The BBC today announced the first round of savings plans to release £139 million a year by 2008, which it says it aims to reinvest in to programmes, but will be at the cost of 1,700 jobs.

Shocked staff were told that 980 of them will be made redundant and a further 750 outsourced from the corporation.

Union leaders said workers reacted with "anger and disbelief" to the announcement, which the Director General, Mark Thompson, delivered not in person, as was originally intended, but via a video message.

A second wave of job cuts is to be announced later this month.

Paul McLaughlin, national officer of the National Union of Journalists, said: "We are deeply disappointed that the BBC has chosen to proceed with this level of cuts. This is a very difficult time for workers at the BBC. The corporation is promising so much to the Government but is not delivering anything to the staff."

The first round of cuts - more than £35 million more than had been expected - come from the BBC's professional services which include: strategy and distribution, policy and legal, marketing, finance and personnel departments.

The savings are part of Mr Thompson's aim to ensure the BBC can develop a bold content strategy, while becoming much simpler in its operations and business processes.

Nearly half of all jobs will go, up to 980, some through staff turnover, others through redundancy, with another 750 posts planned to be outsourced.

Mr Thompson told senior staff that the BBC Governors had endorsed the plans but would consider these and further savings plans from the content and output divisions as a whole at their meeting next week before giving final approvals.

"We have made a strong start, showing we are serious about change and ensuring we are maximising the value of our income for audiences' benefit," said Mr Thomspon.

"We need to make the BBC a simpler, more agile operation, ready to take the creative lead in a very different, very challenging digital future."

The announcements come a week after publication of the Government's Green paper on the BBC's Charter, which Secretary of State Tessa Jowell described as a "blueprint for a strong, independent BBC".

On Monday, the BBC also announced an extensive cross-media, audience-focused Creative Future project that will produce an ambitious editorial plan for BBC programmes, content and services over the next Charter period.

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