Lord Irvine put a colourful Cabinet career behind him yesterday and paved the way for a radical overhaul of the British constitution.

The 800-year-old post of lord chancellor was scrapped and replaced by a new Department of Constitutional Affairs.

The prime minister's friend Lord Falconer of Thoroton will head the new ministry from the House of Lords - but will eschew the title, salary and additional functions of the lord chancellor.

The appointment of an ultra-loyal Blairite peer to the powerful new post prompted criticism from MPs, who said the job should have been based in the Commons.

Falconer's fiefdom will also take on the roles of the Welsh and Scottish Offices and the Northern Ireland Office when devolution can be restored there.

Lord Irvine's additional powers as head of the judiciary will be distributed to a new British Supreme Court outside parliament.

His position as speaker of the Lords will be handed to a figure agreed between the major parties.

The Conservatives accused Tony Blair of "trendy constitutional upheaval".

"To remake constitutions on the hoof, on the basis of personnel changes within the Cabinet, is the height of irresponsibility," shadow home secretary Oliver Letwin said.