April 26, 2012

Murdoch ‘panicked’ over News of the World closure

Closure was ‘serious blot’ on Murdoch’s reputation
NoW closure was decision was taken ‘very quickly’
Murdoch claims: ‘Someone took charge of a cover-up which we were victim to and I regret’
Media mogul admits: ‘I failed. And I am very sorry about it.’
Denies Jeremy Hunt was seen as an ally

Rupert Murdoch “panicked” when he took the decision to close the News of the World, he told the Leveson Inquiry today.

He said the “whole business” of the now-defunct tabloid had been a “serious blot” on his reputation and told the inquiry into press standards he wished he had closed it years earlier.

The media mogul said: “When the Milly Dowler situation was first given huge publicity – I think all the newspapers took this as a chance to really make a really national scandal – it made people all over the country aware of this, who had not been following.

“You could feel the blast coming in the window almost. And I would say it succinctly, I panicked. But I am glad I did.”

He said the decision was taken “very quickly” by him, his son James Murdoch, and former editor and News International chief executive Rebekah Brooks.

“It was a decision taken very quickly by my son, I think Mrs Brooks was still there, and myself. It was done, like that.”

He added: “I am sorry I didn’t close it years before and put a Sunday Sun in,” but said he held back because of its readers.

“Only half of them ever read The Sun,” he added. “In fact only a quarter of them read it regularly. So that probably was brought into consideration at the time.”

Murdoch’s expanded on comments in his written witness statement, which said the firm decided to close the News of the World because “the credibility of the brand with its readers was irretrievably destroyed”.

His statement said the decision to launch the Sunday edition of the Sun was intended to demonstrate the company’s commitment to the newspaper.

His statement said: “In February 2012, after waves of dawn arrests, our employee morale was dangerously low, and some questioned our commitment to the Sun.

“Against that background, I decided it was appropriate to launch the Sunday edition, to demonstrate to our employees and our readers our commitment to the Sun and to putting out the best newspaper in Britain, while observing the highest ethical standards.”

Explaining the decision to lift suspensions on journalists who had been arrested for alleged unlawful payments to the police when the new publication was launched, he said: “It was terribly difficult to plan the ongoing operation of the Sun, let alone to consider extending its operations to seven days a week, with key employees under suspension since their arrest.

“There was no prospect of a charging decision for several months. Therefore, at the same time as launching the Sunday edition, we decided to welcome back those employees who had been suspended. They are innocent until proven guilty and have not, to date, been charged.

“We took this action to protect the jobs of our employees and their families – the vast bulk of whom were not implicated in any way in the activities at issue – to serve our readers, and to demonstrate our commitment to the most popular newspaper in Britain.”

Cover up claims

Murdoch also told the inquiry that News International bosses fell victim to a “cover-up” over the hacking scandal.

The media mogul said senior executives were not informed, or misinformed, and “shielded” from what was going on.

“I blame one or two people for that, who perhaps I shouldn’t name because for all I know they may be arrested yet,” he said.

“But there is no question in my mind that maybe even the editor, but certainly behind that, someone took charge of a cover-up which we were victim to and I regret.”

Asked by counsel to the inquiry Robert Jay QC where the “cover-up” emanated from, the tycoon replied: “I think from within the News of the World. There were one or two very strong characters there who I think had been there many, many years and were friends of the journalists.

“The person I am thinking of was a friend of the journalists, drinking pal, and was a clever lawyer and forbade them to go and see the evidence, or there have been statements reporting that this person forbade people to go and report to Mrs Brooks or James (Murdoch).

“That is not to excuse it on our behalf at all, I take it extremely seriously that that situation had arisen.”

Murdoch told the inquiry he had not paid close enough attention to the situation at the now-defunct Sunday tabloid and apologised for what had happened, and to the staff who lost their jobs when he closed the newspaper last July.

“I have to admit that some newspapers are closer to my heart than others but I also have to say that I failed. And I am very sorry about it.”

Murdoch said he had not paid enough attention to the News of the World, probably “throughout all the time that we have owned it”.

“I was more interested in the excitement of building a new newspaper and doing other things,” he said.

“All I can do is apologise to a lot of people, including all the innocent people in the News of the World who lost their jobs as a result of that.”

He added: “I think in newspapers, reporters do act very much on their own, they do protect their sources, they don’t disclose to their colleagues what they are doing.”

The tycoon said this was shown by the “NightJack” case. The inquiry has heard former Times reporter Patrick Foster hacked into Lancashire policeman Richard Horton’s emails in May 2009 to discover he was the author of the award-winning anonymous blog.

The inquiry has been told a Times lawyer misled the High Court over how the detective was unmasked, as it fought an attempted injunction preventing publication of the story exposing him.

Murdoch said that case did not reflect the Times newsroom.

Gordon Taylor and Sienna Miller

Murdoch told the inquiry he was “surprised” by the settlement between his company and Professional Footballers’ Association chief executive Gordon Taylor over claims the News of the World hacked his phone.

A confidential out-of-court settlement was made with Mr Taylor for £425,000 plus costs, approved by James Murdoch.

His father told the inquiry: “It did indeed surprise me. The size of it.

“I didn’t know who had hacked him or if he had really been hacked or what it was, but just the size of it seemed incredible. Still does seem incredible.”

The tycoon said he was informed about a story published in the Guardian in July 2009, revealing details of the settlement, but the police “disowned” claims that hacking was more widespread than originally thought.

He told the inquiry: “The article was instantly disowned within 24 hours by the police and we chose to take the word of the police over the word of the Guardian.

“We rested on that until, I think, the beginning of 2011, the Sienna Miller thing came forward.

“We immediately realised there was a great danger and we gave the police the name of Mr Ian Edmondson.”

Edmondson, former news editor at the News of the World, was arrested by police in April 2011 as part of Operation Weeting. He was bailed and has not been charged.

Hacking scandal

Murdoch said once he knew the extent of the problem, he had done everything he could to clean up the company.

“There was no attempt either at my level or several levels below me to cover it up,” he said.

“We set up inquiry after inquiry, we employed legal firm after legal firm and perhaps we relied too much on the conclusions of the police.”

He told the inquiry his company had spent “hundreds of millions of dollars” investigating activities at all of its newspapers in the wake of the hacking scandal.

He said they had been through 300 million emails, and anything “faintly suspect” was passed to police.

The billionaire said he had made a pledge to Parliament to clean up the company, and remained “greatly distressed” at the effect of his efforts.

“We are now a new company, we have new rules, we have new compliance officers, and I think we are showing in the Sun that we can still produce the best newspaper without the bad practices that were disclosed.”

Murdoch said that in hindsight he should have spoken personally to former News of the World royal editor Clive Goodman – who was jailed in 2007 for phone hacking – when he claimed the practice was widespread.

“I should have gone there and thrown all the lawyers out of the place and seen Mr Goodman one-on-one – he had been an employee for a long time – and cross-examined him myself and made up my mind, maybe rightly, maybe wrongly, was he telling the truth.

“And if I had come to the conclusion that he was telling the truth, I would have torn the place apart and we wouldn’t be here today.

“But that’s hindsight, which of course, is a lot easier than foresight.”

Hunt not an ally

News Corporation chairman Rupert Murdoch today denied that he saw Culture Secretary Jeremy Hunt as an ally in his company’s battle to take over the satellite broadcaster BSkyB.

Murdoch told the Leveson Inquiry into media standards that he expected Hunt to be a “fairer” judge of the bid than Business Secretary Vince Cable, who was stripped of the role after being secretly recorded saying he had “declared war” on the News Corp boss.

But he said that he was not aware that Hunt had publicly expressed “sympathy” for the £8 billion bid and did not regard him as a “pro-Murdoch” minister.

“Did I assume that Mr Hunt was on our side? No,” Mr Murdoch told the inquiry. “I assumed that any responsible minister would be responsible and deal with it in a completely unbiased way. I thought that Dr Cable was an exception.”

Labour today stepped up pressure on David Cameron to sack the Culture Secretary, with leader Ed Miliband saying he was being used as a “firewall” to protect the Prime Minister.

Shadow culture secretary Harriet Harman last night wrote to Cameron demanding that he order his independent adviser on ministerial conduct Sir Alex Allan to launch an inquiry into three alleged breaches of the ministerial code.

But the PM has held off from calling in Sir Alex, insisting that any judgment on Hunt’s handling of the takeover bid should be made by Lord Justice Leveson.

Hunt this morning avoided journalists’ questions on the affair, which yesterday claimed the scalp of his special adviser Adam Smith.

The Culture Secretary attended the launch of a London 2012 arts festival at the Tower of London, but departed after making a short statement, leaving his deputy Ed Vaizey to field questions. An aide said that it had always been planned that he would leave before the question-and-answer session, as he had to go to another meeting.

Murdoch today told the Inquiry that he “didn’t see anything wrong” with Michel’s activities, which saw him obtain advance details of a parliamentary statement on the BSkyB bid and pass on information from the Culture Secretary’s office about his meetings with regulators and opponents of the takeover.

However the News Corp chairman said he felt there may have been “a bit of exaggeration” in Mr Michel’s emails , which repeatedly refer to conversations with Hunt himself, rather than staff members including Smith.

Murdoch denied that Hunt had given the BSkyB bid an easy ride, telling the Inquiry: “We were made to make very big concessions, for reasons which I can’t understand.”

He said that he was “shocked” by Cable’s comments, adding that when Hunt was given media regulation powers in his place “we thought we will probably get a fairer go from anyone other than Dr Cable”.

Murdoch stands by Brown war claims

Murdoch earlier rejected Gordon’s Brown claim that he was wrong when he said the former prime minister “declared war” on the tycoon’s media empire after the Sun switched support to the Conservatives.

The News Corp chairman and chief executive said he stood by “every word” of his account to the Leveson Inquiry yesterday.

Murdoch, 81, said Mr Brown was “not in a very balanced state of mind” when he called to complain about the Sun withdrawing its backing for Labour in September 2009.

He recalled: “He said, ‘Well, your company has declared war on my government and we have no alternative but to make war on your company’.”

Brown last night said this “serious allegation” was “wholly wrong” and called on Murdoch to correct his evidence.

But Murdoch told the Leveson Inquiry today: “As for the conversation, which he’s denied, I said that very carefully yesterday under oath, and I stand by every word of it.”

The media mogul also suggested that former Labour minister Lord Mandelson was told by the then-prime minister to accuse his UK newspapers subsidiary News International of having “done a deal” with David Cameron over The Sun’s backing for the Tories.

He said: “Lord Mandelson in his book said he did this under order from Mr Brown, knowing it to be false.

“That’s in his own autobiography, that he reluctantly went out to do what he was told, and I think that just reflects on Mr Brown’s state of mind at the time.”

Brown said last night that the only phone call he had with Murdoch in his last year in office was in the second week of November 2009 after The Sun published a story accusing the prime minister of mis-spelling the name of a soldier killed in Afghanistan in a letter of condolence to his mother.

Murdoch told the inquiry he could not recall this conversation.

He said: “At the time I spoke to the editor and thought it was too hard on Mr Brown.

“He had taken the trouble to write to a mother, obviously in a hurry, his handwriting wasn’t very good. But it seemed to be very cruel because he had taken the trouble.

“But I don’t think I rang him personally to apologise or talk about it. I may have.”