THE BBC was thrown into disarray yesterday as it attempted to limit the fallout from the scandal that saw director-general George Entwistle resign over the weekend.

BBC Trust chairman Lord Patten, who appointed Entwistle to the top role at the corporation, said the future of the BBC was at stake if the broadcaster did not make sweeping changes following the 90-year-old institution’s biggest-ever crisis.

The corporation faced further criticism last night over the size of Entwistle’s payoff, which equates to a year’s salary at £450,000, although he was only legally entitled to six months’ pay. Tory MP Rob Wilson said licence fee payers would be “astounded” by the amount.

Entwistle stepped down on Saturday night following a Newsnight report into child abuse that incorrectly implicated a former Conservative politician. The report came in the wake of the BBC facing severe criticism for dropping an investigation into allegations against Jimmy Savile.

“If you are saying, ‘Does the BBC need a thorough, structural, radical overhaul?’, then absolutely it does,” Patten said yesterday.

He told the Andrew Marr show that a new boss would be appointed within weeks.

Entwistle had admitted on Saturday morning that he did not know about the Newsnight investigation before it had aired on 2 November, and had not watched it until the day after. His 54 days in charge make him the BBC’s shortest serving director-general.

The government is understood to be monitoring the state of the BBC closely, but is not interfering in its workings. Culture secretary Maria Miller yesterday called Entwistle’s resignation “a regrettable decision, but the right decision”. “It is now crucial that the BBC puts the systems in place to ensure it can make first class news and current affairs programmes,” she said.

Patten yesterday rejected calls for him to resign, saying his job was to guide the broadcaster through the crisis. “What we now have to do is to get a grip on what’s happening in the BBC,” he told Sky’s Murnaghan programme. “If I don’t do that and if we don’t restore the huge confidence and trust that people have in the BBC then I’m sure people will tell me to take my cards and clear off.”

Other bosses could also face difficult questions over their positions at the BBC as the scandal unfolds. The broadcaster is waiting on a report from BBC Scotland boss Ken MacQuarrie over the failings that led to the incorrect Newsnight investigation.

Patten said yesterday that Entwistle had taken responsibility for “the awful journalism which disfigured the news organisation”, and that the search for a new chief had begun immediately.

In a letter to all BBC staff, Patten wrote: “The priority now is to address the very serious questions that still remain around the original decision not to pursue the initial Newsnight investigation, how last week’s story went so horribly wrong and, most importantly, how the BBC’s historic culture and behaviour allowed Jimmy Savile to get away with his vile criminal activity for so long.”