DAVID Cameron has repeatedly said he wants to cut the cost of British politics, but the 30 new peers are likely to cost the taxpayer another £1 million in expenses in the coming year.

The 30 extra barons and baronesses will make the 785-strong House of Lords bigger than the European Parliament, with 766 members. There are just 650 MPs in the Commons.

The Lords will now be at its largest since 1999 when most hereditary peers were removed. At this rate of expansion, the second chamber could top 1000 by the time of the 2015 General Election. Britain now has more than 1800 parliamentarians in Holyrood, Belfast, Cardiff, Brussels and Westminster.

Last month, Baroness D'Souza, the Lords' Speaker, admitted she found the size of the second chamber embarrassing, pointing out that the only larger political forum was the Chinese politburo.

Lord Steel, the Liberal Democrat peer, noted yesterday that the Lords was so overcrowded at times that some public seats had to be removed to fit more peers in.

"We need to get retirement through. In the long run, of course, there has to be total reform of the House of Lords," he said. Yet the chance to halve the size of the Lords and cut the number of MPs fell by the wayside once again earlier this year amid political recriminations over whether to have a largely elected second chamber.

Among the 30 new appointees are major donors to each of the three big political parties. They include JCB boss Sir Anthony Bamford, whose family and firm have given £2.5m to the Conservatives in recent years, Scottish businessman Sir William Haughey, who has given £1.3m to Labour, and Domino's Pizza entrepreneur Rumi Verjee, who has given more than £800,000 to the Liberal Democrats.

Lord Oakeshott, a senior LibDem peer, claimed giving peerages to major donors "pollutes parliament and political parties who collude in this" In 2006 and 2007 Scotland Yard investigated the infamous "cash for honours" row, which centred on secret loans to Labour by donors nominated for peerages by the then Labour Government, who were rejected by the independent appointments commission.

It led to arrests and even the questioning by detectives of Prime Minister Tony Blair and First Minister Jack McConnell. No charges were brought due to lack of evidence of any wrongdoing.

Lord Oakeshott yesterday declared: "It's now more urgent and vital than ever that we elect the Lords and get big money out of British politics for good."

Labour last month wanted to cap individual donations to £5000, which would have stopped rich benefactors seeking influence.

The Tories opposed this and suggested a cap of £250,000 over five years, but also believed the cap should cover the trade unions, which give Labour many millions of pounds each year.

Fall-out from the Falkirk candiate selection fiasco led Ed Miliband to propose a major change to union funding, creating small individual donations rather than large block ones.

This might give the Labour leader the high moral ground in the political argument, but it is almost certain to cost his party dearly in the run-up to the next election.

Labour plans to find millions from local communities but Mr Miliband may just not have time before the 2015 General Election.