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A commentary in The Telegraph claimed that before 1926, MPs had to win a by-election to join the government. This got me rather perplexed.

Mr Johnson has sensibly stopped short of joining Labour in pushing for an almost complete ban on second jobs, though it should be pointed out that being a government minister is also paid employment that keeps an MP away from his or her “main job”, whatever that is supposed to be. Long ago, this used to be acknowledged since MPs were not paid at all and, until 1926, if they wanted to join the government they had to win a by-election.

(emphasis mine)

Why would MPs need to win a by-election to join the government? Am I understanding this paragraph wrong?

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Yes. This was called a Ministerial by-election

The principle was that by becoming a Minister, an MP was taking a new job and an office of profit from the Crown. Since his paid job working as a paid adviser to the Monarch could cause a conflict of interest with he position representing his constituents, taking a ministerial role automatically removed the MP from Parliament.

To mitigate this, the possiblity of restanding as an Minister and MP and being re-elected was introduced (in 1707). This allowed for MPs to be paid Ministers while retaining their seat in Parliament. It was a Whiggish policy to require the Monarch to appoint ministers from among Parliament.

This new system rapidly changed the nature of Parliament and of government, with the new Minister-MPs forming a cabinet, with a chairman (who was parodied as a "Prime" Minister) holding almost complete executive power.

These by elections rapidly became a rubber stamping process, often uncontested and with very low turnouts.

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