The BBC was plunged into chaos today as Richard Sharp resigned as chairman after a report found he broke rules by failing to declare involvement in a loan guarantee for Boris Johnson.
Mr Sharp announced he will stand down at the end of June to avoid being a ‘distraction’ to the corporation.
The dramatic move followed the publication of a review by Adam Heppinstall KC – ordered after he was dragged into row over a £800,000 loan guarantee for then-PM Mr Johnson.
The report found Mr Sharp, who was acting as an adviser in No10, had told Mr Johnson he wanted to be BBC chair before formally applying in November 2020.
He also apologised for not telling the appointments panel that he had spoken to the Cabinet Secretary the following month and offered to make an introduction to Sam Blyth, a distant cousin of Mr Johnson, who had suggested they could ‘assist’ with the premier’s ‘personal finances’.
The review found both matters amounted to a breach of the Governance Code, but did not challenge Mr Sharp’s insistence that mistakes were ‘inadvertent’.
Minds are now turning to who will replace Mr Sharp at the BBC, with speculation that his successor will have a non-political background.
But Rishi Sunak refused to be drawn on who might be next in line, saying he had not yet read the report.
Speaking to media at the Scottish Tory conference in Glasgow, Mr Sunak said: ‘There’s an appointments process that happens for those appointments. I’m not going to prejudge that.’
Richard Sharp has quit as BBC chairman and will leave at the end of June
The review found two matters amounted to a breach of the Governance Code, but did not challenge Mr Sharp’s insistence that mistakes were ‘inadvertent’
Mr Heppinstall said he disagreed with Mr Sharp’s assessment that mentioning to Mr Johnson his intention to apply for the chairmanship 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.’
In a statement, Mr Sharp – an ally of Rishi Sunak who was his boss when they both worked at Goldman Sachs – said: ‘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.’
Many of his own staff believed the controversial circumstances surrounding his appointment made it impossible for him to continue.
Mr Sharp has denied that he was involved in helping to facilitate any loan, or had any further involvement.
As a result of the controversy, the Office of the Commissioner for Public Appointments appointed Mr Heppinstall to look into the appointment process that led to Mr Sharp getting the top job.
Mr Sharp said today: ‘During my conversation with the Cabinet Secretary on December 4 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.’
Mr Sharp said he will remain in the role until the end of June while the search for a successor takes place.
He said: ‘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.
‘When I sought in December 2020 to introduce the Cabinet Secretary to Mr Blyth, I did so in good faith. I did so with the best of intentions.
‘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.’
‘For more than two years I have seen the beating heart of the BBC up close,’ Mr Sharp said in a statement.
‘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.’
The BBC Board said: ‘We accept and understand Richard’s decision to stand down.’
BBC director-general Tim Davie thanked Mr Sharp for his service to the BBC and ‘the drive and intellect he brought to his time as chairman’.
‘Working with him over the last two years has been rewarding and Richard has made a significant contribution to the transformation and success of the BBC,’ Mr Davie said.
‘The focus for all of us at the BBC is continuing the hard work to ensure we deliver for audiences, both now and in the future.’
Labour’s shadow culture secretary Lucy Powell said Mr Sharp had ’caused untold damage to the reputation of the BBC and seriously undermined its independence as a result of the Conservatives’ sleaze and cronyism’.
‘The Prime Minister should have sacked him weeks ago. Instead it took this investigation, called by Labour, to make him resign,’ she added.
In a letter to Mr Sharp, Culture Secretary Lucy Frazer said that he his ‘held in high regard’ by the BBC board but added that ‘I understand and respect your decision to stand down’.
‘You have clearly demonstrated your commitment to public service and I especially applaud the work you did during the pandemic,’ she said.
‘Your decision to step down in the wider interests of the corporation is further testament to that commitment.
‘Thank you, once again, for your service and I wish you well for the future. I am sure there will be further opportunities for you to make a significant contribution to public life.’
She accepted the decision that he should remain in post until the next board meeting on June 27 when a temporary replacement will be appointed.
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