Peers have narrowly backed government moves to establish a new database of people granted licences to sell alcohol.

A debate in the House of Lords on Thursday heard both the Conservatives and Liberal Democrats express concern at plans set out in the Licensing Bill.

In the Commons, the government had amended the legislation to scrap plans to establish a Central Licensing Authority.

The authority would have been responsible for maintaining nationwide records on individual granted new personal licenses to operated premises selling or supplying alcohol.

Both major opposition parties had given support to the move as a way of clarifying the costs of the new system and ensuring that they were not passed on to industry.

But ministers argued that the creation of a separate quango to monitor the system would be more expensive than the creation of a new database which would allow local councils to share records across a standard framework.

Liberal Democrat peer Lord Redesdale had warned that the cost of the database could run into millions.

And for the Conservatives, Baroness Buscombe said there was widespread unease about the impact of the reforms.

"Everyone is now deeply concerned about who is now to implement, manage and pay for this system," she said.

Switching licensing powers from magistrates to council could see any extra costs pushed on to industry, she added.

But for the government, Lord McIntosh of Haringey said that the main thrust of the legislation was to switch responsibility for licensing issues to local authorities, and therefore a separate licensing authority was not needed.

"It does seem strange that this one particular element should now be being queried," he said.

While unable to provide cost estimates for the new database, Lord McIntosh said the Office of the e-Envoy had already been involved in initial discussions.

And he added that a new quango would cost "substantially more", with the costs being passed on to the consumer whichever system was adopted.

"This government is not in the business of setting up a new government organisation which is not necessary," the minister added.

After a vote on an amendment forcing the government to establish the Central Licensing Authority, the government got its way by a majority of just two - peers voted against the amendment by 117 to 115.