Monthly Archives: April 2012

David Cameron is a good ally to have in a tight spot: that is one obvious conclusion to be drawn from his performance over the last 50 minutes in the House of Commons.

The prime minister had been drawn to the Commons to defend Jeremy Hunt – to the fury of many Tory MPs – at the decision of the Speaker. (The front bench was packed with Tory ministers, but not one Lib Dem was visible.)

There, he raged, fumed and argued until he was red in the face to insist that Hunt had done no wrong – and equally that the right processes were taking place to ensure that this was the case.

Along the way he casually insulted several Labour MPs; he asked why Denis Skinner was not yet drawing a pension, and whether Margaret Hodge (chair of the influential public accounts committee) had “strayed” into political ground.

The defence was robust and took various different forms:

How could Labour get high-handed over Murdoch’s influence when Blair and Brown had broken bread with the Australian tycoon? (“The relationship between politicians and the media has been too close for decadeslook for one moment at the number of meetings that Tony Blair and Gordon Brown had with Rupert Murdoch when they were prime minister”.)

Why were they demanding ministerial resignations over a special adviser’s bad behaviour when none occurred over the activities of Damian McBride or Charlie Whelan? Why wouldn’t they let Lord Leveson get on with his ongoing inquiry into the links between press and politicians? Why did Labour call for Hunt’s resignation within 23 minutes of the damaging emails being published?

“It would be the easiest thing in the world for a prime minister to

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Nick Clegg, Andrew Lansley and David Cameron at Guy's HospitalA month ago, ministers gathered round the cabinet table to be told by Andrew Lansley that the health bill was about to finally pass through parliament and become an act. Those attending banged their desks – partly in celebration, partly with pure relief. After 14 months of delays, negotiations and public rows, one of the most unpopular pieces of legislation from this session was finally about to be left behind.

Except it wasn’t. From next month MPs will start voting all over again on Lansley’s plans. What many in the coalition didn’t realise was that the act (as it now is) made so many changes to the infrastructure of the NHS that parliament will face a series of votes simply to create the bodies necessary to make them work. Clinical commissioning groups, Health Watch, Health Education England, Public Health England: the plethora of new quangos at the heart of the act all need to be legislated for. Read more

Tory and Labour members of the culture select committee are at odds over how far to criticise the Murdoch family barely 24 hours before publishing a report on phone hacking and News International.

The 11 members of the committee are set to vote on several of the most disputed issues at a meeting today in an attempt to forge some sort of consensus ahead of publication tomorrow.

But the group has been deeply divided in discussions, with Labour MPs such as party vice-chairman Tom Watson keen for a more scathing judgment on James Murdoch, in particular. Mr Murdoch was called in front of the committee on July 19 and recalled on November 10.

During his second appearance, when he repeatedly denied being aware of wrongdoing within the company, Mr Watson told Mr Murdoch: “You must be the first mafia boss in history who didn’t know he was running a criminal enterprise.”

Mr Murdoch, deputy chief operating officer at News Corp, blamed Tom Crone, former legal affairs manager at News of the World, and Colin Myler, former editor of the paper, for failing to tell him about evidence showing illegal phone-hacking was widespread at the Sunday newspaper.

He repeatedly said he had been unaware of the contents of a crucial email that led to huge payouts to victims of hacking – a claim that was swiftly disputed by both former colleagues. In the private committee discussions, some of the Tory members have been more forgiving of Mr Murdoch than their Labour counterparts, insisting that his version of events is feasible.

Those party divisions worsened last week, with some Labour MPs privately critical of John Whittingdale, committee chairman, for making comments supportive of Jeremy Hunt, culture secretary, over his handling of the News Corp bid for BSkyB.

With five Labour MPs and five Tories on the committee, the casting vote could end up with Adrian Sanders, a mild-mannered Devon MP who is its only Liberal Democrat.

In early April, when James Murdoch resigned as chairman of BSkyB, some pundits speculated that this was somehow connected to the imminent report from the committee. Mr Murdoch, however, merely said he wanted to distance the company from events at News International, saying he was “determined that the interests of BSkyB should not be undermined by matters outside the scope of the company”.

The report, which has been delayed for four months, will criticise other senior News International figures, including Rupert Murdoch.

The document will be published overnight – to prevent the full contents leaking – and not released until 10.30am on Tuesday, with a lock-in for journalists ahead of a 11.30am press conference.

It is unlikely to refer to either Rebekah Brooks, former chief executive of News International, or Andy Coulson, former editor of News of the World. Both have been arrested by police but have denied any knowledge of widespread phone-hacking at the company.

The report will criticise both Mr Crone and Mr Myler for misleading evidence given to parliament three years ago. Mr Myler, former editor of the News of the World, and Mr Crone, the newspaper’s former legal manager, will be accused of failing to disclose their awareness of the full extent of phone-hacking at the paper when appearing at the culture select committee in 2009.

Members, whose meetings have been attended by a parliamentary lawyer, had wanted to publish their report before Christmas but have waited for the

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The House magazine has turned into a must-read under Paul Waugh and tonight the magazine has interviews with both Boris Johnson and Ken Livingstone ahead of next week’s nailbiting London mayoral elections.

It’s the Boris interview which is most fascinating, as he puts as much clear blue water between himself and the coalition government as he can. Clearly he is aware that Labour’s roughly 1o-point national lead could terminally damage his chances in the capital. Of course it’s not the first time he has criticised David Cameron and George Osborne – but here he cranks up the rhetoric. Read more

A combination of still images from broadcast footage shows News Corporation Chief Executive and Chairman, Rupert Murdoch, speaking at the Leveson Inquiry into the culture, practices and ethics of the media, at the High Court in London April 25, 2012. REUTERS/POOL via Reuters TV


Welcome to our live coverage of the Leveson Inquiry into the standards and ethics of the UK press, on the second day when Rupert Murdoch, chairman and chief executive of News Corp, gave evidence.

By Esther Bintliff, Salamander Davoudi and Tim Bradshaw in London, with contributions from FT correspondents. All times London time.

NB: We refer to Rupert Murdoch as Rupert throughout for speed and to avoid confusion with his son James. Jay is Robert Jay QC, who is questioning Rupert.

16.45 What were the most interesting things that Rupert said today? Here’s a selection of three key moments. Let us know your thoughts in the comments.

  • “The News of the World, quite honestly, was an aberration, and it’s my fault”. Rupert said this in the context of defending his other newspapers and their integrity, thus characterising the NOTW as a sort of rogue newspaper – just as he once relied on the “rogue reporter” argument. However, it’s also noticeable that he appeared to take responsibility – “it’s my fault”. He would later say he was “sorry he didn’t close [the NOTW] years before”.
  • “I think the senior executives were all informed, and I — were all misinformed and shielded from anything that was going on there, and I do blame one or two people for that, who perhaps I shouldn’t name, because for all I know they may be arrested yet, but there’s no question in my mind that maybe even the editor, but certainly beyond that someone took charge of a cover-up, which we were victim to…” This is where Rupert effectively accuses “one or two” people at the News of the World of organising a cover-up of the extent of phonehacking at the newspaper.
  • “It’s a common thing in life, way beyond journalism, for people to say, ‘I’ll scratch your back if you scratch my back’”. It was as if Rupert momentarily let the veil fall when he made this offhand comment, giving a sense into what his critics might say is ‘the real Rupert’. Robert Jay QC was quick to jump on the remark, saying: “You said it was a common thing in life… and that’s true, that’s human nature, but it’s interesting that you say that’s no part of the implied deal in your relations with politicians over 30 years, Mr Murdoch. Is that right?” Rupert saw the trap and took evasive action: “I don’t ask any politician to scratch my back… That’s a nice twist, but no, I’m not falling for it.”

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Labour’s deputy leader, Harriet Harman, is about to send a letter to David Cameron calling for potential breaches of the ministerial code to be investigated by the Independent Adviser on the Ministers’ Interests:

Dear Prime Minister,

I am writing to you in respect of questions of breaches of the Ministerial Code which arise from the handling by the Secretary of State for Culture, Olympics, Media and Sport of the News Corporation bid for BSkyB.

There are clear breaches of the ministerial code detailed below.

These must now be referred to the Independent Adviser on the Ministers’ Interests as a matter of urgency.

The breaches of the ministerial code:

1. Failing to take responsibility for the actions of his special advisor contrary to paragraph 3.3 of Ministerial Code

The Secretary of State admitted in the House of Commons today that in the Read more

Statement issued by DCMS on behalf of Adam Smith:

“While it was part of my role to keep News Corporation informed throughout the BskyB bid process, the content and extent of my contact was done without authorisation from the Secretary of State. I do not recognise all of what Fred Michel said, but nonetheless I appreciate that my activities at times went too far and have, taken together, created the perception that News Corporation had too close a relationship with the department, contrary to the clear requirements set out by Jeremy Hunt and the permanent secretary that this needed to be a fair and scrupulous process.  Whilst I firmly believe that the process was in fact conducted scrupulously fairly,  as a result of my activities it is only right for me to step down as special adviser to Jeremy Hunt.”

AP Photo/Mark Lennihan

Welcome to our live coverage of the Leveson Inquiry into the standards and ethics of the UK press, on the day when Rupert Murdoch, chairman and chief executive of News Corp, is giving evidence.

By Esther Bintliff and Salamander Davoudi in London, with contributions from FT correspondents. All times London time.

NB: We refer to Rupert Murdoch as Rupert throughout for speed and to avoid confusion with his son James. Jay is Robert Jay QC, who is questioning Rupert.

16.40 We’re going to close the blog for now, but as ever we’ll have more news and analysis for you on

And we’ll leave you with the latest development: officials at the FSA are interested in the News Corp emails that were published yesterday, and in particular an email sent by Fred Michel, News Corp’s director of public affairs, in which he described obtaining “absolutely illegal” information from Adam Smith, an adviser to Jeremy Hunt. Read the full story here.

16.15 So, today’s session was shorter than expected, and Rupert’s evidence did not really yield any explosive revelations of the level that James did yesterday. But it’s important to remember that in his questioning of Rupert, Robert Jay QC was largely focused on the decades in the run-up to the two most controversial issues for News Corp (i.e. the phonehacking scandal and the bid for BSkyB) rather than addressing those issues directly – he will presumably concentrate on phonehacking and BSkyB tomorrow.

Thus Jay spent a lot of time asking Rupert about key moments for the business during the 1980s and 1990s; his relationship with different political leaders; and his varying levels of editorial influence over the newspapers.

One could imagine that Jay’s strategy here was to lay the ground – very thoroughly – to then better understand Rupert’s/News Corp’s approach to the more recent issues, and to show whether there was any historical precedent for the behaviour that the company engaged in as it tried to get regulatory approval for its bid for the remaining shares in BSkyB.  Read more

Jeremy Hunt’s line of defence against calls from Ed Miliband for his resignation go like this: he acted properly at all times, and Frederic Michel (director of public affairs at NewsCorp) exaggerated his contact with the culture secretary.

It is true that in a document Michel explains to the inquiry that when he “spoke to JH” this was not exactly the case. Instead he was usually talking to Hunt’s special adviser, Adam Smith, or someone in the press office. Thus the Hunt defence that Michel has exaggerated. Read more

James Murdoch as he arrives at the Leveson Inquiry on Tuesday. (Photo by Peter Macdiarmid/Getty Images)

Welcome to our live coverage of the Leveson Inquiry into the standards and ethics of the UK press, on the day when James Murdoch is giving evidence.

By Salamander Davoudi and Esther Bintliff in London, with contributions from FT correspondents. All times GMT.

NB: We refer to James Murdoch as James throughout for speed and to avoid confusion with his father Rupert. Jay is Robert Jay QC, who is questioning James.

16.33 Wow that’s been a big day. We’re going to close the live blog for now but we’ll be back tomorrow morning just before 10am, for Rupert Murdoch’s appearance. In the meantime, will have all the news, analysis and comment you need. You can also investigate the documents mentioned during today’s proceedings here.

16.30 Members of the opposition Labour party are not being slow to voice their anger at the revelations today. Ivan Lewis, the former Labour culture spokesman – and Jeremy Hunt’s opposite number at a key time during the BSkyB bid - commented:

“Jeremy Hunt told me in parliament he was behaving in quasi judicial way. This cannot include off-record contact with any party.”

16.26 Labour MP Tom Watson – who has played a large role in investigating the phonehacking scandal, and is a vocal critic of the Murdochs and News Corp business practises – said in an interview with ITV news:

“I don’t think people knew the depths to which special advisors had been communicating with executives” at News International.

16.23 Over on the FT’s Business Blog, John Gapper focuses on the issue of whether newspaper proprietors get favourable treatment in business in return for publicly supporting politicians. He points out that the most telling moment on the subject today was when James described his anger at Simon Kelner, the editor of the Independent, who he clearly felt had betrayed the Murdoch family:

“I found Mr Kelner and I told him of my concerns, whether I used colourful language I will not dispute … I was particularly upset because Mr Kelner had been availing himself of the hospitality of my family for years.”

16.21 The prime minister’s spokesman said David Cameron has full confidence in Jeremy Hunt, reports Kiran Stacey from Westminster:

When asked if the PM had full confidence in Mr Hunt, a spokesman said he had. But he declined to say that Mr Cameron had full confidence in Mr Hunt’s handling of the BSkyB bid.

16.19 Jeremy Hunt has not tweeted today. However the first little bit of his update from yesterday – which coincided with the launch of the World Shakespeare festival – has a strange relevance today:

[blackbirdpie url="!/Jeremy_Hunt/status/194426439305674752"] Read more

If David Cameron was never planning to make a keynote speech on green issues then he can’t have cancelled it.

 That is Downing Street’s reaction to news earlier this evening that the prime minister is no longer making a pro-environmental oration on Thursday during a gathering of 23 energy ministers from around the world.

The curious thing, however, is that the expectation among NGOs, Whitehall officials, special advisers – and yes, some Downing St personnel – was that Cameron was going to do so.

So what should we make of this? The steer from the centre is that while Cameron may have mulled a setpiece speech it was only ever considered. And ultimately he decided it Read more

The idea of a consensus in favour of overhauling the upper chamber has just been blown open by a surprise minority report published by 12 rebel members of the joint committee on Lords reform.

I’ve just come back from the press conference and this was not a dry document listing minor changes to sub-clauses of the main report or the original bill.

Instead the members have sought to blow a hole in the very argument for an elected (or mostly elected) upper chamber.

The public would not stomach the “dramatically higher” cost of replacing the House of Lords with a mostly-elected upper house, they have said.

“We are sceptical that there will be ready public support for a new tier of full-time, salaried politicians,” the minority report said. “It is clear that the costs of establishing and running a fully-or partly-elected House of Lords compared with the current House would not only be higher, but would be very substantially, and in fact dramatically, higher.”

Baroness Symons, a co-author of the minority report, said the issue of costs was particularly important “at a time of austerity”.

Baroness Shepherd, the former Tory minister, condemned the government for refusing to even outline costings for an elected House of Lords, despite being in possession of estimates.

She said that the best estimate was from Lord Lipsey, who had given evidence that the reforms could cost £177m in their first year and £433m from 2015 to 2020. “We believe that the public has a right to see such material in considering the issues involved in further House of Lords reform,” the minority report says.

(You can see the line that any anti-reform group might take if a referendum is held after all.)

UPDATE: Except that having checked the Lipsey evidence it’s clear that his calculations have been overtaken by events. For example, he includes £220m for “transitional Read more

The joint committee on Lords reform is holding a press conference at 11am but the report is out and it makes interesting* reading. The gist is as we reported last Thursday, ie it supports 80 per cent elected Lords but recommends a referendum first.

But there are other lines in there which are worth noting. The committee:

- Wants the senators to have a minimum threshold of activity, and should be forced to stand for re-election if they attend fewer than 50 per cent of sitting days in a session.

- Thinks the issue of salaries and allowances should be delegated to Ipsa. But it agrees salaries and second homes are needed.

- Admits there is a problem with the relationship between upper and lower house but Read more

Lords reform is widely seen as a hobbyhorse of Nick Clegg and the Liberal Democrats –yet it is a Tory minister whose task is to push through the legislation to transform parliament’s upper house.

Indeed, aides to Mr Clegg have jokingly referred to it as “the Mark Harper bill” in their attempts to downplay the idea that the deputy prime minister is obsessedby removing the unelected peers.

Mr Harper has a delicate task in front of him; steering through a full shake-up of the Lords which has evaded other politicians for a century.

A press officer warns the FT that the minister keeps his office at a low temperature: but this habit may not prepare him for the frosty reception he will face in parliament during next year’s legislative marathon.

Peers and MPs of all parties have already lined up to oppose the bill. Even if it passes through the Commons without mishap it is likely to be ambushed by the combined forces of Tory, Labour, and even some Lib Dem peers.

There could be a repeat of the filibustering and all-night sittings dominated the Lords in the spring of 2011 over the alternative vote bill.

Nick Clegg has threatened to use the Parliament Act to force it through, but weeks of debate are expected, taking up large amounts of next year’s political calendar.

Mr Harper tells the FT that bill should not take up a “disproportionate” amount of time: but warns potential trouble-makers:

I don’t think the public would understand if people told the public they don’t care hugely about this legislation but then let it (in-fighting) damage the rest of the programme,” he says.

Even David Cameron once said he saw Lords reform as a “third term issue”, implying it was a very low priority. But Mr Harper says the prime minister is fully signed up to the Read more

They call it the weekly bearpit and this week PMQs excelled itself: a spitting, snarling, savage exchange of insults which created heat but almost no light.

The coalition is still reeling from the after-effect of George Osborne’s Budget, which provided endless ammunition for the opposition. The cut in the 50p tax rate, the penalising of pensioners and the raid on philanthropists – all are decent targets for Ed Miliband to chip away at. Read more

Amid rumblings about the government machine, the rumour reaches FT Westminster that Downing Street approached Tim Montgomerie – editor of the ConservativeHome blog – to join the ship. But he said no.

Montgomerie, a former aide to Iain Duncan Smith, is an influential figure in the party who understands its internal mechanics as well as anyone. He has also become rather critical of the Tory hierarchy in recent months; making it obvious why the government might want him inside the tent, facing outwards. Read more

Ken Livingstone was the star turn at today’s lobby lunch in the House of Commons and the Labour mayoral contender gave a robust turn as always. And yet.

Those looking for clues as to why he is not the favourite to win the May 3 elections could see one or two signposts during his speech and subsequent Q&A.

Livingstone is still a larger-than-life character, for sure, with a fun turn of phrase. He has an enviable track record – with arguably more achievements by far than his rival Boris Johnson.

But in several areas Ken’s demeanour was less “let sunshine win the day” than “let it rain, let it rain, let it rain.”

1] He predicted a London with 9m people in the next decade, creaking at the seams, with not enough housing and a public transport system collapsing under the weight of the over-population. This dystopian vision may turn out to be true, but it is far from positive.

2] He tried to present himself as the “ugly” candidate who wants to concentrate on the “boring” issues. Britain is going further down the US-style presidential system, he warned. Boris Johnson was merely a comedian who made people laugh – and what was the good of that? (“If I wanted to make you laugh I’d have become a comedian.”) The whole argument ignored the fact that Ken is himself a one-man brand who – until Boris came along – thrived on being an outsider, a joker, a rebel. It sounded a little like sour grapes.

3] He tried to shoot the messenger. In the good old days there used to be regular journalistic coverage of the GLC, he recalled. But when he announced his housing strategy in Kilburn there was only one journalist there. He cited “Flat Earth News” to paint the entire journo profession as a bunch of churnalists failing to carry Read more

Ed Miliband strove to win the “clean up politics” prize on Sunday morning when he offered to compromise over union donations in return for caps on individual donations to political parties.

Kiran has already explained why this would not make an awful lot of difference to Labour’s finances – apart from in election years. Read more

The data released last night on how much the super-rich paid in tax in 2010-11 was fascinating. As Robert Peston comments on his blog, getting this information out of the last government was nigh-on impossible, as Labour didn’t want to put wealthy people’s tax affairs in the spotlight. So it is an amazing irony that it is a Conservative-Lib Dem coalition that is choosing to do so instead, as it looks to bolster support for its unpopular decision to cap tax reliefs, which will impact on charitable giving.

The Treasury released the data in an attempt to show us how much rich people avoid tax. George Osborne told the Telegraph that when he saw these figures he was “shocked”. And certainly there are some shocking figures within them, such as that thousands of people in the 50p tax band actually pay less than 20 per cent tax. Twelve people who are mega-rich, earning over £10m, even pay less than 10 per centRead more

Ed Miliband took us all by surprise this morning when he went on the Andrew Marr show with a genuinely new proposal to reform party funding. The individual cap on donations should be set at £5,000, he said, way below Cameron’s preferred level of £50,000, and half of Sir Christopher Kelly’s proposal of £10,000.

Significantly, the Labour leader said this cap would include union donations. But, as always with this debate, the stumbling block is what happens with the levy – the automatic £3 that members of some unions pay to Labour as part of their subscription fees. At the moment, members may opt out of making such payments, but the Tories want them to back Sir Christopher’s proposal of having to opt in instead, something likely to have a significant impact on Labour’s coffers.

The row now turns on how much Labour actually makes from one-off union donations, which would be included under Miliband’s proposed cap, against how much it makes from the levy, which wouldn’t. Read more