BRITISH Home Secretary Theresa May was accused of being part of a cover-up of establishment sex offenders for refusing to order a full inquiry into abuse allegations.
Labour deputy chairman Tom Watson made the accusation as he said no area should be "off-limits" to the police.
In a House of Commons statement, Mrs May said the National Crime Agency (NCA) will mount an investigation into new allegations of abuse in children's homes in North Wales amid claims that a senior Tory was among the perpetrators.
NCA director-general Keith Bristow would review the police handling of the case, which dates from the 1970s and 80s, as well as looking at the latest allegations by one of the victims.
She also confirmed that the Waterhouse Inquiry into the North Wales allegations would be reviewed.
A number of investigations by the police and other institutions have also been launched into allegations of sexual abuse by DJ Jimmy Savile.
But Mr Watson, who claimed there was "clear intelligence" suggesting a historic paedo-phile ring may be linked to Downing Street and a former prime minister, criticised the Home Secretary's approach. He said: "To limit this inquiry to North Wales and Savile would . . . be a dereliction of the Home Secretary's duty.
"It would guarantee that many sickening crimes will remain uninvestigated and some of the most despicable paedophiles will remain protected by the establishment."
Mr Watson told the Commons: "There should be no historic sexual abuse of children which is off-limits to this investigation. Whether you were raped and tortured as a child in Wales or in Whitehall you are entitled to be heard."
As Tories cried "outrageous" Mrs May said she was "sorry that you have chosen to take that particular tone".
"I want to ensure we put in place the investigations to look into these issues and if there are people who should be pursued for prosecution that then takes place," she said.
"I think what is horrific is the extent to which this child abuse has been taking place.
"In relation to North Wales, I think it is important that the police are able to pursue any criminal investigations without fear or favour.
"That is what they should be doing, that is what they will be doing and that is what I believe is the best course to bring justice to the victims."