I may create new peers to get tax credit cuts into law, hints PM

DAVID Cameron last night indicated that he could appoint up to 150 Tory peers to force through tax credit cuts – amid a growing standoff with the House of Lords. The Prime Minister warned the unelected upper chamber not to interfere on the issue and ‘listen very carefully’ to the will of the Commons.

A government source pointed out that the Lords would be ‘holding the Government hostage’ if they vetoed the £4billion of cuts to welfare spending.

And Downing Street aides refused to rule out the option of appointing enough Tories to the Lords to ensure the Government could push the measure through. Mr Cameron would need around 150 extra peers to give his party a majority against Lib Dems, Labour and unaffiliated peers.

Yesterday Commons Speaker John Bercow warned the Lords not to block the tax credit cuts. However both Labour and

‘The House should listen carefully’

the Lib Dems have put forward motions that could scupper the policy when it comes to the Lords on Monday.

A Labour ‘ time bomb’ proposal would abolish tax credits if ministers failed to soften the measure by the time the cuts are due to come next April.

The Liberal Democrats – who have just eight MPs in the House of Commons but more than 100 peers in the Lords – have also proposed a ‘fatal motion’ designed to kill off tax credit cuts on the spot.

A third House of Lords motion proposed by a cross-bench peer, Baroness Meacher, would force ministers to halt proposals and reconsider the impact of the cuts.

A Government source said: ‘These amendments amount to the same thing if passed: they would mean the House of Lords blocking the Government’s policy on tax credits and holding the Government hostage.’ Yesterday Tory MP Jacob Rees-Mogg argued that if the Lords blocked the plans, then the Prime Minister would be entitled to create more peers ‘to ensure the Government get financial business through’.

And Mr Cameron said: ‘This House has now decided twice in favour of the measure on tax credits. The House of Lords should lis- ten to that carefully and recognise it is for this House to make financial decisions, and for the other House to revise other legislation.’

However the Prime Minister also faces a rebellion by a dozen or more Tory MPs on the issue next Thursday, when the Commons will vote on a plan to soften the cuts which has been submitted by Labour MP Frank Field. The former welfare minister has come up with a proposal to ‘mitigate the impact’ of the changes on the lowest-paid workers.

Yesterday Tory backbencher Johnny Mercer hinted that the Government may face opposition in the Commons as well as the Lords. He said: ‘I want to be careful that what we’re doing doesn’t go against the most vulnerable.’