Following this period in the Middle East he spent a year with the British Defence Staff in Australia and the Australian Army Staff College. On his return to the UK he became Brigade Major, Company Commander of 44 Territorial Army Parachute Battalion and representative of the Parachute Regiment at the Royal Military Academy at Sandhurst. He was promoted in 1976 to Major General and moved to the UK to command 3rd Division which moved a year later to Germany and became the 3rd Armoured Division. Walsh’s final appointment before retiring was Director of Army Training between 1979 and 1981.

He was deputy Lieutenant of Greater London from 1986 and made a Freeman of the City of London in 1987. He was enrolled in the Venerable Order of St John since 1989 and made a Knight of Justice in 1993. He was Honorary Colonel of the 1st Battalion of Wessex Territorial Army Regiment between 1981 and 1989.

Walsh was appointed Chief Scout of the United Kingdom and Dependent Territories by the Committee of Council in September 1981 and took up the position in February the following year. During the next six years he would make more visits to local Scout Groups than any other Chief Scout, averaging more than one a week. Neither did he neglect working at Headquarters and attending most Committee of Council meetings. He oversaw the introduction of the Beaver Scout section and new training relating to Scout Training Programme, updating of the Venture Scout Training Programme, revision of Group Scout Leader and Commissioner Training. Starting the review of the Cub Scout Training Scheme and Section Leader Training Michael championed two themes as Chief Scout which were that Scouts Help Others and Retain and Recruit. He firmly believed that for Scouting to flourish it needed to be relevant, practical, attractive and enjoyable. He was made a Commander of the British Empire in 1986 for his work in the voluntary sector and since 1988 he has been Vice-President of The Scout Association.