A man who murdered a three-year-old girl in 1979 has been jailed for life with a minimum term of 17 years for the attempted murder of a woman during an argument over a garden rake while he was on release from prison on licence.

Stephen Chafer was 17 when he was jailed for life for sexually assaulting Lorraine Holt and killing Lorraine Holt. Chafer found the girl sitting in the snow crying near her home in Derby, then carried her to a nearby vicarage where he sexually assaulted her then stabbed her 39 times.

Now 57, he had been released on licence and was living under the pseudonym Stephen Leonard when he launched a frenzied knife attack on Fay Mills in Peterborough on 23 June last year. Mills, who has dementia, was so badly injured that police believed the 60-year-old was dead when they arrived at her home.

Chafer was tried and convicted in December last year of the attempted murder of Mills and of the common assault of her neighbour Mark Patchett, who had tried to help her.

He was sentenced at Cambridge crown court on Friday, where he appeared under his pseudonym.

Judge David Farrell QC told him: “The worrying aspect of this offence is, as with the previous murder, that you have attacked a particularly vulnerable person and the attack was with a knife with particular severity.”

He said Chafer was a “serious risk to members of the public and particularly women”, and would be 74 before he could be considered for release from prison.

“I consider the Parole Board to consider the sentencing remarks that I make today,” he said.

Flanked by three security officers, Chafer looked down throughout the hearing and showed no reaction to the sentence.

Patchett, who had served in the armed forces, sustained a cut to his face when he confronted Chafer last year. He said in a statement that the scene was “like a house of horrors ... with blood everywhere”.

Farrell ruled that £750 be awarded to Patchett in recognition of his bravery.

The prosecutor Charles Falk said it was “frankly a miracle that [Mills] has survived”.

The court heard that Mills’s daughter, Sheila, had gone to Kent on the weekend her mother was attacked and believed her mother was in the care of a “close friend” in Chafer.

Falk, summarising a victim impact statement from Sheila Mills, said: “She trusted Stephen with everything. He betrayed her trust. She cannot understand how wrong she could have been.”

Jim Holt, the father of Lorraine, has criticised the Parole Board for giving Chafer the chance to reoffend.

Lorraine Holt. Photograph: PA

Holt, who now lives in Nottingham and was in court for Chafer’s sentencing, said outside the court: “I think the Parole Board should look long and hard at some of their decisions because they were warned that he would reoffend.

“I warned them personally that he would reoffend.”

The court heard Chafer was 6ft tall and 17 stone when he attacked Mills, who weighed 6 stone and was 5ft tall.

Chafer claimed a “switch flicked in his head” during the argument and the court heard he stabbed her about 17 times.

In a statement read outside court by Det Insp Lucy Thomson, the Mills family said: “We’d like to say that we are very pleased with the life sentence that’s been given to Stephen Leonard and we’re pleased that we have some justice for our mum.

“We feel so sorry that Jim Holt’s family had to relive their trauma through this case.

“Our mum continues to fight every day and we hope that one day we’ll have her home so we can be a family.”

Chafer admitted to Lorraine Holt’s murder and was granted parole in 2002, having served 23 years. He was returned to prison in 2013 for setting his flat on fire, risking the lives of the other residents in the building, but was released again in 2017.

Andrew Radcliffe QC, mitigating for Chafer, said the defendant had “multiple mental disorders”.

A spokeswoman for the Parole Board said in an earlier statement: “Tragically, there are rare occasions when offenders go on to commit serious further offences after being released by the Parole Board.

“Whilst this represents an extremely small proportion of cases considered, we do take each case extremely seriously and work with others in the criminal justice system to ensure that lessons are learned to help to prevent further tragedies.”