I fixed this on my system by adding a script with the following content
to /etc/acpi/local/lid.sh.post

#!/bin/bash

grep -q closed /proc/acpi/button/lid/*/state
if [ $? = 0 ]
then

/usr/sbin/pm-suspend

fi

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https://bugs.launchpad.net/bugs/863834

Title:
  [regression] Suspend on lid close broken on Oneiric

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