In 1916, Victorian farmers became suspicious of price-fixing of the price of wheat under the War Precautions Act and established the Victorian Farmers' Union in response and Gibson was elected secretary of its Lismore branch. His brother, David Havelock, won the Victorian Legislative Assembly seat of Grenville for the union in 1917. At a 1918 by-election, he won the federal seat of Corangamite for the Farmers' Union, defeating James Scullin on preferences. It was the first win for what would become the Country Party. In February 1920, when parliament resumed after the 1919 federal election, Gibson chaired the inaugural meeting of the parliamentary Country Party, which saw William McWilliams elected unopposed as leader.
Government minister
He successfully pressed for regulated wheat and dairy prices to be raised until the abolition of price controls in 1921. He was Postmaster-General from 1923 to 1929, and encouraged the construction of telephone lines, the extension of roadside mail deliveries and the building of post offices in country districts. He also encouraged the development of radio broadcasting. In 1928, he was appointed Minister for Works and Railways, as well. Gibson was defeated with the Bruce-Page government at the 1929 elections and returned to farming. He won Corangamite back at the 1931 elections, but Joseph Lyons did not take the Country Party into his ministry.
At the 1934 elections, he was elected to the Senate and he remained a senator until he retired in 1947. Gibson was elected to the Senate on a joint ticket with the UAP, with the support of the Victorian state executive of the Country Party. This was opposed by the federal executive, which endorsed the sitting Country Party senator Robert Elliott; he lost his seat. Gibson took his seat on 1 July 1935 as a member of the Country Party. However, on 23 September the parliamentary party voted to expel him. He subsequently sat as an "Independent Country" senator. He was not re-admitted to the party until November 1939, when the new leader Archie Cameron invited him to rejoin. In 1941, Gibson was elected chair of the Joint Committee on Wireless Broadcasting, which came to be known as the Gibson Committee due to his "vigorous leadership". Its report led to the passage of the Broadcasting Act 1942 by the Curtin Government.
Later life
Gibson retired to "Cluan", his home in Lismore, and in retirement enjoyed fishing, shooting, and golf. He died at the Lismore Bush Nursing Hospital on 22 May 1955, aged 86. He was survived by his son David and daughter Margaret, having been widowed in 1944. His daughter Grace died suddenly in 1946 at the age of 48; she had been his private secretary for 20 years.