BBC chairman Richard Sharp has dramatically QUIT in a bitter cronyism row after a long-awaited report found he'd breached public appointment rules.
Mr Sharp - who awkwardly used to be Rishi Sunak's boss when he was an investment banker - had faced calls to step down since it emerged he helped Boris Johnson secure an £800,000 loan.
Up to now the Tory Party donor has refused to do so, but today a report by barrister Adam Heppinstall KC. found he "failed to disclose potential perceived conflicts of interest".
Labour said Mr Sunak should have sacked Mr Sharp weeks ago.
In a speech this morning the outgoing BBC boss said remaining in place would become a "distraction" for the corporation.
Mr Sharp brokered the loan for Mr Johnson before being recommended by the former PM for the BBC job - but a committee of MPs who approved his appointment weren't told.
He introduced Canadian businessman - and distant cousin of Mr Johnson - Sam Blyth to Cabinet Secretary Simon Case to discuss the funding in 2020.
The disruptive saga has raised questions about the BBC's impartiality and sparked widespread calls for him to be removed.
After the news broke Match The Day host Gary Lineker - who was himself suspended after criticising the Government - posted on Twitter: "BBC chairman should not be selected by the government of the day. Not now, not ever."
Mr Sharp's resignation saves dithering Rishi Sunak - who has up to now refused to condemn the BBC boss - from deciding whether to sack him.
Mr Sunak was responsible for bringing Mr Sharp into government as an economic adviser during the Covid crisis.
The report revealed Mr Sharp told Mr Johnson he planned to apply for the top job at the BBC in October 2020.
On December 4 he told Cabinet Secretary Simon Case that he had a friend who could help Mr Johnson with his finances. The following week, on December 11, Mr Sharp interviewed for BBC chairman job
Shadow culture secretary Lucy Powell said the report was clear that Mr Sharp had breached the rules - and said the PM should have acted faster.
She said: "As a result, this breach has caused untold damage to the reputation of the BBC and seriously undermined its independence as a result of the Conservatives’ sleaze and cronyism.
"This comes after 13 years of the Tories doing everything they can to defend themselves and their mates.
"From Owen Paterson to Dominic Raab, and now Richard Sharp, instead of doing what’s best for the country the PM was more interested in defending his old banking boss. The PM should have sacked him weeks ago. Instead it took this investigation, called by Labour, to make him resign."
Mr Sunak said he has not spoken to former BBC chairman Richard Sharp following his resignation.
Speaking to reporters in Glasgow he said: "When concerns are raised, it is right there is a proper process, an independent process that we don't prejudge, we allow it to carry on, establish the facts of what happened, reach a conclusion.
"That has happened, Richard Sharp has resigned. But it is right that we do these things properly and professionally, I think most people will think that is the right thing to do."
In his resignation letter to Culture Secretary Lucy Frazer, Mr Sharp said the rule breach was "inadvertent and not material".
But he added: "Nevertheless, I have decided that it is right to prioritise the interests of the BBC. I fee that these matters may well be a distraction from the Corporation’s good work were I to remain in post until the end of my term."
Mr Heppinstall said he disagreed with Mr Sharp's assessment that his conversation with Mr Johnson did not amount to a conflict of interest.
"It may well have been a reasonable conversation in the context of Mr Sharp's role as special adviser, but failing to mention it to the panel does amount to a failure to disclose a potential perceived conflict of interest," the barrister wrote in his report.
"There was a risk that members of the public might form the view that Mr Sharp was informing the Prime Minister of his application because he wanted him to make a recommendation to appoint him.
"They might also perceive that he was putting himself in a position where he might, if appointed, be beholden to the Prime Minister for his support such that his independence from Government was compromised."
The BBC said in a statement: “We accept and understand Richard’s decision to stand down. We want to put on record our thanks to Richard, who has been a valued and respected colleague, and a very effective Chairman of the BBC. The BBC Board believes that Richard Sharp is a person of integrity.
“Richard has been a real advocate for the BBC, its mission, and why the Corporation is a priceless asset for the country, at home and abroad. He has always had the impartiality of the BBC and a desire to see the organisation thrive at the forefront of his work as Chairman.
“We understand that the UK Government is moving swiftly to begin the process of appointing a new Chairman of the BBC, in line with the terms of the BBC’s Charter.”
And in a brief statement Mr Sharp said: “Being the Chairman of the BBC has been an enormous privilege.
"It is an incredible organisation which has never mattered more than it does today, at home in the UK and around the world. I am very proud to have worked with the uniquely talented teams across the BBC. They are the best at what they do and I shall always be their champion.”
This morning Labour frontbencher Louise Haigh said the BBC chairman "will have to go" if he is found to have broken the code for public appointments.
She told Sky News: "If it is revealed that he has failed to declare the details of this loan arrangement properly or failed to be forthcoming in the process, then of course he will have to go."
She added: "It's been really concerning to see how the Government has sat back and done very little about the potential breaches in the process, and did nothing to help restore trust and faith in the impartiality of the BBC.
"I think his whole saga raises wider issues around the way that the Government has approached the BBC and the particular links of the Tory party with the BBC."
The Commons Digital, Culture, Media and Sport (DCMS) Committee confirmed his appointment but was not aware of his role in helping to facilitate the loan.
At a committee hearing Mr Sharp insisted he had not “facilitated” any money changing hands in the weeks before his appointment was announced in February 2021.
However Damian Green, who chairs the Commons Culture Committee said in February: “Richard Sharp chose not to tell either the appointment panel or our Committee about his involvement in the facilitation of a loan to Boris Johnson.
“Such a significant error of judgment meant we were not in full possession of the facts when we were required to rule on his suitability for the role of BBC Chair.”
Mr Sunak reported to Mr Sharp at Goldman Sachs in the early 2000s, shortly after the current PM left university.
Richard Sharp's resignation speech in full
I would like to thank Adam Heppinstall and his team for the diligence and professionalism they have shown in compiling today’s report.
Mr Heppinstall’s view is that while I did breach the governance code for public appointments, he states that a breach does not necessarily invalidate an appointment.
Indeed, I have always maintained the breach was inadvertent and not material, which the facts he lays out substantiate. The secretary of state has consulted with the BBC Board who support that view.
Nevertheless, I have decided that it is right to prioritise the interests of the BBC. I feel that this matter may well be a distraction from the corporation’s good work were I to remain in post until the end of my term.
I have, therefore, this morning resigned as BBC chair to the secretary of state, and to the board.
It was proposed to me that I stay on as chair until the end of June while the process to appoint my successor is undertaken, and I will of course do that in the interests of the corporation’s stability and continuity.
Let me turn to the events that are the subject of today’s report.
When I sought in December 2020 to introduce the cabinet secretary to Mr (Sam) Blyth I did so in good faith. I did so with the best of intentions.
And I did so with the sole purpose of ensuring that all relevant rules were being followed.
I am pleased that Mr Heppinstall supports the fact that my involvement in these matters was accordingly “very limited”.
He states that he is “happy to record” that he has seen no evidence – and nor could he – to say I played any part whatsoever in the facilitation, arrangement, or financing of a loan for the former prime minister.
During my conversation with the cabinet secretary on 4 December 2020, I reminded him of the fact that I was in the BBC appointments process.
I believed, as a result of that conversation, that I had been removed from any conflict or perception of conflict. I understood this recusal to be absolute.
This was my error. In my subsequent interview with the appointments panel I wish, with the benefit of hindsight, this potential perceived conflict of interest was something I had considered to mention.
I would like once again to apologise for that oversight – inadvertent though it was – and for the distraction these events have caused the BBC.
For more than 20 years, I have devoted time and energy to public service, whether at the Institute for Cancer Research, at the Royal Academy of Arts, on the financial policy committee of the Bank of England, or as an economic advisor to the Treasury working to protect British business, including the creative industries, during the pandemic.
For more than two years, I have seen the beating heart of the BBC up close. And for all its complexities, successes, and occasional failings, the BBC is an incredible, dynamic, and world beating creative force, unmatched anywhere.
As chair, I have acted at all times in the public interest, and for the betterment of the BBC. I am proud to have fought for the recent return of government funding for the World Service. I have been active in commissioning independent thematic reviews of BBC coverage on touchstone issues.
And I have championed the importance of the BBC as a well-funded and impartial public service broadcaster.
To chair this incredible organisation has been an honour. The BBC’s contribution to our national life is immense, its people are hardworking and brilliant, and preserving and enhancing it matters.
