Legal Affairs Editor
A leading insurance company tried to prevent a council investigation of one of Britain's worst child sex-abuse scandals, saying that it would be a "hostage to fortune" and a "dress-rehearsal for claimants".
When the council went ahead with the investigation, the insurer took action to ensure its findings were not made public.
The behaviour of the Municipal Mutual, insurer of Clwyd County Council, impinged on normal democratic procedures, according to the suppressed independent report into the abuse scandal at care homes in the county. Exclusive extracts from the report, seen by the Independent, also show that fears by the Municipal Mutual of victims launching legal actions helped to ensure that a full report of an earlier investigation into the abuse was never seen by elected councillors, and was confined to a very small group of senior social services personnel.
Clwyd, which was split into three councils last Monday, commissioned an independent inquiry panel led by a former Derbyshire social services director, John Jillings, two years ago but capitulated in the face of threats by the insurers, whose business is now handled by Zurich Mutual, that the county's insurance cover would be revoked if the report was published.
The latest insights into what is likely to rank as one of the most serious cover-ups of professional failure, show the insurers opposed the Jillings inquiry from the outset.
Councillors appointed the Jillings team in response to fears that a paedophile ring had taken hold in children's homes over a 20-year period of abuse. The panel unearthed evidence of disciplinary proceedings against 51 care staff, going back to 1974, and 13 convictions, and described the abuse of children as "frankly appalling". But, in February 1994, the insurers wrote to Clwyd's county secretary, saying the inquiry would be "a hostage to fortune".
"Every inquiry is a further dress-rehearsal for claimants and a further incentive to the `bandwagon' syndrome'."
The report says that the insurers' interests "impinge on the established democratic and constitutional arrangements of England and Wales".
The 1990 conviction of Stephen Norris, the officer in charge at Cartrefle children's home, for indecently assaulting three boys, was one of the first outward signs of a much wider abuse regime, but usual procedures do not appear to have been followed.
Since Norris - later convicted of serious sexual assaults against boys at the Bryn Estyn home - had worked for the council for nearly 20 years, his past contacts with children came up for review. But on the insistence of Municipal Mutual, the inter-agency Area Child Protection Committee was only ever allowed to see a 10-page synopsis of a critical report it had commissioned from outside experts. The social services committee was also confined to receiving the summary.
The explanation was that some matters were sub judice because of an on- going police inquiry, but the Jillings investigation reports a letter from the county solicitor saying: "In addition, the ... insurers indicated that the county council could in certain circumstances invalidate its insurance cover."
Social-work experts said yesterday that no investigator would wish to prejudice criminal prosecutions, but that the way reports were written rarely raised that kind of risk. It was also "highly unusual", according to one social-work inspector, for relevant councillors not to receive a full report.
The Jillings team also reported that pressure from Municipal Mutual blocked the routine practice of placing public notices in newspapers seeking information from former residents and staff. "Our experience ... is that such notices only encourage a `bandwagon' of claims with adverse publicity." The company also sought to control claims to the Criminal Injuries Compensation Board.
The report relates how children regularly ran away from Bryn Estyn. Former residents told the panel that punishments included being punched in the face, stomach or testicles, with boys being ordered to beat up and even defecate on others.
In the meantime, the Welsh Social Services Inspectorate did not inspect a single home. The inspectorate is quoted as saying in 1992 that: "There is no evidence to suggest that this problem [child sex abuse] occurs frequently. Because of its nature, inspection, review, monitoring and spot checks are all equally ineffective as methods of finding or preventing it.
"Attempts to ensure that this problem does not happen should certainly not drive the way we manage, monitor and inspect children's homes."Reuse content