LONDON (CNN) -- The head of the BBC sought Tuesday to defend its handling of a scandal involving sex abuse claims against a late children's TV presenter and DJ -- including why the broadcaster decided to drop an investigation into the star last year.

BBC Director General George Entwistle faced tough questions from British lawmakers over the BBC's response to the allegations against Jimmy Savile, a household name in Britain, and its broader culture.

He acknowledged that "what we now know happened is a very, very grave matter indeed."

But, he said, "we have done much of what we should have done."

Entwistle said the BBC is working with the police and has sought to ensure nothing it does would compromise the investigation into "what the police describe as an unprecedented child exploitation."

He was criticized by lawmakers over his inability to answer detailed questions concerning whether there are current sex abuse claims at the BBC.

A slew of accusations against Savile has emerged over the past three weeks since a rival broadcaster released a documentary in which five women alleged abuse, some of it on BBC premises.

The scandal has gripped the British media, with many questioning who knew what and when about the alleged abuse of teenage girls, and risks lasting damage to the reputation of the United Kingdom's public broadcaster. Savile died in October last year at the age of 84.

Lawmakers on Parliament's Culture, Media and Sport Committee pressed Entwistle over the impact of the furor on public confidence in the BBC.

Their questions are focused on two independent reviews set up by the BBC -- one into its handling of its own investigation into Savile last year, and the second into the culture and practices of the broadcaster, during and after Savile's time there.

"There is no question that what Jimmy Savile did and the way the BBC behaved in the years -- the culture and practices of the BBC seems to allow Jimmy Savile to do what he did -- will raise questions of trust for us and reputation for us," Entwistle responded.

"This is a gravely serious matter and one cannot look back at it with anything other than horror, frankly, that his activities went on as long as they did undetected."

London's Metropolitan Police last week launched a criminal investigation into claims of child sexual abuse by "Savile and others," many of which date back to the 1960s and '70s. The force said more than 200 potential victims had been identified.

"As we have said from the outset, our work was never going to take us into a police investigation into Jimmy Savile," a police statement said. "What we have established in the last two weeks is that there are lines of inquiry involving living people that require formal investigation."

The BBC said Monday that the editor of the BBC's flagship current affairs program "Newsnight" was "stepping aside" over questions about why his show never broadcast its investigation into Savile.

A BBC blog post by Peter Rippon on October 2 explaining his decision to drop the investigation was labeled "inaccurate or incomplete in some respects" Monday by the BBC.

The broadcaster posted a correction on its "The Editors" blog explaining what is now known and how that differs to Rippon's earlier explanation.

The BBC's "Panorama" program broadcast its own probe into the "Newsnight" decision on Monday evening, suggesting serious allegations had been made to "Newsnight" reporters before the investigation was shelved.

Entwistle said he was given no oversight over Panorama's broadcast because it was looking into senior BBC management figures.

But having watched the program, he said, he was "surprised that nothing further happened" in light of the material dug up by "Newsnight."

Key questions relate to whether the "Newsnight" decision was connected in any way to the BBC's plans to run two tribute programs looking back at Savile's charitable work, broadcast last Christmas.

The former head of Sky News is carrying out a review into the management of the "Newsnight" investigation.

The furor has shocked a generation of Britons who grew up watching Savile, one of the most recognizable figures in British showbiz from the 1960s to the 1980s, or listening to his radio shows.

He was the first host of the BBC's hugely popular "Top of the Pops" music show, and his own program, "Jim'll Fix It," ran for almost 20 years. Thousands of children wrote in every week with special requests for him to "fix," or make happen.

The controversy has prompted a wider examination of an apparent culture of sexism at the BBC in past decades that may have fed into abusive behavior.

Newspaper reports say Savile appears to have used his access to children, through his charity and TV work, as a means to prey on vulnerable young people.

The sexual abuse claims also relate to incidents in hospitals, including Leeds General Infirmary and Stoke Mandeville, and Broadmoor, a high-security psychiatric hospital.

Savile was well known for his fund-raising efforts, and ran several marathons for charity. He was awarded a knighthood for his charitable work.

 CNN's Per Nyberg contributed to this report.

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