While he won his seat in the 1930 federal election the Liberal Party was defeated across the country.

With the outbreak of World War II in 1939, however, Mackenzie was moved to the position of Minister of Pensions and National Health, in part because of his role in a scandal involving the awarding of a contract to manufacture the Bren light machine gun.

Mackenzie was an able parliamentarian, and when the increasing pressures of war led Prime Minister King to decide to delegate some of his responsibilities in the House of Commons to the new position of Government House Leader, he chose Mackenzie as the first MP to hold that responsibility.

As British Columbia's senior cabinet minister Mackenzie had a key role in the government's decision to intern Japanese-Canadians for the duration of the war.

In 1947, Mackenzie was named to the Imperial Privy Council along with several other senior Canadian cabinet ministers, allowing him to use the honorific of "Right Honourable".