Tony Holland, a member of the Lord Chancellor's fundamental review team, is "stunned" by reports that his proposal for legal aid fund-holders is being used to cut the annual budget.
It has been claimed that Lord Mackay is negotiating with Jonathan Aitken, the chief secretary to the Treasury, over ways to slash the legal aid bill.
But a Lord Chancellor's Department spokeswoman says it is too early to know what will be included if a green paper is published. Claims that the fund holders' proposal will be prominent are premature, she says.
Holland, joint senior partner at Foot & Bowden in Plymouth and joint author of the report by the Social Market Foundation, says: "The exercise I am involved in has nothing to do with slashing the legal aid budget. It is about using the existing legal aid budget in a more effective fashion.
"I wouldn't take part in any exercise to cut legal aid. I was stunned to read it."
Holland, a former Law Society president, and other members of the review team, including economist Gwyn Bevan, went public with some findings to spark a debate.
In the report, they propose a scheme of gate-keepers for legal aid - assessing eligibility and encouraging firms to compete for funds. It was also suggested block contracts could be offered to selected firms in return for competitive rates. Holland, who distances himself from some of the proposals, insists that radical changes to the system are needed.