THE murder of an 11-year-old North-East boy is likely to spark a thorough overhaul of the treatment of sex offenders, the Government pledged last night.

Home Office officials said they would act after an inquiry into the death of Wesley Neailey, who was strangled by Dominic McKilligan in Newcastle three years ago.

This follows a warning by the inquiry chairman that "other McKilligans" were "out there".

The inquiry was ordered after it was revealed that McKilligan, who was 18, had been released from the Aycliffe Young People's Centre, County Durham, only months earlier.

He had been sent there for a string of sex attacks on young boys in his hometown of Bournemouth in 1994.

Ironically, although McKilligan had been freed early on parole, his sentence officially ended only one day before new legislation came into force making it easier for police to keep tabs on sex offenders.

After he left the centre, McKilligan was able to slip through the system, unseen by police and social services, and build a new life as a take-away delivery man. The job gave him the perfect cover to befriend young children, including Wesley Neailey.

Last night, a long-awaited report into the case called for a national strategy for the treatment of young, and potentially violent, sex offenders. It also called for improved co-operation between police and local authorities.

The inquiry was launched after McKilligan was jailed for life in July 1999 after being found guilty of Wesley's murder.

It highlights mistakes and failures in the system which allowed McKilligan to settle in Newcastle without the knowledge of police or probation service. The report says:

* There are no consistent standards in the care and evaluation of young sex offenders;

* There is no single national watchdog to oversee care programmes;

* There is no agreed form of evaluating how effective care has been; and no consistency in the provision of special care for young offenders.

The report, commissioned by Durham County Council, Bournemouth Borough Council and Newcastle City Council, found there had been breakdowns in communication between the different agencies.

It was more than two months before Newcastle City Council's social services was informed by letter that McKilligan was in their area - and this did not provide detailed information.

When further details did arrive three months later, they were conflicting and confusing, labelling him as of low, medium and high risk.

Police were not even informed of his release to a flat, where he was free to prey on Wesley.

The report, Childhood Lost, noted that 16 agencies and more than 200 staff were involved in his case.

Last night, inquiry chairman John Fitzgerald warned: "There are other Dominic McKilligans out there who could kill.

"Every local authority will have at least one, if not more, sex or violent offenders living in flats in the community."

He added: "Even if the recommendations of this report are followed in their entirety, it cannot be guaranteed that such a tragedy will never happen again.

"However, there are lessons to be learned from this sad case that will reduce the risks to children from adolescent offenders."

Last night, the Home Office pledged to re-examine the care and treatment of young offenders. A spokes-man said: "We are seriously looking at every recommendation."

Wesley's grandfather, Harry Hammond called for immediate action. He said: "We welcome the report, but reports have been made in the past and it remains to be seen whether these recommendations are going to happen, to prevent this from happening again.

"At no point have any individuals been held accountable for their mistakes. As a result, many of our questions are left unanswered."

Durham County Council's social services director, Peter Kemp, said he and his colleagues were "determined to establish an effective mechanism which would reduce, as afar as is possible, the risk of the same circumstances which preceded his death from ever being repeated"