The Legal Services Commission (LSC), which runs the legal aid scheme, is to axe 600 jobs over the next three years.
The commission said the job cuts, which will see LSC's headcount reduce from 1,700 to 1,100 by 2011, is part of its bid to reshape its business support directorate.
As part of the initiative, which will take between three to five years, the LSC is cutting the number of processing sites it operates from 13 to five. The job losses will come about as part of the reduction in sites. The jobs will start being cut by mid 2009 at the earliest.
An LSC spokesman said the changes are part of the transformation of legal aid in England and Wales, which is designed to deliver improved services to clients.
"More efficient processes and increased use of electronic working will enable us to provide these services with fewer staff and to deliver better value for money for the taxpayer," said the spokesman.
Processing sites in Brighton, Cardiff, Cambridge, Reading, Leeds, Chester and Birmingham are all set to close, though relationship managers will retain an office in each city.
The LSC plans to operate from its remaining five offices in London, Bristol, Liverpool, Nottingham and South Tyneside.