting and satisfying grievances through rational negotiation and...

 of Europe's Fascists in the lead up to World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...

.

Lyons sent veteran World War I Prime Minister Billy Hughes
Billy Hughes
William Morris "Billy" Hughes, CH, KC, MHR , Australian politician, was the seventh Prime Minister of Australia from 1915 to 1923....

 to represent Australia at the 1932 League of Nations Assembly in Geneva and in 1934 Hughes became Minister for Health and Repatriation. Hughes made a memorable speech in the portfolio in 1935 in which he argued that "Australia must... populate or perish". However Hughes was forced to resign in 1935 after his book Australia and the War Today exposed a lack of preparation in Australia for what Hughes correctly supposed to be a coming war. Soon after, the Lyons government tripled the defence budget. In the book, Hughes described sanctions as "either an empty gesture, or war", contradicting Cabinet's decision to support the League of Nations
League of Nations
The League of Nations was an intergovernmental organization founded as a result of the Paris Peace Conference that ended the First World War. It was the first permanent international organization whose principal mission was to maintain world peace...

  policy of sanctions after Italy had invaded Abyssinia
Abyssinia
Abyssinia may refer to:* Ethiopia, the modern nation* Ethiopian Empire, a historical nation* SS Abyssinia, 1870 Canadian Pacific steamship* HMS Abyssinia , British armoured ship* Abyssinia * Abyssinia...

.

Defence issues became increasingly dominant in public affairs with the rise of fascism
Fascism
Fascism is a radical authoritarian nationalist political ideology. Fascists seek to rejuvenate their nation based on commitment to the national community as an organic entity, in which individuals are bound together in national identity by suprapersonal connections of ancestry, culture, and blood...

 in Europe and militant Japan
Empire of Japan
The Empire of Japan is the name of the state of Japan that existed from the Meiji Restoration on 3 January 1868 to the enactment of the post-World War II Constitution of...

 in Asia. Scarred by the experiences of World War I, Australia reluctantly prepared for a new war, in which the primacy of the British Royal Navy
Royal Navy
The Royal Navy is the naval warfare service branch of the British Armed Forces. Founded in the 16th century, it is the oldest service branch and is known as the Senior Service...

 would prove insufficient to defend Australia from attack from the north. Billy Hughes was brought back into cabinet by Lyons in 1936 and appointed Minister for External Affairs in 1937. From 1938, Lyons used Hughes to head a recruitment drive for the Australian Defence Force.

National unemployment insurance

A further point of difference between the Country Party and UAP had been the issue of establishing a national system of unemployment insurance, which the CP saw as aiding urban dwellers over country people and a stretch on the national finances during a time of increased defence spending. Treasurer Richard Casey
Richard Casey
Richard Casey may refer to:*Richard Casey, Baron Casey , Australian politician and diplomat*Richard C. Casey , U.S. District Judge for the Southern District of New York...

 introduced the National Insurance Bill in 1938 and it passed through the Parliament despite some opposition from Country Party members, however in the face of further criticisms over costs, the government repealed sections of the Act. This back-down led to the resignation of UAP Deputy leader Robert Menzies
Robert Menzies
Sir Robert Gordon Menzies, , Australian politician, was the 12th and longest-serving Prime Minister of Australia....

 in March 1939, who supported the plan and was by now openly antipathetic to Country Party members - notably Earle Page.

Death of Joseph Lyons

On 7 April 1939, with the storm clouds of the Second World War
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...

 gathering in Europe and the Pacific, Joseph Lyons became the first Prime Minister of Australia to die in office. Driving from Canberra to Sydney, en route to his home in Tasmania for Easter, he suffered a heart attack, dying soon after in hospital in Sydney, on Good Friday.

The UAP's Deputy leader, Robert Menzies, had resigned in March, citing the coalition's failure to implement a plan for national insurance as the cause for his resignation. In the absence of a UAP deputy, the Governor-General, Lord Gowrie
Lord Gowrie
Lord Gowrie may refer* Alexander Hore-Ruthven, 1st Earl of Gowrie* William Ruthven, 1st Earl of Gowrie...

, appointed Country Party leader Earl Page as his temporary replacement, pending the selection of Lyons' successor by the UAP.

The UAP selected Robert Menzies
Robert Menzies
Sir Robert Gordon Menzies, , Australian politician, was the 12th and longest-serving Prime Minister of Australia....

 to succeed Lyons and Menzies was sworn in as Prime Minister for the first time on 26 April 1939. Page refused to serve under Menzies and the UAP entered a period of minority government. On 3 September, 1939, Australia entered World War II.

See also

  • First Lyons Ministry
    First Lyons Ministry
    The First Lyons Ministry was the twenty-first Australian Commonwealth ministry, and ran from 6 January 1932 to 12 October 1934.United Australia Party*Rt Hon Joseph Lyons, MP: Prime Minister, Treasurer...

  • Second Lyons Ministry
    Second Lyons Ministry
    The Second Lyons Ministry was the twenty-second Australian Commonwealth ministry, and ran from 12 October 1934 to 9 November 1934.United Australia Party*Rt Hon Joseph Lyons, MP: Prime Minister, Treasurer...

  • Third Lyons Ministry
    Third Lyons Ministry
    The Third Lyons Ministry was the twenty-third Australian Commonwealth ministry, and ran from 9 November 1934 to 29 November 1937.United Australia Party–Australian Country Party Coalition...

  • Fourth Lyons Ministry
    Fourth Lyons Ministry
    The Fourth Lyons Ministry was the twenty-fourth Australian Commonwealth ministry, and ran from 29 November 1937 to 7 April 1939.United Australia Party–Australian Country Party Coalition*Rt Hon Joseph Lyons, MP: Prime Minister...

  • History of Australia
    History of Australia
    The History of Australia refers to the history of the area and people of Commonwealth of Australia and its preceding Indigenous and colonial societies. Aboriginal Australians are believed to have first arrived on the Australian mainland by boat from the Indonesian archipelago between 40,000 to...

  • Menzies Government (1939-1941)

Further reading

  • Anne Henderson
    Anne Henderson
    Anne Henderson is an Australian writer, best known as the Deputy Director of The Sydney Institute and editor of The Sydney Papers....

    ; Joseph Lyons: The People's Prime Minister; NewSouth; 2011.
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