BBC Versus the Pogues

It seems someone at BBC Radio 1 got the bright idea of bowdlerizing the Pogues' "Fairytale of New York" so as to remove the "cheap lousy faggot" line. Fortunately, good sense eventually prevailed and the original version will go forward.

I'm always puzzled by this sort of thing. The word clearly appears in the text because the character who says it is trying to direct an offensive insult at the other character. What's the basis for the objection?