News of the World phone hacking: Police review all child abduction cases

The move is a direct response to the Guardian's exclusive story on Monday that a private investigator working for the News International tabloid, Glenn Mulcaire, caused Milly's parents to wrongly believe she was still alive – and interfered with police inquiries into her disappearance – by hacking into the teenager's mobile phone and deleting messages.

News of the impending police action capped a dramatic day of unfolding developments in the News of the World phone-hacking scandal.

Last night, it emerged that News International handed to the Metropolitan Police details of payments made by News of the World to senior police officers between 2003 and 2007, the period when Andy Coulson was the paper's editor.

The development brings the crisis closer to the door of prime minister David Cameron who appointed Coulson as his director of communications when in opposition and then staunchly defended him until Coulson quit in January 2011.

News International said last night: "As a result of media enquiries, it is correct to state that new information has recently been provided to the police. As News International and News Group Newspapers has reiterated many times, full and continuing cooperation has been provided to the police since the current investigation started in January 2011. Well understood arrangements are in place to ensure that any material of importance to which they are entitled is provided to them. We cannot comment any further due to the ongoing investigations."

The revelation also suggests there is now a breaking of ranks inside News International since the files on payments to the police are unlikely to have emerged only yesterday, but instead were released to the police as senior executives said the paper could no longer continue to cover up the scale of the wrong doing at the paper.

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