It's hardly the most important issue around at the moment (and that may be part of the problem) but for what it's worth, here are my thoughts on reform of the House of Lords - both what I think should happen, and what will actually happen.
Given the undemocratic nature of the House of Commons due to its idiotic "First Past the Post" voting system (which allowed Tony Blair's Labour Party to form a majority government on only 35% of the vote in 2005), it's very important to have a second chamber with some capacity to delay - and possibly block - legislation which it considers to be not up to scratch. I'd argue that the current House of Lords does not perform this function effectively. Partly that is because there are a lot more party apparatchiks (including a high quota of tedious reactionaries from all three parties) in there than the defenders of the current set-up give it credit for. But more importantly, the blocking function has been whittled down to almost an irrelevance under this government. The Commons can use a mechanism known as "financial privilege" to stop the Lords introducing amendments to legislation. Previously this was only used for Budget-related legislation (e.g. the Finance Act) but the ConDems have extended it to (potentially) any legislation which might impact on the public finances (which is just about any legislation at all, of course). See, for example, what happened earlier this year on the appalling "Welfare Reform Bill" (aka the abolition of social security for working age adults bill.)
So the House of Lords is now emasculated to the point where we have a de facto unicameral legislature. This would be somewhat concerning even if the House of Commons had a democratic and accountable electoral system. With First Past the Post it's a recipe for disaster. What we need, really, is a second chamber with substantially more revising powers than it currently has - and also, perhaps, with the power to initiate legislation in certain policy areas.
My ideal system would be for PR voting for the House of Commons - perhaps through a system similar to the one used for the Euro-elections at the moment (7-member constituencies operating on party lists) with a different system used to elect the Lords (perhaps First Past the Post in very small constituencies - maybe 1,000 or so of them). That way, the Commons would be truly representative of the public vote, but the Lords would have local "micro-mandates" and would be able to raise local issues effectively. It might also be good to set a higher threshold for the Commons to be able to overcome defeats or amendments to legislation sent back from the Lords - for example it could require 60% of MPs to vote to overturn a Lords amendment rather than the usual 50%.
Given that we are unlikely to get PR for the Commons any time soon, PR for the Lords makes sense - although this then results in the odd situation of the second chamber being more representative than the primary chamber, which seems kind of topsy-turvy. I'd push hard for a PR Lords to acquire as much procedural clout as possible, given that it would have more of a democratic mandate than a FPTP Commons.
Turning to the prospects for Nick Clegg's Lords Reform Bill, it looks pretty dead in the water to me. Labour will be voting against the programme motion setting a limit to the amount of time allowed for debate, and it looks like there are enough rebel Tories who are going to vote with Labour to ensure that the Bill drags on and on, gets filibustered and finally talked out. Charles Kennedy has accused Labour of "playing political games" but this isn't a very effective criticism, frankly, because given the sheer destructiveness of the ConDem political agenda, it's no surprise that Ed Miliband is jumping at the chance to f*** up the timetable for the rest of their appalling legislative programme. It's the only honourable thing to do. Charles Kennedy, by contrast, needs to spend some time thinking about just how it is that a once progressive political party - the Liberal Democrats - has been produced to annihilating itself providing lobby fodder for the Tories.
I think we will see Lords reform soon; but it will be under Ed Miliband's first administration sometime between 2015 and 2020. But if the tendency to use financial privilege to override any amendments which the Lords make to legislation persists into future parliaments, it isn't going to matter much WHAT system - if any - is used to elect the second chamber. It'll still be a completely toothless talking shop.