Health Secretary Sajid Javid confirmed plans for passports for nightclubs and large scale events would not be going ahead on Sunday, insisting the Government shouldn't introduce measures "just for the sake of it".
Although Work and Pensions Secretary Therese Coffey said the idea had not been ruled out forever yesterday morning.
The nightclub industry had been highly critical of the measures, with leaders saying the plans could have crippled the industry and led to venues facing discrimination cases.
Martin Monahan, owner of The Buttermarket in Shrewsbury, believes to make nightclub revellers use vaccine passports would have put large-scale venues at a disadvantage compared to smaller late-night bars. He was glad to hear the passports will not be brought in at this stage.
"We've avoided a two-tiered system," he said. "It was going to be an impossibility to deal with fairly.
"If venues across the board had to do it, at least then it would be a level playing field.
"What is clear is a lot of the larger venues have a much better ventilation system, so it doesn't necessarily follow that smaller venues are safer. It's actually quite the opposite."
He added: "I am pleased that they have decided to shelve this. Overall I'm pleased to hear what Sajid Javid has said.
"As larger venues, we have all taken steps to try and be as safe as possible.
"I believe there are some real challenges for the industry, in terms of staffing. It's not as bad now as it was in July and August. We were so short staffed."
After the Heath Secretary spoke, No 10 insisted the plan - which had been set to be introduced at the end of September - would be kept in reserve in case it is needed over autumn or winter.
Under the scheme, people would have been required to show proof - whether of double vaccination, a negative Covid test or finishing self-isolating after a positive PCR test - in order to gain entry to clubs and other crowded events.