Blair offers concessions on reform of Lords

Tony Blair is expected to allow 40 per cent of the members of the House of Lords to be directly elected in a U-turn aimed at heading off a backbench Labour rebellion.

The Prime Minister is preparing to drop his previous proposal for only 20 per cent of the members of the second chamber to be elected by the public. The retreat follows strong criticism from Labour MPs who believe the reform plans do not go far enough, and the Tories' decision to outflank Labour by proposing that 80 per cent of peers be elected.

The Cabinet will thrash out a blueprint in the next few weeks, and Downing Street insisted yesterday that no final decision has yet been taken. Although ministers remain divided over the scale of the elected element, government sources said that a significant increase on the 20-per-cent plan was now on the cards.

Robin Cook, the Leader of the Commons, is privately urging Mr Blair to raise the proportion elected to between 40 and 60 per cent. But a 60 per cent figure is opposed by Lord Irvine, the Lord Chancellor; David Blunkett, the Home Secretary, and Jack Straw, the Foreign Secretary. Officials believe that 40 per cent will emerge as the new "centre of gravity".

Under the Government's original proposals, the Lords would be replaced by a 600-member second chamber with only 120 members elected by the public. Of the remaining 480, 120 would be appointed by an independent commission with the rest chosen by political parties in line with their share of the vote at the last election.

The revised proposals will be welcomed by many Labour backbenchers, but will not satisfy the Tories, who will argue that the Prime Minister would continue to enjoy wide powers of patronage to appoint peers.

In a further concession, ministers are considering a plan for candidates in elections to the Lords to be chosen by open lists in the regions rather than party lists, which would give more powers to party headquarters to influence the choice of candidates. This might win the support of the Liberal Democrats, who could defeat the Government's proposals when they come before the House of Lords by joining forces with the Tories.

In an attempt to boost turnout, ministers are expected to propose that elections to the Lords take place at the same time as general elections. Elected peers would serve for 10 years or two Parliaments, less than the 15 years or three Parliaments favoured by the Tories.

Mr Blair is said to be frustrated at the lack of progress over stage two of the reforms, and there has been speculation that he might drop them on the grounds that they are not a top priority. This would enrage Labour MPs as it would leave the 92 remaining hereditary peers in place.

It is now believed that the Prime Minister will make one final attempt to find a formula acceptable to Labour MPs after a consultation exercise on the Government's White Paper is completed at the end of this month. The new blueprint could then be considered by a joint committee of the Commons and Lords before the Government draws up legislation.

Labour critics of the Government's plans met Hilary Armstrong, the Chief Whip, yesterday to press their case for concessions. A survey of Labour backbenchers last week found backing for 58 per cent of the Lords to be elected.