It’s 10pm in the Western Approaches pub and Stevie Gay, who often drinks here with Wayne Rooney’s dad, is holding court. Suddenly he puts his pint of Carling on the table and turns serious, the smile fading from his lips. ‘I was at Hillsborough. I saw them dragging people up by their scarves, trying to save them,’ he says, mimicking the action with his hands. ‘They were bringing them up the barriers and getting them on the pitch. I heard a scream: “This lad is dead.” It was a horrible sight. All the dead bodies.’

Gay, 49, also remembers the newspaper headline that cuts as deep as ever in Liverpool and, more than 15 years after English football’s worst disaster, still asks questions about the city’s sense of identity in relation to the rest of Britain. ‘The Sun said they were robbing the dead. It was all lies. If anyone was looking through people’s pockets, it was for their IDs. The Sun is scum and nobody in this pub buys it.’

The Western Approaches – in drug- and crime-plagued Croxteth in inner-city Liverpool – was once Wayne Rooney’s local and is still frequented by his father, siblings and cousins. On the cream-painted walls is a framed team photo of the Croxteth amateur boxing squad, naming its secretary as Richie Rooney. Tonight another young Rooney, who in blue T-shirt and tracksuit bottoms is the image of his famous cousin, is standing near the jukebox, watching darts. When an Observer reporter enters the room the laughter dies. There is a hostile silence. ‘Gettout!’ shouts someone. Journalists are not welcome here.

And some are less welcome than others. Those from the Sun must still answer for the sins of their predecessors. In April 1989, four days after 96 Liverpool fans were crushed to death on the terraces at Hillsborough stadium in Sheffield, Britain’s bestselling daily ran the front page headline ‘The Truth’. Below it were three subheadings: ‘Some fans picked pockets of victims’; ‘Some fans urinated on the brave cops’; ‘Some fans beat up PCs giving the kiss of life’. All were lies. The Taylor Inquiry after the disaster found that fans had responded quicker than the emergency services, performing several acts of heroism.

Copies of the Sun were burnt in the city’s streets and many newsagents refused to sell it. It has still not fully recovered: while the paper sells 3.3 million copies nationwide, it shifts only 12,000 in Liverpool. One rival publication calculated that, given an average cover price of 20p over 15 years, editor Kelvin MacKenzie’s catastrophic misjudgment has cost owner Rupert Murdoch around £55 million in lost circulation.

Enter Wayne Rooney, superstar of Everton and hero of England’s recent Euro 2004 campaign. The 18-year-old’s decision to sell his life story – ‘world exclusive’ revelations that he and his fiancée love each other, watch EastEnders and have a dog called Fiz – for £250,000 to the Sun and its sister paper, the News of the World , was guaranteed to test his folk hero status like nothing else. As in 1992, when Liverpool manager Graeme Souness took the paper’s shilling, radio phone-ins were jammed. Fans wrote letters or emails saying they were ‘sickened’. Red-blue rivalries on the field were irrelevant: Everton and Liverpool fans are united in hatred of the Sun.

Leading the condemnation of the deal is Jimmy McGovern, writer of the TV drama documentary Hillsborough. He said last night: ‘Footballers today are on massive wages because 96 fans died at Hillsborough and Lord Justice Taylor had to drag the game into the modern era. Footballers should never forget it. Local lads especially. Locally born footballers have an enormous responsibilty to the Hillsborough dead. That is hard, I know. They are only young men. But, tough, they have it. So for Wayne Rooney to sell his story to the Sun is a disgrace.’

For men like Stevie Gay, who lost friends at Hillsborough and used to take young Wayne to watch boxing, there is a potential conflict of loyalties. But he had no doubt where the responsibility lies. ‘He’s been badly advised, and his agent has made a few quid. Wayne has proved himself to the world, and no one should blame him.’

Others in The Western Approaches shared a fierce allegiance to Rooney that is matched only by their revulsion towards the Sun. John McCormick, 64, a retired labourer, said: ‘The Sun is a disgrace. I won’t have it in the house. It doesn’t matter how often they apologise because it’s too late. I will never forgive the Sun. I can imagine Wayne Rooney’s family are upset. If I was his dad I’d have given him a smack. But he was only three years old at the time of Hillsborough. He’s been misdirected by his agent and should get rid of him.’

Rooney’s agent is Paul Stretford, the millionaire founder and chief executive of the Proactive Sports Group. Stretford is understood to have been aware of the anti-Sun sentiments on Merseyside but advised Rooney to sign the deal anyway, without Everton’s knowledge. What Stretford hadn’t bargained for was last Wednesday’s Sun , which in response to local complaints issued a full-page apology for ‘the most terrible mistake in its history’, and claimed on its front page that Rooney had been ‘hurt by a hate campaign’ against him.

Stretford was incensed that it implied Rooney backed the apology, and rushed out a statement: ‘Proactive, Wayne and his fiancée Colleen believe that the Sun ‘s repeated apologies for its terrible mistakes in its reporting of the Hillsborough disaster are entirely a matter for that newspaper. We all wish to make it clear that the sentiments expressed in the Sun were the views of that newspaper alone and we were not asked to, nor did we, endorse them.’

The Sun’s mea culpa appeared to have backfired by turning a local story into a national one. The apparent self-flagellation was condemned as a cynical ploy because it also managed to accuse the Liverpool Post and Echo newspapers, owned by the rival Trinity Mirror group, of stirring anger towards Rooney for commercial gain. ‘Bollocks,’ said Jon Brown, deputy editor of the Echo. ‘For the Sun to accuse anyone of stoking things up is deeply ironic. There has been no pressure, overtly or subtly. It was a cheap shot and the staff here were furious. Fifteen years ago the Sun published something without thinking about it. They did the same this week. They turned into it more of an issue than we ever did. I’m sure there are people at the Sun now regretting prodding a stick into a hornets’ nest.’

He added: ‘The Sun’s coverage of Hillsborough still has ramifications today in the vilification of Scousers, of an entire culture and community. It blackened the reputation of the city and it has still not recovered. If you go anywhere in the world Liverpool has a great reputation. If you go anywhere in England, it’s different. The Sun has repeated the mass slander this week by saying Rooney is the victim of a hate campaign. There is no hate campaign. The Sun suggested there were mobs of vicious Liverpudlians gunning for Rooney and his girlfriend. The word “hate” is ridiculous. People here are proud of what he’s achieved. You could ask a thousand people here if they hate Wayne Rooney and you wouldn’t get a single yes.’

Pride, insularity, self-pity and living in the past have all become part of the lexicon applied to Scousers by outsiders. Liverpool is in the throes of a dramatic transformation and will be European City of Culture in 2008. But confrontations such as last week’s crystallise its uneasy relationship with the rest of the country. Alan Bleasdale, the writer of TV dramas including Boys from the Black Stuff, said: ‘There is radical change in this city. The only time we look back is when people pick our scabs and the wounds bleed. How often have you heard Scousers sentimentally wallowing in the past? Only in recent days in response to events elsewhere in the country.’

Phil Hammond, who lost his 14-year-old son Philip at Hillsborough, said: ‘There are a few papers prejudiced against Liverpool. The Daily Mail printed a picture from the internet of Wayne Rooney doing a cartwheel and lots of stolen things falling out of his pockets, with the joke being: “You can take the lad out of Liverpool but you can’t take Liverpool out of the lad.” ‘

Rogan Taylor, who was chairman of the Football Supporters’ Association at the time of Hillsborough, said: ‘The people of Liverpool are not soft. Like Jews, Poles, blacks and others who keep getting whacked, they know who they are and who their enemies are. Liverpool is like the Poland of England.

‘You should see it in the context of 150 years of prejudice from the ruling Protestant class towards the Irish Catholic settlers. The opinion columns of the Mail and Express today could easily be transported from the Times in 1845, asking questions like: “What kind of people are they? They like drinking and dancing and telling stories – what do these people think life is?” You could see the same subtext post-Hillsborough. “Why don’t people take responsibility for themselves? Their culture is different from ours.” The Sun splash pushed it to the limit at the end of a troubled decade.’

He added: ‘Our memory is elephantine. Accusing people of robbing the dead is as close to unforgivable as you can get. If Murdoch and MacKenzie came to apologise, that would be interesting. But we haven’t seen them, have we?’

A spokeswoman for Murdoch said: ‘I am sure he completely agrees with the statements in the Sun.’ Kelvin MacKenzie, now head of the TalkSport radio station, refused to comment last week. But in 1993 he told the Commons national heritage committee: ‘I regret Hillsborough. It was a fundamental mistake. The mistake was I believed what an MP said. It was a Tory MP. If he had not said it and the chief superintendent had not agreed with it, we would not have gone with it.’

To the ongoing resentment of the Hillsborough families, neither MacKenzie nor the Sun has disclosed the identity of the source. The paper last week put assistant editor Graham Dudman on a round of radio phone-ins, in which he insisted the 1989 staff were no longer employed and pointed out that current editor Rebekah Wade was a 20-year-old student at the time. But Bleasdale said: ‘The hierarchy of the Sun is different but the owner is the same, the philosophy is the same and the contempt is the same. To use a football analogy, it’s just a transfer of players. You should try to forget but you should never forgive.’

Derek Hatton, the Liverpool council deputy leader-turned-radio presenter, said: ‘I sat next to Rebekah Wade at a party for Max Clifford’s birthday a few months ago and we were talking about Hillsborough. She didn’t know that much about it, and why should she? Wayne Rooney at 18 ought to know more about it because there isn’t a footballing kid of 18 in Liverpool who doesn’t know exactly what happened at Hillsborough. I get a bit pissed off with people defending him. I’m the biggest fan of Wayne as a footballing genius but he has to bear some sort of responsibility.’

There are clearly some who agree. Those leaving Liverpool’s Anfield ground on Friday morning were confronted by the giant words ‘ROONEY SCUMBAG’ daubed in white paint on the wall of a house opposite.

The war of words

Disaster
Liverpool fans are pulled from the crush that killed 96 at the Hillsborough Stadium, Sheffield in April 1989.

Accusation
The Sun front page of 19 April 1989 claims fans dishonoured the city’s dead. The source for the story has never been revealed.

Kiss and sell
Wayne Rooney sold his ‘world exclusive’ story to the Sun, telling of his love for fiancée Colleen McLoughlin.

Apology
The Sun devotes an entire page on Wednesday to saying sorry over Hillsborough… but upsets Liverpool all over again in the process.