Justice minister Lord McNally tells peers that controversial clause has been withdrawn from legal aid bill

One of the most controversial elements of the government's legal aid bill ? the means testing of suspects held in police stations ? has been abandoned following a critical late-night debate in the House of Lords.

As former director of public prosecutions Lord Macdonald rose to object to the proposals that would have undermined the universal right of those arrested to see a solicitor, justice minister Lord McNally signalled that the clause was being withdrawn.

The concession on clause 12 of the legal aid, sentencing and punishment of offenders bill follows vociferous attacks on the practicality of police officers enforcing such a measure in the middle of an investigation.

Lord Macdonald told The Guardian that he had met the Justice Secretary, Ken Clarke, a week ago to raise his concerns about the proposal. "I think they have been in genuine listening mode on this one," he said.

"The idea that you would interrupt the process at the police station to have some means test with all the bureaucracy that would involve is bizarre. The government is always saying that it wants to reduce the bureaucracy in police stations.

"How would a prisoner have produced his mortgage payments or financial details at that stage. It was ludicrous. It would never have worked. It would have slowed down the investigation process and no money would have been saved."

A spokesman for the Ministry of Justice confirmed: "We did concede on means testing suspects in police stations for [access to] legal advice." One of the more curious elements of the clause was that another justice minister, Jonathan Djanogly, had previously indicated that it was not a power the government had said it wished to use at this time.

The lobbying group Sound Off for Justice, supported by the Law Society, had pressed to have clause 12 removed from the bill. It had asked: "How do you have time to do these tests within the timescales that the police operate? How will someone arrested prove their means to pay for their case when they don't know what it will entail?"

The government seems to have accepted that imposing an extra layer of paperwork on police would not prove to be a popular move. The universal right to representation by a solicitor at a police station was enshrined in the 1984 Police and Criminal Evidence Act (Pace) in response to a series of serious miscarriages of justice in the 1970s and 80s involving unrepresented defendants.

Following the government's concession, Lord Carlile of Berriew, the former independent reviewer of terrorism legislation, asked for assurances that the government would "have in mind the importance of the duty solicitor scheme and of there being a process of integrity in the police station, so that suspects do not choose to refuse to answer questions in interview because they are not properly represented?

"... I hope that whatever [replacement] amendment is introduced will ensure that we do not have to return to the bad old days before the enactment of the Police and Criminal Evidence Act 1984."

Lord Beecham, one of the Labour peers who has tabled amendments preserving legal aid in criminal injuries compensation cases, said he welcomed comments from Lord McNally about reviewing the proposed cut.

He commented: "I welcome the first signs of government willingness to make changes to the Legal Aid Bill, dropping the misconceived idea of means-testing suspects needing advice in police stations and reconsidering the withdrawal of legal aid in criminal injuries compensation cases.

"I hope they will extend this approach to vital areas where legal aid is threatened, like domestic violence, housing and clinical negligence. They also need to protect CABS and law centres who give valuable support to claimants."