Labour to abolish hereditary peers' voting rights in revenge for defiance

The last of Britain's hereditary peers are to be stripped of their voting rights in retribution for the chaotic scenes last week when MPs were kept up until 2am to salvage key government legislation.

Tony Blair is reported by aides to have been "cursing" at the way peers obstructed legislation designed to make it easier for courts to convict in serious fraud cases and where criminal gangs have tried to intimidate juries. The Bill went through on Thursday, after three days of frantic horse-trading.

The Prime Minister's angry reaction means that a promised Bill to take reform of the Lords a stage further is now close to the top of the Government's agenda.

The Bill, which will be announced in Wednesday's Queen's Speech, will mean that the 92 hereditary peers still in the Lords will lose their voting rights, and Mr Blair's own power to appoint new peers will be formally surrendered to an independent appointments commission.

This will clear the way for the more contentious issue of a ban on fox-hunting. Government business managers fear that if a Bill to ban hunting were put before the House of Lords in its present state, peers would jam up the legislative process in a rearguard action to preserve the sport.

Instead, Labour is planning to bring legislation forward to make fox-hunting, hare-coursing and stag-hunting illegal, when the pro-hunting majority in the Lords has been pared down by the removal of the hereditaries and the appointment of a new batch of life peers.

Getting rid of hereditary peers and hunting with dogs will improve the Government's relations with its increasingly rebellious backbench MPs, who came close to inflicting a defeat on Mr Blair last week over proposals to allow the top NHS hospitals to apply for foundation status, giving them more control over their own affairs.

The size of the rebellion, which cut the Government's majority to 17 - the lowest in six years - makes it highly likely the Commons will throw out one of the proposals from Wednesday's speech, on student fees. Around half of all backbench Labour MPs oppose the idea that elite universities should be allowed to charge higher fees for selected courses. The combination of Conservatives, Liberal Democrats and Labour rebels plus MPs from the fringe parties may be enough to defeat the Government.

There could be rebellions on other measures trailed in the Queen's Speech, in particular David Blunkett's proposed clampdown on asylum-seekers, but they are expected to be on a much smaller scale.

The Bill will also include long-delayed legislation to introduce house-seller packs. This will oblige people who sell their homes to pay for a pack, costing around £600, including a local authority search and surveyor's report.

A new energy Bill will include ambitious plans to provide government funds to decommission nuclear power plants. This is likely to get a warm welcome from environmental groups, but it will be vastly expensive.

Another costly measure will be Gordon Brown's scheme for Child Trust Funds, under which every newborn child will receive £250 to invest and draw after the age of 18. There will also be a Bill introducing tougher penalties for people who abuse children, and making it easier for juries to convict in cases where parents refuse to give evidence. The new legislation has been cautiously welcomed by organisations dealing with domestic violence.

David Blunkett's cherished plan to introduce compulsory ID cards will get a passing mention in the Queen's Speech, as will plans to reform gambling laws, although neither is scheduled to become law in the next 12 months.