GREG DYKE, who was forced out as BBC director-general in January, could make a sensational return to the helm of the corporation.

He is being urged by close friends to apply to Michael Grade, the new chairman of the corporation, to get his old job back. One of Grade’s first tasks when he takes up the chairmanship on May 17 will be to oversee the search for a new director-general. Grade is understood to have told friends that Dyke, an old friend and former colleague, could be a contender.

Dyke, who resigned after the Hutton report condemned the BBC’s journalism in the David Kelly affair, indicated this weekend that he would not discount a return. He told The Sunday Times that the suggestion was worth considering.

According to Dyke’s allies, his return would not plunge the BBC into fresh confrontation with the government. Senior sources say Tony Blair, the prime minister, never wanted Dyke, a former Labour donor, to be sacrificed.

But the manner of his departure could present obstacles. When Dyke left his post in January he accused Downing Street of “systematic bullying” and “intimidation” of the BBC over its coverage of the Iraq war.

He also released a copy of a letter to Blair showing the ill feeling that existed between Number 10 and the corporation even before the Today programme report which claimed the government “sexed up” its dossier on Iraq’s weapons of mass destruction.

That antagonism could undermine the BBC’s case as it lobbies for a 10-year extension to its Royal Charter, which expires in 2006, and the continuation of the licence fee.

That said, Grade and Dyke would be a powerful team. They first met in the 1970s when Grade was director of programmes at London Weekend Television (LWT) and Dyke was beginning his career as editor of the Six o’Clock Show.

In 1984 Grade, who had moved to the BBC, offered to hire Dyke, dangling the prospect of eventually running BBC1. But Dyke, in demand after his success with Roland Rat at TV-am, turned him down.

The two men, both football fans, are part of the “LWT mafia”, former employees of the station who went on to key jobs in media and government. Other members include Sir Christopher Bland, chairman of BT and former chairman of the BBC, and Lord Bragg.

The appointment of Grade marks a reversal for Lord Birt, another LWT alumnus and Dyke’s predecessor as director general. Birt, who now works as a policy adviser at No 10, was thought to be lobbying for his friend Lord Burns as chairman and his protégé Mark Byford as director-general. Byford is currently acting director-general.

Grade said on Friday that he was a “Dykeist” rather than a “Birtist” and praised Dyke for the “marvellous job” he had done during his four-year term. Dyke sacked the expensive management consultants hired by Birt and overturned some of his reforms, declaring that he wanted to “cut the crap” and “make it happen”.

As director-general Dyke scored a tactical success by moving the BBC’s main television news bulletin, presented by Huw Edwards and Fiona Bruce, into the slot vacated by ITV’s News at Ten.

But there was criticism of the manner in which BBC1 overhauled ITV in the ratings. Under Dyke it broadcast the lightweight Fame Academy and a fourth weekly episode of EastEnders, while Panorama was moved out of peak time.

This weekend Grade, whose own commissions as a broadcasting executive have ranged from The Big Breakfast to the hit movie Four Weddings and a Funeral, acknowledged the perils for the BBC of an overly populist agenda.

Changes in the composition of the BBC’s board of governors may be shifting the balance of power in Dyke’s favour. He has admitted that when he offered his resignation to the governors he hoped they would refuse to accept it.

Now some of Dyke’s detractors from that time have left or are are due to do so.

The acting chairman, Lord Ryder, a former Conservative chief whip, who opposed the journalistic style of Radio 4’s Today programme, is to quit in June. Baroness Hogg, the head of the No 10 policy unit under John Major who is said to have pressed for Dyke’s departure, retired at the end of February.

Dyke’s main rival for the job is said to be Mark Thompson, chief executive of Channel 4. However, Thompson has yet to make his mark at the station, and might find it difficult to extricate himself from his contract. Other contenders include Peter Salmon, the BBC’s director of sport, and Jenny Abramsky, BBC director of radio. Byford is no longer a favourite.

Dyke inspired unprecedented scenes of loyalty from corporation staff when he quit.

He could yet be the greatest repeat ever seen at the BBC.

• Grade’s first management hurdle could be defending himself against accusations of a conflict of interest regarding his chairmanship of Pinewood Shepperton Studios, which has business links with the BBC. Some of the corporation’s biggest programmes were made at Pinewood.

  Grade has made clear he will neither relinquish his management role nor a 4% stake in the studio which could be worth as much as £5m when the company is floated on the stock exchange this summer.

   

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