Hacking scandal claims scalp of Murdoch junior

THE phone hacking scandal claimed its biggest scalp yesterday when James Murdoch quit as executive chairman of News International. The 39- year- old, who was once regarded as automatic heir to his father Rupert’s media empire, has cut ties with Britain and its newspapers.

Parent company News Corporation said the move would enable him to focus on expanding its global TV business following his relocation to New York.

Mr Murdoch’s sudden resignation comes after months of fierce criticism over his handling of the scandal and repeated questions over just how much he knew about phone hacking at the News of the World.

The controversy has seen journalists arrested and the firm forced to set aside a £20million fund to pay damages to those whose voice messages were intercepted.

Although the move distances him from the firestorm that has engulfed his father’s UK newspapers, Mr Murdoch is expected within

‘A barrier to taking responsibility’

weeks to be criticised in a Commons culture, media and sport committee report.

Days ago the Murdoch empire was rocked again when the Leveson Inquiry was told of a ‘culture of illegal payments’ at the Now’s sister paper, The Sun.

Police are also understood to want to question him about ‘bombshell’ emails held at a data storage facility in India.

Discussions are reported to have taken place with the Crown Prosecution Service about whether he should be interviewed under caution. Scotland Yard last night said it was ‘not prepared to discuss’ whether there was a warrant out for his arrest.

MP Don Foster, co-chairman of the Lib Dem parliamentary policy committee on culture, media and sport, said: ‘James Murdoch’s resignation has all the appearances of being bundled in a car, away from the scene of the crime.

‘There are unanswered questions on his knowledge of phone hacking at the NOW. He must make clear his move to New York will not be a barrier to his taking responsibility for what happened on his watch.’

Mr Murdoch found himself at the epicentre of the hacking scandal, which led to the closure of the NOW last July. He has faced repeated claims that phone hacking was far more widespread than the company originally admitted.

John Whittingdale, chairman of the Commons committee, said Mr Murdoch’s departure was ‘unsurprising’.

‘We took evidence twice from James Murdoch – he was very clear that he did not know about phone hacking, although he did authorise substantial payments to several of the victims of hacking.

‘Even if he wasn’t aware of the details, it caused some surprise to us that he was willing to sign off those payments without asking questions about the detail as to why it was necessary.’

But he claimed the resignation might signal Rupert Murdoch’s commitment to stay in the UK market. The media mogul launched the Sun On Sunday last weekend – with son James conspicuous by his absence. However, Chase Carey, News Corp’s chief operating officer, revealed on Tuesday that the board might consider ridding itself of its British newspapers, which form a small part of the Murdoch empire.

James Murdoch had to rely on the large family stake in News Corp to remain on its board last November amid fears that his links to the hacking scandal would damage the company’s reputation in the U.S.

Victims of phone hacking welcomed the news. Labour MP Chris Bryant, who received £30,000, said the resignation was ‘ long overdue’.

‘On his watch, we have seen the biggest corporate corruption scandal since 1720 and historic titles like The Sun brought into disrepute,’ he added. Mr Murdoch remains News Corporation deputy chief operating officer and keeps responsibility for BSKYB.

EVEN critics of the Leveson Inquiry cannot reasonably dispute that evidence given by a senior police officer on Monday was very disturbing. Deputy Assistant Commissioner Sue Akers alleged that there was ‘a culture of illegal payments’ to public officials at The Sun.

Her claims that a journalist was given £150,000 to pay public officials, and one official had received £80,000, may yet be tested in a court of law. If they turn out to be true, and no plausible public interest defence is entered by The Sun, it will indeed be a bleak day for journalism.

For the time being, though, we won’t find out much more. Operation Elveden, which is investigating alleged corrupt payments to the police by News International, owner of The Sun, grinds on. Meanwhile James Murdoch, son of Rupert, was forced to stand down yesterday as the company’s chairman.

There is another possibly corrupt relationship with the Murdoch Press that has so far received very little attention, and yet is arguably more important. I mean the assiduous and unrelenting courting of the media tycoon by Labour and Tory leaders over a period of nearly 20 years.

It may be more important because it does not concern what Sue Akers acknowledged was a relatively small number of officials but our entire political system. The relationship between News International and our leaders has helped shape policy.

Some will blame Rupert Murdoch for suborning our politicians. I submit that they had a choice. They did not have to seek his patronage and support in such a craven way. Money may not have changed hands, as it is alleged to have done with the police, but something far more precious was handed over by our political leaders.

The process began with Tony Blair flying to address Murdoch executives in Australia in 1995 shortly after being elected leader of the Labour Party. The strategy, largely devised by Alastair Campbell, Mr Blair’s spin doctor and a former red-top journalist, was to gain the endorsement of the Murdoch Press, which New Labour believed, very possibly wrongly, had been responsible for the party’s defeat in 1992.

HOW ironic that the same Alastair Campbell, who virtually masterminded Labour’s intimate relationship with the Murdoch papers, should now be touring television studios to present himself as a high-minded and virtuous critic of the very media tycoon and newspapers he once so desperately wooed.

Of itself the new bond between New Labour and the Murdoch Press was not necessarily reprehensible. It is where it led that should make us queasy. Though Mr Murdoch almost certainly did not win Mr Blair any elections, he gave him crucial support before the Iraq War. Without it, Mr Blair might well have been unable to commit British troops.

In the months before the invasion of Iraq in March 2003 both The Sun and its sister paper, The Times, wildly exaggerated the danger posed by Saddam Hussein, taking at face value Mr Blair’s and Mr Campbell’s overblown claims about Saddam’s supposed weapons of mass destruction.

Again and again The Sun painted Iraq as a formidable threat to British interests. After the publication in September 2002 of the famously inaccurate dossier partly compiled and edited by Alastair Campbell, the paper carried the ridiculous — but powerful — headline: ‘Brits 45 Mins from Doom.’

So involved was Mr Murdoch as cheerleader for the war party that he and Tony Blair spoke three times on the telephone in the ten days before the invasion. The Press magnate was better informed, and more listened to, than most Cabinet ministers.

What was true before the start of the war was true afterwards. The Sun and The Times enthusiastically sided with Alastair Campbell in his ferocious assault on Andrew Gilligan and the BBC after the reporter had said, I believe correctly, that No 10 had deliberately ‘sexed up’ the September 2002 dossier. Bad news from Iraq was downplayed or even suppressed by these newspapers.

No wonder the former Labour minister Charles Falconer, whose main qualification for office was that he was once Tony Blair’s flatmate, should have slunk into Radio 4’s Today programme studio on Tuesday morning to express misgivings about New Labour’s erstwhile cosy relations with Mr Murdoch. A bit late in the day!

In light of Mr Blair’s alliance with Mr Murdoch, which culminated in his standing as godfather to one of his daughters in 2010, David Cameron’s courting of the media tycoon may seem less egregious. But it was pursued with remarkable vigour and determination.

Against much spirited advice, the Tory leader insisted on appointing former News of the World editor Andy Coulson as his spin doctor in 2007 even though he had recently resigned as a result of the then embryonic phone hacking scandal, and was in the view of informed observers quite likely to be implicated. Mr Cameron clung to Mr Coulson because the ex-editor provided access to News International in general and Mr Murdoch in particular. His campaign reached its climax in August 2008 when he was flown on a private jet to meet the ‘Sun King’ on his yacht in the Mediterranean. This meeting marked a turning point in their relationship.

THE Tory leader also cultivated Rebekah Brooks, chief executive of News International until last July, and as it happens a near neighbour in Oxfordshire. As recently as Christmas 2010, he thought it appropriate to have dinner at her house, where James Murdoch was also present.

Both Tony Blair and David Cameron got far chummier with Rupert Murdoch than was seemly or proper. Although I believe they both exaggerated his power, that does not exculpate them in any way.

Incidentally, Labour leader Ed Miliband had a bit of a cheek to get on his high horse about Rupert Murdoch during Prime Minister’s Question Time yesterday in view of Tony Blair’s association with him, not to mention that of Gordon Brown. Mr Miliband was himself to be found at Mr Murdoch’s summer party last year.

It is absolutely right that leading politicians should meet proprietors, editors and journalists. Indeed, it may be one of the unfortunate consequences of the Leveson Inquiry that ordinary relations of this sort become inhibited, as contacts between the media and the police also seem likely to be. An open interchange is vital to democracy.

But relations between some of our leaders and the Murdoch papers have been unhealthily close — and we probably only know the half of it. So far these ties have barely figured in the Leveson Inquiry, though the third part of the process, likely to begin in May, is supposed to be about politicians and the Press.

Unless David Cameron, Tony Blair and others are personally required to give a frank account of their relationship with the Murdoch empire — and, one hopes, to concede that it was unwisely intimate and dependent — we are in danger of missing what may be the most important lesson of this affair. The bribing of public officials is illegal and obviously unacceptable, but the enslavement of leading members of our political class is potentially far more dangerous.