The BBC is now in 'its last stages' because budget cuts will make it increasingly difficult to maintain standards, the corporation's world affairs editor has warned.

John Simpson, one of BBC's longest serving news reporter, said the corporation's future is bleak as the world service was paying the price of the licence fee being 'chopped away.'

"The future? Well, I don't think that it's going to look very good for the BBC. I think the BBC we have known, for good or worse, is now in its last stages," the veteran correspondent, whose career at the BBC spans more than 40 years, told an audience at the Cheltenham Literature Festival.

According to Britain's Daily Telegraph, the 64-year-old foreign correspondent, who has visited 120 countries, said the BBC was "already cutting back on operations across the board, as a result of the effective cut in the licence fee."

The grim assessment of the top editor, who fears that he may be sacked soon 'in horrible circumstances,' comes as the corporation has been forced to cut 2,500 posts and slash budgets for news and current affairs as the result of the lower than expected licence fee settlement.