The legal aid budget will face further cuts whoever wins the election, politicians from the three main parties warned last week.

Legal aid minister Lord Bach, shadow justice secretary Dominic Grieve QC and Liberal Democrat justice spokesman David Howarth all said new funding streams needed to be explored as there would be no more money for legal aid.

Speaking at a Question Time-style debate organised by pro bono group LawWorks, Bach said: ‘There are moments when politicians have to tell the truth and this is one of them. Legal aid is liable for more cuts under any government. We need to look at alternative ways to find money to fund criminal and civil legal aid cases.’

Grieve said policymakers needed to ‘go back to the drawing board’ and that, if elected, the Conservatives would conduct a legal aid review to explore new funding options and examine ways to relieve pressure on the legal aid fund.

‘We have got to do something completely new,’ he said. ‘Our intention is to do that by bringing in new funding streams.’

Grieve said his party is looking at options including a contingency legal aid fund; before-the-event insurance; and a version of the French scheme whereby money from solicitors’ client accounts is pooled and funding is gained from the interest ­generated. He also suggested that having an ombudsman system to deal with prison law cases would be a cheaper alternative to using the courts.

Howarth said legal aid policy must involve a reasonable quality of service. ‘All the current reforms have been designed to drive down quality,’ he said. Howarth suggested decentralisation of provision would reduce costs.

Law Society chief executive Des Hudson said he did not accept that there could be no more money for legal aid and suggested spending less on management consultants.