In 1935 the Labour Party, like its Liberal predecessor, secured office with the combined support of small farmers and workers. As in 1891 these groups desired steady employment, security, and a higher standard of living. The Government attempted to satisfy these hopes by providing jobs on public works at full pay and stimulating employment in secondary industries; by granting increased pensions to the aged, the sick, and those unable to work; and by endeavouring to secure farmers' standard of living through guaranteeing or “supporting” the price that they obtained for their produce. Between 1935 and the outbreak of war in 1939, seven additional Departments were created, and others grew in size to cope with the expanding volume of administration. In addition, the Labour Government reversed the tendency for public corporations to grow in numbers, and reconverted the Mortgage Corporation, and the Railways, and the Broadcasting Boards into Departments of State. The Primary-products Marketing Department assumed some of the functions of the Dairy Produce Export Control Board, and, largely as a result of the war, the Marketing Department became responsible for marketing, or servicing and advising on the disposal of most primary produce.

Between 1940 and 1948 the problems of war and post-war readjustment added to the work already resulting from new social policies, and six more Departments were established. This increase was offset by a reduction of six Departments secured through administrative reorganisation.