Lord Forsyth of Drumlean said the SNP election result was a "revolution" and could not be overlooked.
Meanwhile, former Labour chancellor Alistair Darling said Mr Cameron had the chance of "building a constitution for the 21st century".
The SNP won 56 of the 59 Scottish seats at Westminster last week.
Mr Darling added that in his opinion the rising success of the SNP had "completely  overtaken" any agreements made in the Smith Commission - which outlined increased devolution proposals in the wake of the independence referendum last year.
Lord Forsyth, a Conservative peer, told the BBC that the big advantage of giving Scotland more powers was that it would prevent SNP leader Nicola Sturgeon producing "fantasy manifestos" without raising the cash to pay for it.
He said: "I think we have to recognise what happened in Scotland last Thursday was a revolution.
"The Conservative in me was full of joy for what David Cameron had achieved but the unionist is greatly dismayed.
"We used to say if the SNP won a majority in seats in Scotland then they could have independence.
"They got 50% of the vote and 95% of the seats and the reality is you have to respond to that and I think what the government needs to do is produce a White Paper which sets out how fiscal autonomy, devo-max, call it what you will, would work in practice so people are aware of the advantages and the disadvantages."
The Conservatives have outlined in their manifesto an "English votes for English laws" proposal, which would give MPs for English seats a veto on issues which affect only England, including on income tax.
Mr Cameron promised firm proposals within 100 days of forming a government, which would be "fully implemented" by the time of the Budget in March of the following year.
But Mr Darling warned that such a law could break up the union.
He told the BBC: "...by saying that essentially English MPs will decide tax and spending, you are well on the way to breaking up the Union."
SNP leader Nicola Sturgeon has previously said if there were matters that were genuinely English only, and had no impact in Scotland, there would be "a strong case" for Scottish MPs not voting on them.
"The problem is there's a lot of issues characterised as English-only issues that are anything but - matters relating to the English health service for example.
"Decisions taken on that have a direct impact on Scotland's budget," she said.
Ms Sturgeon is referring to the system used to allocate funds to devolved governments. These sums are dictated - via the Barnett formula - by the figure allocated to services such as health and education in England.
The government needs to set out how it will devolve further fiscal powers to Scotland following the rise of the SNP, a former Scottish secretary has said.