The party of Gladstone, Asquith and Lloyd George, the Liberal Party emerged in mid-Victorian Britain from a combination of Whigs, Radicals and Peelite Tories. It was a dominant force in Britain, and the world, at the height of the power of the British Empire. Split by Gladstone's Home Rule Bills, it nevertheless returnes to power in Edwardian England and held it until after the outbreak of the First World War, with Lloyd George heading a Coalition Government from 1916-22. Riddled by internal divisions and increasingly challenged by Labour, the party losyt ground in Parliament, becoming little more than a rump for many years. With the foundation of the Social Democrats in 1981, and their subsequent merger with the Liberals as Liberal Democrats in 1988, a modern version of the party emerged, under Paddy Ashdown, Charles Kennedy and now Menzies Campbell as a significant third force in British politics.