On the day a Bar Council poll showed seven out of 10 people in England and Wales were worried that cuts to legal aid could lead to innocent people being convicted of crimes, shadow justice minister Robert Flello asked whether miscarriages of justice were a price worth paying for the reforms.
Responding during justice questions, Mr Grayling said: "I still don't think that the Opposition understands the nature of the financial mess they left behind and what we have to do to balance the books.
"I also think that the public expect me to do what I can to maintain a strong prison system, a strong court system, but also to have a legal aid system that provides justice but that is also affordable and that is what we are doing."
The reforms to the Legal Aid, Sentencing and Punishment of Offenders Act (Laspo) will help the Government cut its £2.2 billion legal aid bill by £350 million. A Government consultation on legal aid is also ongoing, which paves the way for lawyers to compete for contracts among other reforms.
Senior Liberal Democrat Sir Alan Beith, MP for Berwick upon Tweed, said there would be no incentives for firms who won contracts to keep standards high, while Labour's Meg Hillier, MP for Hackney South and Shoreditch, warned that some lawyers would prove too expensive for the Government.
Mr Grayling said: "I have absolutely no intention of ending up with a legal aid market which is dominated by a small number of very large firms. And a central part of the tendering process will involve a quality threshold that ensures that we have the quality of advocacy and the quality of litigation support in this country that we need and expect."
Tory former lawyer Anne McIntosh, MP for Thirsk and Malton, warned that the reforms would mean young barristers would have less access to the profession.
Mr Grayling said: "We have taken care during these proposals to put together a package based on our statistical analysis that we think will actually protect incomes at the lower end of the bar particularly. It is my intention that where we have to impose changes on the profession that they come through either through the re-organisation of business or income changes at the top end of the scale."