It's a very different system from the one most people mean when they talk of introducing PR. The system that is generally regarded as the best is known as "Single Transferable Vote", which works based on multiple-member constituencies. Say, constituencies of ten MPs or so. Parties therefore have a right to put up ten candidates per seat, but in principle the votes can be assigned to the individual MPs and not just the party. Voters are free to rank MPs in order of preference. Then the system works by setting a threshold of votes required to gain a seat (this threshold is set at 50% for a one-seat constituency, 33% if there are two seats, 25% for three seats, and so on). Anyone who reaches or exceeds this threshold gets elected, and, crucially, the "excess" votes are redistributed according to second preferences. If no new MPs are elected, the last-placed candidate is knocked out and his votes are redistributed also, and so on until all seats are filled by candidates who have reached the threshold. The general result for most constituencies would then tend to be that Labour and the Conservatives get two or three seats each, and the remaining four or five would probably be split between the minor parties.
By restricting the constituency size so that there are still not that many MPs per seat, there is still some link between voter and MP; this can be strengthened if voters are still able to vote for individual MPs (eg a vote for Labour candidate A over Labour Candidate B). By also allowing second preferences to be expressed, and distributing the votes around according to these preferences, the general results are also that the number of MPs elected is roughly proportional to the party's total vote share.
This is as close as possible to the best of both worlds, at least in terms of reflecting what voters ask for at the ballot box. What the MPs do afterwards is, of course, not in the voters' control. But in a fairer system it's reasonable to hope that the quality of MPs elected will go up too, and perhaps even the "protest" vote will diminish somewhat. Half of the reason some people vote for minor parties is that while they are aware that their vote will not lead to that person being elected, it's a good way to stick two fingers up to the system to have the teller read out "Monster Raving Loony Party", or some such.