Ministers are braced for defeat in the House of Commons tonight after Tory MPs joined calls for a new body to administer payouts to infected blood victims.
At least 30 Conservative backbenchers are due to rebel against the Government and demand the establishment of a judge-led body to oversee a compensation scheme.
The infected blood scandal saw thousands of patients infected with HIV and hepatitis C through contaminated blood products in the 1970s and 1980s.
Compensation payments to victims and their families could reportedly cost between £5billion to £22billion.
The Government has already paid out around £400million in interim compensation payments, with ministers having wanted to wait until the ongoing inquiry has concluded before establishing a full scheme.
But they could have their hands forced after Labour put their support behind an amendment - being backed by rebel Tory MPs - to establish a body to adminster payouts within three months.
The infected blood scandal saw thousands of patients infected with HIV and hepatitis C through contaminated blood products in the 1970s and 1980s
At least 30 Conservative backbenchers are due to rebel against the Government and demand the establishment of a judge-led body to oversee a compensation scheme
Labour shadow chancellor Rachel Reeves wrote to Chancellor Jeremy Hunt this weekend to inform him of her party's support for the amendment to the Victims and Prisoners Bill
Labour shadow chancellor Rachel Reeves wrote to Chancellor Jeremy Hunt this weekend to inform him of her party's support for the amendment to the Victims and Prisoners Bill.
She described the infected blood scandal as 'one of the most appalling tragedies in our country's recent history'.
'This week we have the opportunity to work together to begin to bring justice for the victims,' Ms Reeves added.
'Blood infected with Hepatitis C and HIV has stolen life, denied opportunities and harmed livelihoods.'
Under the amendment, tabled by Dame Diana Johnson, the Labour chair of the Commons home affairs committee, the Government would be required to create a compensation body within three months of the legislation becoming law.
Senior Tories Sir Robert Buckland and David Davis are among those backing the amendment.
The creation of a compensation body by the end of this year had been recommended by the chairman of the contaminated blood inquiry, Sir Brian Langstaff, a former High Court judge.
But Culture Secretary Lucy Frazer this morning indicated that ministers are unlikely to shift position, insisting that it was 'appropriate' to wait until the ongoing inquiry has concluded.
'We have made interim compensation awards, there is an inquiry ongoing. That will report next year and that is why we think it is appropriate to wait for the inquiry,' Ms Frazer told BBC Radio 4's Today programme.
'I can totally understand and this is an absolutely dreadful situation, that is why Government has already identified compensation on an interim basis and that is why we have got an inquiry'
She said it was 'appropriate' to 'wait for the outcome'.
'I think it is always appropriate when you put in place mechanisms for review that you await the outcome of those reviews before you make any final decisions,' she said.
The independent inquiry into the scandal was due to publish its final report this autumn but the document will now be published in March 2024 due to the 'sheer volume and scale of the material'.
Under an initial scheme, only victims themselves or bereaved partners can receive an interim payment of around £100,000.
Labour's shadow minister for victims and sentencing Kevin Brennan has also tabled an amendment which would require the Government to respond to the final report of the independent Infected Blood Inquiry within 25 days.
'This is not a party political issue,' Ms Reeves said. 'All of us have a responsibility to act now to address this historic wrong.
Commons Speaker Sir Lindsay Hoyle will decide which amendments MPs will vote on later.
Senior Tories Sir Robert Buckland and David Davis are among those backing the amendment tabled by Labour's Dame Diana Johnson