Shadow attorney-general George Brandis says "Why should there be carte blanche for people who are not Australian citizens, who have come to this country illegally, have chosen of their own volition to place themselves in the hands of people smugglers to get here rather than take advantage of the Australian government's humanitarian entry programs?" he said.
The Coalition has not specified how the saved money would be used.
Refugee advocates, Greens describe move as cruel
The Greens have vowed to block the changes in parliament, arguing without appeals asylum seekers could be sent to their deaths.
Greens Leader Christine Milne condemned the policy.
"This is an incredibly cruel attitude that Tony Abbott is taking, and without the Greens strongly standing there in the Senate and
Adam Bandt in the House of Reps there won't be anyone standing up for strong advocacy for human rights, and for decency and for fairness," she said.
Refugee advocate Julian Burnside QC says asylum seekers usually do not have the money to pay for professional advice, so they either represent themselves or get help from an agency.
"The problem is that roughly 50 per cent of people who are knocked back by [Immigration] Department officers in their claim for asylum go to the Refugee Review Tribunal (RRT) and get the assessment changed. In other words, Department officers simply get it wrong," he said.
"For a person without representation to go to the RRT is likely to end up in an unfair result if they don't know what they're doing, can't speak the language, and don't have professional help.
"The result of that will be that a number of people who are genuine refugees will be returned to face persecution because they haven't had a fair go in our assessment system."
Mr Burnside added his work with refugees is pro bono, so there is no profit motive to his thoughts against the idea.
The Refugee Action Collective's Chris Breen says the proposal is unfair and unjust.
"It sounds outrageous. It sounds discriminatory. The legal services for asylum seekers, quite literally, save lives," he said.
"Tony Abbott's announcement appears to be just the latest in a horrific series of announcements. We would urge both Rudd and Abbott to step back. We can do better than this."
But Opposition Leader Tony Abbott defended the decision.
"Why should people who come to this country illegally get legal aid to run immigration applications and appeals when so many Australians who find themselves before the courts for whatever reason don't get legal aid," he said.
The ABC tried to contact Attorney-General Mark Dreyfus, but did not receive a response.
read in fullhttp://www.abc.net.au/news/2013-08-31/coalition-would-stop-funding-immigration-advice-for-asylum-see...
