Ms Gray, whose report into the partygate scandal contributed to the downfall of former prime minister Boris Johnson, is among 30 new Labour peerages announced ahead of Christmas to redress the party “imbalance” in the House of Lords.
The Conservatives have nominated six people, and the Liberal Democrats two.
Other notable names include:
• Carwyn Jones – former Labour Welsh first minister
• Thangam Debbonnaire – former Labour shadow cabinet minister who lost her seat unexpectedly at the general election
• Dame Thérèse Coffey – former Conservative deputy prime minister
• Toby Young – (Conservative) founder and director of the Free Speech Union, and associate editor of The Spectator.
Ms Gray was widely expected to be nominated after leaving her role as Sir Keir’s chief of staff in October following an internal power struggle in Downing Street.
The former civil servant was then appointed to a newly created nations and regions position within Number 10, however, it was confirmed in November she would not be taking up the role.
In 2022, Labour unveiled proposals to abolish the House of Lords and replace it with a “reformed upper chamber”.
However, ahead of the general election this year, the plans were scaled back, with Sir Keir instead pledging to remove the 92 hereditary peers and introduce an age cap of 80.
It is understood Sir Keir has made the nominations in an attempt to tilt the balance towards Labour in the second chamber.
A Labour source told Sky News: “The Tories stuffed the House of Lords, creating a serious imbalance in the chamber. This needs to be corrected to drive through the government’s plan for change and deliver on our mandate from the British people.
“We are committed to an overdue programme of reform and have already laid legislation to remove the right of hereditary peers to sit and vote in the Lords.”
During the 14 years the Conservatives were in power, the number of Tory peers rose to 273 while there are 187 Labour peers, 78 Liberal Democrat peers and 184 crossbenchers, who are not affiliated to any political party.
That will now rise to 217 Labour peers, 279 Conservatives and 80 Lib Dems.
The independent House of Lords Appointments Commission (HOLAC) will now vet the nominations before the prime minister recommends them to the King.
A title then has to be agreed and legal documents called the writ of summons are issued by parliament, and a letters patent issued by the King to create a life peerage. They can then sit in the House of Lords and vote.
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