Could the Tories be about to forge an unlikely alliance?

'Nothing would do more to tempt the Lib Dems than a Tory commitment to proportional representation'

Having taken one tough decision on constitutional reform, Iain Duncan Smith now faces another. To his great credit, the Tory leader has outflanked the Government by sanctioning the proposals for an 80 per cent elected second chamber published this week.

It isn't quite as momentous as Disraeli "dishing the Whigs" with an 1867 Reform Act that was more democratic than anything contemplated by the Liberals of the day. For one thing, the Tories were in office then, rather than in Opposition. But Mr Duncan Smith has still done exactly what William Hague failed to do in the first parliament and faced down his most reactionary elements by opting for radical reform. And he has laid the basis for quite a formidable alliance between the Liberal Democrats, Conservatives and the impressive number of Labour dissidents (especially in the Commons) who want a properly democratic upper house, rather than the weak reforms envisaged by the Government.

Although so far confined to the issue of parliamentary reform, this new alliance between the LibDems and the Tories should worry the Government quite a lot. The proposals on the Lords from the two parties are so similar – as are their equally important proposals for long overdue reform in the Commons – that they have a real chance of undermining Tony Blair's principal defence of the government's White Paper, which is that none of its critics can agree on alternative. If the LibDems, the Tories and the Labour MPs who have signed an early day motion in favour of a "wholly or substantially elected" second chamber can agree on a common platform, they will make that defence inoperable.

Suddenly, the Government case – that, in Mr Blair's words "there are as many views about the Lords as there are MPs" – begins to wear very thin. Suddenly, an administration which has tried to make much of its reputation as the bold champion of radical constitutional reform finds itself increasingly isolated in its desire to resist just such reform. This is neither a familiar or comfortable place for it to be.

Which brings us to the second dilemma faced by Mr Duncan Smith. Down the track, there is an important – though by no means insurmountable – obstacle to total agreement between the Liberal Democrats and the Tories on what should happen to the Lords. Unsurprisingly, the LibDems want the members of the new upper house elected under a system of proportional representation. Indeed it is pretty much a sine qua non of their proposals. But the Tory plan is for first-past-the-post elections.

For Mr Duncan Smith, as a convinced first-past-the-post man, this is difficult territory. Wouldn't proportional representation be a wishy-washy liberal leap too far even for the newly radicalised – at least in terms of constitutional reform – Conservatives?

As it happens, the lack of interest among Conservatives in a proportional system for the Commons, let alone the Lords, is remarkable, given the scale of the task of defeating Labour under the present system. In February 1974 Labour were returned to office even though the Conservatives had won more of the votes. As a result, Conservative Action for Electoral Reform was founded. At its height it had the support of 70 Tory MPs, including Douglas Hurd and Chris Patten. Yet the sums look even more hopeless now.

Professor John Curtice has calculated that the Tories would need to be 11 per cent ahead of Labour to secure a one-seat majority next time. Last time they took only a quarter of the seats with just under a third of the votes. Add to that an increasing incumbency factor, bolstered by recent generous increases in constituency allowances for sitting MPs, and the prospect of a 100-year Labour reich begins to look gruesomely plausible.

And that's not all. Proportional representation for the Scottish Parliament, more than any other single factor, has helped the revival of the Tories north of the border. And finally, nothing would do more to tempt the Liberal Democrats into a return to equidistance between the parties than a Tory commitment to proportional representation.

But no one is currently asking the Tories to embrace proportional representation for the Commons – much as it would arguably be in their interests to do so. Instead the issue is the Lords, where the Government has already proposed such a system for its lamentably low 20 per cent of elected members.

And here there is movement in the undergrowth. Eric Forth, the Shadow Leader of the Commons, is sticking firmly to his party's commitment to first past the post. But in talks behind the scenes with other parties he has been holding out the possibility of a "cascade of options" on electoral systems in a Lords reform Bill that could allow MPs and peers to choose between them in a free vote. With the support of many anti-proportional representation Labour MPs, that could theoretically allow Tories to push through a first-past-the-post system. But, equally, Tory MPs could vote for proportional representation to push through their objective of a mainly elected second chamber.

What this illustrates above all is a quite startling willingness to compromise on the part of the Government's principal critics, which in turn underlines the extent to which the Government's alibis for honourably resisting radical reform are beginning to run out.

This is how it should be. Lord Irvine's largely moribund White Paper on Lords reform is riddled with defects unworthy of its author's prodigious intelligence. The idea that a democratic house could not be manageably sized has been comprehensively demolished by the LibDem peer Lord Oakshott.

To take just one other example, the White Paper rejects the idea of 10 to 15 year terms for elected members on the grounds that this would make them less "accountable" – as if the non-elected party appointees who he wants to form the bulk of the members would be accountable at all.

Indeed, as both the pro-reform Tory MP Andrew Tyrie and the Oxford politics professor Ian Maclean have pointed out, the appointments system envisaged by the Government would allow the party whips to maintain iron discipline by handpicking the members ripe for expulsion when the numbers were rebalanced at each election.

It's true that the Government could just decide to withdraw its proposals. But to do that would impel the Prime Minister to appoint another 20 to 30 Labour members – provoking a row about "Tony's cronies" overshadowing all previous ones. We are not, repeat not, talking of an alternative sovereign chamber to the Commons here, only a body more legitimately able to force the Government to explain its actions and scrutinise its works and, if the LibDems have their way, its public appointments.

The idea, in the 21st century, that such a body should not have democratic legitimacy beggars belief. But we know that. It is becoming apparent is that the Commons – the very body whose supreme legitimacy ministers continue to proclaim – is determined not to let the Government get away with it.

d.macintyre@independent.co.uk