William Hague, the Secretary of State for Wales, says in a letter sent to the Prime Minister and other Cabinet colleagues, which has been leaked to the Independent: "Whenever abuse of children in public care occurs it naturally gives rise to a strong public reaction. As a government we need to be seen to be responding to this appropriately."
Mr Hague is strongly critical of Clwyd County Council for its handling of the child abuse scandal in north Wales in the 1980s, one of the worst seen in Britain, but he adds: "The issue has ceased to be one simply affecting Wales.
"There is talk of a cover-up and this is leading to renewed calls for a public inquiry. As you may have seen, the Independent newspaper is running a sustained campaign."
As many as 200 children were abused in homes in North Wales, and seven care workers have been convicted of serious crimes. In recent years, 12 former residents have committed suicide in circumstances related to their experiences.
In the letter, Mr Hague expresses concern over mounting fears that not all the perpetrators of abuses in Clwyd had been put on trial, intensified by the failure of the councils to publish the findings of the inquiry led by John Jillings, former director of social services in Derbyshire.
Mr Hague writes: "There remains a strong feeling of unease in North Wales that, thorough as the police investigations appear to have been, by no means all the people responsible for the abuse were successfully brought to justice."
He attributes the "mishandling" of the Clwyd inquiry - and the failure to publish the Jillings report - to the county council, which was caught in a stranglehold by its insurance company. The Municipal Mutual insisted the publication of the investigation would be a "dress rehearsal" for claimants pursuing legal action against the local authority, following their traumatic experiences in homes.
Among the issues Mr Hague highlights is "the extent to which the likely loss of insurance cover and the risk of surcharge should oblige local authorities in these circumstances to heed their insurers' wishes".
Despite a series of scandals involving children's homes across Britain, the Government has consistently failed to respond to recommendations for change, including setting up a paedophile register, improved training for workers and better inspection of homes - and a general council to oversee the profession.
Mr Hague says in the letter, also sent to the Lord Chancellor and Stephen Dorrell, the Secretary of State for Health, that Whitehall officials from all the relevant departments should meet urgently to discuss the issues, including more effective vetting and safeguards.
Mr Hague has ordered the councils in Wales who have taken over from the now defunct Clwyd to edit the report to ensure that it can be published without fear of libel or repercussions from the insurance company.Reuse content