On the outbreak of the First World War Bates joined the Transport Department of the Admiralty, and later became Director of Commercial Services of the new Ministry of Shipping, responsible for the shipment of civilian supplies.

For these services he was appointed Knight Grand Cross of the Order of the British Empire (GBE) in the 1920 Birthday Honours.

Bates was an occasional guest at meetings of the Inklings, an informal literary discussion group associated with the University of Oxford attended by C. S. Lewis and J. R. R. Tolkien, which met for nearly two decades between the early 1930s and late 1949.

[3] Bates suffered a heart attack in his office on 14 October 1946 and died at his home, Hinderton Hall, Neston, Cheshire, two days later.

Bates's only child, Edward Percy, was killed over Germany in 1945 while serving as a Pilot Officer with the Royal Air Force.