Smith lost her seat to the Conservatives at the 2010 general election, contesting the reformed South Basildon and East Thurrock constituency.

Amess's hold on the seat had always been tenuous even in Tory landslides, and he knew the new boundaries all but assured his small majority would be overturned by Labour.

On 28 June 2007, Smith was appointed as a Parliamentary private secretary to the new prime minister Gordon Brown, entitling her to attend Cabinet.

She gave up this role at the reshuffle of June 2009, to enter Government in the Cabinet Office as Minister of State for the Third Sector,[6] when she was sworn of the Privy Council.

A review by Sir Thomas Legg uncovered further monies over-claimed by Baroness Smith making a total of £1,429 which she later returned.

On 27 May 2015, Smith was elected unopposed as Labour's Leader in the Lords, and so joined Harriet Harman's Shadow Cabinet.

[15] In April 2020, Corbyn resigned and as the leadership election ensued which was later won by Keir Starmer, Smith remained as Shadow Leader of the House of Lords.

[16] Smith strongly advocated for reforming the House of Lords, aligning with Labour's broader constitutional review led by former prime minister Gordon Brown.

Smith emphasised that the initial years of a Labour government would likely focus on more immediate issues such as economic growth and addressing the cost of living crisis, rather than undertaking a complete overhaul of the Lords.