Treasurer Robert Menzies became prime minister in April 1939 and appointed himself as
Treasurer, as was common at the time. Spender was promoted to
cabinet as a
minister without portfolio, but effectively ran the
Department of the Treasury in Menzies' stead. He was initially given the title "Minister without portfolio assisting the Treasurer", and then in November 1939 was named Acting Treasurer. He was a member of two subcommittees within cabinet – the Economic Cabinet and
War Cabinet – and in January 1940 was additionally made
Vice-President of the Executive Council. According to political historian John Hawkins, Spender was "the most academically qualified economist among pre-WWII treasurers". He promoted interventionist
Keynesian policies, such as borrowing money and raising taxes to spend on defence-related projects and thereby reduce unemployment.
Later activities After the
1940 federal election,
Arthur Fadden was elected leader of the
Country Party, the UAP's coalition partner, and demanded the position of Treasurer. Spender was instead made
Minister for the Army, which he would hold until the government's defeat on a
confidence motion in October 1941. Billy Hughes was expelled in similar circumstances two months later. Spender sat as an independent after being expelled from the UAP. He was approached to join the
Liberal Democratic Party, a small UAP breakaway, but declined. In May 1945, Spender became a financial member of the
Mosman branch of the
Liberal Party of Australia. However, he was not admitted to the parliamentary Liberal Party until 13 September 1945, when the Advisory War Council was abolished. Hughes was also re-admitted at that point. ==Post-war politics==