New South Wales Premier Barry O’Farrell has announced a Special Commission of Inquiry into police handling of abuse by Catholic Church clergy in the Hunter Valley, after a senior detective aired claims of a cover-up.

His move follows a call from Nationals MP Troy Grant for a royal commission and claims people in the Catholic Church are hindering police investigations.

A senior Hunter Valley police officer, Detective Chief Inspector Peter Fox, alleges the church covers up for paedophile priests, silences investigations, and destroys crucial evidence to avoid prosecution.

He outlined his claims in an open letter to Mr O’Farrell

“I can testify from my own experience that the church covers up, silences victims, hinders police investigations, alerts offenders, destroys evidence and moves priests to protect the good name of the church. None of that stops at the Victorian border”, he said.

Last night Detective Chief Inspector Fox told ABC TV’s Lateline that he encountered alleged serious issues of cover-up in his investigation of priest Father Denis McAlinden.

The priest had arrived in Australia from Ireland in 1949 and for four decades he was transferred from parish to parish, and even outside Australia.

The NSW Department of Public Prosecutions is now looking at whether McAlinden’s crimes were covered up by three senior members of the clergy, including the general secretary of the Australian Catholic Bishops conference, Brian Lucas, the Archbishop of Adelaide, Philip Wilson, and former bishop of Newcastle, Michael Malone.

Chief Inspector Fox was in the middle of investigating the matter in 2010 when he was directed to hand over all his evidence to other officers, including a statement from a critical witness.

He says the statement was “explosive”.

“When I was directed to hand that statement over I described her statement as … explosive. And I still describe that statement as explosive,” he said.

“What is disclosed in that is monumental.”

Northern Region Commander Assistant Commissioner Carlene York told Lateline that Chief Inspector Fox was directed to hand over his work because the case was taken over by a new taskforce in a different Local Area Command (LAC).

“It would be unusual for a crime manager from a neighbouring LAC to work on a Strike Force in another LAC,” he said.

While similar to a royal commission, special commissions of inquiry are restricted to looking into possible offences which may justify prosecution, while royal commissions can have a wider scope.

Special commissions are also required to observe the rules of evidence as applicable in a court of law, while royal commissions have no such restrictions.

Mr O’Farrell’s move came as calls for a royal commission intensified in Victoria, where an ongoing parliamentary inquiry is looking into the handling of child abuse.

Victims’ support group Broken Rites says it has evidence that two orphaned boys died while in the care of the Hospitaller Order of St John of God in Victoria – one of them after being thrown down a flight of stairs.

Broken Rites says it will present its evidence to the ongoing parliamentary inquiry and says it wants a nationwide royal commission to look into abuse claims.