Ex-prisoners staying in bail hostels are being inadequately supervised, an undercover investigation by the BBC's Panorama programme has revealed.
The probe found one man, a convicted paedophile and child-killer, befriended children while at a Bristol hostel.
Home Secretary John Reid has responded by ordering an urgent review of hostels filmed for the documentary.
He is expected to admit in a speech later that some parts of the probation service are underperforming.
Setting out plans to improve the service, he will say too much money is being spent on report-writing and not enough on practical help. He is also expected to propose opening the service to private competition.
Martin Wargent, chief executive of the Probation Boards Association and a former probation hostel warden, told BBC News the service did a difficult job, with high concentrations of serious offenders in hostels making it hard for staff to provide good levels of supervision.
"Most hostel staff would probably say that's not a good idea," he said.
Panorama's investigation focuses on two hostels in Bristol, one of which was home to paedophile Frank Parker, released after serving 39 years in jail for sexually assaulting and murdering a 10-year-old girl.
Secret filming shows Parker befriending children and speaking of taking a photo of a semi-naked teenager who he invited up to his hostel room.
Police tipped off
During filming, Panorama called police twice anonymously to report that Parker was associating with children.
Parker, 61, is not only monitored by the National Probation Service, which runs bail hostels in England and Wales, but also comes under a level of monitoring called Multi Agency Public Protection Arrangements (Mappa).
The police did not pass the details of the calls onto the Probation Service.
When Panorama called 999 a third time and told police staff from the programme had been watching Parker and were concerned about his behaviour, officers rushed to the address given by reporters.
Since the filming Parker has been recalled to prison.
The National Probation Service says this action was taken not because of what Panorama filmed him doing but because of fears he would abscond after the programme was broadcast.
Paedophile Kevin Rogers in a Bristol shopping centre
A second paedophile, Kevin Rogers, who lived at the same hostel as Parker until July - Brigstocke Road - was filmed standing outside public toilets at a Bristol shopping centre and secretly taking pictures nearby.
He is a high risk predatory paedophile convicted of sexually abusing five children and has admitted to abusing others.
Loitering at swimming pool
Rogers was sentenced to four years in jail but released early to the hostel.
Last summer he moved out of the hostel and into a flat but on 18 July was recalled to prison after he was caught loitering near children at a swimming pool.
Panorama also went undercover at a second bail hostel in Bristol - Ashley House - which, like Brigstocke Road, had a case of an offender killing a member of the public last year.
Ashley House predominantly homes people who have committed drug-related crimes. But staff are not allowed to search them for drugs.
Daniel Gill was filmed shoplifting
One offender, Daniel Gill, had been sent to Ashley House rather than jail in order to overcome his drug addictions.
But he was filmed shoplifting and apparently pimping in order to raise money to buy drugs.
Since filming he has been arrested for burglary and theft and is now in custody.
A senior bail worker was secretly recorded saying: "We can keep an eye on them until they walk to the end of the path. Once they turn left or right we haven't got a clue what they are doing."
Mr Reid said he had asked chief inspector of probation Andrew Bridges to review whether the management and operation of the premises mentioned in the programme should be investigated.
But shadow home affairs minister Edward Garnier said: "The supervision of post-custody offenders in the community and of serious offenders released on parole has been patchy, to say the least, with terrible consequences in a few cases."
Exposed: The Bail Hostel Scandal will be broadcast on Wednesday at 2100 on BBC One and bbc.co.uk/panorama.
If you are affected by any of the issues in this Panorama film you can call the BBC Action Helpline on 08000 934934 for free advice. Lines will open from 2200 on Wednesday. All calls are free and confidential.