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DERMOT MURNAGHAN: Well then, David Cameron suffered his biggest party rebellion this week in the vote over House of Lords reform so as Parliament prepares for its summer recess, what can he do to get his backbenchers back on board? I am joined now by Conservative MPs Margot James and we’ll be joined by Nadhim Zahawi in a moment or two, he’s at the Sky Centre and also with us is the former Conservative cabinet minister, David Mellor. Well I’ll start with you two with me in the studio here, a very good morning to you. Margot, do you think that has emboldened those that feel that the Conservative party isn’t Conservative enough, the Tuesday night vote?

MARGOT JAMES: Well I think the Tuesday night vote was exceptional in that a lot of colleagues voted with heavy hearts, both people who voted for the Bill and people who voted against the Bill, so I don’t think it’s typical of the rebellions that we’ve seen in the past.

DM: But I mean there are other issues bubbling around there. Do people get emboldened, once they’ve done it is there a sense of right, okay, we’ve broken he spell?

MJ: Well I haven’t rebelled yet so I am perhaps the wrong person to ask but I would imagine so, yes.

DM: But your colleagues, I know you were talking before we came on air of colleagues, you have always voted together, gone through the correct lobbies together and yet you saw colleagues on Tuesday night who you’ve long voted with going in the opposite direction.

MJ: I know, it was a hard night, Tuesday night because as I said, I think quite a number of the people like Nadhim who voted against the Bill, had never voted against the government before and although I take your point that once you’ve done something like that once it’s perhaps not so difficult to do it again but I don’t see in some of those colleagues, there is certainly no wish to destabilise the government amongst so many of those colleagues so I don’t think it will lead to mass rebellions on every other topic.

DM: Well let’s get David’s take on it currently and with reference to when you were in government, plenty of rebellions, plenty of problems for the Conservative leadership, is it a case of t’was ever thus or is this something different because they’re in coalition?

DAVID MELLOR: Well it’s different because the Tory party really rather ripped itself apart under John Major about Europe and I think the Tory party is rather ripping itself apart now because of the sense that David Cameron is a prisoner of Nick Clegg and the Lib Dems, a sense of frustration that what the Tories want to do in government they can’t do because of the Lib Dems and that Labour, just by being there and doing nothing, are now nine points ahead in the latest poll and I think they’re desperate for David Cameron to show fundamental Conservative credentials and, if necessary, to say to Nick Clegg we are the majority partners in this coalition and we are not going to do stuff like House of Lords reform purely because Nick Clegg, in his own frankly deluded world thinks this will be good for the Lib Dems but who really in the world outside – let’s go out on the street and say to people, what do you think about House of Lords reform? They’ll either give you a volley of abuse or say they know nothing about it.

DM: Well let’s bring in Nadhim Zahawi and see if he goes along with that, he’s joining us now from Sky Centre, a very good morning to you Mr Zahawi, you voted against the government with a heavy heart?

NADHIM ZAHAWI: Yes, I did, it was a heavy heart. We did quite rightly say that we’d bring proposals forward in the coalition agreement, we tried very hard because we praised the committee that didn’t quite work out, that was disbanded, then we brought forward legislation that went before a joint committee. Now the only thing that the joint committee could agree on by the way was that whatever happens is that there needs to be a referendum at the end of the process especially if you had direct elections, so if we had what the Lib Dems want which is 360 newly minted politicians. My view is that we don’t need a second chamber full of politicians, we need a second chamber that is reformed properly and we can get on with the reform now if we can build a consensus that we don’t need direct elections but what we need is reform.

DM: But I mean you’re talking about the principle and the issue, you didn’t then vote against as we suspect some others did, well some others articulated it directly saying that it was also because they feel that the Liberal Democrat tail is wagging the huge Conservative dog here?

NZ: I don’t buy into that. If you look at what the coalition has achieved in just two years, we’ve cut the deficit by a quarter, we had 200 academies and we now have over 2000 academies, we’ve dealt with public sector pensions in a most dramatic way that no other government has been able to do in the past, so there are lots of things that we’ve done that are very positive. The two parties came together and put party interest and self-interest aside to form this coalition and I think the nation supported that, now that we are in danger of behaving as if party politics and personal interest are guiding us, that is a very bad place to be and I would recommend that the coalition think long and hard about what the priorities are. I know where the Prime Minister wants to be, he wants to effectively get back to dealing with the things that are effectively causing people real pain and he wants to deal with that efficiently and quickly rather than waste a lot of time talking to ourselves about House of Lords reform.

DM: Margot James, I saw you nodding along with an awful lot of that and Nadhim Zahawi there saying more or less that the coalition can get back on track but of course we know that the Liberal Democrats are very, very angry about this indeed, many of them saying well actually we have to get back to Liberal Democrat principles, the Observer saying it brings on the prospect of general election sooner rather than later. Do you not think this has fundamentally affected relations within the coalition?

MJ: Well I think it has, yes and I think it’s not the first thing to have affected relations within the coalition and I think that we do have to remember that we are a coalition government. Yes, we’d all prefer a Conservative government, the Conservative members of it, I certainly would, David would, Nadhim would but we didn’t actually get an outright majority at the election and I think people are forgetting this and we have done well out of the coalition agreement. It is a predominantly Conservative platform, Nadhim has listed many of our achievements, most of them are derived from the Conservative manifesto and if we push the Liberal Democrats too hard I think in the long run we will regret it.

DM: David, come in on that because lots of Lib Dems want David Cameron and they wanted him to do it on Tuesday and before, go to them and say precisely Margot’s point there, we didn’t win the election and we have to make compromises because we are partners in coalition.

DAVID M: It’s difficult for these guys because obviously they are both gifted backbenchers, they are far better than some of the people that are ministers and they don’t want to entirely blot their copy books, I understand that, but free from such concerns may I just say to you that the Tory party didn’t win the last election because the trumpet gave forth an uncertain sound. Dave Cameron thought that by being a Tory he’d lose so by not being a Tory he lost, right? Now having put himself into that position he’s now gone into coalition with the Lib Dems with the purpose of national revival in terms of the economy, something that is patchy but now the law of diminishing returns has set in and the danger for Dave Cameron is that in seeming to be too afraid of Nick Clegg, I mean the temptation must surely be to go to Nick Clegg and say do you want an election next week, mate, because you’re going to get one unless you actually start being sensible. The worry is for a lot of Tories is that David Cameron is not enough of a Tory to really want to do that.

DM: Ah, not enough of a Tory? This comes back to my first question, is he Conservative enough?

MJ: I think if he calls an election he wants to win one. I think David’s forgetting that we are actually ten points behind in the polls.

DAVID M: It’s because of that.

MJ: No, but a year ago we could sit back and say the Lib Dems are not going to want an election where they are in the polls, well we’re not so prettily placed ourselves now and I think we’ve got to get a sense of realism back amongst colleagues that we’re in this for the long run. The crisis hasn’t gone away, we still have a huge job to do in the national interest and we should get on and …

DM: But what about David Mellor’s point though, is he really a Conservative at heart?

MJ: Yes, I think David Cameron is a traditional Tory at heart and I have no worries about that but I do think the world has changed. We did lose three elections in a row, the world has changed and particularly people’s commitment to one or other of the major parties. In 1979 80% of people voted either Conservative or Labour, that figure was down to about 65% in 2010. People’s commitments are not what they were, coalitions might be much more common in the future and the Liberal Democrats don’t have to have many seats to hold the balance of power.

DM: Okay, as they do at the moment and I want to push this further down the road in terms of what might happen and bring back Nadhim Zahawi. What happens if the Liberal Democrats now retaliate or however we want to term it by blocking boundary changes?

NZ: Well I’d like to think that we can try and get to a consensus, both the Prime Minister and the Deputy Prime Minister, to be fair to him, have said that they will work towards a consensus and I think that we can find consensus without having direct elections. We can halve the size of the Lords, get rid of the mad, the bad and the lazy immediately, get rid of the rump of the hereditaries, have a truly independent Appointments Commission – all these things we can do now. We can have a House of Lords full of the professions so the professions can even have their own electoral colleges to appoint or suggest people to go before an Appointments Committee but both the Prime Minister and the Deputy Prime Minister understand that we need to do this swiftly, i.e. not spend weeks and months over this but spend maybe a couple of weeks trying to come to a consensus. Let’s draw a line and move on and focus on what really matters.

DM: Let me bring in David Mellor, do you think that can work, if they can find some fudge effectively for the House of Lords, throw out the hereditaries and have some elected, will that sort it out?

DAVID M: No, because it’s more complicated than that. These are profound constitutional changes. Look, the Tory party needs to reconnect, we say Dave Cameron has got to reconnect with his back benchers, yes he has but more than that he has got to reconnect with Tory voters in the country. Messing about with the Lords for no better reason than to appease poor little Nick Clegg is just ludicrous. At the end of the day the Tory party are 10% behind in the polls, that’s because they are not cutting heroic figures in government and the issue has to be, by going on in this shambles are they making their situation worse?

DM: So do you think it would be better to go, just cut and run and say let’s go to the country soon?

DAVID M: No, they could just say to the Lib Dems here’s the basis on which we are prepared to continue, take it or leave it and if the Lib Dems opt out the Tories will say okay, we’ll govern by ourselves and as soon as they get defeated they can go to the country. If people think it is a new, different Conservative party they might vote for them but why vote for this pale sad shadow of what the Tory party used to be?

DM: I mean it’s a dangerous cocktail that’s beginning to gather there, isn’t it Margot James, in terms of Mr Cameron looking like a leader who is not in control of his party and not discussing the issues that people really care about?

MJ: Well I think we do have to get back to discussing issues that people really care about, I strongly support that but I don't think that it’s the shambles that David has set out. I think people realise this is a coalition government, each party is a coalition in itself and then when you add to that a coalition with another party things are bound to be difficult.

DM: I just want to give the last word to Nadhim Zahawi, if you don’t get this consensus you’ve been talking about a lot this morning Mr Zahawi, do you think we should have a general election before 2015?

NZ: No, I don’t, I don’t think the country would thank us for it. I think we need to focus on the things that brought us together which is sorting out the economy, sorting out education – as I said we have got 2000 academies now and we only had an announcement last week of 100 more free schools, these are all the things we should be doing. Iain Duncan Smith is trying to deliver on welfare reforms, a massive change in our country – that’s what we should be focused on, let’s put this aside, if we can fix it we can quickly, yes, if not let’s move on.

DM: Okay, David Mellor if you have got a very quick point you can make it.

DAVID M: Yes, I just think if you look at this weekend’s headlines – Theresa May damned over the Olympics, another headline because they failed – in the Mail on Sunday top headline, because they failed to sort of the European Court of Human Rights. Everywhere you look the government is seen to be falling below the level of events. It should get a grip and if it doesn’t get a grip, House of Lords reform doesn’t matter a two penny stamp.

DM: David Mellor, Margot James and Nadhim Zahawi, thank you all very much indeed.