The Ministry of Justice (MoJ) has refused to increase fee levels for very high-cost criminal cases (VHCCs) despite thousands of barristers opting to boycott the new Government contract.

Just 130 barristers from the 2,300 that were offered contracts have signed up to the deal, which aims to lower fees on major criminal cases by as much as 20%-30%.

However, as virtually all of the 330 law firms that applied for the panel have signed up, the Legal Services Commission (LSC) and the MoJ have announced that solicitors will be able to instruct non-panel barristers at the reduced rates.

The VHCC contract offers QCs a rate of £476 for each day spent in court. Leading junior barristers will receive £390 and a junior acting alone will be paid £285 per day. For preparatory work, silks will pocket between £91 and £145 an hour.

Around 100 VHCC cases were funded by legal aid last year, with defence teams typically paid around £400,000 per case. However, some cases cost several million pounds.

Commenting on the news, legal aid minister Lord Hunt of Kings Heath said: "Both the LSC and I are very disappointed that most barristers who bid for VHCC work have refused to sign. It's essential that we put these measures in place to ensure that access to justice is not compromised in any way."

The news comes just days after Bar Council chairman Timothy Dutton QC warned of a "second-class system" emerging from the Government's legal aid reforms, which have attempted to slash the legal aid budget.

Dutton said: "We urge the LSC and ministers to reflect on the demerits of their proposed scheme and to return to the table to devise one based on a fee for the work undertaken and not hourly rates.

"This would be fairer to the taxpayer and the advocate alike and would stand a much better prospect of attracting the most able into this difficult work."