 In 1860, after discharging his bankruptcy, he returned to Sydney to re-establish himself in business.Lloyd won the seat of Newcastle in the New South Wales Legislative Assembly against James Martin, three times premier, in December 1869, advocating free trade, immigration, compulsory education, railway extension and a local harbour trust.He was Postmaster-General in Henry Parkes' first government from May to December 1872, when he became Colonial Treasurer.