Relatives of dead infected blood victims will get compensation
The change follows a heavily critical report into the way victims of the worst treatment disaster in NHS history were being compensated.
A 'long overdue' memorial for thousands of victims of the scandal will also be created.
Earlier this month, the Infected Blood Inquiry made a series of recommendations to improve compensation for people who were both infected with contaminated blood and those indirectly affected by the scandal.
Sir Brian Langstaff, chairman of the inquiry, said the number of people who have been compensated to date is 'profoundly unsatisfactory' as he called for 'faster and fairer' compensation for victims.
The investigation found victims had been 'harmed further' by the compensation scheme's failings.
Responding to the report, the Government said that it was immediately accepting a number of the recommendations and will consult on others. It is not rejecting any of the recommendations.
Affected people's claims will no longer 'die with them' and their payments will be passed on to their estates.
People infected with HIV before 1982, who were previously ineligible, will be compensated - and the requirement for people with hepatitis to provide a date of diagnosis will be abolished.
It said it will consult on a number of issues including: how the scheme recognises the impact of interferon treatment for hepatitis which has been linked to severe side effects; how the scheme recognises severe psychological harm; and it will also consult on the scope of how victims of unethical research are to be compensated.
Elsewhere, the Government announced further interim payments to the estates of people who have died.
It also confirmed that Clive Smith, president of the Haemophilia Society, will be the chairman of the Infected Blood Memorial Committee.
Mr Smith will lead the work to create a national memorial to the victims of the scandal and will 'support memorials in Scotland, Wales and Northern Ireland'.
Cabinet Office Minister Nick Thomas-Symonds said: 'When I appeared before the inquiry in May, I said that I would take a constructive approach and, carefully, consider the issues that had been put to me.
'I have concentrated on removing barriers to quicker compensation, working with IBCA, and am determined to deliver improvements based on this new report.
'Our focus as we move forward must be working together to not only deliver justice to all those impacted, but also to restore trust in the state to people who have been let down too many times.'
David Foley, chief executive of IBCA, added: 'The community is at the heart of everything we do. We can only grow the service, and implement these new recommendations by listening to and acting on the views of the community.
'Some of the recommendations will take longer to implement, which we know may cause frustration and upset for some in the community.
'We will always act with transparency. That is why I can confirm that we will create a registration process, so that the community can tell us that they intend to make a claim.
'We will also develop the service for all groups, paying the first claims before the end of 2025. And we will improve transparency by sharing more of our processes, documents, data and plans on our website.'
Incoming memorial committee chairman Mr Smith said: 'A memorial to the thousands who have died from the contaminated blood scandal is long overdue.
'It is a great privilege to be asked to lead this important work on behalf of the community.
'I look forward to working with the whole community across the UK on building an appropriate memorial to those we have lost and to act as a lasting memorial to the nation of what can happen when patient safety is not prioritised.'
More than 30,000 people in the UK were infected with HIV and hepatitis C after they were given contaminated blood and blood products between the 1970s and early 1990s.
More than 3,000 people have died as a result, and survivors are living with lifelong health implications.
The Infected Blood Inquiry published its main report on the scandal in May last year, and a compensation scheme was announced a day later.
But in the same week a general election was called and officials from the IBCA have described how in the early days of the organisation it consisted of two men, a laptop and a phone.
Some £11.8 billion has been allocated to compensate victims, administered by the IBCA.
As of July 15, 587 people have had their compensation paid totalling more than £400 million.
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