Australian Dictionary of Biography

William McMahon, Australian Information Service, c.1971

National Library of Australia, 12265985

Sir William McMahon (1908-1988), prime minister, was born on 23 February 1908 at Redfern, Sydney, second surviving son of Sydney-born parents William Daniel McMahon, law clerk, and his wife Mary Ellen Amelia, née Walder. After his mother’s death in 1917, he was brought up by relatives and guardians, the most prominent among them his maternal uncle, (Sir) Samuel Walder. Billy’s father died in 1926. Educated at Abbotsholme College, Killara, and at Sydney Grammar School (1923-26), where he rowed in the first VIII (1926), he was later a student of St Paul’s College, University of Sydney (LL.B, 1933). At university he was a boxer, a lover of ballet, the theatre, music and art, and keen on horse racing. He was articled to the Sydney law firm Allen, Allen & Hemsley, where (Sir) Norman Cowper influenced his political thinking. From 1939 to 1941 he was a partner.

On 26 April 1940 McMahon was commissioned in the Citizen Military Forces. He transferred to the Australian Imperial Force in October. Employed on staff duties in Australia, he was deputy assistant quartermaster general (movements) at the headquarters of II Corps (1942-43) and the Second Army (1943-45). In 1943 he was classified medically unfit for overseas service because of chronic catarrh that impaired his hearing. He was promoted to captain in 1942 and major in 1943. His AIF appointment ended on 10 October 1945.

After making an extensive tour of Europe to observe the problems created by World War II, McMahon returned to the University of Sydney (B.Ec., 1949). In 1948 (Sir) Jack Cassidy sought preselection for the new Federal seat of Lowe and asked McMahon to speak at Strathfield on his behalf. So impressed were the Liberal Party women whom he addressed that they encouraged him to stand for preselection himself. Elected in December 1949 as the Liberal member for Lowe, he was to hold the seat for thirty-two years, although he never lived in the electorate.

McMahon’s maiden speech on 2 March 1950 displayed not only his attributes—proficiency in economics and robust preparation—but also an inclination to show off and exaggerate, and weak attempts at humour. Its theme was that the coalition parties had a greater prospect of maintaining full employment than the Australian Labor Party whose ‘lack of warmth for private enterprise’ and tendency to increase the size of the public service channelled employment into non-productive spheres.

After the 1951 election McMahon became minister for the navy and minister for air. He visited troops in Korea and approved Sir James Hardman’s reorganisation of the Royal Australian Air Force along functional command lines. Appointed minister for social services in 1954, he supported the building of more rehabilitation facilities to enable disabled people to enter the workforce. The minister for trade, (Sir) John McEwen, lobbied the prime minister, (Sir) Robert Menzies, to promote McMahon and on 11 January 1956 he was elevated to cabinet as minister for primary industry. With no experience in agriculture, McMahon was expected to comply with decisions made by McEwen. Instead, by working hard and mastering his brief, he often brought matters to cabinet without McEwen’s knowledge and argued against his senior minister.

In his longest held portfolio, as minister for labour and national service (1958-66), McMahon introduced the National Service Act (1964) that authorised conscription for army service. Australia was soon to send troops to fight in South Vietnam and the Borneo State of Malaysia. The government also wished to increase army manpower in case of wider conflicts involving the country’s commitments under the South-East Asia Treaty Organization and the Australia, New Zealand, United States Security Treaty. He pursued the Communist-dominated Waterside Workers Federation, established an inquiry into waterfront efficiency and employment, legislated to strip the WWF of its authority over recruitment and made deregistration of the union theoretically possible. From 1964 to 1966 he was vice-president of the Executive Council.

When Harold Holt replaced Menzies as prime minister on 26 January 1966, McMahon defeated (Sir) Paul Hasluck for the deputy leadership. As deputy, he was also treasurer (1966-69)—the post he had always wanted. He developed good relationships with his department—which contained a number of highly skilled economists—and was appointed a governor (1966-69) of the International Monetary Fund and chairman (1968-69) of the board of governors of the Asian Development Bank. Extensive knowledge of his portfolio, his understanding of economics, his inquisition of public servants and his desire to keep control of expenditure often made him unpopular, but these qualities boosted his reputation as a treasurer. He introduced four budgets, gradually reducing the deficit from $644 million in 1967-68 to $30 million in 1969-70. They were characterised by significant increased spending on defence, drought assistance, pension benefits and grants to the States, and by new Commonwealth programs for the health, education and housing of Aborigines, and for school libraries. Funding came from increased company and sales tax rates, radio and television licence fees, air navigation charges and overseas borrowings. Together with (Sir) John Gorton, he tried to resist State demands for extra revenue.

Relations between the Treasury and the Department of Trade were strained even when Holt was treasurer. When McMahon became treasurer his relationship with McEwen deteriorated further. They clashed over industry protection, McMahon’s opposition to the establishment of the Australian Industry Development Corporation and his (ultimately vindicated) decision not to devalue the Australian dollar. McEwen accused McMahon of being behind the Basic Industries Group, a pro-free-trade agricultural lobby that funded Western Australian and Victorian Liberals to stand against Country Party members. The governor-general, R. G. (Lord) Casey, met with McMahon to encourage him to heal relations with McEwen, but there were persistent tensions that the affable Holt found difficult to manage.

Following Holt’s disappearance on 17 December 1967, Casey installed McEwen as ‘caretaker’ prime minister. McEwen announced that he and his party would not serve in a coalition headed by McMahon. Initially McMahon sought to contest the leadership, notwithstanding the veto, but soon withdrew in favour of Gorton. At the November 1969 Federal election Gorton’s government suffered a swing against it of almost 7 per cent. (Sir) David Fairbairn and then McMahon announced that they would contest the leadership; Gorton survived by only a few votes. Gorton then moved McMahon, against his wishes, from Treasury to the Department of External Affairs. There, McMahon’s concerns were the spread of communism, the growing Russian interest in South-East Asia, British plans to withdraw troops from the region and the increasingly unpopular Vietnam War. Responsible for creating specialist Asian and policy research branches, he changed the department’s name to the Department of Foreign Affairs in November 1970. When Gorton lost office on 10 March 1971 McMahon stood for the leadership and easily defeated (Sir) Billy Snedden. Gorton became his deputy.

Although McMahon came to the prime ministership with longer ministerial experience than anyone else who has held the office, he inherited a divided and dispirited party, and suffered from active undermining of his leadership and cabinet instability. He sacked (Sir) James Killen, Tom Hughes and Gorton, and he removed Leslie Bury from foreign affairs, falsely claiming it was for health reasons. Snedden announced, before the 1972 election, that he would be a future candidate for leadership and even the deputy prime minister, Douglas Anthony, refused to give unequivocal support, telling reporters that the leader of any party could not be determined until after the election.

McMahon’s prime ministership was a blend of cautious innovation and fundamental orthodoxy; he restored Sir John Bunting as secretary of the Department of the Prime Minister and Cabinet and strove to placate State premiers. He created the Department of the Environment, Aborigines and the Arts, the Australian Institute of Marine Science and the Australian Wool Corporation, and he gained full Australian membership of the Organisation for Economic Co-Operation and Development; he gave additional assistance to independent schools on a per capita basis, provided Commonwealth funding for child-care centres, abolished the pensioner means test and instigated the Henderson commission of inquiry into poverty. He was outmanoeuvred on China policy, having criticised the July 1971 meeting of the Opposition leader Gough Whitlam with Chinese leaders, just as the president of the United States of America, Richard Nixon, announced his own proposed visit to Peking. Unable to bring the economy under control, his government presided in 1972 over higher inflation and unemployment rates and a low growth rate, despite increased government spending. His term as prime minister was probably the least rewarding chapter of his career.

At all hours of the day and night McMahon took soundings from contacts in business, the media and government. His frequent phone calls, some from Eric Robinson’s home on the Isle of Capri at Surfers Paradise, inspired Whitlam to dub him ‘Tiberius with a telephone’. He assiduously cultivated the media, and (Sir) Frank Packer was a longstanding friend and supporter.

In the December 1972 Federal election, the Liberal Party-Country Party coalition lost government to the ALP. Labor achieved only a 2.5 per cent swing and a net gain of eight seats. An additional 1917 votes in five seats would have seen McMahon re-elected. Whitlam conceded that without McMahon’s skill, resourcefulness and tenacity the ALP victory ‘would have been more convincing than it was’. These qualities and his persistence against adversity were the hallmarks of his personal and political life.

Ambitious and pragmatic (‘Politics is trying to get into office’) McMahon was accused of leaking information, spreading calculated lies and engaging in intrigue. He was a difficult personality: Alan Reid wrote of his ‘nervy intensity’. Indecisive and accident-prone, he made damaging slips of the tongue: he once stated in an interview that the government ‘looks forward to increasing opportunities for unemployment in the new year’. Nevertheless he made a major contribution to postwar Australian politics, particularly in tariff policy debates. Although he lacked the flair of Whitlam, he was a capable administrator and a shrewd negotiator.

Remaining in parliament until 4 January 1982, McMahon was a frequent commentator on economic and political issues, offering advice and criticising both the government and Opposition. His ill-timed retirement from parliament caused a by-election in the then marginal seat of Lowe, which fell to Labor. McMahon received superannuation of more than $500,000. He travelled, worked as a consultant to the Bank of America and wrote an unpublished autobiography.

Short (172 cm), wiry, with blue eyes, bald from his 40s and with large ears, McMahon was unkindly described by Killen as ‘a Volkswagen with both doors open’. His deafness had been surgically cured but had left him with a tremulous, piping voice. In his later years he was a fitness fanatic, enjoying golf and swimming. At squash, he beat—and sometimes accidentally injured—younger opponents. He was always fashionably dressed. In February 1985 he underwent surgery for skin cancer and his left ear was removed.

On 11 December 1965 at St Mark’s Church of England, Darling Point, McMahon had married Sonia Rachel Hopkins, an occupational therapist and film production assistant. Attractive and vivacious and twenty-four years his junior, his wife caught the eye of the international media in Washington, DC, when she wore a dress with a thigh-length split to a state dinner at the White House. Steadfastly loyal, she provided both emotional support and political counsel. They had two daughters and a son. Appointed privy councillor (1966), Companion of Honour (1972) and GCMG (1977), McMahon was named New South Wales Father of the Year in 1971.

Survived by his wife and their children, Sir William died on 31 March 1988 at Potts Point and was cremated. A state memorial service was held on 8 April. A portrait by (Sir) Ivor Hele (1973) hangs in Parliament House, Canberra, and one by Charles Thompson (1985) is in the dining hall of St Paul’s College, University of Sydney.