"This has been a harrowing inquiry in which we have heard of children being treated in an appalling way not just by their abusers but, because of catastrophic failures by the very agencies that society has appointed to protect them," Vaz, the chairman of the influential House of Commons Home Affairs Select Committee, said at the end of an inquiry into the problem.
"Children only have one chance at childhood, once that childhood is stolen by the horrific crime of sexual exploitation, it cannot be returned," he said.
The committee began an inquiry and has been taking evidence on sexual exploitation and grooming after nine men from Rochdale were convicted in 2012.
Seven men are currently awaiting sentencing after being convicted last month of involvement in a major sex trafficking ring in Oxford.
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The MPs from the Home Affairs Select Committee said that recent cases had typically involved large networks of Pakistani-heritage abusers who preyed on vulnerable white girls, although it added that this was just one form of sexual exploitation.
"Despite recent criminal cases laying bare the appalling cost paid by victims for past catastrophic multi-agency failures, we believe that there are still places in the UK where victims of child sexual exploitation are being failed by statutory agencies," the report said.
"The police, social services and the Crown Prosecution Service must all bear responsibility for the way in which vulnerable children have been left unprotected by the system," it added.
It said that both councils had been "inexcusably slow" to realise what had been going on in their areas thanks "in large part to a woeful lack of professional curiosity".
The MPs also backed the introduction of video-recorded cross-examination of child victims to make it easier for them to give evidence without being distressed by appearing before a live court session.