First Minister Arlene Foster has said it is "grotesque" that Sinn Fein is blocking the victims' pension to "accommodate the people who made them victims in the first place".
The DUP leader, speaking on Radio Ulster's Good Morning Ulster, expressed her anger that the scheme, which is to provide a pension to victims of the Troubles in Northern Ireland, has not been implemented.
"I think it is absolutely wrong that the scheme has not gone ahead," she said.
"I find it go grotesque that we had a scheme set up in October by the government at Westminster and we have not been able to get it implemented.
"As first minister, I think that is absolutely wrong and shameful."
Sinn Fein has refused to nominate a department to handle the scheme, arguing that legislation passed in Westminster discriminates as anyone with a conviction with a jail term more than two-and-a-half years would be excluded irrespective of if they were involved in the Troubles or not.
Sinn Fein MLA Gerry Kelly said the regulations are "discriminatory and unacceptable".
The DUP says the regulations only exclude those injured by something they did, such as a bomber injured while setting a device.
Mrs Foster added: "The definition of a victim that was set out in the Bloomfield Report, which I think Gerry Kelly is referring to, has always caused difficulties. It is not a legal definition and of course the Westminster government is entirely within their right to set the limits of any scheme that they set up."
Mrs Foster said the next stage is to designate the Department of Justice to manage the scheme, but that she needs agreement from Deputy First Minister Michelle O'Neill.
"It is wrong, absolutely wrong, that we should not be implementing this victims' pension because what we are essentially saying is that everybody has been held up to accommodate those people who made them victims in the first place. I think that is grotesque," Mrs Foster said.
The first minister added that she is working with the UK Government and Northern Ireland Secretary of State Brandon Lewis to solve a dispute over who will fund the scheme but that first a department must be designated to handle the scheme in Northern Ireland.
"Sinn Fein need to acknowledge that the law is there and they have a legal obligation and I hope they come to a position where they designate the Department of Justice to take this matter forward," she added.
Sinn Fein has been approached for comment.
Mr Kelly told the BBC his party has concerns over the funding for the scheme with estimates of £100m in the first three years.
"It is the British Government who have brought in these regulations, without consultation, to be discriminatory, and all they are interested in is to protect one section of victims," he said.
"The regulations are discriminatory and unacceptable.
"The issue was around perhaps a small amount of people. But what they have done quite deliberately is expand that out for anyone - and it does not have to be conflict related - for anyone who with a sentence of two-and-a-half years or more will not be eligible."