On the contrary, life peerages existed before the 1958 act. What the 1958 act did was to enable baronial life peerages after that date to take a seat in the House of Lords. Life peers previously were barred. The act doesn’t limit what title a life peer can have but rather enables life peers of baronial rank to take a seat which they otherwise would not be entitled to.
The non-hereditary appointments to the House of Lords are on the advice of the Prime Minister and restricting those to non-hereditary baronial rank (the lowest rank in the peerages) prevents other issues of maneuvering up through the ranks for reasons of vanity.
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