The facts of this tragic story are clear: the BBC pursued a story that was wrong

A publicly funded company should not run sexed-up stories and defend them by making even more sexed-up claims about the source
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Lord Hutton, the Law Lord leading the inquiry into the death of David Kelly, has cleared his summer diary. The key players are making themselves available. Tony Blair will leave the heat of his holiday in Barbados if he is summoned. Andrew Gilligan will not be gracing the airwaves as he prepares for Lord Hutton's interrogation. No doubt Alastair Campbell would jog back to London from his holiday location, to put his case. Perhaps they will all shed fresh light. But what is extraordinary is how much light is already beaming. Lord Hutton could head for Tuscany tomorrow, and reach some fairly clear conclusions.

He could begin with the tape of Today's original story. John Humphrys hailed Andrew Gilligan's scoop by declaring that the BBC had "evidence" that the dossier on WMD had been "cobbled together". We now know the BBC did not have "evidence", but the views of Dr Kelly. Mr Gilligan said his source was a "British official who was involved in the preparation of the document".

This was technically true, but misleading. Dr Kelly was involved only in preparing the uncontroversial section on Saddam's past involvement with weapons of mass destruction. According to Mr Gilligan, Dr Kelly blamed "Downing Street" (in his Mail on Sunday article Mr Gilligan named Mr Campbell) for inserting the allegation that some weapons were ready for use in 45 minutes against the wishes of the intelligence agencies.

In his evidence to the Foreign Affairs Committee Dr Kelly denied making this claim. Whether Dr Kelly did or did not speak in such forthright terms can never be proven. What we know is that the assertions attributed to Dr Kelly were wrong even if he made them. Dr Kelly was in no position to confirm at first hand what happened in the compilation of the controversial section of the dossier. He was not directly involved. Subsequently everyone from Tony Blair to the chairman of the Joint Intelligence Committee has denied the claim and the Foreign Affairs Committee was shown the intelligence that confirmed to most of them that the dossier was not "sexed up". The BBC was making waves with the assertions of a single source that was not involved in the relevant section of the dossier. The allegations were wrong and yet they were causing mayhem around the world.

So did Alastair Campbell have the right to defend himself against the allegations broadcast with the supposed authority of the BBC? The answer can only be "yes". Parts of the BBC may have reached the conclusion that Mr Campbell was a barely human demon, but most decent-minded people would argue that anyone should have the right to put a case, which Mr Campbell did openly at the Foreign Affairs Committee and on Channel 4 News. At which point parts of the media expressed outrage that Mr Campbell had become the story.

It was then that I began to wonder whether we were living in a reverse police state, in which the media brainwashes itself and everyone else against those in a position of power. Mr Campbell became the story because of the BBC's serious allegations, not because of any machinations on his part. If you wake up on a Sunday morning to find Watergate style allegations being made in the Mail on Sunday by a BBC correspondent, you are a story whether you like it or not. Mr Campbell was not on the Machiavellian offensive, but on the defensive. He knew he would be slaughtered for it, he knew that in the short-term it would damage the Government, but what choice did he have?

The BBC also went on to the robust defensive, declaring the story was based on a "senior intelligence source". This was sensational. If the source had been from the intelligence agencies, he or she would have been near the top to speak with authority about the dossier. We now know this was not true. Again the question must be posed: What should Mr Campbell have done - kept quiet and allowed the myth to permeate that the story was based on a genuinely significant intelligence source?

There were other inconsistencies. Jeremy Paxman reported that one of Newsnight's reports was based on a different source from Mr Gilligan's, implying mayhem at the top of the intelligence agencies, as different sources briefed BBC journalists. We now know it was the same source, and not from intelligence.

In the current climate, the reverse police state, anyone who dares to criticise the BBC is attacked as a lackey of Rupert Murdoch or the Government. So let me make it clear: as far as I know Mr Murdoch has not added this newspaper to his empire; I continue to believe that the bigger questions relate to why Britain went to war in the first place; I do not believe that at any point the BBC should have revealed the identity of its source; I do not regard the BBC as anti-war or pro-war, nor is it pro- or anti-New Labour; those who claim the BBC broadcast Mr Gilligan's report as part of an anti-war agenda are wrong.

In the end it is straightforward. A publicly funded organisation should not run sexed-up stories and then defend them by making more sexed-up claims about the source.

Why has the BBC made a series of colossal errors? As I argued in the Independent on Sunday three weeks ago, parts of the BBC are biased against all politicians and advisers. They cannot take a stand on policies or political parties so they try to make waves on process: spin, sleaze, and control-freakery. This is what gets some of them excited, a way of competing with the newspapers they read so avidly.

I suspect that Gavyn Davies, the chairman, and Greg Dyke, rushed to defend the BBC partly because they were desperate to show they were not government lackeys. The allegations of bias were always nonsense, but assaults by the Daily Mail and The Sun are hard to withstand (which is partly why politicians employ spin doctors). The layers of managers below them were so thrilled to find a story being defended for once, few of them dared to wonder whether they had chosen the wrong fight. Equally alarming, some BBC managers metamorphose into the personality of the latest director general. Under John Birt they were ardent upmarket Birtists. Now they are populist Dykeists.

The BBC is not the arrogant, mighty institution portrayed in some newspapers. As far as its news and current affairs department is concerned it is full of insecure managers, many of whom have never worked anywhere else. Probably this is a story of decent people, used to the insular world of the BBC, stumbling out of their depths. For those of us who want the BBC to flourish as a publicly funded body there are issues here in terms of its accountability and editorial direction. That is well beyond the remit of Lord Hutton, but before he has formally started there is plenty of evidence to suggest that this is a story of the supposedly mighty BBC causing mayhem probably without realising what it was doing, and a supposedly mighty Government having no choice but to neurotically defend itself.