MANILA - The Philippine authorities have admitted missing numerous chances to shoot a sacked policeman who hijacked a busload of Hong Kong tourists in a standoff that ended with eight hostages being killed.

President Benigno Aquino said he took responsibility for the tragedy, as a public inquiry was told of a catalogue of mistakes during the day-long crisis, which was broadcast on live television around the world.

The country's police chief left Manila halfway through the standoff, the force's best-trained unit sat out a bungled assault on the bus and the media were allowed to run wild, the inquiry heard.

Interior Undersecretary Rico Puno and police chief Jesus Verzosa admitted there were repeated opportunities for snipers to shoot the armed hijacker during the siege in the heart of Manila.

"There were a lot of chances where we could (have taken) him down," Puno said. "The general idea then was we would just tire him out and he would release the hostages."

Sacked policeman Rolando Mendoza took the busload of tourists hostage on August 23 in a desperate bid to clear himself of extortion charges and get his old job back.

The standoff came to a bloody end when police made a botched attempt to storm the bus and rescue the hostages.

Puno, the president's pointman man for the crisis, said he would take the blame for the failed rescue.

But Aquino said that, as Philippine president, he must shoulder responsibility.

"At the end of the day, I am responsible for everything that has transpired," Aquino told reporters elsewhere.

Manila Mayor Alfredo Lim, who was monitoring the negotiations, said that during the crisis, Aquino called him by phone, asking him to make sure the situation would be settled peacefully.

"Make sure the hostages are safe, ensure the safety of the hostages and exhaust all resources for a peaceful settlement of this situation," Lim quoted the president as saying.

For much of the day the negotiating team believed Mendoza was cooperative, Puno said, borne out by his decision to free about a third of the 25 hostages as he bargained for authorities to reopen the extortion case against him.

"By all indications he would release all of them," Puno said.

But Mendoza, armed with an M-16 assault rifle and a pistol, started shooting about 10 hours into the ordeal after he saw his brother, also a Manila police officer, being detained just outside the bus.

The ill-prepared police were then forced to assault the bus, but were unable to get in and another hour went by before a sniper, who did not have night-vision goggles, eventually shot Mendoza dead in the dark.

Asked if the authorities had failed in assessing Mendoza's readiness to kill the hostages, Puno told the inquiry: "Most probably, that is the case."

Verzosa said he agreed with the decision not to kill Mendoza early on, saying there was no indication he would hurt the hostages.

"During the time that he was exposed, it was foreseen that a peaceful resolution was at hand," Versoza said.

Verzosa said he flew from Manila to the southern Philippines four hours into the crisis to attend an official function.

He said he was in the air and unable to communicate with his personnel in charge of the hostage negotiations for about an hour, and then was only able to watch events unfold on television 800 kilometres (500 miles) from Manila.

Verzosa insisted the visit was important because he had to meet officials on insurgency and terrorism issues.

He acknowledged that the police rescue squad sent to storm the bus was not the best-trained or best-equipped unit at the government's disposal.

The unit best-equipped to handle the situation, the police Special Action Force, was in the area but sat out the assault until the last five to 10 minutes, Verzosa said.

Both Verzosa and Puno also said the police failed to control the crowd, while television and radio stations continued to broadcast the crisis.

This allowed Mendoza to monitor what was going on around him via a television on board, which police failed to disable.

The police ground commander, Rodolfo Magtibay, said reporters interviewing the hostage-taker by telephone prevented negotiators from contacting him in the crucial last hour before the bloodbath began.

The inquiry, headed by the justice secretary, is scheduled to finish its hearings on Monday.