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Last Updated: Tuesday, 18 December 2007, 02:14 GMT
MPs call for honours law reform
State opening of Parliament
The report will suggest all peers pay taxes in Britain
Fundamental reforms to the law are needed to help make the process of awarding peerages more transparent, an MPs' committee is expected to say.

The Commons public administration committee began its inquiry into "propriety issues" relating to the honours system in March last year.

But it was held up by a separate cash-for-honours police investigation, in which no charges were brought.

The committee is expected to say prevention is better than prosecution.

Peers' taxes

Its report is expected to call for a change in the law, which would update the 1925 Honours Act.

The MPs are likely to suggest ensuring that all peers pay taxes in Britain and the powers of the Electoral Commission are enhanced.

This latest report is also bound to reopen calls for the reform of the House of Lords, a process started by Tony Blair a decade ago.

During the 1.4m police inquiry, 136 people were interviewed and four arrested over claims peerages had been offered in return for loans or donations.

It was later widened into whether there had been an attempted cover-up.

Figures questioned by officers included Mr Blair and ex-Tory leader Michael Howard.

But the 19-month long probe ended earlier this year without any charges being brought.

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