Director-general Tony Hall has enlisted the BBC's audience in his opposition to plans for what he described as a "much-diminished" corporation.
Speaking to reporters at the launch of the BBC's annual review, he said the recent funding agreement in the run-up to the budget was "not a good process" but was now settled.
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That deal, which saw the BBC take on responsibility for funding free TV licences for the over-75s, will be followed on Thursday by a Government green paper expected to call for a narrower range of programming and an examination of the future of the licence fee.
Culture Secretary John Whittingdale has also appointed an eight-person panel to work on the renewal of the BBC's royal charter – which sets out the corporation's remit – which runs out at the end of next year.
Hall told reporters the charter debate was "shaping up to be a clash between two different views of the future".
He added: "Because there is an alternative view that prefers a much-diminished BBC. It's a view that is often put forward by people with their own narrow commercial interests or ideological preconceptions".
Hall said audiences do not want "a significantly smaller BBC" and the public's voice "will matter most in this debate".
Hall set out what he described as "non-negotiable" aspects of the BBC, including universal funding – "because we all pay, we all pay less" – and political independence.
He said: "I have real difficulty with the idea of artificial restrictions on creativity – after all, the last time politicians tried to be creative we ended up with the Millennium Dome. So it will be hard to support any proposal that stops us finding the next Strictly, the next Bake Off or – dare I say it – the next Top Gear."
The annual report showed that amid talk of cost-cutting the BBC increased its workforce in 2014/15.
Hall has pledged to save £50m by cutting layers of management and 1,000 jobs. Between 2013/14 and 2014/15 the workforce rose from 18,647 to 18,974 people, and the BBC paid out £976.5m in wages – up from £955m in 2014.
The BBC, which is in the middle of its Delivering Quality First efficiency drive which it says has saved £484m this year, saw its reported bill for on-screen talent rise from £194m to £208m. The BBC said this was because the new figure, making up 12.2 per cent of internal spend on content, includes the BBC World Service.
The number of people earning more than £500,000 a year fell from 14 to nine, but the amount paid to the top earners who take home more than £1m a year has gone up from £4.2m to £5.1m.
The BBC cut the amount paid to talent earning between £500,000 and £750,000, which fell from £6.5m to £2.9m.
BBC Worldwide paid £226.5m to the corporation last year due to the success of shows including Doctor Who and Great British Bake Off.
The report said Doctor Who was its top-selling show having been licensed to 189 territories, with programmes including Top Gear and The Weakest Link also doing well.
Local versions of the motoring show, currently in the middle of recruiting a new presenting team after the exit of Jeremy Clarkson and his co-hosts, have been launched in France and China, and Bake Off has been sold to countries including Turkey and Israel.
The report showed that BBC News has yet to fully recover from the scandals of 2012 in terms of perceptions of trust from the public.
The report said: “Last year we said that we would monitor perceptions of accuracy and impartiality, which fell a little in 2013.
“This year perceptions were fairly stable overall, although audiences in Scotland showed how challenging it was for the BBC to satisfy all parts of the audience with its referendum coverage.
“Audiences continued to rate BBC News much more highly than other news providers, although perceptions of trust in BBC News have not returned to the record levels of 2012.”
The graph above shows that 53 per cent of public surveyed by Ipsos MORI said they would turn to BBC News – above others – for impartial news coverage. Surveys in 2014 and 2013 put this figure at 50 per cent and 49 per cent respectively.
The report last year said: "[W]e are slightly below the levels reached before October 2012 when the crisis broke over coverage of Jimmy Savile and the separate Newsnight child abuse investigation…
"We will work hard to justify the audience’s continued trust. We will be alive to our critics and take responsibility for mistakes when we make them. We will uphold an uncompromising commitment to accuracy, impartiality, diversity of opinion and fair treatment of people in the news.”
As part of the report, the BBC monitored how well news and current affairs represents the lives of people in England (61 per cent), Scotland (48 per cent), Northern Ireland (61 per cent) and Wales (55 per cent).
The report said: "Councils reported strong appreciation for locally produced TV output in Scotland, Wales and Northern Ireland, and in the English regions, welcomed investment and innovation in high-quality journalism regional current affairs and digital services.
"Members noted unprecedented BBC activity in Scotland for the Commonwealth Games and the independence referendum, increasing the overall audience for BBC output.
"Audience Council Scotland commended BBC coverage of the referendum debate, but believed network news coverage came too late, and noted significant concern among a section of the audience about perceptions of impartiality.
"Councils in Wales, Scotland and Northern Ireland said audiences would welcome more coverage of their affairs on network TV news."
The report said the BBC news reached 80 per cent of UK adults on a weekly basis, with 32m watching it on television and 27m unique browsers recorded online each week in the first three months of 2015. This online figure was 65m worldwide.
The BBC said that it attracted a then-record 70.7m unique browsers, including just less than 30m in the UK, on the news website in the week of the Charlie Hebdo attacks. It said that 13.2m UK unique browsers, and 23.4m globally, visited the BBC Scotland News website in the week of the independence referendum.
The report said that over the course of the year the World Service reached 210m people, going above 200m for the first time.