The lord chancellor has given an indication he might be looking to remove the controversial criminal courts charge or soften its impact on defendants.

Answering questions in the House of Commons yesterday, Michael Gove (pictured) said the government was reviewing the ‘operation of the charge’ in light of the concerns expressed by MPs, magistrates, the judiciary and by pressure groups.

The criminal courts charge has attracted widespread criticism since it was introduced in April. More than 50 magistrates have resigned in protest against the charge and critics argue it is encouraging innocent people to plead guilty to avoid higher costs.

There have already been some indications that the lord chancellor might be looking at scrapping the charge. One of the plans which has been floated is to impose a levy on top City firms to replace any revenue lost.

Facing questions from both Labour and Conservative MPs during justice questions, Gove gave a further indication he is open to reforming the charge.

Alex Chalk, Conservative MP for Cheltenham, asked whether the lord chancellor could give discretion to judges and magistrates on imposing the charge.

Gove said he would reflect on this ‘valuable submission’, and once more acknowledged that the charge was a ‘cause of concern for the house’.

Craig Mackinlay, Conservative MP for South Thanet, noted the system is ‘wholly despised’ by the lay magistracy, with some worried that bailiffs will try to chase debts that will be written off and never collected.

Gove responded that he will continue to ‘listen to the points’ many are making about the charge. He said the government has listened to a ‘number of representations’ from magistrates, but these concerns have to be balanced against other factors.

On Monday, Bob Neill, chair of the justice select committee, which is conducting a review of court fees, told Radio 4’s The World Tonight that two elements of the criminal charge are failing.

‘It was said that this would raise money to offset the cost of the court system,’ said Neill. ‘Well, leaving aside whether that is right in principle or not, all the evidence is that it isn’t and it may well run at a loss.

‘Perhaps even more troubling is the fact that it does seem to be distorting the way in which people behave in court – whether or not defendants might plead guilty to save the cost of the charge when otherwise they would not have done, which isn’t what we want to see.

‘Or, perhaps most concerning of all, judges or magistrates may have to distort the way in which they sentence because they have got this charge which they have to impose and they have got no discretion about it. It crowds out their ability perhaps to award compensation or fines.

Speaking in the Commons yesterday, Gove said: ‘The criminal courts charge is generating revenue, which helps ensure that the taxpayer is not the first port of call for supporting the way in which our courts operate, but it is important that we balance all the criteria in making a judgement on the review of the charge.’