THE mother of murdered toddler James Bulger is demanding an inquiry after reports emerged yesterday that one of his killers had sex with a woman carer at a secure unit just months before he was released.

Jon Venables was 17 when he reportedly had the affair with the woman who was responsible for his care at the Red Bank Community Home, run by St Helens Council.

Now Denise Fergus, from Kirkby, wants an inquiry to establish whether there was a cover-up to withhold damning information from the judge who released him on parole.

Mrs Fergus, 43, said: “This calls into question the original decision to parole Venables and Thompson.

“The Parole Board should go back to 2001 and review its decision on Venables, since it was clearly based on lies and deceit.

“I sat in the court in October, 2000, and heard Lord Woolf saying he had been handed glowing reports on them. The main reason he gave for allowing them to be released early was their supposed good behaviour.

But now we know that was not the truth and it is clear that the reports sent to Lord Woolf were rubbish. I want a full inquiry about what went on while they were in those secure homes and how false reports were given to the judges.”

Venables lived under a new identity when released in 2001 after serving seven years and eight months of a life sentence for killing toddler James, two, in 1993, with his accomplice Robert Thompson.

After Venables, now 28, was jailed last year for two years for downloading child pornography, justice secretary Kenneth Clarke commissioned an inquiry by Sir David Omand into the events leading to his return to prison.

But it did not mention what happened with the female staff member. It is understood she was charged with misconduct, suspended and never returned.

An MoJ spokeswoman said: “Sir David Omand’s terms of reference made it very clear he was reviewing the management of Jon Venables from his release in June, 2001, until his recall to custody in February, 2010.

"The mentions of Red Bank in his report are to set context for his review. It was for Sir David to decide which individuals he wished to interview.”