Lords told to agree deal or face cut in powers

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The House of Lords' historic powers to delay legislation could be cut drastically if the Tory party refuses a deal with the Government over plans for a supreme court.

The House of Lords' historic powers to delay legislation could be cut drastically if the Tory party refuses a deal with the Government over plans for a supreme court.

Ministers were locked in negotiations all day yesterday in an attempt to find a compromise that would get the Constitutional Reform Bill on to the statute book before the general election.

The Bill, which also abolishes the post of Lord Chancellor and creates an independent judicial appointments commission, was referred to a special select committee after Tory and crossbench peers defeated the Government on Monday.

Intense discussions were under way yesterday to rescue the Bill by fixing a strict deadline for the committee and agreeing for the first time to timetable its passage through the Lords.

But although Downing Street played down threats to invoke the Parliament Act, government sources warned that the Lords faced retribution if the Tories failed to agree the plan in the next few days.

For nearly a century, peers have had the power to delay by up to a year Bills passed by the Commons, but that could be slashed to a few months if no compromise is reached.

The Government's long-awaited Lords reform Bill, which will abolish the remaining 92 hereditary peers, is due to be published next week and could be amended to curbthe second chamber's powers, a source said.

Ministers had wanted the Lords Bill to be unamendable so that Labour MPs could not cause further delay by inserting clauses insisting on a fully or mainly elected upper house.

But because of a drafting mistake, the Bill will now be open to amendment, leaving the Government with the chance to threaten serious curtailment in the Lords' powers.

Some Tory peers are understood to be keen to reach a compromise with ministers to allow the Constitutional Reform Bill to be timetabled.

Under the putative deal, the Bill would be discussed by a special select committee. It would be carried over into the next parliamentary session, but become law after scrutiny by the Commons and the Lords. "This is an important Bill and we want it on the statute book. If that means doing it this way, then so be it," one source said.

Lord Falconer, the Lord Chancellor, made clear his own preference for compromise yesterday when he told the BBC: "What we need to do is use existing processes to ensure that we can have the Bill properly considered by both Houses of Parliament." But it remains unclear whether Michael Howard, the Tory leader, will agree. If he does not, then ministers are determined to invoke the Parliament Act, under which a Bill can bypass the Lords after a year's delay.

The Government will have to decide its course of action today or tomorrow because to reintroduce the Bill to the Commons and then invoke the Parliament Act will take weeks.

The Prime Minister's official spokesman said that the Government had a "very clear idea of how to progress" but would not be rushed into announcing its plans.

He described the vote as a "serious matter".