Isabel Hardman

Tory MPs clamouring for a new relationship between Britain and Europe were given an amuse-bouche today when William Hague announced a review into the impact of the EU on everyday life. The Foreign Secretary told the House of Commons earlier that the review, which will report towards the end of 2014, 'will present the evidence and analysis', adding that it would be 'for political parties to decide on their own policy recommendations'. The Foreign Office is briefing that the audit was not about identifying powers to grasp back from the EU, but many in the Conservative party certainly hope it's the start of that process if nothing else.

'Shouldn't we just go home?' the SNP's Pete Wishart asked Sir George Young this evening after the Leader of the House revealed the government was dropping its programme motion on the House of Lords. 'You know it's all over. They know it's all over,' he added. But they didn't go home, and the Commons has just voted in favour of the second reading 462 votes to 162. Early reports suggest that there were 86 Conservative MPs who defied the whip, which would make this the biggest rebellion in this parliament. Nick Clegg paused from trying very hard not to grimace on the front bench to cheer as Mark Harper told the chamber shortly before the division that this legislation belonged to the coalition. But the speeches from MPs throughout the evening gave a very different message.

When Ed Miliband gave his speech to Labour's autumn conference last year, he rather tied himself in knots about how to end predatory capitalism. The Labour leader was trying to make it clear that he would stand up to vested interests, but the message was lost under a row about whether he was pro- or anti-business. Today Miliband managed to put that speech into context a little more, by announcing Labour's plans to change the culture of banking in this country. Instead of predator banks, he wants 'stewardship banking', which builds 'a long-term, trusted relationship with their customer' and serves the real economy as well as the industry itself.

That the Liberal Democrats might try to scupper the boundary reforms if they don't get their way on Lords reform has been the talk of the tearooms in Westminster for months. But today the threat comes to the fore as Nick Clegg's departing head of strategy Richard Reeves warns the Independent that there will be 'consequences' if Tory MPs try to block reform of the upper chamber by voting down the Government's programme motion for debating the legislation. This is what he told the newspaper: 'There would be broader consequences for the Government's programme, particularly around political and parliamentary reform. The idea that a failure to deliver a government commitment on Lords reform would be consequence-free is for the birds.

Defence Secretary Philip Hammond has the unenviable task today of announcing a cull of army units as the force is cut from 102,000 to 82,000. The Army 2020 review, the launch of which was delayed beyond Armed Forces Day last weekend, also doubles the number of reservists to 30,000. This leaves it half the size it was during the Cold War era, and the smallest since the Boer War. This is obviously deeply unpleasant for those troops whose units are being abolished. It is also uncomfortable for the Tories, who have long enjoyed the reputation of being the party of the armed forces. Tim Montgomerie tweeted this morning: 'Biggest tax burden since WWII. Smallest army since Victorian times. This isn't Conservatism.

Last night a group of Liberal Democrat and Conservative MPs met to discuss Lords reform. Public outbursts from the Conservative backbench have so far focused on opposition to the bill and the programme motion that the whips are trying to impose on the legislation, but the group of pro-reform MPs, who have informally dubbed themselves the Democratic Majority, are optimistic that the legislation will make a successful passage through the House of Commons. There are 27 Conservatives on board at the moment along all the Lib Dems, standing up the list of 100 MPs that the rebel leaders claim to have among their number.