An internal report by Surrey Police has said the failure to investigate the hacking of murdered Walton schoolgirl Milly Dowler’s phone remains a matter of “deep regret” and that it should have been scrutinised.

The Operation Baronet report, released yesterday by Surrey Police, concludes that the interception of Milly’s voicemails by News of the World staff in April 2002 should have been investigated by senior officers but was not.

Milly, 13, a pupil at Heathside School in Weybridge, had been abducted as she walked home from Walton station after school.

Serial killer Levi Bellfield was convicted of her murder in June 2011, and Surrey Police revealed earlier this year that he had finally admitted to her abduction, rape and murder, though this was later contested by Bellfield in a letter to The Sun.

In the report, internal investigators said diverting resources from the hunt for Milly to an investigation of the News of the World would have been “difficult to justify at the time”, but added police could have deferred the investigation, referred it to another force or complained to the Press Complaints Commission.

In a statement alongside the report, A Surrey Police spokeswoman said: “When it became apparent that messages on Milly’s phone had been intercepted in April 2002, the primary focus of the investigation team was rightly on finding Milly and then bringing her killer to justice.

“However, senior officers would or should have been aware of the News of the World’s illegal actions and the matter of phone hacking should have been revisited and investigated at a later stage. The failure to do so was unacceptable and remains a matter of deep regret for the force.”

As part of the operation, two senior police officers were referred to the Independent Police Complaints Commission, but it was concluded there was no case to answer.

The spokeswoman added: “Although it is possible a decision was made not to pursue the newspaper because of the potential consequences, it is more likely the matter was simply not seen for what it was.”

She added the term “phone-hacking” had not been coined by 2002, and that there was no indication at the time of the “endemic use of this practice” by the News of the World.

The investigation had also found no evidence of conspiracy or collusive relationship between officers and the now defunct paper or any other media.

The results of the report have been shared with Milly’s family.