Health services minister Rosie Winterton was speaking at the Commons health select committee as part of its inquiry into public and patient involvement in the NHS.
She defended the fact that out of 23 cases received from overview and scrutiny committees, health secretary Patricia Hewitt has referred just four to the independent reconfiguration panel.
MPs questioned whether Ms Hewitt had a 'vested political interest' in allowing trusts to go ahead with reconfigurations opposed by the public, rather than letting the panel decide.
Ms Winterton responded: 'Elected representatives have an opportunity to look at the proposals being put forward. The secretary of state has to say whether the consultation is adequate and whether it's going to damage the NHS.
'Yes, the secretary of state as an elected politician has to make that big decision, but there's also the option to refer it to the IRP.
'It's a balance between local involvement, the political involvement, and a certain amount of independence,' she said.
The IRP was set up in 2001 to mediate in disputes over hospital restructuring. But two years later, a lack of referrals forced it to take on a more informal preventive role with health and local government organisations.
Ms Winterton argued that the new local involvement networks (LINks) would make it easier to gain a consensus and reduce the need for arbitration in future. 'We're trying to bring about a system whereby people feel they're involved in the decisions at a very early level and understand the reasons for the changes,' she said.
'If the NHS can engage in that process more effectively, we will find fewer referrals because there's more of a consensus.'
The LINks will replace patient forums under legislation currently being debated in Parliament.