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Unlike OTL, George III, King of Great Britain and Ireland, and the chief claimer to the title of King of France, was extremely active in government, excrising his royal progrative as he saw fit: he attended and convened Cabinet meetings, appointed and dismissed ministers at will, handled legislative affairs with Parilament, assented to and rejected laws as he saw fit, issued Royal Charters and Patents on his own, coordinated the government, appointed and dismissed ambassdors, signed treaties with other countries, and commanded the military.
Like OTL, George III, Prince of Wales and Duke of Edinburgh, comes to the throne in October 1760 when his grandfather, George II, King of Great Britain and Ireland, as well titular King of France and Elector of Hanover, died. George III, in this ATL, however, was taught by his tutors and his mother, the Dowager Princess of Wales (George's father, and the heir to the throne, Frederick, had died in 1751, and as eldest son of Frederick, George became heir to the throne and was later aclaimed Prince of Wales), to use his power in every means possible. George III decided that the decline of the monarchy's power that had ran from the reign of William III through the reigns of Queen Anne, George I, and George II, would be stopped, and in some ways, reversed. George III issued a Order-in Council, stating his goals as King, and that I am to excerise, in all responsible means, my royal powers,.
In January, George III fell into a argument with his Prime Minister, the Duke of Newcastle, over two matters: the first was the course of the war. George III wanted to end British involvement on the continent, while Newcastle believed if Prussia fell, Britain would be isolated. The second was the extent of political power held by the King in relation to his ministers. The King believed that according to English law and conventions, as well as traditions and recognized practices that the executive power was in the King's hands only. Newcastle believed the King only exercised his powers by the advice of his Ministers and the consent of his Parliament. George III opposed this. When the King prorogued Parilament from meeting until June without his Ministers' knowledge or advice, Newcastle threatened to resign. George III accepted the resignation and fired all of Newcastle's ministers. He appointed Lord Bute, his childhood tutor, the new Prime Minister and First Lord of the Treasury, and he appointed his loyal cronies Ministers. The King then ordered the Foreign Secertary to cut the aid going to the King of Prussia from $100,000 a year to $40,000 a year. George III also authorized negotiations for peace.
In April, the government submitted the yearly military budget proposals to Parliament for approval. Parliament, still dominated by William Pitt, former Secetary of Foreign Affairs, and Newcastle, the former Prime Minister, rejected the proposal. The King threatened to dissolve Parilament and call for new elections, but the Commons would not budge. So, the King, again without his Ministers' advice or knowledge, dissolved Parilament and issued a Order-about Parliament calling for new elections throughout the country. The elections returned the Whigs (supporters of Newcastle and Pitt), so the King simply decided to have the Treasury issue the Yearly Budget without Parliamentary authority. Parliament was angry and cut off funds for the government. The King would not give in, and he dismissed Parliament again. This time, the King's cronies bribed voters in the Parilamentary counties with money and other "favors". Finally, the Tories won, after months of bribary and campaigning, and the Tory-filled Parilament approved the Budget by December. It also restored the flow of funds to the King's government.
The King was shocked when Spain declared war against Britain. This declaration was not forth-coming, but George III immediately reacted. The King ordered Lord Bute to commit troops in capturing Manila and Havana, the western and eastern major ports of the Spanish Empire. When Bute refused, the King had him dismissed. George III then appointed Lord Greville Prime Minister, and Greville carried out the King's orders without question.
In Ferbruary, Parliament passed the Militia Governance Bill, which effectively stated that the British militias would be run by a board of commissioners elected by Parliament, but offically nominated by the King. George III withheld assent from the bill, calling it "a intrusion on my royal powers". Parliament introduced another, more complicated, bill, the Militia Board Act, allowing the king to appoint a board of commissioners to run the militia, but with approval by the House of Lords, and with prior consulation with the Prime Minister. The king veteod the bill and dissolved Parliament. He would not convene it again until January 1763 when he needed Parilamentary approval for the Treaty of Paris.
Meanwhile, progress in the War went further. In the same month the King vetoed the Militia Governance Bill, Empress Elizabeth I of Russia (one of Prussia's opponents), died, and was succeeded by her Prussian-loving nephew, Grand Duke Peter of Holstein-Gottrop. Once Emperor, Peter made a peace with Prussia, restored all conquests, and sent troops to support Prussia. This allowed Frederick II of Prussia to drive the Austrians out of Silesia. George III then turned his attention overseas, and both Manila and Havana were captured by the British by the end of the year. The British also crunched the French in West Africa and almost completely eliminated their presence in India.