Entwistle's pay-off is a boiling point for the BBC

But there are bigger things at stake than the £450,000 he took home

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The BBC likes nothing more, it seems, than a story about the BBC. I am sure that somewhere in the Sumatran jungle there is a creature that stays alive by feeding on itself, and someone listening to any of the Beeb's news outlets yesterday might be forgiven that a peculiar form of auto-parasticism had overtaken the corporation.

Everywhere you turned, the same questions were being asked. Is this the biggest crisis in the BBC's history? How many more heads will roll, or, in the bulls**t bingo phrase, how many more executives will be "stepping aside"? Will Newsnight be canned? And will Eddie Mair emerge as the man to restore faith in the BBC's journalism? (Actually, that last question was one going around in my own head, but if calmness, thoroughness and independence of outlook is needed, he should be the new face of BBC news.)

There are, of course, huge issues for the corporation to resolve, and the acting Director-General, Tim Davie, made a good start by refusing to be bounced into quick decisions. But if I take the temperature of the Radio 5 phone-ins accurately, the matter that exercises the British public more than any other is the size of George Entwistle's pay-off. The sum of £450,000 is a decent wedge in anyone's book, but you can understand the angry reaction of Fulminating of Falmouth and Incadescent of Ipswich yesterday. "It would take me 20 years to earn that amount of money," said one listener, making the point that Mr Entwistle's settlement was payment for 54 days of pretty catastrophic leadership. On and on the callers went, some saying they were going to refuse to pay their licence fee, others doubting they would ever trust the BBC again.

Both David Cameron and Maria Miller, the Culture Secretary, surfed this wave of general indignation by saying that the pay-off was difficult to justify, and a complicated, nuanced story became one we could all understand: it was about fat cats, noses in the trough, and our old friend, "the reward for failure". So it has come down, as most things do, to money.

I obviously don't know the precise details of Mr Entwistle's contract, but it is not unexpected that someone in a high-profile, demanding and vulnerable post would have a degree of financial comfort in the event of a forced resignation. Whether that should equate to a year's salary for Mr Entwistle is moot, but it's hardly the most important discussion point around this whole sorry saga.

The failures of journalism are breathtaking, and what it exposes is a schizophrenic news organisation in which some figures take themselves so seriously as inheritors of the Reithian philosophy – witness the statement released through his agents by Jeremy Paxman, which had all the portent of a papal edict – while others at a middle-management level are making decisions that would fail any simple test of journalistic practice.

One further question I'd like to pose is this: why does the best-resourced editorial operation in Britain have to outsource its investigative journalism, as Newsnight did with the fateful child abuse report? One thing is clear: as the BBC belongs to us, we have the right to demand answers.

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