When the Liberals came to power in 1905 under Sir Henry Campbell-Bannerman, Pease was appointed a Junior Lord of the Treasury (government whip). After H. H. Asquith became Prime Minister in 1908 he was promoted to Parliamentary Secretary to the Treasury (Chief Whip) and sworn of the Privy Council. In 1910 he entered Asquith's cabinet as Chancellor of the Duchy of Lancaster, a post he held until 1911, and then served under Asquith as President of the Board of Education between 1911 and 1915 and as Postmaster-General in 1916. In 1917 he was raised to the peerage as Baron Gainford, of Headlam in the County of Durham.