Bailey had entered the Commonwealth Public Service in 1946, as an assistant to George Knowles, Secretary of the Attorney-General's Department. He joined the Department in Treasury in 1962, and then the Prime Minister's Department in 1965. The first prime minister Bailey worked under was Robert Menzies, who he described as "the most careful listener and the most effective of the prime ministers I saw". He was most influential during the prime ministership of Harold Holt, who he had first worked under at Treasury. Under Holt, Bailey was given the title of "first assistant secretary" and was in charge of the prime minister's private office. In December 1967, he was given the task of informing Zara Holt of her husband's disappearance.