A campaigning Labour MP has warned that the Government looks as though it does not "want to get to the truth" about historic child abuse after Home Secretary Theresa May indicated that the troubled inquiry panel could be disbanded and replaced.
Simon Danczuk said victims would be dismayed at the lack of progress in the probe, and could not help worrying that the litany of mistakes was "deliberate".
But others welcomed the move, arguing that the current set-up is flawed and must be changed.
Mrs May signalled a potential shift of approach last week when she told MPs that she wanted the wide-ranging inquiry - which is without a chairman following the resignation of two previous appointees - to be given extra powers.
That could mean waiting for a chairman to be appointed for the inquiry panel, who would then request statutory powers, or setting up a new inquiry panel under statutory terms.
The third option of a Royal Commission - which many prefer - would not have the powers of a statutory inquiry under the 2005 Inquiries Act and would be ''legally more risky''.
Previous appointments as inquiry chairwomen, Fiona Woolf and Baroness Butler-Sloss, resigned following claims about their perceived closeness to establishment figures.
In a letter to the panel members, reported by the investigative website Exaro News, Mrs May said: "I am currently considering these options and I appreciate this has implications for members of the panel."
In a reply to Mrs May obtained by Exaro, panel member Sharon Evans, of the child safety group Dot Com Children's Foundation, said: "I, like other members of the panel, feel devastated at the prospect of the independent inquiry being halted as it has been made clear to us 'off the record' that the panel will be stood down in the new year."
But Peter Saunders, of the National Association for People Abused in Childhood, said if the inquiry does not have confidence of abuse survivors, it will be "meaningless" and starting the process again should not be a "huge trauma".
"If indeed the decision has been made or is made to disband the panel as it is currently constituted, then I know that that would be supported by the vast majority of survivors or survivor organisations that we are in touch with," he told the BBC Radio 4 Today programme.
"I have yet to encounter any survivors who have any faith in the process, or in the panel as it is currently constituted.
"We need to have a transparent, open recruitment or a panel with appropriate skills and expertise, all done out in the open, nothing to do with nepotism or connections with people already in the establishment.
"There are some very good people on that panel as it stands at the moment, but there are one or two characters who sadly have association with the past that would make them inappropriate."
Mr Danczuk told Today the situation is a "mess".
"What I suspect will happen, because we are not getting any satisfaction from Government, because we are not moving forward and it has been six months now - documents going missing, chairmen having to stand down and resign, the Wanless whitewash review into lost documents, terms of reference not being appropriate and now the panel being disbanded - I think that people will turn to more direct action and you can hardly blame them.
"What you do need is a mixture of people on that panel who have a whole variety of experiences. I think the Home Secretary had got it broadly right in terms of the people that she appointed.
"Where she got it badly wrong is in terms of the process, the consultation with key stakeholders in this case the survivors of child abuse."
Mr Danczuk said he expected there would be "more and bigger peaceful protests, more challenging of ministers, more challenging of the police to take action".
"I have supported her (Mrs May) on previous occasions ... but it is time and time again, and now this arrangement," he said.
"There is very little faith in Government in terms of delivering this.
"If Government are set on doing this then it can be achieved. But you can't help thinking that they are not intent on getting this right.
"There is a catalogue of mistakes that have been made, some of them fairly basic, and you can't blame the survivors of child abuse for wondering - because of the allegations of high-profile figures involved in the abuse - you can't help thinking that some of this is quite deliberate mistakes.
"They don't want to get to the truth, that would be the allegation."
Former children's minister Tim Loughton said the inquiry would be set back by "yet more weeks and probably months".
"All of the survivors that I have seen on a one-to-one basis or as part of the Home Affairs Select Committee, have said 'Look, we need to get on with this. We need this inquiry to get to the truth'," the Tory MP told Today.
"This panel is not perfect, but there are some very well-qualified, decent people on the panel. They have given up their time, they have started their work.
"They have lost two chairmen, they have got on with their work ...
"So now to say 'Look, sorry, but you are all going to be sent back home again', I think it is very unfortunate and rather disrespectful to the panel members.
"It is just going to set the inquiry back yet more weeks and probably months."
A Home Office spokesman said: "The Home Secretary is determined that appalling cases of child sexual abuse should be exposed so that perpetrators face justice and the vulnerable are protected.
"She is absolutely committed to ensuring the Independent Panel Inquiry into Child Sexual Abuse has the confidence of survivors.
"The Home Secretary is also clear that we have to balance the need to make progress with the need to get this right."
Shadow Home Office minister Diana Johnson said: "The Home Secretary should be utterly ashamed of the process she has overseen.
"We are now in a position where there is no chair and no panel, while no work has been done on examining the horrible crimes of the past or into the flaws in the current child protections system.
"Theresa May needs to take responsibility for the utter failure to get this vital work off the ground over such a long period.
"This is not the first time inquiries have been held on difficult and sensitive issues. Neither the Hillsborough inquiry led by the Bishop of Liverpool nor the Bichard inquiry into child protection was mired in this chaos and confusion.
"The Home Secretary has failed time and time again to set up an inquiry which commands the confidence of the public."
Over the weekend it emerged that Labour MP John Mann has handed Scotland Yard a dossier including allegations about the involvement of 22 politicians - some of them apparently still serving - in paedophile rings. The names are said to include 14 ex-ministers.
Copyright (c) Press Association Ltd. 2014, All Rights Reserved.