The head of the BBC was mocked by MPs over his lack of knowledge of the Jimmy Savile child abuse scandal yesterday, as the organisation admitted that current employees and contributors are being investigated over nine fresh claims of sexual harassment, assault and inappropriate conduct.

George Entwistle, the BBC Director-General, admitted that a Newsnight investigation into sex abuse carried out by Jimmy Savile while he worked at the Corporation should never have been dropped.

And today David Cameron today announced the Director of Public Prosecutions, Keir Starmer, would launch an urgent investigation into the failure to prosecute Savile over allegations of child abuse while he was alive.

Meanwhile Conservative MP Sir Roger Gale has become the first politician to suggest senior figures at the BBC may have to resign over the scandal.

At yesterday's House of Commons hearing, he was accused by MPs of displaying "an extraordinary lack of curiosity" in the Savile case as he claimed he only learnt of the Newsnight story while eating at an event in a London hotel. "It was a busy lunch – I didn't want to show undue interest," he told the Select Committee on Culture, Media and Sport.

It emerged yesterday that Liz Mackean, one of two BBC journalists working on the Savile investigation, believed the story was quashed after Peter Rippon, the editor of Newsnight, questioned whether the witnesses were really victims. She claimed in an email leaked to Channel 4 News that he told her "the girls were teenagers, not too young … they weren't the worst kind of sexual offences".

Mr Entwistle informed MPs that two of his senior colleagues – the director of news, Helen Boaden, and her deputy, Stephen Mitchell – had spoken to Peter Rippon, the editor of Newsnight, about the Savile story prior to his decision to halt the investigation. Ms Boaden warned Mr Rippon there should be no "skimping on standards" in the quality of the journalism because Savile was dead.

The Director-General told the committee he was "very disappointed" in Mr Rippon for producing an inaccurate blog about his decision not to run the story, which the BBC published on its website on 2 October. He revealed that the blog – which has been the subject of a prominent correction – was seen ahead of publication by Mr Mitchell.

In a series of critical comments about the Newsnight editor – who has been made to stand aside pending an internal BBC inquiry – Mr Entwistle was scathing of Mr Rippon's email to journalists that said the Savile story was based on evidence from "just the women". The Director-General said: "The phrase, on the face of it, is not the least defensible."

Mr Entwistle was asked about claims that a paedophile ring was active at the BBC, but said that while he had heard of allegations, it was a matter for the police to investigate. Scotland Yard's Operation Yewtree into sex abuse relating to Savile is following more than 400 lines of inquiry.

Yesterday's gruelling two-hour session was a painful experience for Mr Entwistle, who began work as Director-General less than six weeks ago. Much of his time in the post has been taken up with firefighting the Savile scandal, which was prompted by an ITV documentary on 3 October containing allegations that the former Jim'll Fix It host was a predatory paedophile. MPs were incredulous yesterday that Mr Entwistle still appeared to have very limited knowledge of the detail of what had happened.

He recalled his brief exchange with Ms Boaden over Savile in 2011 which, ironically, took place at a lunch for the equal opportunities group Women in Film & Television. He said she told him: "I wanted to tell you that Newsnight are looking at Jimmy Savile and if it comes off, if it stands up, it may have an impact on your Christmas schedule."

Mr Entwistle, who was the BBC's director of vision at the time, was planning to broadcast tributes to Savile, who had died weeks earlier. But he never asked Ms Boaden about the substance of the Newsnight investigation – even though he said it was "relatively rare" for her to give him such a "heads up". He told the committee: "We never spoke about it again – I inferred the decision had been taken not to go ahead." On 28 December, the BBC broadcast a glowing tribute show – for which Entwistle had responsibility – called How's About That Then?

John Whittingdale, the chairman of the committee, accused the Director-General – who is himself a former editor of Newsnight – of showing "an extraordinary lack of curiosity". Mr Entwistle repeatedly stressed that he had not wanted to ask any questions which "could be construed as pressure".

Mr Entwistle admitted that "perhaps I was being over-sensitive" in his degree of caution. But after he struggled to provide details of the number of BBC staff under investigation for alleged sexual abuse and harassment, the head of Britain's biggest news organisation was mocked by Philip Davies, the Tory MP.

"It appears your determination not to show undue interest applies to absolutely everything at the BBC," he said to loud laughter. Mr Entwistle was also accused of sounding "a bit like James Murdoch", a reference to the News Corp executive's limited answers at a hearing into hacking.

Mr Entwistle said the scandal raised questions of trust. He told MPs: "There's no question that what Jimmy Savile did and the way the BBC behaved – the culture and practices of the BBC seemed to allow Jimmy Savile to do what he did – will raise questions of trust for us and reputation for us."

The BBC issued a statement saying: "As a result of the allegations about Jimmy Savile and subsequent contact from staff, former staff and members of the public, we are currently aware of nine allegations of sexual harassment, assault or inappropriate conduct regarding current staff or contributors. Some of these cases have been passed to the police where appropriate."

Mark Thompson, the BBC's DG at the time the Newsnight investigation was dropped, offered to give evidence to the committee. Mr Thompson wrote to Rob Wilson MP to say he was "never formally notified about the Newsnight investigation". He had two brief conversations about the story but had no part in the decision not to run it.

The fallout: What has this done to key players’ reputations?

George Entwistle

With the BBC in need of leadership the DG needs to get a grip. Poor performance before MPs. He looks negligent for not ensuring Savile tributes were justified. Damaged.

Helen Boaden

The director of news must explain why she didn’t give Entwistle more warning in their lunchtime talk, and what she knew and told Rippon of Newsnight’s investigation. Vulnerable.

Stephen Mitchell

The popular deputy director of news is being sucked in. He spoke to Rippon about the investigation and read his inaccurate blog before it was published. Questions to answer.

Peter Rippon

After inexplicably dropping the story, the Newsnight editor, criticised by the DG for his innaccurate blog, seems doomed without remarkable new evidence for Pollard review. History.

Mark Thompson