“It was a failure of leadership,” said counsel assisting Naomi Sharp, in a 276-page submission released on Thursday.

Ms Sharp named defrocked former Dean of Newcastle, Graeme Lawrence, business manager Peter Mitchell, diocese solicitor and trustee Keith Allen and diocesan deputy chancellor Paul Rosser, QC, as part of a “network of long term diocesan ‘insiders’” during Bishop Herft’s tenure from 1993 to 2005.

They “worked together to frustrate efforts by other leaders, including the bishop, to deal with the sexual abuse of children by priests and others within the diocese”, Ms Sharp said.

Bishop Herft, who went on to become Archbishop of Perth, “mishandled the allegations of child sexual abuse made against two of the most senior and domineering priests in the diocese”, Mr Lawrence and Archdeacon of Maitland, Peter Rushton.

Archbishop Herft became the most senior Australian church casualty of the royal commission, after he resigned in December following damning evidence against him. 

The final submission to the Royal Commission into Institutional Responses to Child Sexual Abuse, before the final report into Newcastle Anglican diocese, outlined devastating failures by senior members of the diocese to respond to abuse.

“Proven sexual offending against children on the part of clergy and others associated with the diocese since the mid-1960s is widespread,” Ms Sharp said in her submission.

Convicted offenders included Ian Barrack, Jim Brown, Robert Ellmore, Stephen Hatley Gray, Eric Griffith, Allan Kitchingman and Lindsay McLoughlin. Priest George Parker died in January, only a few weeks after being charged with child sex offences from the 1970s.

The diocese accepted that Rushton was a prolific child sex offender. Priests Graeme Lawrence, Andrew Duncan, Graeme Sturt and Bruce Hoare were disciplined after an alleged group sex incident in 1984 with a 19-year-old man. It was alleged the 19-year-old had been in a sexual relationship with Mr Lawrence since he was 16, with Mr Lawrence’s partner Gregory Goyette since he was 17, and with Mr Duncan since he was 14.

 Also accused of sexually abusing children were Bishop Ian Shevill, priests Michael Cooper and James Brown, a priest known as DBJ, Canon Eric Barker and Canon Harold Marshall. 

Ms Sharp found it was available to the royal commission to make adverse findings against a succession of bishops and senior diocese lay members, including lawyers representing the diocese. She found bishop from 1958-72, James Housden, was aware of priest Alan Kitchingman’s child sex conviction before transferring him to Grafton where he sexually abused another boy.

There was evidence the diocese’s “Boy Bishop” from 1973-77, Ian Shevill, was told that Rushton, youth worker James Brown, trainee priest Robert Ellmore, Canon Harold Marshall and George Parker had sexually abused children.

Bishop from 1978-92, Alfred Holland, and assistant bishop from 1983-92, Richard Appleby, put children at risk of harm because of their inaction after credible child sex allegations against Rushton and Brown, and after they allowed Stephen Hatley Gray to pre-date his resignation a day before he was arrested for sexual intercourse with a 15-year-old boy, Ms Sharp found.

Bishops Holland and Appleby “when able to ignore disclosures of allegations of sexual abuse, chose to do so”, and protected the reputation of the diocese when unable to ignore allegations. The two bishops, “by their acts or omissions, enabled alleged or convicted perpetrators to continue working with access to children and without alerting other members of the clergy”, Ms Sharp found.

The royal commission was told diocese actions meant Gray was allowed to leave the area after his conviction and surprisingly light sentence of a fine and good behaviour bond.

Relatives of the teenage victim later told a priest they were shocked to see Gray on television in 1992 officiating over a memorial service for two of Ivan Milat’s victims, as they were promised Gray “would never minister again following his conviction”.

Ms Sharp found that the diocese policy used to deal with child sex allegations after 1993, during Bishop Herft’s tenure as bishop, was “an inadequate and unsuitable framework” to manage allegations against clergy and church workers.

It focused on conciliating complaints rather than reporting them to police.

It was “remiss” of Bishop Herft to not make Bishop Farran aware that Mr Lawrence and Rushton, who had been two of the most senior priests in the Diocese, had both been accused of sexually abusing children, Ms Sharp found.

After evidence in August about the extent of child sexual abuse in Newcastle Anglican diocese, Ms Sharp said Reverend Dyer first raised his concerns about allegations that Rushton had abused boys with professional standards director Michael Elliott in mid-2009 and with Bishop Brian Farran by late 2009 at the latest. Ms Sharp said investigations initiated by Mr Elliott about offences by Peter Rushton included questions on Bishop Farran’s behalf to Bishop Herft, and former bishops Holland and  Appleby.

“Bishop Holland implied to Bishop Farran that he had no prior knowledge of allegations that Rushton had sexually abused children. This representation was not correct,” Ms Sharp found. “Bishop Appleby implied to Bishop Farran that he had no prior knowledge of allegations that Rushton had sexually abused children. This representation was not correct. Bishop Herft implied to Bishop Farran that he had no prior knowledge of allegations that Rushton had sexually abused children. This representation was not correct.”