The short-lived first Deakin government failed to pass any legislation in the fledgling Australian Federal Parliament, and its shaky coalition with the Labour Party did not long survive the December 1903 Election.

By the resumption of Parliament in March 1904, the Deakin government had fallen, amid a dispute over a Labour Party amendment to the Conciliation and Arbitration Bill.

However, the response of the conservative Victorian government to a railway strike led Federal Labour to stridently pursue inclusion of state public servants within the ambit of the Conciliation and Arbitration Bill, which Deakin was reluctant to accept.

[4] John Christian (Chris) Watson (1867–1941) was a trade unionist, company director, and politician who led Australia's—and the world's—first Labor national government.

[1] He was active in arguing the Labour case for Federation, and joined Labor's opposition to the Australian Constitution put to referendum in the 1890s, though accepted the majority vote once obtained.

Deakin promised "the utmost fair play" to allow the new government to operate, but his Protectionist Party was too divided to agree to serve in a Labour led alliance.

[2] George Reid of the Free Trade Party was sworn in as prime minister on 18 August, and Watson returned to negotiations with the liberal wing of the Protectionists.

Watson encouraged Deakin to abandon the Free Traders, saying: "We, and especially me, don't want office, but I have the utmost anxiety to stop the retrogressive movement which Reid is heading."