image captionTony Hall has been criticised for a "woefully ineffective" investigation into Bashir

Former BBC director general Tony Hall has said he is "sorry for the hurt caused" to the Royal Family by the scandal surrounding Martin Bashir's 1995 interview with Princess Diana.

At the time, Lord Hall investigated Bashir's faking of bank documents after questions arose about whether Bashir had used them to secure the scoop.

"I trusted a journalist. I gave him a second chance. We, the team, gave him a second chance, and that trust was abused and was misplaced," Lord Hall told a committee of MPs on Tuesday.

Lord Hall was head of news at the time, and his investigation concluded that Bashir was an "honest and an honourable man".

image captionBashir's interview with Princess Diana on Panorama in 1995 was watched by 22.8 million people

But a recent report by former judge Lord Dyson criticised Bashir's "deceitful" actions and Lord Hall's "woefully ineffective" investigation.

After the Dyson Report was published, Prince William, Diana's son, said "the BBC's failures contributed significantly to her fear, paranoia and isolation".

He said: "She was failed not just by a rogue reporter, but by leaders at the BBC who looked the other way rather than asking the tough questions."

media captionPrincess Diana was failed not just by Martin Bashir but by leaders at the BBC, says Prince William

Lord Hall said on Tuesday that Bashir had ended up "contrite and in tears" when he interviewed him about the matter at the time.

"He appeared to us that he was contrite, inexperienced and out of his depth and that is why in the end rather than sacking him, and I can see the reasons for that, he was given a second chance," he said.

'A failure of morality'

The committee's chairman Julian Knight MP said Lord Hall's decision to blacklist the graphic designer who mocked up the documents and not sack Bashir "wasn't just a failure of management, it was a failure of morality".

Mr Knight also said it was "utterly extraordinary" that the BBC would re-hire a "known liar" as religious affairs correspondent in 2016, when Lord Hall was director general.

"We didn't know 25 years ago the scale of what Martin Bashir had done to gain access to the Princess of Wales, through [her brother] Earl Spencer," Lord Hall said.

"If we knew then what we know now, of course he wouldn't have been re-hired."

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The House of Commons culture select committee will also quiz John Birt, who was director general at the time of the interview, plus Tim Davie and Richard Sharp, the current BBC director general and chairman respectively.

Bashir's explosive interview with Diana – in which she discussed her unhappy marriage to Prince Charles, their affairs and her bulimia – was one of the biggest scoops in the BBC's history and was watched by 22.8 million people.

But questions soon arose about why Bashir had commissioned a graphic designer to mock up bank documents and whether he had used those fake papers to gain Diana's trust.

The matter died down until late last year when the questions about Bashir's methods – and the BBC's subsequent actions – resurfaced around the 25th anniversary of the interview.

That led to last month's Dyson Report, which described Bashir as "unreliable", "devious" and "dishonest". The BBC admitted the report showed "clear failings" in its own processes.

media captionTim Davie said Martin Bashir would not have been rehired if they had had full knowledge around events of the Princess Diana interview

The MPs' hearing came a day after the BBC published a separate report into how and why Bashir was rehired in 2016 before being promoted to religion editor two years later.

That report, conducted by BBC executive Ken MacQuarrie, found that none of the individuals involved in Bashir's hiring had knowledge of all of the matters contained in the Dyson Report, and that he wouldn't have been rehired if they had.

Earl Spencer responded on Twitter, saying: "It won't end with this, I promise."

Bashir has said mocking up the documents "was a stupid thing to do" and he regretted it, but that they had had no bearing on Diana's decision to be interviewed.