After the 1940 election Menzies, seeking a way out of the political difficulties created by the Independents holding the balance of power, approached Curtin to form a National Government. Curtin responded by suggesting the Labor proposal of an Advisory War Council. After some negotiation the parties arrived at an agreement. The Labor Party promised to co-operate with the Government in its attempts to strengthen the war effort, to deal with internal security matters and in preparations for the immediate postwar period. It would not use its numbers in the Parliament to embarrass the Government in its war effort. (This last condition is worth noting. It puts the lie to Joe Hockey's claim that Curtin did not pair Menzies when Menzies went to London and Washington in January 1941.) All members of the Council, Menzies, Fadden, Spender and Hughes for the Government, Curtin, Forde, along with Makin for Labor and Beasley for Lang Labor were sworn in 'to respect all confidences.'
On 13 February, 1941, after an Advisory War Council meeting held about two and a half weeks after Menzies had departed for London to impress on Churchill the potential danger Australia faced from Japan, Curtin issued a joint statement with the acting Prime Minister, Artie Fadden that 'effective preparatory measures' were being taken to put Australia on a war footing. Curtin faced severe criticism within the Parliamentary Labor Party for his association with the joint warnings when Fadden was forced to justify his statements against the charge that he was a panic merchant. Eddie Ward, the Labor member for East Sydney, labelled the warnings a hoax. To counter this, Fadden called a secret session of Parliament to discuss the impending Japanese threat, and the measures taken to counter that threat. This was not achieved without drama. Eddie Ward refused to give an undertaking to keep secret matters disclosed at the closed session and was ejected from the House. His behaviour resulted from his conviction that the Menzies led .coalition was not fit to govern and should be attacked on any grounds regardless of the danger to national security.
Menzies returned to Australia at the end of April, 1941 On 27 June Eddie Ward seconded a Caucus motion 'that in the interests of the people and for the safety of the nation' the Labor Party pledge itself to defeat Menzies in the House 'not later than the next Budget.' This gave the Party just over a two month deadline. The motion was nullified by a Curtin supported amendment.
Menzies was having serious problems within his United Australia Party. At the end of July he had fended off a challenge to his leadership exacerbated by calls from within the Labor Party for him to be deposed. Despite pressure from Dr. H. V. Evatt, who had pronounced himself Curtin's natural successor when it appeared the Labor leader might lose his seat in the 1940 election, and from Beasley, Curtin refused to commit himself publicly to Menzies' overthrow.
At the suggestion of some of his Cabinet colleagues Menzies put forward the idea that he might go again to London, so the Australian voice could be 'directly heard in the place in which the major decisions are inevitably made' - the British War Cabinet. Hughes, his eyes on the Prime Ministership yet again, was one of the most forceful advocates of this plan. But Labor, with the balance of power in the House of Representatives, would not give their assent to the visit. They believed the Prime Minister should be in Australia to direct the administration of the war effort and knew Menzies would fail if forced to stay in Australia. (This is the only instance where Curtin denied Menzies a pair, and, under the circumstances facing Menzies, Labor's attitude is perfectly understandable politically.) On 28 August, after consulting his wife and parents, Menzies bowed to intra-party pressure and resigned.
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