The near-miss happened on 22 June 2017 on a steam locomotive from Totnes (Riverside) to Buckfastleigh. The railway is owned and operated by the South Devon Railway Trust, trading as South Devon Railway (SDR).
The train was travelling at about 32 km/h when the three-year-old and his mother were in a toilet cubicle at the end of carriage 4805.
The toilet was marked "out of use" but the child had already opened the door. He stepped inside the cubicle and fell forwards on to a brake pipe. His mother grabbed his arm and prevented him falling through the opening.
The RAIB's investigation found that in April 2017 SDR's maintenance team had removed the toilet cubicle floor to repair the leaking brake pipe underneath. However, the work revealed the underframe had badly corroded and there was wood rot in the floor and partition walls.
SDR instructed its workers to repair the brake pipe and decided the outstanding refurbishment work would be undertaken in June so as to not affect its capacity over the upcoming bank holiday weekend. A fitter taped a warning sign to the door and secured it with screws through the frame on 13 April and the carriage entered service with the floor missing.
Shortly after the accident in June, two fitters were called while the train was at Buckfastleigh station. They found the toilet door was open, part of the wooden doorframe had broken off and the screws that were supposed to be holding the door closed were missing.
They resecured the door and removed the handle so there was no way of opening it. The duty officer, engineering manager and guard were satisfied with the repairs and allowed the train to re-enter service.
The duty officer left work later that day without reporting the accident to the RAIB or the Office of Rail and Road (ORR). On 25 June the accident was brought to the attention of a different duty officer when the train was then taken out of service, the carriage in question was quarantined and SDR contacted the RAIB.
The report, published on 30 January, said: "The risk associated with the absence of the toilet floor was not sufficiently appreciated nor adequately managed after the carriage was allowed to enter service. SDR had no formal competence management assessment for staff involved in carriage maintenance and train preparation."
Both these factors led to no one detecting that the door had become unsecure, the RAIB concluded.
In its report the RAIB also criticised SDR's maintenance regime which, it said, had "failed to identify the degrading condition of the carriage structure, nor was it adequately monitored after its partial repair".
Since the accident SDR has developed a new safety management system, which was published last November, and introduced a competence assessment process for staff working in the engineering and carriage and wagon workshops.
The carriage maintenance section of the new safety management system proposes a "major overhaul" of SDR's carriages every 20 years or 100,000 miles (whichever comes first).
It has recirculated its risk assessment policy for defects to all managers and implemented a fault reporting and defect recording system.
All SDR's duty officers have been re-briefed on its accident reporting process to remind them of the company's "legal obligations to report such events in a timely manner and ensure evidence is preserved".
A new carriage shed also has been built to protect the rolling stock.
The RAIB has made one recommendation to SDR to commission an independent review of its new safety management system, including governance, risk assessments, additional control measures and employee competence, and the way it is being applied. "Any changes identified as necessary by this review should be implemented and reported to the ORR," it said.
In response to the RAIB's report, a spokesperson for SDR said: "The South Devon Railway accepts that safety on a moving train was badly compromised on this isolated occasion and which could have resulted in serious injury to a female passenger and her young son.
"Since then, we have been working closely with the RAIB and the ORR in their investigation. As a result, the South Devon Railway has fully satisfied the requirements of the ORR's improvement notice. We have learned lessons from this regrettable incident, and acted quickly to make the necessary improvements."