Despite its victory at the 1906 election, the Liberal party still needed to reaffirm the validity of a ‘Liberal’ outlook. New circumstances presented new challenges. Initially, with a Cabinet reflecting the party's ‘Old Liberal’ roots, the party image was very conservative. The internal balance shifted with Asquith's elevation to the Premiership in 1908, and the increased institutional power of the party radicals. Nonetheless, the New Liberalism did not take over the party. Rival Liberal strands were still strongly represented. Their aims and objectives influenced aspects of national policy. They successfully modified the New Liberals' aims before 1910. They were also waiting for an opportunity to assume a more prominent role (Section I). However, so long as the New Liberals put forward ideas which had electoral purchase, they were unlikely to be displaced.

The Liberals' ideological success put MacDonald under serious pressure. His own attempt to forge an attractive, composite, party image was more severely affected by rival strands acting in a contradictory manner. Nonetheless, he retained the support and sympathy of a broad section of the party elite. MacDonald's ideological/strategic trajectory suited their aims and interests (Section II). The strength of Labour moderates, and the nature of Liberal policy, insured that the Progressive Alliance operated fairly smoothly at the 1910 election (Section III).

After 1910, as electoral problems intensified, tensions grew within the Liberal party. Despite a few Cabinet changes, policy formation was still heavily influenced by conservative Ministers.