Leader of The Liberal Party
Fraser's government was defeated in the March 1983 election by the Labor Party under Bob Hawke. Fraser immediately retired from politics, and Peacock contested the party leadership, defeating Howard, who remained as Deputy Leader.
As Opposition Leader, Peacock faced an uphill battle against the hugely popular Hawke. At the 1984 election he was given little chance of winning, but he performed better than expected by reducing Hawke's majority. In 1985, as Labor's position in opinion polls improved, Peacock's popularity sank and Howard's profile rose, keeping leadership speculation alive. Peacock said he would no longer accept Howard as deputy unless he offered assurances that he would not challenge for the leadership. Following Howard's refusal to offer such an assurance, in September 1985 Peacock sought to replace him with John Moore as Deputy Leader. The party room re-elected Howard as Deputy, contrary to Peacock's wishes. Despite possessing greater support in the parliamentary party than Howard, Peacock unexpectedly resigned and Howard was comfortably elected Opposition Leader on 5 September. Howard appointed Peacock Shadow Foreign Minister.
Howard lost the 1987 election to Hawke, and Peacock was elected Deputy Leader in a show of party unity. But Peacock's supporters began to plot against Howard, and in May 1989 they mounted a party room coup which returned Peacock to the leadership. Peacock, now 50, cultivated a new mature image, enhanced by a second marriage to Margaret St George.
On 18 March 1990, Peacock was interviewed by Laurie Oakes on the television program Sunday, regarding his stance on the Multifunction Polis (MFP), a proposal to build a Japanese funded technology city in Australia. Peacock attacked the MFP concept, saying it would become an Asian "enclave". According to Roy Morgan Research, Peacock's attack on the MFP did not help him politically, and the Labor Party used the issue to highlight division within the Liberal Party, as John Elliott and others supported the MFP. The following day, The Australian newspaper ran a headline titled Peacock a 'danger in the Lodge'.'
Although Hawke's government was in political trouble, with record high interest rates and a financial crisis in Victoria, Peacock failed to defeat Hawke at the 1990 election. Peacock resigned after the election. He became Shadow Attorney-General (1990–92) and Shadow Trade Minister (1992–93) under the new leader, Dr John Hewson. who Peacock supported in getting the job in 1990 over Peter Reith and to stop Howard returning. He returned to Foreign Affairs when Hewson lost the 1993 election to Keating. He retained Foreign Affairs when Hewson was displaced by Alexander Downer.
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