Douglas and his allies brought a leadership challenge to Lange, whom they regarded as in a weak position, having alienated both the left and right wings of the Labour Party.

Caucus brought forward the vote from early 1989 to 21 December in order to avoid the issue dominating headlines over the new year holiday period when there would be little else to report on.

[5] Even though many Labour MPs supported the Rogernomics reforms, most weren't prepared to replace the charismatic and witty Lange for Douglas, who was a wooden speaker lacking the common touch.

Some, but not all, voting preferences were known:[7][8] Douglas congratulated Lange on his win and pledged loyalty to the caucus while stating he would still promote issues he believed in.

Later, in 1994, he co-founded with former National Party MP Derek Quigley the Association of Consumers and Taxpayers which would go on to become ACT New Zealand.