Daily fees for peers will be halved to reflect changes to working practices due to the coronavirus pandemic.
The Lords authorities have recommended that the maximum peers can claim be reduced from £323 a day to £162.
It said the temporary measure reflected the fact most business would take place remotely and peers would be incurring fewer costs by not staying in London.
Peers will also have to “actively participate”, either by speaking in a debate or committee, to get the fee.
Those merely “following” proceedings in the chamber or online will not be entitled to any reimbursement, under proposals from the House of Lords Commission.
The Lords has scaled back its proceedings in response to the coronavirus outbreak. It now sits three days a week and is conducting limited business on a largely virtual basis.
This was done in response to medical advice, with more than half of the 785 peers currently taking their seats aged over 70 and the average age of members being 70.
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Most peers are not paid a salary but are able to claim an allowance for the costs associated with attending Parliament.
The Commission said the current system, which has been criticised for allowing peers to claim fees for attending meetings in Parliament even if they do not take part in debates, was no longer suitable and should be suspended.
The move, which will have to be approved by peers in a physical sitting next week, will reduce the daily allowance to the lower level currently paid for peers for undertaking work outside of Westminster.
It is expected to save “significant” sums, with daily claims expected to fall from at total of nearly £130,000 to about £15,000.
Lord Fowler, the Lord Speaker who chairs the Commission, said the proposed change reflected the fact most peers were no longer incurring costs for accommodation and subsistence for staying in London.
“Members of the Lords work hard and do a vital job scrutinising public policy and holding the government to account,” he said.
“That is more important than ever in the current crisis, and the allowance we are proposing will ensure that this work can continue without the need for members to go against the public health guidance by travelling into Westminster to sit on the red benches in the House of Lords chamber or in a committee room.”