Victims of child abuse say Hodge did not listen to paedophile claims by senior social workers

When Margaret Hodge was appointed to the newly created post of minister for Children just five months ago, she told friends that at last she had her dream job.

Yesterday, as two victims of child abuse threatened legal action and a third demanded the resignation of the former Islington council leader, the dream looked like it had turned into a nightmare.

The decision by Demetrious Panton, 35, Douglas Fitch, 28, and Yvonne Williams, 40, to come forward throws into doubt how long Mrs Hodge will remain in post. The three, who were subjected to abuse at the hands of different paedophiles in Islington children's homes, have horrific stories of the suffering they endured in the 1970s and 1980s.

Mr Panton, who had been placed in care at the age of 10, was one of the many victims of Bernie Bain, a notorious paedophile who was head of one of the borough's care homes. He complained about Bain on three occasions, in 1979, 1985 and 1992, but no action was taken by the council. Bain, whose predilection was for boys aged seven or eight, was never brought to trial in Britain. Unlike many abuse victims, Mr Panton went on to university and a good job. He is employed as a consultant on urban renewal with clients that include SureStart, the Government's under-fives project under Mrs Hodge's control.

Mr Fitch and his brother, Michael, were harassed by Roy Caterer, a sports instructor at a boarding school used by Islington. Caterer was sent to prison for seven and a half years for abusing seven boys and two girls.

Mr Fitch claims that Mrs Hodge should have listened to senior social workers who raised suspicions about paedophiles and has approached lawyers to sue her. He said: "I hold Hodge responsible for what happened to me and I will not rest until I get justice."

Ms Williams was sexually abused every day from the age of 10 for six years by Jeffrey Wildjones, the superintendent of her Islington- controlled home. Ms Williams said: "For the sake of all the children she did wrong by ... it's high time she resigned."

Mrs Hodge made her political reputation at Islington, where she was leader for 10 years from 1982. A moderniser before New Labour was created, she was a close neighbour of Tony Blair. Her husband, Henry Hodge, was a solicitor who gave Cherie Blair her first brief as a barrister.

The Islington child abuse scandal has dogged her since 1992 when the London Evening Standard exposed how, for two decades, children in the borough's care homes were molested, driven into prostitution and raped by people in positions of trust. Mrs Hodge initially derided the reports as "gutter journalism" but, within two years, accepted that there had been abuse and blamed her initial response on "misleading information" from officials. Meanwhile, she was elected MP for Barking in 1994. The Standard was vindicated in 1995 by an independent report which recommended drastic change in the way the council operated. The whole issue appeared to have died down as the years went by and was not raised when she was appointed as an Education minister in 1998.

The chaos of Mr Blair's reshuffle this summer obscured Mrs Hodge's elevation to minister for Children, a job that brought together areas such as youth justice, child care, SureStart and teenage pregnancy units.

But, within a fortnight, the Standard published testimonies from two former Islington social workers, who claimed publicly for the first time that Mrs Hodge failed to back them over allegations that children in care had been subjected to sex abuse.

Mrs Hodge insisted she did not ignore a single allegation of abuse. She went further, declaring that her experience in Islington made her "well equipped" to learn the lessons of past mistakes. Her supporters claim she has done invaluable work in pushing a national childcare strategy and other areas, and is the victim of a media witch-hunt.

However, it is Mrs Hodge's belief that she was being unfairly harassed over her past that has, itself, brought the issue to its climax.

Mr Panton is threatening to sue Mrs Hodge for libel over her complaint to BBC Radio 4's Today programme, in which she described Mr Panton as "an extremely disturbed person". The programme brou- ght into question Mrs Hodge's role when she was leader of Islington council. Some of Mrs Hodge's allies doubt whether legal action will really go ahead or simply be threatened.

Tony Blair is thought to be reluctant to offer his friend's head on a plate to the press. But Mrs Hodge's future as minister for Children is undoubtedly in the balance.

Islington and the minister

February 1982: Margaret Hodge becomes leader of Islington council

April 1990: Council social workers Liz Davies and David Cofie warn Mrs Hodge about sex ring preying on children in homes

1991: Roy Caterer, who worked at a school used by Islington, is jailed for seven and a half years for sexually abusing children

February 1992: Ms Davies resigns and takes her information to Scotland Yard

14 October 1992: London's Evening Standard reports abuse in Islington care homes. Mrs Hodge calls it "gutter journalism"

23 October 1992: Mrs Hodge resigns from council to work at accountancy firm Price Waterhouse

February 1994: Mrs Hodge admits there was abuse in the children's homes

1994: Mrs Hodge becomes MP for Barking. Abuse victim Demetrious Panton writes to her about his ordeal, she replieswith a four-line letter referring him to the council

1995: An independent report by Ian White, Oxfordshire's director of social services, lambasts the council

June 2003: Mrs Hodge becomes minister for Children, her record is attacked in the media

November 2003: Mrs Hodge describes Mr Panton as "extremely disturbed", in a letter of complaint to the BBC. He threatens to sue her