Because his ancestor put down a riot in 1780, this man sits in our Parliament. Can that be right?

He says it is, unless we can think of a better system. Nick Cohen reports on the new debate about the House of Lords

AUGUST has been a kind month for Henry George Reginald Molyneux Herbert, seventh Earl of Carnarvon and racing manager to Her Majesty The Queen. On the fourth of the month his horse Tarry won the Team England Toiletry Range Selling Stakes at Newmarket. And on the 14th, last Monday, he and three fellow peers published, to establishment acclaim, a report on the future of the House of Lords.

In the case of the horse, Lord Carnarvon decided that Tarry's life should be transformed. He sold her by auction for 6,500 guineas after the race because the filly was "surplus to the requirements" of his 10,000-acre estate on the Berkshire-Hampshire borders.

When it came to the constitution, however, his lordship took a different view. His report strongly hinted that the 771 hereditary peers entitled to legislate in the Lords - the only feudal chamber left in Europe - were anything but surplus to requirements.

Written with the Earl of Selborne, Lord Bancroft and Viscount Tenby, and with Douglas Slater, a former clerk to the House of Lords, the report was not a blatant defence of privilege. The arguments of all sides were fairly presented and the peers made concessions to the democratic spirit of the age.

If the public wanted reform, it said, then of course the public must have it. "Hereditary members ... would vote themselves into history with barely a backward glance in favour of a reformed house which was more effective and whose composition commanded wider public acceptance," the authors said.

But the promise that if asked they would gather up their ermines and leave quietly was followed by clear hints that they felt the eventuality would never arise.

The Labour Party wants them out, and has promised that a Labour government would strip the hereditary peers of their role. The principal message of the Carnarvon report was that such an idea would not be effective and did not deserve to win support.

Their lordships offered a stout defence of the institution. The fact that two-thirds of the seats in the second chamber of Parliament at present change hands only through death and inheritance may seem "arcane" and "archaic" to some, they conceded, but it had its advantages.

Many peers were independent-minded "crossbenchers" who were not tied to political parties. If they were expelled, "Gone would be the young peers with their distinctive contribution. Gone, we fear, would be the wider sympathies of the House ... and its capacity to espouse unusual causes, to express attitudes learned in a wide range of ordinary walks of life, and - on occasion - to act as the small boy in the crowd who points out that the Emperor has no clothes."

And who would Labour get to replace these simple truth-tellers, they asked? In 1993, the answer seemed clear. John Smith committed the party to abolishing the House of Lords and replacing it with an assembly elected by proportional representation from regional constituencies.

But under Tony Blair the commitment has changed. Graham Allen, a radical democrat determined to break up the "elective dictatorship" of Westminster, was replaced as Labour's spokesman on the constitution by the more traditionally- minded Kim Howells, who certainly does not want an elected second chamber which could threaten the power of the Commons.

Mr Howells is still drawing up his plans with Jack Straw, the shadow Home Secretary. But he was clear last week that the only reform in the first term of a Labour government would be to abolish the voting rights of hereditary peers. Tony Blair would then create up to 100 life peers to redress the pro-Tory bias of the House of Lords. The question of how to produce a more democratic upper chamber would be shelved until the next century.

Lord Carnarvon and his colleagues have seen an opportunity in Labour's retreat. A chamber consisting entirely of life peers - political appointees, there solely because Mr Blair and previous prime ministers had used their powers of patronage to ennoble them - "would be the ultimate quango", they wrote.

Lord Carnarvon even mused last week that if it came to a battle for public support between the hereditary peers and the placemen Mr Blair would want to put in their stead, the old aristos would prove more popular than the new quangocrats.

"A great many people we interviewed for our report thought that," he said. "Hereditary peers are privileged, but the public could realise that they are motivated by a strong sense of duty to do the best for the country whatever their politics."

IT IS easy to make fun of the Earl of Carnarvon and his colleagues. Go far enough back in the family history of any hereditary peer and you will find a political appointment just as blatant as those being proposed by Labour.

The seventh Earl's ancestor, William Herbert, was ennobled ostensibly for his part in putting down the Gordon Riots in London in 1780. But his was also one of the many new peerages created by George III's ministers at that time in an attempt to swamp a Whig majority in the Lords that was restless about the crown's disastrous handling of the American colonies. It was a very political appointment.

By the same token Lord Carnarvon's co-author, Viscount Tenby, is a descendant of Lloyd George, whose government was responsible for the biggest scandal about the sale of honours this century. In their report the peers mention this controversy, but fail to note that descendants of those who paid for titles can still have a say in government.

Allegations of honours for sale have not gone away. In evidence to the Commons Home Affairs Committee, the left-wing pressure group Labour Research said that since 1979, 50 per cent of honours for services to industry had gone to businessmen from the 6 per cent of companies that donate to the Conservative Party. Among the honours it highlighted were peerages for: Lord Laing (whose United Biscuits gave pounds 1m to the Conservatives between 1979 and 92); Lord Hanson and Lord White from the Hanson Trust (which gave pounds 852,000); Lord Sterling from P&O (pounds 727,500); and Lord Forte from the Forte group (pounds 693,700).

It is not just friends of the Conservative Party treasurer who find a secure home. Convicted felons are not allowed to stand for election to the Commons. But Joseph Kagan, the Gannex manufacturer ennobled by his friend Harold Wilson, was allowed to return to the Lords after serving 10 months for fraud.

Constitutional reformers will happily spend hours researching and recounting tales of dubious pedigree and unconventional behaviour among the members of the upper house. They lament the pounds 700 a week peers can claim for attending the chamber and they denounce the lack of any register of members' interests. But this is not where the argument about the House of Lords ends, for there is another, possibly graver, charge against it than absurdity or sleaziness. As Stuart Weir of the research group Democratic Audit put it: "The real fault with the Lords is that it cannot do its job. Second chambers across the world amend legislation and when necessary delay it. But the Lords is dominated by Conservatives who on the whole like this administration. Even when they think they ought to fight, they don't because they know they have no democratic legitimacy."

The charge is backed with strong supporting evidence. Of the 1,039 peers allowed to sit in the House at the end of July this year, 476 took the Tory whip, 112 were Labour, and 52 Liberal Democrat. The remaining 399 are either from minor parties or non-aligned crossbenchers, bishops and law lords.

Exhaustive studies by Donald Shell of Bristol University have shown that the crossbench peers, of whose independence Lord Carnarvon and his colleagues think so much, back the Conservatives two times out of three.

In the 1988/89 session, for example, 61 per cent of crossbench votes went to the Government and helped produce 172 Tory victories and just 12 defeats. If the hereditary aristocracy had been denied the right to vote in the Lords, the picture would have been very different. The Government would have lost 159 divisions and won just 21. On average the post-1979 Conservative governments have lost 15 divisions per session; the 1974- 79 Labour government lost about 70 per session.

The figures are a convoluted way of stating the obvious: aristocrats tend to be rich - and the rich tend to back the Conservative Party.

THE best example of this simple logic in action is the poll tax. While it was being pushed through Parliament in 1988, many predicted that the Bill introducing the charge would run into trouble in the Lords. But when a rebel Conservative amendment calling for the tax to be related to ability to pay was presented to the peers, the Government hauled in the titled "backwoodsmen" who did not normally go to the chamber.

Many of these had a financial interest in the outcome, since nearly all the hereditary legislators stood to have their property tax bills cut if the government had its way. Lord Vestey, Britain's third richest man, attracted the most comment. It was reported that he would save pounds 4,000 in charges on his Stowell Park mansion in Gloucestershire when the poll tax replaced the rates.

Lord Vestey voted for the change, as did most of his fellow lords. The poll tax sailed through the Lords with 317 votes in favour and 183 against.

The record shows that when a Conservative government needs the backwoodsmen, they hardly ever let it down. In all the years since 1979 only one Bill has been thrown out by the Lords: the war crimes legislation of 1989 to 1991. Peers used their sternest sanction of forcing the Commons to reconsider by delaying the measure for a year because they had grave doubts about whether it was possible to give fair trials to men who had allegedly committed massacres in Nazi Europe 50 years ago.

Their fears seemed reasonable to many, but as Stuart Weir says, the fate of alleged old Nazis has not been the most pressing or the most controversial issue for the nation since Margaret Thatcher came to power. The poll tax affected millions, proved impossible to administer and led to mass rioting, yet it was accepted. The War Crimes Act, which the Government forced through a year after its Lords defeat, has to date led to one prosecution.

The Lords does have its occasional success. The sale of council houses, the mechanism for abolishing the GLC, and Michael Howard's Criminal Justice Bill were significantly modified after objections from peers. But direct confrontations with the Government are generally avoided. To the fury of Liberal Democrats Labour peers support this placid approach because they fear setting a precedent that would allow the Conservatives to use their massive majority in the upper chamber to frustrate a future Labour government.

There also seems to be a genuine doubt among peers about whether it is legitimate for the Lords to fight the Commons on important issues, and a genuine fear that the future of the House will be endangered by defiance. They do not want to rock the boat for fear they will be pitched out.

During the poll tax debate, Lord Wyatt of Weeford, the Conservative columnist who writes as the "Voice of Reason" in the News of the World, said the Lords would be "committing hara-kiri" if it dared to reject the flat- rate poll tax.

The pattern was repeated in 1993 when for a moment it seemed as if the railway privatisation Bill would be thrown out by the Lords and delayed for a year. At the last minute frightened peers abandoned the railways to their fate. Lord Peyton, the former Tory transport minister who led the opposition, said he did not want to risk the long-term constitutional consequences of confronting the Commons.

"If we were to press our view," he said, "we would be moving the argument on to an altogether different level. We would be embarking on a process which we would not find it easy to bring to a full stop."

After monitoring peers for years, Andrew Adonis, a historian of the House of Lords, has concluded: "The worst thing about it is that it fools the people into thinking we've got a second chamber which can revise hasty and ill-informed bills from the Commons. We haven't. The Lords is too scared to do anything but pass trivial amendments. It won't work until it is reformed."

SO HOW can it be reformed? The Conservatives, unsurprisingly, are in no hurry to change it, but for the Labour Party, which appears to have most to gain from reform, the area is a minefield.

When Graham Allen was constitutional affairs spokesman, Labour wanted to take on privilege and the class system with democracy. Abolishing the Lords and replacing it with an elected second chamber was to be part of a wider programme to break up the Westminster system and the huge power it gives the prime minister.

But Mr Allen has been moved on and his ideas, which had significant support in the party, have been replaced by the realisation that a slightly modified version of the present system could serve Labour quite nicely if it wins an overall majority.

One front bench spokesman, close to "New Labour" thinking on the Lords, said: "I've no time for Charter 88 [a radical democratic pressure group] and the civil liberties lobby. In the 1980s, they thought Labour couldn't win the south of England and so they were prepared to settle for a little bit of power European-style in the second chamber or regional governments.

"Well, we can win the south now and perhaps we can realise that Europe isn't a great example for us. After all, our system has served us well. We've never elected fascists."

Kim Howells, Labour's new constitutional affairs spokesman, would probably agree. He has committed Labour to kicking out the hereditary peers and he emphasises that this will be done quickly in a short Bill. Under his proposals, old life peers and the new ones created by Tony Blair would sit in the Lords until there was all-party agreement on who should replace them at some indefinite date in the future.

"I'm very, very against a directly-elected second chamber which would rival the Commons," he said. "Perhaps we could have regional assemblies nominate members as the Germans do, but we are not clear on that yet. There are lots of other options."

Many on the left disagree. Caroline Ellis, parliamentary officer for Charter 88, said Labour would not get popular support unless it fought the aristocracy with the weapons of democracy. "Blair talks a lot about values. This is a real test of whether he has the courage to put them into practice," she said. "Labour has to ask itself if it really wants change or just wants to turn the Lords into a retirement home for elderly politicians. Unless the elective principle is established we will just have a grand but sleazy quango."