Davies is writing to the prime minister to resign

BBC chairman Gavyn Davies has resigned in the wake of Lord Hutton's criticisms of the corporation's reports.

He quit after Lord Hutton said the suggestion in BBC reports that the government "sexed up" its dossier on Iraq's weapons with unreliable intelligence was "unfounded".

Lord Hutton also criticised "defective" BBC editorial processes over defence correspondent Andrew Gilligan's broadcasts of the claims on the Today programme.

THE HUTTON REPORT Full Report (PDF file 2MB) Lord Hutton's statement Hutton report in full (html version) Chapter 12: Summary Davies resignation statement

In his resignation statement, Mr Davies said no-one at the BBC in the past year had deliberately misled the public, and no one had acted out of malign motivation.

"I have been brought up to believe that you cannot choose your own referee, and that the referee's decision is final," he added.

But he questioned whether Lord Hutton's "bald conclusions" on the dossier's production could be reconciled with the balance of the inquiry's evidence.

And he asked whether those conclusions about the use of sources whose remarks could not be verified, constituted a "threat to the freedom of the press in this country".

Culture Secretary Tessa Jowell said Mr Davies had "done the honourable thing" and she would now advertise for his replacement.

The Hutton report would be taken into account for the review of the BBC's charter in 2006, she said, but the result would be a "strong BBC, independent of government".

In his long-awaited report, Lord Hutton said he was satisfied Dr Kelly had killed himself after being named as the suspected source of the BBC's controversial weapons dossier story.

HAVE YOUR SAY Let's just hope it shakes up the BBC to be more the type of broadcaster they used to be Mike, UK Send us your comments

Prime Minister Tony Blair said the report showed "the allegation that I or anybody else lied to the House or deliberately misled the country by falsifying intelligence of weapons of mass destruction is itself the real lie".

"I simply ask that those that have made it and repeated it over all these months now withdraw it fully, openly and clearly," he said.

In other key developments:

• BBC director general Greg Dyke said the corporation apologised for things which were wrong in Mr Gilligan's reports and pointed to changes in the corporation's procedures

• Ex-Downing Street media chief Alastair Campbell said: "If the government had faced the level of criticisms which today Lord Hutton's report has directed at the BBC, there would have been resignations by now, several resignations at several levels."

• Lord Hutton said the BBC governors should have properly investigated Downing Street's complaints as they defended the corporation's independence

• Mr Blair's wish for the dossier to make a persuasive case might have "subconsciously influenced" Joint Intelligence Committee chairman John Scarlett to use stronger words than usual but Mr Scarlett had acted to ensure the dossier was consistent with reliable intelligence, said the judge

• There was no "dishonourable, underhand or duplicitous strategy" by the government to leak Dr Kelly's name covertly to help its battle with the BBC

• The Ministry of Defence was "at fault" for failing to tell Dr Kelly that his identity as the suspected source would be confirmed to journalists who suggested it, said the report

• Lord Hutton "deplored" the leak of some his findings in the Sun newspaper and is looking at an investigation and possible legal action

BBC political editor Andrew Marr's reaction to the report was: "In the end what it comes down to is a judgement by Lord Hutton - who he believes, whose motives he trusts most and in that, again and again, he comes down on the side of politicians and officials."

INQUIRY BACKGROUND September 2002: Government produces dossier about alleged Iraqi weapons of mass destruction, including claim they could be deployed within 45 minutes May 2003: BBC Today programme's Andrew Gilligan broadcasts report of claims Downing Street "sexed up" dossier, with 45 mins claim included against intelligence agencies' wishes 10 July 2003:Dr David Kelly named as suspected source of report as government continues to deny the story 17 July 2003: Dr Kelly found dead August 2003: Lord Hutton begins six weeks of hearings about the circumstances around Dr Kelly's death Key points at-a-glance Blair cleared Profile: Gavyn Davies

Dr Kelly's family urged the government to learn from their tragedy.

"No other person should have to suffer the pressure he experienced," said their solicitor, Peter Jacobsen.

Tackling Mr Blair amid rowdy scenes in the House of Commons, Conservative leader Michael Howard said the press statement about an unnamed official meeting Mr Gilligan made it inevitable Dr Kelly's name would emerge.

He said: "Isn't there the starkest contrast between Dr Kelly, who had done so much for our country, and the cabal of ministers and advisers, including the prime minister himself, who were so obsessed by the war with the BBC that they gave scant attention to his welfare?"

Meanwhile, Liberal Democrat Charles Kennedy called for an independent inquiry into the Iraq war.

"We are still no closer to determining whether this country went to war on a false prospectus," he said.