The Local Government Bill completed it parliamentary progress when it returned to the lords, with Conservative Baroness Hanham reluctantly deciding not to press her amendment which would have allowed individual authorities to discuss with government how they should spend housing capital receipts.
Earlier, Tory and Liberal Democrat peers had supported the proposal.
Lord Rooker, minister in the ODPM, reported that the commons continued to resist the lords' amendment because it would alter the financial arrangements made by the commons.
Baroness Hanham found the commons privilege argument extraordinary. She said: 'Our amendment does nothing about the revenue support grant for local authorities. It does nothing at all about any of the money that the government are giving to local authorities.
'The argument that we have used all the way through is that the amendment marginally changes the government's right to redistribute capital already in the ownership of the local authorities to other local authorities that the government prefer'.
She added: 'We must bow to what the commons puts forward, but I am bound to say that it is an odd argument to make to stop the amendment in its tracks'.
Royal assent was later given to the Act, along with the Fireworks Act.
Report stage of the Fire Services Bill was adjourned after a session without a division.
Hansard 18 Sept: Column 1078 - 1081; 1139 - 1140; 1140 - 1170