Tax credits revolt 'will cause biggest constitutional crisis in 100 years': Voting against cuts shows House of Lords is 'too big for its boots', warns former civil service chief

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Lord Butler (pictured) warned that a rebellion by the House of Lords to block tax credit cuts would lead to the biggest ‘constitutional crisis’ for 100 years

The House of Lords is getting ‘too big for its boots’ by trying to block tax credit cuts, a former head of the Civil Service said last night.

Lord Butler warned that a rebellion would lead to the biggest ‘constitutional crisis’ for 100 years.

Peers usually accede to the House of Commons on tax and spending matters under a precedent dating back to 1909.

But Liberal Democrat and Labour members of the upper house insisted they would still try to vote against the cuts when the issue comes before the Lords on Monday. And one Lib Dem peer hinted the house could try to thwart ministers by blocking other bills in the coming years.

Government sources said Monday’s vote is expected to be ‘tight’ amid signs ministers are drawing up radical plans to overrule the Lords and get the measure through. Lord Butler, the former Cabinet Secretary, warned the Lords not to set up a confrontation with MPs, who have backed George Osborne’s welfare cuts three times.

He said it would be ‘quite wrong’ to obstruct the motion, giving Mr Cameron a ‘legitimate grievance’ that could pave the way for Lords reform.

‘The fact is that this was established 100 years ago; that the House of Lords doesn’t oppose the House of Commons on tax and financial matters,’ he said. ‘The Government would have a quite legitimate grievance if it did.

‘It would be really an example of the House of Lords getting too big for its non-elected boots.’ Speaking on Radio 4’s Today programme, he added: ‘The House of Lords has long accepted the supremacy of the House of Commons on tax and expenditure, however frustrating that might be for members of the Lords.’ 

Peers are not supposed to challenge MPs over tax and spending policies following a constitutional crisis in 1909. After lords rejected David Lloyd George’s ‘people’s budget’, the 1911 Parliament Act was introduced to make sure ‘money bills’ are passed without objection.

Last night Lib Dem peer Dick Newby rejected the suggestion peers should accede to the Commons, where his party has only eight MPs. He hinted of further battles to come, adding: ‘I think the Lords is going to be the scene of quite a bit of action.’

He also accused the Prime Minister of acting like a ‘schoolboy bully’ in the row. ‘He has been challenged in the playground so he is threatening to bring round lots of his mates to duff us up,’ he said.

Welfare cuts: Lord Butler, the former Cabinet Secretary, warned the Lords not to set up a confrontation with MPs, who have backed George Osborne’s welfare cuts three times

On Monday peers are set to vote on a Labour motion to block the cuts and force the Chancellor to impose transitional arrangements to help low-income households.

The Government does not have a majority in the Lords and an alliance between the opposition parties and crossbench peers would result in a defeat for ministers.

Chief Secretary to the Treasury Greg Hands said the House of Lords was crossing a line it had not crossed for more than a century. He accused the Lib Dems of provoking the row to secure reform of the upper house. The issue returns to the Commons on Thursday where around a dozen Tory MPs are expected to vote for a motion calling for changes to ease the hit on poorer families.

They are expected to include Heidi Allen, who this week accused Mr Osborne of betraying Conservative values by pushing ahead with the cuts.