The UK’s spiraling child-abuse scandal has already reached Prince Charles once – he was a good friend of the children’s TV presenter Jimmy Savile who was hailed as an eccentric saint in his lifetime but has been unmasked as a predatory paedophile in death - and now the prince’s judgment is being called into question again, after it emerged that a retired Church of England bishop arrested yesterday by police investigating historic allegations of child sex abuse was given a free house to live in by Charles after the bishop resinged in disgrace having received a police caution for committing acts of gross indecency against a 17-year old trainee monk.

Sussex police arrested the 80 year-old Rt Rev Peter Ball, former bishop Gloucester, on Tuesday morning on suspicion of eight sex offences against eight boys and young men in the late Eighties and Nineties, after carrying out a "comprehensive and painstaking" analysis of internal church files “relating to certain child safeguarding issues within the Chichester diocese from between 20 and 25 years ago", the Guardian reported.

Ball was created bishop of Gloucester in 1991 at a ceremony attended by Prince Charles. But in 1993, Ball resigned in disgrace after receiving a police caution for committing an act of ‘gross indecency’ against a teenage trainee monk. The young man involved, Neil Todd, spoke out about Ball’s ‘mental, sexual and physical' abuse on the BBC in May.

Astonishingly, after he left the clergy in such appalling circumstances, Prince Charles provided Ball with a grace-and-favour home, Manor Lodge, in the Somerset village of Aller. The wisteria-clad property is owned by the Duchy of Cornwall, Charles’s private estate.

At the time, Ball said: "He has been wonderfully kind and allowed me to have a duchy house. The prince is a loyal friend. I have immense admiration for him, he has been through horrific times and is a great person."

Charles’s admiration for Ball was underlined when Ball gave the homily at the funeral of Camilla Parker Bowles’s father, Major Bruce Shand, in 2006.

The BBC report stated that, despite the caution he received from police, he continued to work in churches until 2010.

In a statement yesterday Sussex police said: "The investigation, which relates to alleged offences not previously reported to Sussex police, has taken six months so far. This is a very complex inquiry, in the course of which many people, all now adults, have had to be traced, together with other witnesses and records from a wide variety of sources, and there is continuing consultation with the Crown Prosecution Service.

"There are no allegations of recent or current offending and police emphasise that there is nothing to suggest that any young people are currently at risk."

The news of Peter Ball’s re-arrest comes shortly after the Queen’s former press secretary, Dickie Arbiter, said that Jimmy Savile’s behaviour when invited to St James' Palace was a cause for "concern and suspicion".

“He would walk into the office and do the rounds of the young ladies taking their hands and rubbing his lips all the way up their arms if they were wearing short sleeves," Arbiter said. "If it was summer [and their arms were bare] his bottom lip would curl out and he would run it up their arms. This was at St James's Palace. The women were in their mid to late 20s doing typing and secretarial work."

Asked about Savile's behaviour with the royal assistants or whether Prince Charles had taken any action to find out if anyone in his family or staff might have suffered any abuse or have any information relating to the criminal investigation into Savile's alleged paedophilia a spokesman for the prince told the Guardian: "We have no record of anyone making a complaint…The prince first met Savile through their shared interest in supporting disability charities [the prince became patron of the British Wheelchair Sports Foundation in the late 1970s] and it was primarily because of this connection that they maintained a relationship in the years that followed."

Arbiter said he struggled to understand why Savile was granted such access to the royal family, "I looked at him as a court jester and told him so," said Arbiter. "I remember calling him an old reprobate and he said 'not so much of the old'."

Savile allegedly helped to mediate between Charles and Diana as their marriage foundered.

Asked by the Royalist about providing free accommodation for Ball, a spokesperson for the Duchy of Cornwall said today they would not comment on individual tenants or their arrangements.