As many as five Fianna Fáil ministers last week told Mr McDowell they would not support his proposed Defamation Bill unless it included legislation to protect the privacy of individuals from press intrusions.
Mr McDowell promised to reform defamation legislation when he was elected to office in 2002. The proposed bill includes stronger guarantees of press freedom but also provides for the setting up of a press council, which will be set up but not operated on a statutory basis.
However, when he first presented the bill to fellow ministers last summer, several ministers including Martin Cullen, Noel Dempsey and Brian Cowen opposed it on the grounds that its privacy provisions were not sufficiently strong.
At the Cabinet meeting last week, Mr McDowell outlined details of proposed privacy legislation to be published at a later date. It was based on a landmark European Court of Human Rights case that upheld the rights of Princess Caroline of Monaco to privacy.
However, a number of Fianna Fáil ministers insisted the privacy legislation be published simultaneously with the Defamation Bill.
The Irish Examiner understands the minister will present reworked proposals for the legislation at the weekly Cabinet meeting tomorrow.
A reliable source yesterday said the new package would gain the consent of all
Government ministers and would be published before the summer.
Transport Minister Mr Cullen has been widely perceived as the strongest advocate of privacy legislation, in the light of the public controversy and sustained media coverage surrounding his appointment of Monica Leech.
However, it is believed that two other Cabinet colleagues, Mr Cowen and Mr Dempsey, argued more forcefully for the privacy legislation to be included.