Premier understands Theresa May is considering such a move, and is expected to make her decision early in the New Year.
The inquiry which she set up in the wake of claims of paedophiles operating in Westminster in the 1980s continues to blight her department, after a series of false starts and blunders.
In November, Mrs May was forced to apologise to victims in the Commons after the first two nominations to chair the panel stood down over links with 'establishment figures'.
The current inquiry is investigating whether public bodies and other non-state institutions have taken seriously their duty of care to protect children from sexual abuse in England and Wales.
Peter Saunders, from National Association for People Abused in Childhood claims victims wants to see a more transparent selection process put in place ahead of any newly proposed statutory inquiry.
Speaking on Premier's 'News Hour', he said: "One of the issues that survivors and survivor organisations had with the whole process was that the panel seemed to be selected without any sort of due regard or even due diligence, in terms of the constitution of those panel members; and there are certainly one or two panel members that many survivors have issues with as being part of it.
"In some sense it could be back to the drawing board, but that's up to the Home Secretary not up to us."
Meanwhile, Labour MP John Mann has reportedly said it was "inconceivable" that police would not now arrest and interview some of the politicians he has named in a list which claims up to five paedophile rings operated at the heart of Westminster.
According to the Telegraph, Mr Mann, who has spent months sifting evidence from members of the public, met Scotland Yard and handed over evidence on 22 politicians, including three serving MPs and three members of the House of Lords.
"There are at least five paedophile rings which involved MPs", he said.
"Each of them involved at least one MP, some involved more and these were groups of people who knew about the activities of one another.
"In some cases I believe they committed abuse together."
Peter Saunders, CEO, National Association for People Abused in Childhood
