The Prime Minister had hoped to appoint the new body in time for the next New Year honours list, to answer critics who have accused Downing Street of handing out knighthoods and peerages to "Tony's Cronies" rather than to more worthy candidates.
Tory opposition to the House of Lords Bill has now scuppered this plan. Mr Blair has been advised by officials that he now does not have enough time to introduce the new political appointments commission.
"We have always said we wanted an appointments commission to be in place for next year's New Year's honours but because of the attacks on the Bill in the Lords, this cannot be done in time," said a government source.
The Tories criticised the proposed commission, saying that it would only perpetuate the alleged influence of Downing Street and amended the House of Lords reform Bill to make it more independent.
But the Government has committed itself to overturning the Tory amendments and will not be able to throw out the changes in time. The delays to the Bill are likely to postpone the third reading in the Lords until after the summer recess of Parliament.
The New Year honours list will be vetted by the existing political honours scrutiny committee, which vetoed a peerage proposed by William Hague for Michael Ashcroft, the embattled treasurer of the Conservative Party. Mr Hague's aides yesterday did not rule out the possibility that the Conservative Party leader would put forward Mr Ashcroft's name for a peerage in the future. "I don't know about that," said a party spokesman.
Labour Party sources also denied a newspaper report that said the party offered a peerage to Mr Ashcroft in return for funding for Labour. "This is a pathetic attempt to try to divert attention from the current crisis in the Conservative Party caused by William Hague's refusal to investigate a series of important questions surrounding his treasurer," said a spokesman yesterday .Reuse content