Tony Benn, the MP for Chesterfield, said the proposed compromise would breach the party's manifesto commitment to scrap hereditaries' voting rights. Speaking during the second reading of the House of Lords Bill, he said: "I support this Bill because it abolishes feudalism. But you have made a big mistake if you come back and ask us to reverse our manifesto commitment by endorsing the principle of hereditary peers.
"Don't ask us to endorse the principle of hereditary peers, elected by other hereditary peers, and the principle of appointed peers because both of them are an absolute denial of the democratic principle that this House is based on and the upper chamber should be based on."
Lamenting prime ministers' unduly large power of patronage, Mr Benn, who, as Viscount Stansgate gave up his peerage in the Sixties to sit in the Commons, said he would like to introduce a Modernisation of the Premiership Bill, which would force all prime ministerial appointments to be approved by the elected Commons.
However, Margaret Beckett, the Leader in the Commons, made clear the Government would be prepared to accept the deal if other keynote legislation was not being obstructed by peers.
If not, she warned, ministers were prepared to use the Parliament Act under which the Bill in its present form would become law after a year's delay.
The amendment to retain 91 hereditaries will be introduced in the Lords by Lord Weatherill, the chairman of the crossbenchers.
Opening the two-day debate yesterday, Mrs Beckett said: "Should this Bill be obstructed in the Lords, despite being a clear manifesto pledge, or should it appear that the consensus and good faith for which we hope is lacking, then it is to this simple Bill that we should wish to apply the Parliament Act."
She sought to counter backbench concern, pledging that even with such an amendment the automatic rights of hereditary peers would have been removed because those elected by their peers would be there in a personal capacity and their heirs would not inherit their seats.
But Nicholas Hawkins, the Tory MP for Surrey Heath, claimed that this amounted to putting a "pistol to the heads" of the Lords, adding: "If that is the case, the word that would be applied to that in the courts would be `blackmail'."
Mrs Beckett branded the right of the 750 hereditaries to sit in the second chamber by virtue of birth alone "utterly, totally and literally indefensible". Some hereditaries had "benefited from dubious favours, sometimes sexual, sometimes financial, performed for past monarchs", she said.
Pointing to the in-built three-to-one Tory majority in the Lords, Mrs Beckett said the Government had been defeated almost three times more often by peers than had happened on average during the previous Tory government.
Andrew Robathan, the Tory MP for Blaby, was cheered by his own benches when he accused Mrs Beckett of "revelling in class warfare".
Dr Liam Fox, the party's constitutional spokesman, urged ministers to extend the legislative power of the second chamber by increasing peers' ability to scrutinise secondary legislation such as European directives. Challenging the Government over its "hidden agenda" behind the reform, Dr Fox added Tony Blair's real aim was to weaken the Lords' power as a second chamber "that he and his cronies could control".
An independent commission, chaired by the Tory peer Lord Mackay of Clashfern, the former lord chancellor, will report on alternative proposals for a future second chamber at the beginning of March.