Appearing soon after Home Secretary Jack Straw announced the scathing conclusions of the Macpherson report, Sir Paul rejected calls to resign and pledged to continue to fight racism.

He welcomed the new meaning of institutional racism contained in the report after he repeatedly refused to acept a more damning definition used at last year's inquiry.

Sir Paul Condon's speech in full

He called it a new standard, which would apply to all public institutions.

He said it talked about racism as unwitting prejudice and ignorance rather than defining such action as deliberate.

"We needed a radical new definition and we got it," he said.

He also repeated his public apology to the Lawrence family for not bringing the killers to justice and spoke of a "sense of shame" over the investigation into the murder.

He told BBC One's Six O'Clock News: "We failed dramatically and publicly and we have acknowledged that and apologised."

But he said he would ignore calls for him to stand down in the wake of the severe incompetence charges levelled at the Metropolitan Police, adding "there is still much to do".

Referring to Stephen's murderers, Sir Paul said: "I have never given up hope of bringing these people to justice."

'Failure of leadership'

Sir Paul said he accepted part one of the report, which paints a damning picture of the service's handling of the case.

It says "the investigation was marred by a combination of professional incompetence, institutional racism and a failure of leadership by senior officers".

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However the report adds that not all officers, nor the Met's policies, were racist, and that the problem was being tackled.

This, Mr Straw told the Commons, was a new definition of institutional racism that he and Sir Paul had accepted.

Straw backing

He gave his full backing to Sir Paul and said he had asked the commissioner to stay on until his retirement next January.

Mr Straw made clear that the report had praise for Sir Paul in tackling the problems of racism with "great vigour".

Though the report contains no call for Sir Paul to resign it does cite his reluctance to accept the original label of institutional racism as "a somewhat less positive approach" than that adopted by other senior officers.

It also criticises him for his role in accepting the findings of the Barker review, the internal investigation into the failure of the murder probe which cleared officers of wrongdoing.

Sir Paul had originally rejected accusations that London's police force was "institutionally racist" as defined at the time by the inquiry.

He insisted it would be unfair to thousands of honourable officers to accept such a label.

Condon 'vindicated'

The report "vindicated" London's top police officer and his force of charges of racism, the group that represents Metropolitan Police officers said afterwards.

Metropolitan Police Federation Chairman, Inspector Glen Smyth, said the report had showed that incompetence rather than racism or corruption had been at the root of the failure of the first inquiry into Stephen's murder.

He said: "Sir Paul Condon stood his ground at the public inquiry and refused to accept that the 26,000 men and women of the Metropolitan Police service came to work with one intention in mind, to treat people differently.

"He has been vindicated and the stance he has taken as a police service has been vindicated."

He said: "Sir William has said that Metropolitan police officers are not racist and overt racism did not play a part in the bungled investigation."