The budget was eventually passed by the Lords, after the Commons' democratic mandate was confirmed by holding a general election in January 1910.

[3] The Reform Act 1832 had been passed when the House of Lords dropped their opposition to it: King William IV had threatened to create eighty new peers by request of the prime minister, Earl Grey.

For example, Irish disestablishment, which had been a major point of contention between the two main parties since the 1830s, was passed by the Lords in 1869 after Queen Victoria intervened and W. E. Gladstone won the 1868 election on the issue.

However, in practice, this gave the Lords a right to demand that such public support be present and to decide the timing of a general election.

This denied the Lords the ability to reject individual components, and the prospect of voting down the entire budget was seemingly unpalatable.

[2] With the Liberal Party attempting to push through significant welfare reforms with considerable popular support, problems seemed certain to arise in the relationship between the houses.

[2] Between 1906 and 1909, several important measures were considerably watered down or rejected outright:[6] for example, Augustine Birrell introduced the Education Bill 1906, which was intended to address nonconformist grievances arising from the Education Act 1902, but it was amended by the Lords to such an extent that it effectively became a different bill, whereupon the Commons dropped it.

[7] This led to a resolution in the House of Commons on 26 June 1907, put forward by Liberal Prime Minister Henry Campbell-Bannerman, declaring that the Lords' power ought to be curtailed.

[6] The IPP saw the continued power of the Lords as detrimental to the prospect of securing Irish Home Rule.

[13] However, the issue of home rule for Ireland was the main contention, with Unionists looking to exempt such a law from the Parliament Act procedure by means of a general exception for "constitutional" or "structural" bills.

The Liberals supported an exception for bills relating to the monarchy and Protestant succession, but not home rule.

This led H. H. Asquith to declare the King's intention to overcome the majority in the House of Lords by creating sufficient new peers.

[18] At the request of prominent Cabinet member Sir Edward Grey, the preamble included the words:[19][20] Whereas it is intended to substitute for the House of Lords as it at present exists a Second Chamber constituted on a popular instead of hereditary basis, but such substitution cannot be immediately brought into operationThe long title of the act was "An Act to make provision with respect to the powers of the House of Lords in relation to those of the House of Commons, and to limit the duration of Parliament.

[15] These were defined as any public bill which contained only provisions dealing with the imposition, repeal, remission, alteration, or regulation of taxation; the imposition for the payment of debt or other financial purposes of charges on the Consolidated Fund, or on money provided by Parliament, or the variation or repeal of any such charges; supply; the appropriation, receipt, custody, issue or audit of accounts of public money; and the raising or guarantee of any loan or the repayment thereof.

[15][24] The Local Government Finance Act 1988, which introduced the Community Charge ("Poll Tax"), was not certified as a money bill and was therefore considered by the Lords.

This two-year period meant that legislation introduced in the fourth or fifth years of a parliament could be delayed until after the next election, which could prove an effective measure to prevent it being passed.

[29] The five-year maximum duration in the amended Septennial Act referred to the lifetime of the parliament, and not to the interval between general elections.

The Lords continued to suggest amendments to money bills over which it had no right of veto; and in several instances these were accepted by the Commons.

The importance of this was highlighted in Jackson v Attorney General,[case 1] in which the lawfulness of the Parliament Act 1949 was questioned.

[35] It is commonly considered a statute of "constitutional importance", which gives it informal priority in Parliament and in the courts with regard to whether later legislation can change it and the process by which this may happen.