Key government documents relating to a blood disaster - which saw thousands of people exposed to HIV and hepatitis C - were destroyed to prevent a scandal and the victims taking legal action, the Health Minister at the time said yesterday.

Lord Owen told the independent inquiry into the deaths of nearly 2,000 haemophiliacs exposed to the viruses that he found the alleged cover-up "extraordinary".

The qualified doctor, who was Labour Health Minister in the mid-1970s, sought to make Britain self-sufficient in its blood supplies for transfusion in order to stop contaminated blood being imported from abroad.

He told the inquiry that only one memo remained of his involvement in the process.

Lord Owen said that the hearing should be told which civil servant had pulped his private ministerial papers and he should be brought to give evidence as to why it was done.

He said that while he was "very against" conspiracy theories, "the more you look at this, the more you look at the question in France (where there was a major scandal over the use of contaminated blood for transfusions), the more you begin to see people who were fearful of a legal process going on in this country".

The investigation is examining the deaths of 1,757 haemophiliacs as a result of exposure to the viruses in what fertility expert Lord Winston dubbed "the worst treatment disaster in the history of the NHS".

Many more are said to be terminally ill after contracting HIV and/or hepatitis C in the tragedy, which took place between the early 1970s and the mid-1980s.

When the scale of the problem emerged, The Northern Echo campaigned for Government compensation.

In 1989, lump sum payments of between £30,000 and £70,000 were made if families pledged not to take legal action.

Haemophilia is usually an inherited disorder in which the blood does not clot properly.

In the 1970s a new method for producing clotting factors was discovered which used plasma donations from thousands of donors. If one had a blood-borne virus, the whole batch would be contaminated.

During this period some blood products came from US suppliers who paid what became known as "Skid Row" donors for their blood - people more likely to be infected with HIV and hepatitis.

Lord Owen told the inquiry that in the early to mid-1970s it was well known within Whitehall, the haemophiliac community and doctors that there were problems with contaminated blood.

"It's always a difficult question for ministers," he said.

"Do you reveal a risk or do you get on with trying to reduce the risk. I chose to try to reduce the risk."

But although his aim was to make Britain self-sufficient in its blood supplies by 1977 or 1978, progress was "sluggish", with a need to find the resources and to reduce transfusion, meaning that it did not happen in his time at the Department of Health. After he left, the plans appeared to stop in their tracks.

The inquiry by Lord Archer of Sandwell has already heard from a number of witnesses including sufferers and their families.