The Newsnight broadcast which wrongly implied a high-ranking Tory of child sex abuse has "appalled" its other reporters, according to their union today.
The National Union of Journalists (NUJ) warned BBC management that morale at the broadcaster was "already at an all-time low" before the controversial broadcast as huge staff cuts were damaging the quality of journalism.
The union issued the statement after the BBC's director of news Helen Boaden and her deputy Stephen Mitchell dramatically stepped aside today over the furore just two days after the resignation of director-general George Entwistle.
Newsnight sparked uproar last week after mistakenly alleging a "senior Tory figure" in the Thatcher era had been involved in a paedophile ring based out of a north Wales care homes.
Within days the victim interviewed retracted the allegation, saying he had misidentified his abuser.
But the affair has only intensified criticism of directors' editorial judgement, weeks after it emerged the broadcaster pulled a credible investigation into decades of serial sex abuse by BBC presenter Jimmy Savile.
The NUJ said in a statement it was "fully engaged" with the situation.
"Our members at Newsnight have asked us to make clear they are appalled at what happened, and that the overwhelming majority of those who work there had no involvement with the story and were not consulted about it," said general secretary Michelle Stanistreet.
However she pointed out that BBC management were in the midst of slashing their budgets by more than a sixth on orders from Chancellor George Osborne.
Around 2,000 staff are expected to lose their jobs in the cull and Ms Stanistreet said the cuts had to stop.
She said: "Even flagship programmes have not been ringfenced. At Newsnight, for example, the budget in real terms has halved over the past five years and the number of reporters and senior journalists has been cut relentlessly.
"These are simple facts. With fewer journalists, many employed on a casual basis, it means there is no time for that extra telephone call, no time to double-check the facts, no time to reflect properly before a programme goes out.
"This should be a wake-up call to the BBC."
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