BBC director general Mark Thompson has defended the controversial decision which saw the British broadcaster race a behind the scenes deal with Sky.

With the TV licence frozen the BBC argued that it needed to cut costs, and while spending in some quarters has actually increased the state broadcaster insisted that its spend on F1 was not value for money. Consequently, rather than reach a deal with a rival terrestrial broadcaster, the BBC sought a deal with Sky, part of Rupert Murdoch's vast News Corporation empire - even though the state broadcaster has been one of the leading critics of Murdoch's increasing influence in terms of his ownership of various media outlets.

The new deal sees Sky Sports show all twenty rounds of the 2012 world championship season - at a cost - while the BBC will only show ten races live and the rest delayed.

At a recent hearing of the Culture, Media and Sport Select Committee, Thompson (salary circa £800,000.00 in 2010) defended the deal.

"We know that Formula One has only fairly recently come back to the BBC; it has been very popular on the BBC," said Thompson, according to the transcript. "Secondly, we know that Formula One fans ideally do not want Formula One to be interrupted by advertising, because of the character of the sport," he added. "Nor, of course - for the subset of Formula One fans who do not have Sky subscriptions - would they ideally like Formula One to go entirely behind a pay wall.

"I believe that the arrangements that we have reached offer very good value to the licence payer, and the experience of Formula 1 on the BBC will still be very rich. The first grand prix next season, when this new arrangement starts - the Australian Grand Prix - will be live on Sky in the very early hours of the morning. There will be a 75-minute highlights package in peak time on the BBC, which we would expect to reach many more people than the live coverage.

"Talking about changing the arrangements in the existing contract and the extension of that contract, all I would say, and I have of course heard the arguments that perhaps this could have been picked up by another free-to-air broadcaster - is that what we have done has guaranteed that a very large amount of Formula 1 will still to be free-to-air to the British public for many years to come. Had we simply stopped the contract and decided to walk away from Formula 1 after that, there was a real danger that all of Formula 1 would have gone behind a pay wall.

According to Thompson, over the course of the contract, the BBC will 'save' around £150m. Asked why a deal couldn't be done with a rival terrestrial (free to air) channel he said: "We were quite clear that, to get the economics to work for us, it was going to have to be a pay partner, and this was the only pay partner, credibly, whom we thought we could involve in it - indeed, a pay partner who had expressed interest in this very topic of conversation previously," he said. "It was an example of a free-to-air pay partnership, which is not by any means unknown in the market.

"It seems to me that it was not required of us, and given that, in a sense, what we were trying to achieve on behalf of the licence fee payer was a significant saving, actually keeping the confidentiality of the process until it was clear whether the thing was viable and whether all parties to it - including, of course, the rights-holder - were happy, militated in terms of doing it the way we did it."

Meanwhile, in an interview with the Daily Telegraph, the BBC's head of sport, Barbara Slater (salary circa £187,000 in 2010), also justified the controversial deal.

"Cuts have been hard, make no mistake," she said. "We have been very clear about what is driving our rights strategy, and it is crown jewel events. The message from audiences is crystal clear. They want the BBC to broadcast the shared national moments, the pinnacle events, because they are standout.

"We are showing that in practice. We have deals to 2017 with Wimbledon and the Six Nations. We have the World Athletics Championships coming back in 2017. Even in F1 we have been clear that the British grand prix is a critical moment when we need to be live, even if we have fewer races. But the truth is that some live football rights have got out of reach in terms of their value."