The police officer who headed up the Omagh bomb investigation has told an inquiry into the atrocity that he believes a covert agent was involved in the bombing.

Retired PSNI Ch Supt Norman Baxter gave evidence to the inquiry sitting in Belfast on Thursday.

"I believe, just for total clarity, that one of the people who brought the bomb to Omagh on the day was an agent," he said.

Twenty-nine people, including a woman pregnant with twins, died in the Real IRA bombing in the County Tyrone town on 15 August 1998 - the biggest single atrocity in the Troubles.

Baxter was the senior investigating officer (SIO) who led the investigation from May 2002 until he retired in November 2008.

The hearing was told that one of those he suspects of involvement in the bomb attack was "a covert human intelligence source".

He also told the inquiry that he believes information about the bombing was "deliberately hidden" from the investigation which "prevented" people involved from being detected.

"After the bomb exploded the chief constable said no stone would be left unturned and I'm sure he genuinely believed that," he said.

He added "the problem was that people had hid some of the stones. So the investigators couldn't find the stones to look under".

"Not accidentally, deliberately hidden to prevent the investigators finding out," he said.

"And at an organisational level, there was a failure to ensure that all the stones that were to be unturned, were still you know, available to be looked at."

The hearing was told that Baxter joined the Royal Ulster Constabulary (RUC) in 1980.

He had served 22 years in the police, but only two and a half years as a detective when he was appointed as the SIO of the Omagh inquiry.

He described the role was a "poisoned chalice".

"I was the one who lived west of the province, and I was the one who probably, and I don't mean this with any disrespect to the families, but one probably drew the short straw in terms of the allocation of it."

He said that he had been told that he would be "closing" the investigation as it was moving into a maintenance phase.

"In effect the view was that by the time I assumed the role....there would be no proactive investigations required."

He also told the hearing that he was the "least qualified" SIO to hold the role.

At the time he was appointed as SIO of the Omagh bombing, he had not received any formal training in being a detective. He attended a one week course after his appointment.

He described his formal training as "absent" but that he had "life learned, life experience".

He outlined how his workload grew with further appointments, meaning he had less time to spend on the Omagh inquiry.

Over that period he told the inquiry he was combining his role as Omagh SIO with other significant responsibilities.

The hearing heard that in 2009, Baxter gave evidence to the Northern Ireland Affairs committee about the investigation.

He was quoted as having said:

"I think it is inconceivable that in mainland UK, if you had a series of bombs happening every week or two weeks, that there would not have been arrests and that there would have been government intervention to ensure this group was disrupted."

He told the hearing that he still stands by that.

"The suspects that had been identified had been active terrorists for many years including the period leading up to Omagh."

He said he believed that if they had been disrupted there is a "high level of probability Omagh could have been prevented".

Three days after the attack, the Real IRA released a statement claiming responsibility for the explosion.

It apologised to "civilian" victims and said its targets had been commercial.

No-one has been convicted of carrying out the murders by a criminal court.

In 2009, Michael McKevitt, Liam Campbell, Colm Murphy and Seamus Daly were all ordered to pay a total of £1.6m in damages to the relatives, but appeals against the ruling delayed the compensation process.