Ruth Kelly, Education Secretary, is expected to bow to backbench rebels demands and remove, or qualify her proposed power of veto over local authorities creating new community schools.
As the TES went to press, leading rebel Labour MPs were saying they expected Government to reveal the change yesterday.
But although the issue represents their biggest demand, the backbenchers still hope to nail down further concessions before the bill's expected publication on February 28.
Labour MPs have organised a meeting to continue their fight through Parliamentary amendments to change the education bill.
The 95 rebels want clarification on admissions, how PFI assets could transfer to a trust, and where schools will be able to find information on the suitability of potential trust sponsors.
Speaking at Labour's spring conference in Blackpool, Angela Eagle, the former home office minister and the rebels' 'chief negotiator' said she believed the two sides were getting closer. "What a pity we couldn't have had the debate before the white paper, then we all could have gone through the lobby with a song in our hearts," said Ms Eagle, who is also the twin sister of education minister Maria Eagle.
The Lib Dems have published alternative proposals which include paying schools extra to admit disadvantaged and low attaining pupils.
They are also refusing to support the Bill without further concessions but hope that they can tempt ministers to rely on them rather than the Conservatives to get the Bill through. In return they want more safeguards on admissions.
This week research on admissions in London secondaries revealed that a quarter used potentially selective admissions criteria, such as collecting extra information from parents and interviews.
The London School of Economics report found the practice was more common in self-governing schools that the white paper aims to promote.
The Education Network, a local authority advisory group, proposes giving councils a duty to compile admissions reports and forums the power to approve them.