ELECTING peers would increase the cost of the House of Lords fourfold to almost £100 million a year and a referendum should take place, opponents have claimed.
Constitutional Reform Minister Mark Harper, who is in charge of the plans, dismissed the figure as "speculative" but admitted he could not guarantee costs would not rise for the Upper Chamber.
Under the proposed changes the number of peers would be cut in half but they would for the first time be paid a salary not just able to claim expenses.
The row came as a joint committee of MPs and peers released a wide-ranging report on the Tory-LibDem Government's plans which backed the referendum calls.
However, a leading academic suggested there was no point reforming the House of Lords before the planned 2014 referendum on Scottish independence.
Professor Peter Hennessy, from Queen Mary's London, said: "Is it wise to refashion a significant moving part of the British constitution ... In advance of the Scottish question being answered?"
Yesterday's report also backed proposals for an Upper Chamber of 450 peers, 80% elected by the public and 20% appointed.
It also risked a political row by suggesting peers were paid more than members of the devolved assemblies but less than MPs, at up to £65,000 a year.
And it recommended elections by a complicated variation of the Single Transferable Vote (STV) system – in which electors rank not only individuals but parties.
However, it is the issue of a referendum, that has, initially at least, triggered the most political damage.
The Scottish Government has already warned that any vote must not clash with the 2014 independence poll.
The issue has also inflamed tensions within the Coalition.
Many Tory backbenchers are utterly opposed to the plans amid fears it could question the supremacy of the House of Commons.
At the weekend rebel Tories even began to talk of the need for a vote on the European Union if one went ahead on Lords reform.
Both party leaders are publicly opposed to the idea, although David Cameron appeared to open the door to a referendum yesterday, refusing to rule it out completely.
On the other hand, Liberal Democrats regard reform of the second chamber as a key priority, but Nick Clegg has dismissed calls for a referendum as a waste of money.
Mr Harper said he "simply did not know" if the costs of an elected upper chamber would rise. He added: "Those costs are completely speculative. We start with a House of Lords which has got over 800 members who can claim £300 a day tax free when they turn up, and means they can take home almost as much as a member of the House of Commons.
"The reason why we didn't publish any costs is because we haven't set all the details yet."
Baroness Shephard, one of committee's dissenting members, pointed to research by Labour peer Lord Lipsey, on the "vast increase" in costs. She said that at the moment the cost was just under £19m a year, making the chamber "probably the cheapest legislature in the world.
"If we were elected, that cost would rise immediately to £177m," she said. "Lord Lipsey has also calculated the cost of an elected chamber, a second chamber, for the five years between 2015 and 2020 would rise to £433m. This is a vast increase on what we have at the moment.
"It may well be worth it in the name of democracy but what I would say is the public really should know.
"I wonder if it were put to them ... Whether they would be as enthusiastic for 450 more elected paid party politicians."
A rebel group of peers, including Baroness Shephard and former Ulster Unionist leader, now Tory peer, Lord Trimble, also called for a Constitutional Convention to consider "the functions and powers of both Houses of Parliament" as well as relations with assemblies in Scotland, Wales and Northern Ireland.
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