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* BBC Trust head says changes must be made

* Director general quit over “shoddy” journalism

* PM Cameron says crisis serious but BBC can recover

* Murdoch and others will try to take advantage, Trust says

By Michael Holden and Kate Holton

LONDON, Nov 12 (Reuters) – Britain’s BBC could be doomed

unless it makes radical changes, the head of its governing trust

said, after its director general quit to take the blame for the

airing of false child sex abuse allegations against a former

politician.

BBC Trust chairman Chris Patten said on Sunday confidence

had to be restored if the publicly funded corporation was to

withstand pressure from rivals, especially Rupert Murdoch’s

media empire, which would try to take advantage of the turmoil.

“If you’re saying, ‘Does the BBC need a thorough structural

radical overhaul?’, then absolutely it does, and that is what we

will have to do,” Patten, a one-time senior figure in Prime

Minister David Cameron’s Conservative Party and the last British

governor of Hong Kong, told BBC television.

“The basis for the BBC’s position in this country is the

trust that people have in it,” Patten said. “If the BBC loses

that, it’s over.”

George Entwistle resigned as director general on Saturday,

just two months into the job, to take responsibility for the

child sex allegation on the flagship news programme Newsnight.

The witness in the Newsight report, who says he suffered

sexual abuse at a care home in the late 1970s, said on Friday he

had misidentified the politician, Alistair McAlpine. Newsnight

admitted it had not shown the witness a picture of McAlpine, or

approached McAlpine for comment before going to air.

Already under pressure after revelations that a long-time

star presenter, the late Jimmy Savile, was a paedophile,

Entwistle conceded on the BBC morning news that he had not known

– or asked – who the alleged abuser was until the name appeared

in social media.

The BBC, celebrating its 90th anniversary, is affectionately

known in Britain as “Auntie”, and respected around much of the

world.

But with 22,000 staff working at eight national TV channels,

50 radio stations and an extensive Internet operation, critics

say it is hampered by a complex and overly bureaucratic and

hierarchical management structure.

THOMPSON’S LEGACY

Journalists said this had become worse under Entwistle’s

predecessor Mark Thompson, who took over in the wake of the last

major crisis to hit the corporation and is set to become chief

executive of the New York Times Co on Monday.

In that instance, both director general and chairman were

forced out after the BBC was castigated by a public inquiry over

a report alleging government impropriety in the fevered build up

to war in Iraq, leading to major organisational changes.

One of the BBC’s most prominent figures, Newsnight presenter

Jeremy Paxman, said since the Iraq report furore, management

had become bloated while cash had been cut from programme

budgets.

“He (Entwistle) has been brought low by cowards and

incompetents,” Paxman said in a statement, echoing a widely-held

view that Entwistle was a good man who had been let down by his

senior staff.

Prime Minister Cameron appeared ready to give the BBC the

benefit of the doubt, believing that “one of the great

institutions of this country” could reform and deal with its

failings, according to sources in his office.

Patten, who must find a new director general to sort out the

mess, agreed that management structures had proved inadequate.

“Apparently decisions about the programme went up through

every damned layer of BBC management, bureaucracy, legal checks

– and still emerged,” he said.

“One of the jokes I made, and actually it wasn’t all that

funny, when I came to the BBC … was that there were more

senior leaders in the BBC than there were in the Chinese

Communist Party.”

Patten ruled out resigning himself but other senior jobs are

expected to be on the line, while BBC supporters fear

investigative journalism will be scaled back. He said he

expected to name Entwistle’s successor in weeks, not months.

Among the immediate challenges are threats of litigation.

McAlpine, a close ally of former Prime Minister Margaret

Thatcher, has indicated he will sue for damages.

Claims for compensation are also likely from victims who say

Savile, one of the most recognisable personalities on British

television in the 1960s, 70s and 80s, sexually abused them as

children, sometimes on BBC premises.

INQUIRIES

Two inquiries are already under way, looking at failures at

Newsnight and allegations relating to Savile, both of which

could make uncomfortable reading for senior figures.

Police have also launched a major inquiry into Savile’s

crimes and victims’ allegations of a high-profile paedophile

ring. Detectives said they had arrested their third suspect on

Sunday, a man in his 70s from Cambridgeshire in central England.

Funded by an annual licence fee levied on all TV viewers,

the BBC has long been resented by its commercial rivals, who

argue it has an unfair advantage and distorts the market.

Murdoch’s Sun tabloid gleefully reported Entwistle’s

departure with the headline “Bye Bye Chump” and Patten said News

Corp and others would put the boot in, happy to deflect

attention after a phone-hacking scandal put the newspaper

industry under intense and painful scrutiny.

He said that “one or two newspapers, Mr. Murdoch’s papers”

would love to see the BBC lose its national status, “but I think

the great British public doesn’t want to see that happen”.

Murdoch himself was watching from afar.

“BBC getting into deeper mess. After Savile scandal, now

prominent news program falsely names senior pol as paedophile,”

he wrote on his Twitter website on Saturday.

It is not just the BBC and the likes of Entwistle and Patten

who are in the spotlight.

Thompson, whom Entwistle succeeded in mid-September, has

also faced questions from staff at the New York Times over

whether he is still the right person to take one of the biggest

jobs in American newspaper publishing.

Britain’s Murdoch-owned Sunday Times queried how Thompson

could have been unaware of claims about Savile during his tenure

at the BBC as he had told British lawmakers, saying his lawyers

had written to the paper addressing the allegations in early

September, while he was still director general.