Well, the need to keep overall budgets in control is hardly unique to the BBC. And the fact that Doctor Who
was "floundering and out of fashion" in 1985 was reflected in its viewing figures, which were pretty appalling and had been for a while. There might still have been a hiatus even with larger audiences, but the attitude taken toward the programme by executives would have been a bit different. Ratings are, as has been noted, not nearly as important to the BBC as they are to for-profit networks, but they're still the measure of overall audience, which (along with level of audience devotion, social/educational importance of programming, and other factors) is one of the ways the BBC determines whether something is worth spending the license fee on.