The case of Garry Weddell, who killed while on bail, caused uproar
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Banning bail for all murder suspects would "present legal problems", the Ministry of Justice has said.
A consultation document on the issue for England and Wales suggests "less drastic changes" to the rules.
The government reviewed bail decisions in murder cases after a policeman on bail for murdering his wife, went on to kill her mother, then himself.
A "general right" to bail is enshrined in law. In January 13% of murder suspects - 60 people - were on bail.
The public consultation document, unveiled by Justice Secretary Jack Straw, said that "snapshot" study on 31 January also found that across all crimes, 68% of suspects were out on bail.
Mr Straw told MPs he did not "take it for granted" that it would be necessary to change the law, but he said: "Public protection must be paramount when considering an application for bail."
He added: "Bail decisions in murder cases will never be easy.
"The vital thing is to ensure that the courts strike the right balance between respecting individuals' right to liberty and protecting the public.
"The government's aim is to target custody as precisely as possible upon those cases where there is a risk of harm to the public."
'Shock and concern'
A review was set up after the case of Garry Weddell, a policeman who killed his mother-in-law while on bail for his wife's murder.
Weddell was charged with murdering his wife Sandra at their Bedfordshire home but was released on bail ahead of the trial - the judge felt he did not pose a risk to the public.
In January he shot his mother-in-law, before killing himself.
Mr Straw said few murder suspects were released on bail and most who were, were "highly unlikely" to kill again. But he said the case had "naturally aroused shock and concern".
However there was a concern that a total ban on bail for all murder cases, might contravene the European Convention on Human Rights - which requires courts to have some discretion to grant bail in some circumstances.
The consultation paper noted that an attempt in 1994 to prevent bail in grave offences was found to breach the European Convention on Human Rights.
Mental harm
And it pointed out that a ban could be "unjust" in cases of murder suspects in "mercy-killing" cases or that of someone who shot a burglar in their home.
Instead it proposed a "more modest alternative" requiring courts to give greater weight to the potential risks of granting bail to a murder suspect, including the likelihood of them inflicting physical or mental harm.
The Conservatives launched their own review of bail in February which is due to report shortly.
Responding to the government's consultation document, shadow justice secretary Nick Herbert said: "The government has belatedly come forward with narrow and weak proposals for consultation which only look at bail for murder suspects and which may result in no change in the law at all.
"Tinkering with the law in these cases cannot be enough to address the scale of the problem."
He added: "Any suggestion that human rights laws could be an impediment to sensible and necessary safeguards must be challenged decisively."
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