Editing Alfred Deakin (section)

==Prime Minister, 1909–1910==
{{Liberalism in Australia}}
Deakin was sworn in as prime minister for a third time on 2 June 1909.<ref name=adb/> The [[Third Deakin Ministry]] contained five first-time appointees, reflecting the need to balance the competing interests within the new party.{{sfn|Brett|2017|p=388}}

In a letter to his sister, Deakin described the legislative achievements of 1909 as "the finest harvest of any session". Acts were passed authorising the creation of [[Australian pound|a separate Australian coinage]], establishing [[Conscription in Australia|compulsory military training]] for young men, defining the extent of the future [[Australian Capital Territory]], and creating the office of the [[Australian High Commissioner to the United Kingdom]], Australia's first official diplomatic posting.{{efn|In order, the ''Coinage Act 1909'', the ''Defence Act 1909'', the ''[[Seat of Government Acceptance Act 1909]]'', and the ''High Commissioner Act 1909''.{{sfn|Brett|2017|p=392}}}} Bills were also introduced to create the [[Inter-State Commission]] and formalise federal control over the [[Northern Territory]], but were not progressed and were passed by the succeeding ALP government.{{sfn|Brett|2017|p=392}}

Deakin and Forrest negotiated the Financial Agreement of 1909 with the state governments, which distributed surplus federal revenues to the states as per-capita grants and became the model for intergovernmental financial relations. This replaced the interim arrangements provided by [[Section 87 of the Constitution of Australia]]. Deakin subsequently sought to enshrine the agreement in the constitution, at the urging of state premiers. This step was seen as unnecessary by many, including within his own party, but a second proposed amendment allowing the federal government to take over state debts was less controversial.{{sfn|Brett|2017|pp=391–392}} Two referendums were held simultaneously with the 1910 federal election, with the state debts amendment being [[1910 Australian referendum (State Debts)|accepted]] and the surplus revenues amendment being [[1910 Australian referendum (Surplus Revenue)|rejected]].{{sfn|Brett|2017|p=395}} The Financial Agreement nonetheless remained in place [[Loan Council#History|until 1927]],<ref name=adb/> and was seen by Deakin as one of his most important accomplishments.{{sfn|Brett|2017|p=391}}

===Final defeat===
{{Further|1910 Australian federal election}}
Deakin did not call an early election, allowing the parliament to run to its maximum permissible length.{{efn|The House of Representatives expired by "effluxion of time" on 19 February 1910. This is the only occasion on which the House has been allowed to expire rather than being dissolved by the Governor-General.<ref>{{cite news|url=https://www.aph.gov.au/About_Parliament/House_of_Representatives/Powers_practice_and_procedure/Practice7/HTML/Chapter7/A_Parliament|title=A Parliament|work=House of Representatives Practice|publisher=Parliament of Australia|edition=7th|year=2016|access-date=6 April 2020}}</ref>}} He expected a "sweeping victory", anticipating that after being confirmed in office he could complete his legislative agenda, attend the [[1911 Imperial Conference]] and then hand over to a successor.{{sfn|Brett|2017|p=393}} The [[1910 Australian federal election|April 1910 federal election]] was the first to present a straight choice between two alternative parties. To Deakin's surprise, the ALP won a clear majority, gaining 16 seats in the House and sweeping the Senate. In what he called "the [[Battle of Waterloo|Waterloo]] of the Liberal Party", many former Protectionists lost their seats, and Deakin himself won by fewer than 500 votes.{{sfn|Brett|2017|p=395}} While there were several factors in Labour's victory, Deakin's perceived hypocrisy in the creation of the Fusion was frequently brought up in the campaign and likely cost the Liberals the votes of many of his former supporters.{{sfn|Brett|2017|pp=394–396}}