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DERMOT MURNAGHAN: Well now, House of Lords reform, the issue that could tear the coalition apart, is back. The government will publish its Bill for a partly elected second chamber this week but with some Tory right wingers threatening to rebel and Lib Dems also, it could be a bit of a problem. Joining me now is the Conservative party’s Deputy Chairman, Michael Fallon. Good to talk to you Mr Fallon, thank you very much indeed for coming in. Is this going to be another proposals, another Bill on House of Lords reform that’s going to end up gathering dust on the shelf, you’re not going to go through with it?

MICHAEL FALLON: Well there have been many before but I hope this one will have a reasonable chance. We were all committed in our manifestos when we stood at the last election to work to build a consensus for this and we have been doing that over the last year or so. There has been a draft Bill put before parliament on which MPs and peers have expressed their views and I think it is quite reasonable now to have a good shot at this.

DM: But the fact is as Conservatives your heart is not really in it, you are only doing this to please your coalition partners.

MF: No, that’s not right. Obviously it’s not the priority of the government but that’s to deal with the deficit and to get some serious reform of welfare benefits which we are going to talk about in a moment and reforms of the curriculum and the exam system but we are committed in the Coalition Agreement to do our best with our partners in the Liberal Democrats, to see if there is a consensus for reform. Of course everybody has different views on how you reform the House of Lords but you are going to see a Bill produced this week which is going to go to the Commons, before the Commons rises for the summer recess and it’ll contain some key safeguards in it which I hope will satisfy most of my colleagues in the Commons.

DM: Okay, can you outline any of those? What sort of shape will it have, is it something that we have kind of seen before?

MF: A lot of MPs, I know you have peers to talk to but a lot of MPs were concerned that this would somehow weaken the Commons and it is going to be made absolutely clear in the Bill that whatever shape the new Lords has, this is not going to weaken the power of the Commons. Secondly, there were a lot of MPs concerned that the new peers would be kind of alternate MPs. They won’t be, they won’t be able to usurp the role that MPs have inside their own constituencies. So those are two key safeguards which actually have come out of some of the work that’s been done on the draft Bill.

DM: And in terms of the proportions, partly elected, 80/20?

MF: Well mainly elected, that’s what we were committed to. Now you are going to see the details of the Bill, it hasn’t gone to Cabinet yet so I am not going to go into the details with you but mainly elected is what we were committed to and I think actually it was what all three parties were committed.

DM: You have managed to sidestep, very elegantly it must be said, the question of who is driving this within the coalition. You make out that oh this is Conservative policy and everyone else agrees with it but it’s the satisfy the Liberal Democrats isn’t it? This is something that they really care about and so many of your back benchers, I don't know if you personally feel it as well, you did say it, think that this is not the issue of the times. The economy is staring us in the face.

MF: Well first of all this is a coalition policy, it will be a coalition Bill, it is going to the coalition Cabinet this week so it is a coalition piece of legislation that has the full force of the coalition behind it. Now of course there are people with different views, there have been throughout this process. There may well be some Liberal Democrats who are not keen on individual bits of this reform but where those views have been expressed by our colleagues on the Conservative benches, I think you’ll find the government has tried to address them by putting in those two safeguards that I described.

DM: As you mentioned, I have three Lords to discuss House of Lords reform in a moment or two but I just wanted to ask you on that issue you touched on in terms of government priorities, welfare and benefits reform. We’re hearing today that the Prime Minister feels that there is more to go for, there are more cuts to be made after the already substantial ones that have happened.

MF: Well it is also a question of improving incentives. What’s key in the welfare system is to make it more worthwhile to go out to work than to claim benefits and we need to keep on doing that, keep on improving the incentives so that people for example don’t just have to write letters and then not turn up for a job interview. I’ve had that in my own constituency, they haven’t turned up but they are still allowed to retain their benefits. We’ve got to make sure that young people have sufficient incentive to go out and get the jobs that people from East Europe seem to be able to come to England to get quite quickly.