The Government is facing a showdown with peers over its controversial shake-up of the benefits system.

The proposals have already endured a difficult time in the House of Lords, where peers inflicted a series of defeats on ministers over the reforms, which will cap benefits at £26,000.

But the changes imposed on the Government were reversed by MPs, and the Welfare Reform Bill now returns to the Lords for what could be a test of strength between the two Houses of Parliament.

The decision by officials in the Commons to signify that the Lords amendments were “financially privileged” and could not therefore simply be reinstated in the second chamber has been condemned by senior peers.

Although the original amendments cannot be tabled again, new proposals will be considered by the upper house, which could trigger a protracted session of parliamentary “ping pong” with the legislation being sent between the two chambers until agreement can be reached.

Labour will once again try to introduce a regional system for the benefits cap to reflect the variation in housing costs.

Crossbencher Lord Best has tabled amendments to limit the impact of the “bedroom tax”, which involves housing benefit being cut for tenants with more than one spare bedroom.

Changes to the Employment and Support Allowance (ESA), which limit the payment of the contributory element to 12 months, could also be challenged again by peers.

The Bill, which also creates a new Universal Credit to replace a range of existing means-tested benefits and tax credits for people of working age, has come under attack from a series of campaign groups and peers from all sides.

The Spartacus campaign led by disabled people has urged peers to be ready to stand up to the Commons, claiming the situation “is not only a struggle about welfare benefits … it is also a struggle over the quality of our democracy”.

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