> They are likely even more out of touch with the electorate.
Not compared to the hereditary peers.
In theory these people have proved themselves useful in some way and bring expertise to the upper chamber, rather than just being born in the right family. In practice there is some of that and some political cronyism.
> Seems to me this just centralizes power even more in the hands of a few.
That is exactly what hereditary peerage is. The few, by definition. The aristocracy.
Being out of touch with the electorate is the thing they have as a feature over the house of commons.
i.e. they're not trying to win the next election.
They're also not there because of the favours they've done existing politicians.
I don't think this is "great" but it does make me wonder if the people who want an end to herditary peers are really going to like what they get.