PUB managers have pledged to investigate how two-year-old Joe Hutcheon got out of the Moorings pub to the canal where he drowned.
The move has come as anxious parents revealed how they have stayed away from the pub with their children because of their fears about the nearby canal.
Staff and customers of the pub, on Bolton Road, Blackburn, launched a frantic search when the toddler went missing on Saturday afternoon.
The child was discovered in the Leeds and Liverpool canal, which runs alongside the pub, by a customer who pulled him to the bank.
Health and Safety officers from Blackburn with Darwen Council have begun their own investigation after the incident was reported by pub staff.
Pub manager Stuart Lee, a trained first aider, gave Joe mouth-to-mouth resuscitation and heart massage until police and paramedics arrived. He was taken to Blackburn Royal Infirmary where he was later pronounced dead.
His parents, Hazel and Robert of Manxman Road, Blackburn, are devastated by the tragic accident and have left the area to stay with friends.
Paul Cowland, area manager of the Pub Estate Company, said all their thoughts were with the toddler's family.
He said the company would carry out their own investigation as well as working with the police.
He said: "I'm unable to comment further until we have had more time to assess the facts leading to the tragic accident. "It is unfair to speculate but once we have the full facts we will issue a fuller statement."
A police spokeswoman said they were investigating the incident and officers were interviewing many people who had been at the pub at the time.
It is thought Joe wandered through the pub's back door to steps leading down to the unfenced canalside, which is near a fenced-off children's play area.
Moorings customer Emma Fielden, of the Infirmary area of Blackburn, said she never took her three-year-old daughter Lauren to the pub because of the canal's dangers.
She said: "This is terribly sad. I've often gone to the pub in the evenings with friends but I've never liked taking Lauren there because of the canal. "There is a playground for the kids but it's not in an ideal place because it's so close to the canal.
"I know it's fenced off but they are so curious at that age and they can be away in a minute. It think it's asking for trouble to have the playground there."
Another local mother, who did not wish to be named, said she had only visited the pub once with her two young daughters but had been too worried by the unfenced canal to return.
She said: "The playground is fenced off but you can't keep an eye on the children from the pub."
An inquest into Joe's death was due to open today.
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