Morning Hearing on 10 May 2012

John Mullin and Viscount Rothermere gave statements at this hearing

Hearing Transcript

(10.00 am) Statement by LORD JUSTICE LEVESON LORD JUSTICE LEVESON On Sunday last there was an article in the Independent on Sunday which disclosed details which are in fact part of Mr Coulson's witness statement. Using the power vested in me under Section 21 of the Inquiries Act, I have caused an inquiry to be made of the editor of the Independent on Sunday and I anticipate that as a result he will be interposed at some stage during the course of today's evidence to deal with the issue. Right. MR JAY Sir, the first witness today is the Viscount Rothermere, please. VISCOUNT ROTHERMERE (sworn) Questions by MR JAY MR JAY Lord Rothermere, your full name, please?
A. Jonathan Harold Esmond Vere Harmsworth. LORD JUSTICE LEVESON Lord Rothermere, thank you very much for your statement and for the obvious care that you've taken in putting it together.
A. Thank you. MR JAY Your statement is dated 3 May. You've signed it. There isn't a formal statement of truth, that doesn't matter. This is the evidence you're content that our Inquiry receive; is that right Lord Rothermere?
A. Yes, that is correct.
Q. You have been the Executive Chairman of the Daily Mail and General Trust since 1998, when your father, the third Viscount Rothermere, died.
A. Yes.
Q. So you're from a distinguished family in newspapers. You chair the main board of I'm going to call it DMGT. What in general terms are your responsibilities?
A. I'm responsible for the oversight of the board and the corporate governance of the company and, along with the executive team, the strategic direction of the organisation.
Q. Thank you. And you explain that your role is to take a broad long-term perspective, that's understood.
A. Yes.
Q. You also explain in paragraph 6 of your statement that the pressures facing the newspaper industry are well known.
A. Yes.
Q. But from the particular perspective of your company, what do you see those pressures to be?
A. The process of the newspaper industry on the regional newspaper industry have been primarily classified, has moved to the Internet, and within the national newspaper group a sort of increase in the amount of competition for advertising if you like with the emergence of the Internet and the growth of online news services mean that circulation is harder to come by.
Q. In terms of your flagship paper, if I can describe it that way, the Daily Mail, of course it remains profitable, doesn't it?
A. Yes, it does.
Q. Do you have a view as to why that is?
A. I think that the Daily Mail has been built on very firm ground. It has a loyal readership base. It has a good place in the market. People are willing to pay a healthy amount of money for it in cover price, from which 60 per cent of our revenue is derived, and that means that we are able to withstand the storm of economies better than others.
Q. You also explain in paragraph 6 that you're very proud of what has already been achieved with MailOnline. What in particular gives you pride in relation to that publication?
A. I think that well, firstly, MailOnline is a global has a global footprint. It is one of the most looked at newspaper sites in the world, and has grown to that level quite quickly and is growing faster than others, so I suspect it will become the number one site. It's built on a fundamental belief that I share within the company on trust in journalism as opposed to technology, and I think that that's what makes me proud. I think we've seen our organisation be able to transfer its skills into the online world.
Q. Looking at the MailOnline and comparing it with the Daily Mail, some might say that it has a greater interest in celebrity tittle-tattle and pap. Would you feel that's fair or not?
A. I would say that one of the reasons the Daily Mail has been so successful is it has a broad spectrum of news. We don't try and feed our readers stuff that they don't want, and online you can measure stories that people want, and so and also you have an unlimited amount of space, because obviously you're not limited by your press configuration. So if people want to read more celebrity stories online, then we provide it for them, but that's, I believe, not everything they read. I believe that they also Martin Clarke gave evidence yesterday which stated that most people, 90 per cent of the people who go to MailOnline also read news stories, not only about celebrities, so it's a mixed bag.
Q. Okay, I may come back to that point. You say in paragraph 9, Lord Rothermere, that you believe your personal role in achieving this vision that's the strategy, as it were, through your group of publications is "to promote these principles which are built on my own personal and family values".
A. Yes.
Q. Which aspects of those would you particularly draw to our attention?
A. Well, I think in my witness statement I talk about three things: pride in our products and services. I think my family have always had a tremendous pride in the newspapers that our company produce, and in the journalists that produce them. That's something that I care very deeply about and which my predecessors did also. We also have a fundamental belief in people who work for us, and particularly the editors and entrepreneurs who run a lot of our businesses. We believe in supporting them, helping them, but basically having faith and trust in them, and that's, I think, a strong differentiator for us. And I also think that I'd like to think that our company has the courage to think innovatively and to try new things and to go into new markets. Those are the sort of principles that Lord Northcliffe and my great grandfather had when they started the company and I fervently hope that those are the principles we still have today.
Q. Thank you. Your statement deals with the various corporate structures interlocking and over-arching. We're going to take those as read, Lord Rothermere. Can I come straight to paragraph 42, which is our page 03297.
A. Yes.
Q. You say in the third line: "The editors have complete editorial independence And then I paraphrase: the editors are subject to the same corporate governance structures as everyone else. Is that something which comes from you, namely the conferring of complete editorial independence, or from somewhere else? Because you could, if you wished, intrude, couldn't you?
A. Potentially, yes. I think that well, I was always brought up to believe that specialists should do their job and that it's the job of the proprietor to enable them to do that and to protect them, in fact, so I feel that it's my job to protect the independence of editorial. That's my position and that's where I get my authority from. My justification, if you like, for the job that I do. My father felt the same way, and I think my grandfather felt the same way also. I think that's what gives us value, and
Q. It may be, Lord Rothermere, you're not, if I may say so, particularly a political person. Paragraph 48 makes clear you were a cross bench peer in the House of Lords, so is it fair to say that you are apolitical or is that unfair?
A. I would say that I think it's very important in my role for me to not exhibit partisan political because I think it puts undue pressure on my editors to support perhaps a political view that they think that I may have. I don't want to influence them through inference, so and I also think it's important for me to be available to people from all political parties to approach me if they feel that the paper's been unfair to them, if they seek redress. That's why I took that decision.
Q. In terms of some of the positions the paper might have taken over the years, have you ever felt personally uncomfortable with them?
A. At times inevitably the paper will do things which makes one feel uncomfortable, and I think that it's at that point which really stretches the notion of everything I've said, but as I said, I let my editors edit, and however uncomfortable it makes me feel, I believe they're the people who have the responsibility, and so therefore they should have the authority.
Q. I'm not going to come up with examples, since this isn't going to help the discourse at all, but in terms of what might give you discomfort, are we talking sometimes about political positions the paper might take or not?
A. It may no, largely not on political grounds, no. It may be around friends of mine who are being attacked in the newspaper, people I have a high regard for who I think are being attacked in the newspaper. It may be sensitive stories about people who I feel that maybe I feel for on a sort of empathetic level, but I try and keep those feelings to myself. LORD JUSTICE LEVESON You said just a moment ago that it's important that all political parties feel able to approach you if they feel that they've been treated unfairly.
A. Yes. LORD JUSTICE LEVESON Maybe we're going to come back to that, but can I just pick up that answer for one moment and ask this: is that well known? In other words, do the major political parties know that if they feel the Mail editorial line has treated them unfairly, they could come to you?
A. I sir, I don't know what they think. Certainly, when I've had meetings with politicians, they have expressed of all parties expressed unhappiness with some of the coverage in the newspaper. Largely, I refer them back to Paul Dacre, but if there is an instance which I feel justifies merit, then I may well bring that up with Paul and say that and recommend that he look into it and talk to that politician to seek out the truth. So if they say that we've run something which is blatantly untrue, and that is probably I won't get involved on a level of opinion, but if someone comes to me and says, "Your newspaper has printed an untruth, it is categorically a mistake", then I will say to Paul, "This person has written to me", and it is normally a letter, "complaining about this which they say is untrue, would you please look into it" and he and the legal team look into it and either talk to the politician and sort it out directly or write back to me and say that there is no truth in it sometimes people have a different opinion as to truth. LORD JUSTICE LEVESON So it's just a system that's built up. It's not something that you've made known?
A. No, I well, yes, it's not something I've made known, and to be honest, I don't really invite it, because I don't think that is I don't wish to get into a position of having to constantly deal with this issue because obviously the newspaper is writing controversial things all the time, so it is LORD JUSTICE LEVESON That's actually why I asked you the question.
A. Yes. MR JAY You were talking in general terms about the nature of your concerns. Does it amount to this, that as a fair-minded person, as I'm sure you are, there have been occasions when you feel that the paper may have gone too far in terms of intrusiveness, in terms of the tone and substance sometimes of some of its material? Is that it?
A. Well, sometimes we have breached or appear to have breached and made apologies, and of course at those times I am I regret those instances.
Q. In paragraph 44 of your statement, in the fourth line, you refer to the reputation of your business. I've been asked to raise this specifically with you, Lord Rothermere. How do you measure reputation?
A. Well, it is a very good question. Clearly we wouldn't be having this Inquiry if the reputation of the press wasn't under serious concern, and as a leading newspaper, we have to take that on board. However, ultimately, the commercial reputation that we have is with our readers and advertisers, and they continue to read our newspaper and continue to advertise in our newspaper, and I think you can see with the closure of the News of the World what happens when they do when the reputation is so badly affected that advertisers and readers stop buying the product.
Q. That's the commercial end point of the process. You said we wouldn't be having this Inquiry if the reputation of the press were not a matter of concern. Without differentiating between any section of the press or any particular print title, do you think that those concerns which you're referring to are justified?
A. Well, I can see why people have concerns for the press. After all, it does appear to have quite a lot of power, and some elements of our industry have not necessarily acted in the right way, apparently, so it is probably, you know, worthy of review. However, I feel pretty confident that our newspaper has acted ethically and I'm willing to stand up for us.
Q. As you say in paragraph 44, you will, of course, discuss issues of concern with your editors, so some of these concerns must enter onto your radar in terms of what your print titles are doing; is that correct?
A. Yes, sometimes.
Q. When you say in paragraph 45, about two-thirds of the way through it we're on page 03298, "We allow our editors to make editorial decisions without reference to commercial considerations", again I've been asked to explore that with you, Lord Rothermere. What do you mean by "commercial considerations" in that sentence?
A. Commercial considerations would be, I suspect, advertisers, for example. Sometimes they threaten to pull advertising if they don't like a particular line of stories or they feel they've been harshly treated. Our editors are encouraged to pursue what they feel is the truth rather than react to coercion.
Q. Although, particularly with MailOnline, where you are able to identify the most visited sites on a particular day, inevitably you will have an eye on what is or appears to be most appealing to your readers, wouldn't you?
A. Yes.
Q. Mr Murdoch expressed a view about MailOnline. Let's see what your reaction to it is, whether you agree with him. This was in the transcript Day 65, page 83, line 10. He told us this: "The MailOnline, which is unrecognisable as part of the Daily Mail, I think Mr Dacre doesn't have a computer and said to someone else, 'You do this', that just steals. But they have their own gossip, they steal gossip from everybody. It's a great sort of gossip site. Or bad, whichever way you look at it. And comes right up to the barrier of what is fair use of other people's material." I can't deliver that in the same way as Mr Murdoch did sitting in that seat, but is there any basis for what he said?
A. Certainly MailOnline glories in the fact that it isn't just a newspaper online. It has been I think one of reasons why it's been so successful is it's taken all the advantages that the online world offer journalism and it's able to take advantage of it and build a better relationship with its users or readers. I think that our business is about journalism more than about newspapers, and Mr Murdoch is, you know, entitled to his view.
Q. I think he was suggesting, though, that MailOnline pilfers material from other sites and other newspapers. Isn't that the point he was making?
A. Honestly, I don't get involved in that level of executive control. I know that Martin Clarke gave a statement yesterday, so he's probably better able to answer that question than I.
Q. Then he said, and I paraphrase now, "there's no profit in it" I think he's saying at the moment MailOnline makes no profit, we'll come back to that "according to their public statements". He's obviously been studying you quite closely. Then he says: "Yet. Their hope is for profit. Profit motive, perhaps, but I think that would include everybody." I'm sure it would. Is it the position that MailOnline will be entering into profit soon?
A. We certainly hope so, and indeed if we didn't reinvest so much of its current revenues in expanding it, then it would already be profitable.
Q. Thank you. Paragraph 46 now. Since he gave evidence to us in January, Mr Wright has moved on and he's now the first editor emeritus in charge of standards for your newspapers?
A. Yes.
Q. Could you explain, please, the general remit of his role in that capacity?
A. He is to work with Paul in overseeing the managing editors and to make sure that appropriate ethical conduct and regulation is enforced throughout our organisation.
Q. But how is he supposed to do that?
A. By working closely with the editor, by talking with the legal team, with the journalists, by building a relationship, by making sure that there's appropriate training going through the journalists all our journalists are appropriately trained. You know, basically utilising all his skills as a journalist of some note and huge experience in order to ferret out best practice.
Q. Was the appointment of Mr Wright to that post anything to do with the issues which have arisen during this Inquiry or would you have done it anyway, do you think?
A. No, I think Mr Wright Paul felt that Mr Wright should make way for a younger, newer editor for various reasons, which some personal, which I don't wish to go into, but Paul wanted to retain Peter's great skills as a journalist to help him in navigating a path through appropriate conduct and ethical conduct.
Q. Then the last sentence of paragraph 45 you say: "Our newspapers do not have political allegiances but support or criticise government policies according to the editorial assessment of their merits." It's certainly fair to say the Daily Mail doesn't hold back from criticising government, but in terms of its political allegiances, at General Election time it usually makes its position clear, doesn't it?
A. Seemingly, yes.
Q. Tends to support one particular party, doesn't it?
A. I yes.
Q. And the brand, that's been described in all sorts of different ways. There's a piece in the Independent, no less, which refers to the values of Middle England. That more or less sums it up, doesn't it?
A. Yes. I mean, the newspaper a good editor reflects the views of his readership, and I would say that the area of concern that I would have is if Paul suddenly went off on a wing and supported a political party which the readership did not believe in. I think a good editor has to reflect the views of its readership, and not lead them, but, you know, work in, if you like, collusion with the readers. LORD JUSTICE LEVESON But doesn't that involve a certain measure of leadership, to spot what is likely to work and then to take, as it were, the next step? Some of the campaigns presumably have been very much led, and you would say very well led
A. Yes. LORD JUSTICE LEVESON by the paper, isn't that fair?
A. That is exactly fair and that is what a great editor should do. He should have an affinity with what his readers care about and fight a cause that he feels that they believe in. MR JAY I think the point that's being made, it's not just a reflection of what the readers want. It is anticipating what they might want and moving forward with campaigns which are assessed might appeal to them. Isn't there a sense of leading opinion in that way? Would you agree?
A. I think yes, but it may not be necessarily leading opinion. It may be highlighting an opinion, it may be editing is as much about what you focus on as opposed to what you don't focus on. So take, for example, the plastic bag the Tesco's plastic bag story, where we campaigned against not just Tesco's but against the use of plastic bags in supermarkets. I don't know where that campaign originated or how Paul got involved in it, but I certainly felt that his readers had an affinity for it, even though many of them might have used plastic bags in supermarkets. Does that answer your question? LORD JUSTICE LEVESON Yes, I'm actually trying to work out where the balance lies. You've made the position very clear in relation to your own position, and you've identified where you see the editor sits, and I'm just not sure, just pursuing the question Mr Jay has asked, whether it isn't part of the editor's job to identify what is next going to be the issue that truly affects those whom he understands read the Daily Mail.
A. I would agree with that. I think it's a fair assessment. MR JAY In terms of assessing these matters, you defer to the judgment of Mr Dacre; is that correct?
A. Of course, yes.
Q. Are these matters the subject of frequent discussion between you and him?
A. Not really. I don't if he decides to launch a campaign, he doesn't feel the need to tell me about it and nor do I feel he needs to. It's his job and I let him get on with it.
Q. I'm sure that's right, but are there occasions in which particular campaigns nonetheless are discussed between him and you?
A. I can't remember one. I think the reason I brought up the plastic bag campaign is because he didn't tell anybody and actually at the time we were polybagging quite a lot of copies of the Sunday paper and we had to change our supplier to a biodegradable polybag, so I think I might have said, "If you'd given us a bit of notice, we could have done that before you launched the campaign", but
Q. Fair enough. Your dealings or relations with politicians, you've kindly provided us with a list, Lord Rothermere, which is exhibit LR1, it starts at page 03281. So we understand its provenance, it's been compiled from your personal diaries; is that correct?
A. It's been compiled from my personal diaries and from Finsbury, who have been helping us with this area.
Q. So you can't put this forward as necessarily 100 per cent accurate, but you've done the best you can to assist the Inquiry with the materials you've got, going back over ten years, is that a fair summary?
A. That is absolutely correct.
Q. If we look at the first page of the list, which starts on 11 February 2002, our page 03282.
A. Yes.
Q. Without examining this in very fine detail, would you agree that the picture which might emerge or does emerge is that until about 2008 you were seeing more government and Liberal Democrat politicians than Conservative politicians?
A. Yes. I think that's about right.
Q. You saw Mr Clegg on at least three occasions. Were you reasonably close to him?
A. I've known Nick Clegg since he was an MEP for Leicester, which is where we have the Leicester Mercury and he was an MEP in that area and he helped us with some legislation in Europe in the late 1990s so I got to know him then, yes.
Q. "General discussion". We've seen that under the subject matter of others' similar lists. That's presumably because you can't remember precisely what was discussed at this distance, would you agree?
A. Yes.
Q. The sort of things, though, which might be discussed, would you discuss the general political issues of the day?
A. Yes, generally. Politicians like to talk about their general issues and they like to talk about what they're trying to achieve and it's very interesting to listen to them.
Q. Do they ever discuss media-related policies?
A. Unless it's a formal meeting, in my experience they really don't like talking about special interests, so in a full meeting, for example, where you go to there and there's public servants there then there's an agenda and you can talk about the issues that you want to discuss, but largely when it comes to personal engagement, they talk about you know, they try and impress you with what they're trying to do with the country and their vision for the country and then they might complain about the fact that the paper's not supporting them, but they don't talk about the commercial interests of our newspapers. Nor do I encourage them to, to be honest.
Q. Standing back from this, no one is suggesting that you meet with politicians with great frequency, but what do you think is in it for them? Why do they want to engage with you in this way at all?
A. Well, I think, coming back to my, you know, comments earlier on, I think honestly sometimes they feel the paper's been hard on them and I think they try and implore, you know, on me, to have some sort of influence, and I tell them that that's not going to be the case, but honestly I would have to I think you really should ask them the question of why they feel the need to meet with me, but ultimately that's what I think is going on.
Q. But if they know that there's little point imploring you for your papers to back off, why do they persist?
A. I don't know. That's really a question for them.
Q. We've heard from one other proprietor, I think, that there are frequent emails or in the nature of text message exchanges between him and a politician. Is that the sort of way you operate or not?
A. No. I don't send text I mean I've sent two text messages. One was to Nick Clegg and the other one was to David Cameron and it was after the public debate before the last election saying, "Congratulations on a job well done". That's the only two text messages I can recall ever sending them.
Q. We know Mr Dacre was personally quite close to Mr Brown. Did you have a view about that?
A. I not really. I thought it was amusing and I used to tease Paul about it, but basically he was entitled to have a relationship with whoever he wants. Personally, I like Gordon very much, so I wasn't opposed to it.
Q. But why did you think it was amusing, though?
A. Because Paul has a view of the world which is, I suspect, quite different from and an economic view of the world which is quite different from Gordon, but they shared an affinity with one another, which is surprising.
Q. In 2008, and other commentators have remarked on this, there appears to have been a shift more back to the Mail's natural habitat, namely the Conservative Party, and that's reflected to some extent by your own engagements. Would you agree with that?
A. Yes, probably.
Q. Why is it that the Mail is shifting back to the Tories and you're seeing more Tories? Why is that the position?
A. I think well, it's in the nature of I don't think seeing more Tories? Perhaps I think Finsbury were suggesting that there's a chance they may win the election so we needed to hear more about what they were going to do, so there was this sort of formal relationship with meeting shadow ministers to find out what their commercial ideas were, to familiarise with them on a commercial basis, and then I suspect also that leaders of the opposition want to, you know, try and get in with high-ranking media individuals so they instigate more meetings.
Q. Is this fair, that you like others were beginning to assess that the Conservative Party was likely to win the next election that was the 2010 election, of course or at least if not win it, at least be the major force in Parliament?
A. I have to say that it did look like there was going to be some form of change and it would be it's important for the company to become adaptable to that.
Q. Indeed. Is there any sense, though, that you would want to be becoming closer to the likely winning party of the next election because that would safeguard or might safeguard, as best it could, the general commercial interests of your paper?
A. Well, obviously it's important for us to have a good commercial relationship with all government, so that they can listen to what we have to say over various elements to do with regulation, and I make no apology for that. It would be but did we seek to familiarise with themselves to get extra favours? No, we didn't, and there's no reason for us to have done that. There's no favours that we sought anyway.
Q. I'm not saying there was a discussion which amounted to an express quid pro quo in exchange of favours, but we know, for example, in 2008 that you were still extolling the virtues of self-regulation of the press, weren't you?
A. Yes.
Q. Was that a topic, you think, which you ever discussed with the politicians we see listed here, particularly in 2008 to 2010?
A. I can't recall it. I can't be positive that I didn't, either.
Q. But do you think it's a topic that you're likely to have discussed?
A. No, I don't think I'd have brought it up. The regulation of the press has only really become a big issue recently. Until that time, government was largely happy with the way the PCC was run. That's certainly my understanding of it. And so there would have been no real reason to bring it up. LORD JUSTICE LEVESON There was an issue, wasn't there, in relation to the implementation of the amendments to the data protection legislation?
A. Oh, okay. Well, if they did bring it up, they would have brought it up with Paul Dacre and not me. And if they had brought it up with me, I'd have said that I wasn't really familiar on the details of that legislation, so. MR JAY In this period, or particularly if we look at 2009/2010, the context of press regulation, was the phone hacking issue ever discussed with government or opposition?
A. No.
Q. We see from this list as well we may be coming back to this in a moment when I put questions to you from another core participant, but I was interested in this as well. At page 02384, Chequers on 10 and 11 July 2010. Do you see that, Lord Rothermere?
A. Yes.
Q. This presumably is a weekend at Chequers, isn't it?
A. It is.
Q. Are the persons present just limited to the people we see there? There would therefore have been eight of you, with you and your wife, presumably?
A. Jeremy and Lucia joined us for Sunday lunch, along with Michael Green, and Miranda and Luke Taylor, who are personal friends of David Cameron, were there overnight.
Q. Michael Green, is he Carlton?
A. Michael Green was chief executive of Carlton, and I believe David Cameron's former boss when he was working for Carlton.
Q. So he was there as well. So Mr Hunt was there. So the conversation must have involved, at least from time to time, media and newspaper issues, didn't it?
A. The only conversation I had with any minister about media issues was when I when Jeremy Hunt arrived, we talked a bit about local TV. Jeremy was very passionate about his ideas for local TV and wanted us to be a core participant of that and he talked to me briefly about that, but it was in passing, it was probably less than a few-minute conversation, and that was the only thing that we discussed. That was discussed with
Q. I've been asked to put this to you specifically, that the BSkyB bid by News Corp was announced on 15 June 2010 and this weekend at Chequers obviously follows that. Did you discuss the bid with any of Mr Cameron, Mr Gove or Mr Hunt on that occasion?
A. No, I did not.
Q. You're sure about that, are you?
A. I'm absolutely positive.
Q. What was your personal position or your company's position in relation to that bid?
A. At that time, we didn't have a position. It was only later on, when the Claire Enders report on the merger came out, that Kevin Beatty and Paul Dacre started to take notice of quite how powerful the combination was going to be, and that took a while to settle in and I think we only really started to wake up to the ramifications of the merger after the summer.
Q. Is that really right? Okay, News Corp had 39.1 per cent and arguably a rolling interest in any event, but they wanted the extra 61 per cent. That must, as someone in your business, have immediately struck you when the bid was announced in June, and I would suggest caused you concern. Isn't that true?
A. Well, it caused us concern, but we were under the impression that because News Corp already controlled BSkyB, that there wasn't really going to be a material change. It was only after the report by Claire Enders pointed out what they could do which was extra to the power they currently wielded that we started to become concerned.
Q. It really took that report to bring that point home to you, did it?
A. The detail of it, yes, I think it did.
Q. I'm also asked to pursue this with you: we can see in your list that after the Chequers weekend in July of 2010, we move to 25 August 2010. You had a meeting, this time it looks like a more formal meeting, at DCMS with Mr Hunt, Mr Vaizey, isn't it?
A. Yes.
Q. Who is, I think, a minister in DCMS but I'll be corrected if I'm wrong if he's not there, he's at BIS and others. Did you discuss the BSkyB bid with Mr Hunt or Mr Vaizey on that occasion?
A. I did not, no.
Q. By the time the alliance against the bid had coalesced, you say, based on the expert evidence of Claire Enders and a legal assessment of it, did you then discuss the BSkyB bid with any politician?
A. I can't recall having done so, no.
Q. Without requiring, as it were, a particular occasion, looking at it generally, do you think you might have done?
A. No, because I think that it was obviously a very contentious issue. It's unlikely that I would have got wouldn't have got an answer that I wanted anyway, or, you know, the only answer that we were possibly wanting is that there would be a fair review of the process. I didn't really see any politicians during that time other than these two meetings, and I had a very full agenda during the meeting with Ed Vaizey and Jeremy Hunt, and at that time it was Vince Cable who was the person who had the decision and I didn't see him at all. In fact, I don't think I've ever spoken to Vince Cable in my entire life, so and it's also not my job to go around particularly lobbying politicians on things like this. I mean so.
Q. Politicians don't shrink from complaining to you about what the Mail prints. Can't the tables occasionally be turned around to this extent: your company has a, you might say, legitimate commercial interest. Why not raise it if the opportunity arises? It shows admirable self-restraint not to, doesn't it, Lord Rothermere?
A. Well, at Chequers it was a friendly weekend. We were getting on. We didn't I didn't want to bring up business. It's sort of rude to do that if you're invited to someone else, even if it is the Prime Minister, on a friendly basis. With Jeremy Hunt and Ed Vaizey, we had a strict agenda so I didn't feel it was appropriate to bring it up then either. Also, we had an alliance with other people and we thought the best use of our concern was expressed through that alliance as a group rather than individually.
Q. If you look at the next page of your list, I want to bring this point out really for balance. It's page 03285 and if you look at the various meetings with politicians you had between 22 September 2010 and I think the last relevant occasion, 19 March 2012, we can see that you have dinners, social engagements, with Michael and Sarah Gove?
A. Mm-hm.
Q. And you have three with George Osbourne, and they're both, each of them, said to be close to News International.
A. Mm-hm.
Q. What in general terms is the nature of the discussions you had with these people? I'm not talking about social interaction, I'm talking about discussions which relate to political or media issues. Could you assist us at all?
A. Largely talking about the economy, talking about how to you know, what George's attitude was towards the economy, the crisis of the economy. You know, largely macro things like that. And if I had a conversation with him at all which wasn't just about social issues. And then with Michael and Sarah it was normally about the importance of education. My company feels very strongly about education, in fact the success of the Daily Mail was born out of the Education Act in the Victorian times, and we feel that it's very important that the quality of education and literacy in this country improves, so like Mr Murdoch, I had ample opportunity to talk to Mr Gove about that, because we have an affinity on that.
Q. Okay. There's one anecdote I'd like to put to you. It doesn't actually tie in with any item on your list, but we're going back now to 2004. My source is a book called "The New Machiavelli" by Jonathan Powell, who, as you know, was close to Tony Blair.
A. Yes.
Q. You've seen the relevant extract
A. Yes, you sent me a copy of it.
Q. 205 and 206. What Mr Powell says, just to seek your comment on this: "The other lesson we had learned too well in opposition was the importance of staying on the right side of the media moguls. The moguls have no problem with their papers attacking politicians, but they have an unwritten rule not to attack each other." I'll come back to that point because it's a point of slight interest. "The Mail broke this understanding by constantly referring to Richard Desmond, the owner of the Express, as a pornographer." That's true, isn't it?
A. That is true.
Q. "He eventually hit back with stories about the personal life of Jonathan Rothermere, the proprietor of the Mail." Without going into what those stories were about, is that true?
A. Is it true that he attacked me?
Q. Yes.
A. Yes, but I wasn't that offended by it. He seemed to think the fact that I have an illegitimate son is of some concern. In fact, my son I'm very proud of my son, he's a member of my family, we go on holiday together and my children are very proud to call him their brother, so I don't make a secret of it and frankly the idea that I'm offended by it is slightly offensive.
Q. The purpose of my question was not to explore that, but I read on: "When Jonathan and his wife Claudia came to dinner with Tony and Cherie in April 2004" pausing there, there isn't a dinner on your list for April 2004, but that may or may not matter "they complained bitterly about their treatment in the Express. When Claudia said 'I can't believe they print that stuff', Tony said Cherie was 'literally speechless'." Is that true?
A. I have no recollection of it. I think it's as fictitious as the date of the dinner.
Q. Really?
A. I do.
Q. "And when she had recovered [that's Cherie] she asked mildly, 'Have you seen what they put in your paper about me?' the Rothermeres just laughed and said oh that was a little fun." Is that true or not?
A. I have no recollection of it, no. I don't believe it's true.
Q. As for the non-aggression pact, the evidence about this is vague or anecdotal, but there may or may not have been a discussion back in 2001, I think, between Mr MacLennan and Mr Desmond. Do you know anything about that?
A. Yes, I do.
Q. What light if any can you throw on that.
A. So, if I shall tell the story as I remember it: Paul Dacre felt very strongly that Richard Desmond should not own the Express Newspapers, that the government had should have used the fit and proper person clause in order to stop him from doing it because of his other business interests, and sort of expressed that point of view forcibly through the newspaper. Richard Desmond responded by trying to dig up everything he possibly could on my family, my wife's family, you know, making things up about my parents, which we largely took in stride. However I largely took in my stride. Murdoch, however, took the view that firstly he was very loyal to my father, and I think that the stuff that Richard was printing about my father, which was very untrue, was very painful to him personally, and secondly, he felt that Richard Desmond was going to be the owner of a national newspaper, we had to work together in all forms of you know, and that this unhealthy antagonistic relationship was not in the interests of the readers and not in the interests of the industry. So he decided, I think at Richard Desmond's invitation, to accept a lunch to talk about this to try and pour oil on troubled waters, so to speak. He asked me if I thought that was a good idea. I said I didn't think it would be a good idea, but he had a good commercial rationale for doing it, so he should go along and see what Richard Desmond had to say. He went to lunch at the Howard Hotel. They discussed various issues to do with the industry, and, you know, this mud-slinging, I suspect, although I didn't actually get a full briefing from Murdoch on what was said at lunch. On the way back from the lunch, Richard Desmond announced publicly that there had been some form of truce. I asked Murdoch about that, and he said no truce had been created and no agreement was created and he just thought that Richard Desmond was making trouble, and that is that, really.
Q. But at all events, you say there wasn't a truce, because if there was one, it didn't last very long anyway, did it?
A. I don't believe there was a truce, and I think the proof is in the pudding, so to speak. You know, the Express continued to attack me, you know, so.
Q. But this in microcosm, I suppose, raises the sort of privacy intrusion harassment concerns which we were touching on earlier, doesn't it, because there isn't really a public interest in talking about you in this way, is there?
A. Oh, I think if he had found something genuinely shocking about me, then he had every right to publish it. Still does, you know.
Q. No, but what he did publish there was no public interest in publishing, was there? Or do you think there was?
A. I don't personally, no. I don't think so, no.
Q. I think all this is trying to say is this is an example of the concern which arises more widely in the context of the culture, practices and ethics of the press. Would you agree with that or not?
A. Sorry, I don't quite understand. Could you explain? LORD JUSTICE LEVESON The point is that there's a risk that newspapers may use the power of their position without there being a public interest justification, to have a go at, invade the privacy of people for reasons which may be good to them, but which don't really stand up. That's the point.
A. I see. There is obviously a danger of it, yes. It is not a conduct that we condone in our company. Indeed, Paul Dacre's decision to attack Richard Desmond's ownership of the Express is an example of that. He thought it was a gross he thought the government had acted wrongly and he thought it was not in the public interest for Richard Desmond to own the Express and he thought it was in the public interest to publish those stories. I think that if we have a free press, there will always be a danger that some people will try and abuse that power, but I don't know I mean, that is something I believe that you're struggling with. Certainly I do not try and do that. I try and I'm very mindful and respectful of the power that our newspaper has and I have, and I respect our readers, I respect their right to know the truth, and if I thought my editor-in-chief was using those tactics, then I would be very unhappy. MR JAY Okay. Lord Rothermere, you were asked to address the Mail's coverage of the McCann story. This is paragraph 51 now of your witness statement, page 03299. You say in paragraph 52 you have great sympathy for the Drs McCann and the terrible ordeal they continue to face. Mistakes are made from time to time in the coverage of crime." Then you say: "Our legal and editorial systems are designed to minimise these risks." Was your sympathy for the McCanns something that you felt when this particular story or these stories were published back in 2008 or is this something you're looking back on now?
A. As a parent, you would have to be inhuman not to feel deeply about what the McCanns went through, and I was no different from anybody else.
Q. Was your analysis then that we're not just talking about the Daily Mail now, we're talking more widely that part of the problem may be rooted in too great a taste for sensationalism, prurience and intrusion, and this is just another manifestation of it?
A. I'm sorry?
Q. Looking at the McCann case as an example, was your analysis back in 2008 that part of the root of the problem was an unhealthy taste in sensationalism, prurience and intrusion?
A. Sorry, part of what problem?
Q. The problem which we see exemplified by the stream of stories which related to the McCanns.
A. The stories they disagreed with?
Q. Well, the stories not that they disagreed with but which were frankly palpably incorrect.
A. Okay. Firstly, it is obviously a very big story because of the nature of it. The McCanns encouraged publicity in order for very good reasons, and then there was, I believe, the problems of the jurisdiction, Portugal, created briefings by police officers. I think our journalists were unfamiliar with the way in which the Portuguese media and police operate, and a number of allegations were made that were followed up in our newspapers which we regret, which we when the McCanns complained about, we immediately rectified, and gave them compensation. It's a regrettable occurrence, and but it is the nature of sometimes of journalism to do that.
Q. That's as far as I
A. But not wilfully. Sorry, I don't believe our newspapers set out to wilfully upset the McCanns. I think they were reporting on briefings that they had which they believed at that time to be true. And when they realised that they'd made a mistake, they rectified it.
Q. Paragraph 53, Lord Rothermere, the reports of the Information Commissioner, which you say there was a discussion you had with Mr Dacre about those. Do you recall that?
A. Yes.
Q. Was that a conversation that you instigated or he instigated?
A. Paul instigated it.
Q. Can you remember why?
A. He instigated it because he said that he this report had come out, that it shone a light on an area of practice within our organisation which was not best practice, and that he was going to do his best to put in better controls to stop it happening in the future.
Q. When he said "shone a light on an area of our practice which was not best practice", was that the exact language he used or was he blunter?
A. I can't remember in detail what Paul said. I'm only sort of paraphrasing what he said.
Q. Because I think the ICO, as you know, were going further, were saying this was strong prima facie evidence of criminal conduct. Was that the message which Mr Dacre was imparting to you?
A. To be honest, I can't remember it, but he said that there was no evidence that he said that he was going to deal with the matter and make sure that it desisted and that he would put in controls within the organisation to stop it happening again.
Q. Your view, finally, Lord Rothermere, any changes to regulation. You're quite careful in the way you express yourself. Of course, you should be careful in the way you express yourself, but paragraph 56 says: "The perception is that self-regulation has not worked." I mean, do you feel that self-regulation has not worked?
A. The press do I feel I believe that the establishment and many members of the public do not believe that self-regulation has worked and so therefore it has not worked. I mean, rather the form of the PCC has not been able to establish a level of truth and faith that is necessary for it to function properly. That is almost certainly the case.
Q. Does it go any further than that or not, in your view?
A. Well, the press complaints body, as I understand it, is a body which is about complaints. People are able to complain to it and under the codes that they have then journalists and newspapers have to correct themselves. I believe that that's been largely done. I don't know of many instances where the PCC has asked a newspaper to do something and it hasn't complied. So on that level I have to say that it has worked. It is not the job of the PCC to administer, you know, the law. LORD JUSTICE LEVESON Well, is that right? I mean, possibly this is not a discussion which we need to develop too far, but you may have heard that I've had this debate with others. Of course we have the police and we have the civil courts, but isn't self-regulation also to do with the industry itself making sure that its practices are not merely the absolute minimum, but are appropriate and proper?
A. I would like to think so, yes, but it is very difficult to enforce the law on people where you have no authority to do so. LORD JUSTICE LEVESON Well, that's another question, and therefore raises issues of what authority a regulator should have. If the regulator is no more than a collection of some of the titles, then their authority is obviously comparatively modest.
A. I would certainly agree that in order for self-regulation to work, I think that you would have to have all members of the industry support it, yes. Or the defined industry support it, whatever that definition was. LORD JUSTICE LEVESON That raises a question of definition. Could we come back to that. As Mr Jay has sat down, I'm going to start a bit. One of the issues that I have to think about is the whole issue of plurality.
A. Yes. LORD JUSTICE LEVESON If one looks at our press: vibrant, not always entirely profitable, but I hope free, and vital to our democracy, all of which I have made very clear I fundamentally believe in. Should we have concern that with are in the main talking about six families, a couple of companies and one or more trusts?
A. Mm. LORD JUSTICE LEVESON So if one deals with it historically, obviously your family has been engaged in the development of a free press for many generations.
A. Yes. LORD JUSTICE LEVESON Then and I'm not trying to put them in order at all of age or whatever you do have the Murdoch family, Mr Murdoch taking over from his father and News Corp and News International. We have now the Barclay family. We have Mr Lebedev and his family. We have Mr Desmond. I think those are the families that I'm talking about. Then you have the plcs, such as Trinity Mirror, and then you have the I won't use the word "odd", although that's the word that came to my mind the unusual arrangements such as the Scott Trust for the Guardian.
A. Yes. LORD JUSTICE LEVESON Do you have any observations I start by saying we are where we are, and I can't tear up what we have, and before anybody suggests I might, I have no intention of doing so. But the question does arise about how that ought to be managed so that it is open, transparent and obvious to the public that the public interest is being served by what are a comparatively small number of organisations, of families. I'd be very interested for your observations on that, speaking with all the authority of your forefathers.
A. Okay. Hm. It's a very interesting question. I can certainly see why people would be concerned. It's hard to imagine, though, a free commercial press which isn't run by commercial interests, and those commercial interests may sometimes be corporations and sometimes they may be individuals and sometimes they may be families. It's hard to see how the government can regulate ownership of free commercial enterprise on that level. Certainly I can only speak for my family in that we try and be as fair as we possibly can. We believe in ethics, we believe that good journalism is ethical journalism, we believe in putting our faith in journalists, we believe in most journalists, on the whole, wish you know, are good people and want to find the truth, and that is what motivates them. I believe our newspapers and our journalists only print what they believe to be the truth. If I thought that a journalist was printing lies knowing they were lies, then I would expect him to be fired. I think that if you take authority away from the people and responsibility away from the people that should have that authority and responsibility, if you try and create a body which takes a box-ticking mentality to this issue, then you devolve authority and responsibility and that's quite a dangerous place to go. Certainly in my organisation, Paul Dacre has the responsibility and the authority, and it is my duty to make sure that he upholds those responsibilities. So there is a clear LORD JUSTICE LEVESON But in the way you want him to do it, which you've just described.
A. We set the parameters as an ethical organisation, what we believe to be right, yes. That's naturally there has to be a set of parameters. We believe in the Editors' Code, for example. LORD JUSTICE LEVESON I'll come to the code in a minute.
A. And Paul is duty-bound to honour those practices as part of our organisation, as indeed every other employee is duty-bound to do. If legislation wishes to intersperse on that and effectively become the one that's responsible, you could end up in a situation like the FSA, where you have more and more regulation with more and more box-ticking without people really focusing on the matters which really count. LORD JUSTICE LEVESON Yes, I understand that the FSA might not provide me with a solution, but I'm grappling to organise in my mind how it actually operates, and to understand the extent to which it requires a proprietor to be benign, the risk being that if he or they are not benign, they materially affect the way in which we learn what happens in our democracy.
A. Well, polarity is the best guard, really. If you get a Hurstian type situation where one individual becomes very powerful, then you don't create natural balance, the universe gets out of kilter, so to speak. But in a commercial world where people are not forced to buy newspapers, in fact they have to part with money in order to get them, by and large, people can take the views that they take, and even, I believe, in Mr Murdoch's stable, his newspapers take different views over different subjects. So it's that polarity which creates a rich environment of diverse thinking. It's hard to see how we could replace that. Does it not work at the moment is the question. LORD JUSTICE LEVESON That's one of the questions I have to address, I think. All right. Let me give a subset of that. You answered Mr Jay and explained that there was no agreement, as far as you're aware, between the Express and your papers that nobody would attack each other. But another of the concerns that I have to address is whether newspapers really do hold each other to account. It is interesting, isn't it, that if the judiciary make a decision and I have no complaints on behalf of the judiciary then within hours those who disagree with it will make their disagreement very, very clearly felt.
A. Yes. LORD JUSTICE LEVESON If politicians make decisions, if local authorities make decisions, health trusts make decisions. But it doesn't very often happen, does it, that the press hold each other to account, and we have got this example, haven't we, that the whole business of interception of voicemails, 2005, 2006, all that period, and concern about sentences on those who were breaking the law really dies a death until it so happens that the Guardian, or that a particular journalist within the Guardian picks it up and runs with it.
A. Mm-hm. LORD JUSTICE LEVESON And runs with it pretty vigorously, and nothing much happens, and then it's the New York Times that picked it up.
A. Mm. LORD JUSTICE LEVESON I posed this in the question when I was first appointed, and I said who guards the guardians? Who actually is watching what the press themselves are doing? Do you think the press have failed in that regard?
A. To guard ourselves? LORD JUSTICE LEVESON Yes. To keep an eye on everybody else. And I'm sorry if you've got the question, but it's really prompted by the anecdote about the exchange of insults with Mr Desmond.
A. Okay, interesting. I can't speak for the Guardian certainly surfaced much of what's now become public knowledge, so I would say that was an example of the press regulating itself to a degree. LORD JUSTICE LEVESON Do you think? Do you think? Given that it took, I think, probably the best part of five years, three years before the 2009 article, then something in 2010, and then in 2011, they really did have to this is not a publicity advertisement for the Guardian, but I am raising the issue.
A. I think that it's very difficult to ferret out information, particularly given all the rules around data protection and so forth that's come through in the last, you know, few years. So the Guardian had to work very hard indeed, and they have my admiration for all the work they put into it. LORD JUSTICE LEVESON I think newspapers ferret out information all the time, and sometimes they get information which perhaps they shouldn't have, but they stilt ferret it out and publish it if they believe it's in their interests to do so, notwithstanding orders to the contrary, sometimes. Hm? All right.
A. Certainly I believe that newspapers have a right to publish what they think is in the public interest and sometimes the debate over what is in the public interest is a debate. Sometimes we come down on the wrong side of that debate. Happily, the MPs' expenses, which is a clear example of information that was bought by the Telegraph, which would actually be in breach of the Parliament Act and certainly fall foul of the current Bribery Act, was defendable through public interest, I think, and I hope that this country continues to do that. LORD JUSTICE LEVESON Well, I think there has to be a balance, hasn't there? But ultimately it's likely to have to be a court that decides that.
A. Yes. LORD JUSTICE LEVESON Because well, you may be aware that I encouraged the Director of Public Prosecutions to consider putting some flesh around the concept of the test for the code for Crown prosecutors in relation to public interest, and he has done so and he is currently consulting on it. But you would agree that it's important that we try to ensure that everybody is held to account?
A. I think that is correct. I think there shouldn't be yes, no, I think it's the job of our institution to hold people accountable, yes. LORD JUSTICE LEVESON Including members of your institution?
A. Including members of our institution. Including myself. LORD JUSTICE LEVESON You say about links with politicians that there's no reason why what's discussed shouldn't be confidential, but they should be more transparent. I think that's in your statement.
A. Mm. LORD JUSTICE LEVESON Can you help me, if you've considered the issue, how one distinguishes between the right of everybody, you, the Prime Minister, Mr Gove, whoever, to be friendly with whomsoever you wish, while at the same time being able to preserve an openness and transparency about what is otherwise an opportunity for lobbying?
A. Yes. It is a duty I take very seriously. My father and I understand that in order to be an effective newspaper publisher you have to be an outsider. That doesn't mean that you can't have friendly relationships with people and get along with them, but ultimately it means that when, you know, things are exposed that are might be painful to that person, you have to have a degree of aloofness and professionalism. It means it's sometimes very hard to make friends and keep them, but that is the cost of doing the job properly, and, you know, that is my duty. LORD JUSTICE LEVESON I understand that. But what I was really focusing on is the slightly different point, which is the lobbying aspect. It's perfectly legitimate for the coal industry to make an appointment to see the Prime Minister and say, "Actually, we think coal is a good idea and we want to develop this particular colliery and we will provide so many people and it will have this effect", and equally it's legitimate for Greenpeace or somebody to come along and say, "Actually, we don't think coal is a good idea and we think that it's causing enormous damage to our environment and you shouldn't do it".
A. Yes. LORD JUSTICE LEVESON And the way our democracy works is that we elect politicians who make the decisions and then we allow commentators to criticise the decisions, whichever way they go. Commentators in that way can't lose. It's I don't say easy, but I suppose it's rather less difficult than actually sometimes having to make the decision in the first place. The question then becomes, at the level of the press, where there is not a deal I'm not for a moment suggesting there's a deal but that there can be a recognition that actually these things are in the interests of we think these things are in the interests of the press and what we believe is important, and nobody's saying, "Well, if you do this, we'll support you, or we'll go down your route", but creating the understanding, the common understanding, has with it danger unless it's open and transparent. Would you agree with that?
A. I believe that but my own I can only describe my own personal conduct, which is that if there is a matter of industry that I have a particular, you know, view on, like, I don't know, the EU privacy directive, and I want the minister in charge to understand the views of my organisation, I believe that is the best form of that conversation is in their office with public servants with the whole thing being on the record. I think for me, I'm the sort of person who quite likes to do business and then there's pleasure and I don't really like mixing the two, honestly, so and I think if I invite someone to my home or I go to somebody else's home, on a friendly basis, and then I use my access to, you know, bore them with my particular problems, then I think that that's not very good manners, basically. LORD JUSTICE LEVESON You may not be boring them, actually, Lord Rothermere.
A. Yes. LORD JUSTICE LEVESON It's really not just at the personal level, it's the level of how you believe the press should operate.
A. Well, I don't I think that if I see a politician and they want to talk about general politics and they want to talk about they want to explain their views and I want a general understanding of what's going on, then that's appropriate in one scenario. If I have specific issues that I wish them to understand over something like the EU privacy directive or local television, I think that's best done in a business environment, where everything is on the record. Frankly, I think it's the it protects them and it protects me from insinuations of undue access. That's how I operate, anyway. Or try to operate. LORD JUSTICE LEVESON All right. In relation to regulation, if I just touch upon that very, very quickly, I think you've said that regulation that is only for part of the industry simply doesn't work. It has to involve everybody.
A. I think yes, I would say that in order for it to be credible, and credibility is very important, I agree with that, yes. LORD JUSTICE LEVESON All right. Well, I have no doubt that Associated Newspapers will be taking part in Module 4 to look at the future and we'll get their views, which will incorporate your views in the process.
A. Thank you very much, sir. LORD JUSTICE LEVESON Thank you very much indeed, Viscount Rothermere. Right, we'll take a few minutes. (11.29 am) (A short break) (11.40 am) LORD JUSTICE LEVESON Right. Mr Jay, the proprietors that we've heard have crossed several modules. The witnesses from now on, though, essentially deal with Module 3. MR JAY Correct. LORD JUSTICE LEVESON So it's appropriate to, as it were, start that module, and although I haven't done so in every case, I think I would like to introduce my perception surrounding this module first, before you open it. At some stage, we're going to have to deal with the Independent on Sunday and the point, but we'll doubtless find some time to do that. But I'll start. Statement by LORD JUSTICE LEVESON When seeking to devise a convenient method of addressing the wide terms of reference that have been set for part 1 of this Inquiry, it has been convenient to do so in short form by reference to the modules into which the work has been divided. That is the press and the public, the press and the police, the press and politicians and the future. Before commencing Module 3, which concerns the press and politicians, it's important to expand the language out again and to focus not only on precisely what it encompasses, but also on what it does not deal with. Stripped of anything that relates to other modules, it is as follows: "To inquire into the culture, practice and ethics of the press including: "(a) contacts and relationships between national newspapers and politicians and the conduct of each "(d) the extent to which there was a failure to act on previous warnings about media misconduct. "2. To make recommendations for a new more effective policy and regulatory regime which supports the integrity and freedom of the press, the plurality of the media and its independence "(b) for how future concerns about press behaviour, media policy, regulation and cross media ownership should be dealt with by all the relevant authorities including Parliament, government "(c) the future conduct of relations between politicians and the press The focus, therefore, is on the way in which the press goes about its business, and in that context its relationship with politicians and how each behaves towards the other. To put it more crudely, has the relationship, which is of critical importance in our democracy so that politicians can inform the public about their policies and the press can hold those in political life to account, got out of hand? Does it need to be recalibrated? It is obvious that politicians will want to gain support and need support for the messages they wish to convey, but in developing entirely appropriate relationships, is there a risk that there is an inappropriate press influence, without anything being expressed, or at least the perception of inappropriate press influence? Although I retain an open mind and will listen very carefully to the many different perspectives that will be offered over the next weeks, I have so far understood that all political leaders have been saying that the relationship does need to be rebalanced, but the problem is to identify an approach that preserves what is absolutely vital for our democracy, while at the same time ensuring that whatever might be the appropriate line in necessary relationships is not crossed. It's also important to consider whether, because of those relationships, warnings about media misconduct have been left unaddressed. This inevitably is a historical issue, and given where we are, it will be important to go back to various Royal Commissions, to the reports of Sir David Calcutt and various more recent incidents of serious press misconduct over the past, after none of which, or so it is submitted, was sufficient done to address the problem. This, it is said, is at least one of the reasons why we are where we are today. The module is therefore directed towards recommendations as to the ways in which future concerns about press behaviour, media policy, regulation and cross media ownership should be dealt with by Parliament and government. That is at the core of this part of the Inquiry. As I have said, I am determined that it should not simply represent the next footnote in a historical analysis of failed efforts to find a correct approach to the regulation of the press, whatever form that regulation might ultimately take. For the avoidance of all doubt, I must emphasise what this module is not about. First, although I recognise that some have sought to make political points arising out of the evidence as it has emerged, and I am not so naive that I do not understand that there are elements of what I am doing that are likely to be of party political interest, I have absolutely no intention of allowing the Inquiry to be drawn into such a debate, and will vigorously resist any attempt to do so. I am approaching my task in a politically neutral fashion, and intend to ensure that the principles of fairness, which I have sought to maintain throughout, apply equally to this module. I will be considering the way in which politicians of all parties have engaged with the press. In the same vein, I will also be considering the way in which this part of the Inquiry is reported. Robust reporting and comment is of course entirely appropriate. In my judgment, an attempt to divert what I am doing into political channels, away from the culture, practices and ethics of the press, along with the conduct both of the press and politicians, is not. Second, although I have made it clear that I will look at the facts surrounding the News Corporation bid for the remaining shares of BSkyB, I will do so in order to investigate the culture, practice and ethics of the press and its relationship with politicians. It was because of the need to examine the facts fairly that on 25 April I spoke about the need to hear every side of the story, and that although I had seen requests for other inquiries and other investigations, it seemed to me that the better course was to allow this Inquiry to proceed. That may cause me to look at the Ministerial Code and its adequacy for the purpose, but I will not be making a judgment on whether there has been a breach of it. That is simply not my job, and I have no intention of going outside the terms of reference that have been set for me. Third, in order to get to grips with culture, practice and ethics of the press, it will of course be necessary for me to consider internal governance of propriety issues, generally within the press and specifically within News International, although I will not do so to the extent that it risks causing prejudice to the criminal investigation or any prosecution. Furthermore, everybody might as well understand immediately that it will not draw me into questions of the fitness or suitability for a particular responsibility of Mr Rupert Murdoch, or indeed anyone else whether senior management executive, editor, senior journalist, journalist, policeman or politician. I appreciate that this module is rather different from the first two because there is no corresponding factual investigation in part 2 of the Inquiry, with the result that it might be appropriate to go somewhat further than in the earlier modules where, in circumstances of possible or potential criminal liability, I have ruled out who did what to whom, and created the self-denying ordinance in relation to others. Having said that, however, I've approached how I view Rule 13 of the Inquiry Rules 2006. I will approach my task with those broad principles, including the self-denying ordinance, in mind. Further than that I will not go. Again, it's simply not the task that I have been set. Finally, I must recognise the limits of what I can do in another way. The issues arising from the fact that the press have access to politicians and are able to lobby them about issues that affect them directly, such as the implementation of amendments to the Data Protection Act, are a subset of the wider issues arising in relation to lobbying generally. Whereas this may well be a question that requires to be addressed by the government, and I recognise that my consideration of press lobbying might have implications for more general issues about lobbying, I do not consider that these wider issues can be fully addressed in what I am doing. The same is likely to be so for competition issues and questions of plurality. Although paragraph 2(a) of the terms of reference includes making recommendations for "a new more effective policy and regulatory regime which supports the integrity and freedom of the press, the plurality of the media and its independence", and paragraph 2(d) asks "how future concerns about press behaviour, media policy and regulation of cross media ownership should be dealt with", the former is limited to regulatory recommendations to support plurality of the media, and the latter to mechanisms that can deal with concerns about cross media ownership. In each case the emphasis on those words is mine. Without commenting one way or the other about whether other investigations of any sort are necessary, this Inquiry cannot take the place of an investigation either by Ofcom or by the Competition Commission, and again nobody should think that it does. In the light of a number of comments in the press, I ought also to say something about the approach the Inquiry takes to the questioning of witnesses. First, as I have previously explained, witnesses are warned about issues likely to be raised and it is not my intention that anyone should be tripped up or trapped. We need to elicit relevant information that helps to address the terms of reference. There is no cross-examination as such. Those who look for forensic fireworks should turn to fictional trials. Second, in relation to Mr Coulson and Mrs Brooks, I repeat that I remain concerned to ensure that criminal investigations and possible prosecutions are not placed in peril by the work of the Inquiry. That means not only that I will not investigate certain issues with these witnesses, bearing in mind their own rights against self-incrimination, but also that I will try to ensure that the witnesses do not prejudice the rights of others who may be subject to investigation. It should not be assumed that failure to ask a question or follow a line of questioning is not the result of careful consideration of the adverse impact or effect of doing so. Right, Mr Jay. Opening submissions on Module 3 by MR JAY MR JAY May it please you, sir. The main subject matter of Module 3 of your Inquiry is the "contacts and the relationships between national newspapers and politicians and the conduct of each". The principal focus of your terms of reference is and always has been the culture, practices and ethics of the press. Thus the laser of scrutiny is primarily directed at the conduct and mores of the press in the context of Module 3 national newspapers, rather than the conduct and mores of politicians. Having said that, it would be idle to assume that the conduct of politicians is not being brought within scope, and as I've already pointed out, the terms of reference are explicitly concerned with the conduct of each, namely the conduct of both sides of this equation. Even so, this remains an Inquiry into press standards, and the conduct of politicians, both collectively and individually, should not occupy centre stage. To borrow from Mr Rupert Murdoch's own terminology, the Inquiry has already had a taster of evidence relevant to this module. Some of the Module 1 and 2 witnesses were asked Module 3 questions towards the end of their evidence: viz Lord Patten, Mr Dacre, Lord Prescott, Mr Simon Hughes MP. I mention but four. And it will not have escaped anyone's notice that the evidence of Murdoch father and son covered much Module 3 terrain. However, your modules have never been hermetically sealed caskets and we have taken a pragmatic approach to the timetabling of evidence as well as to these opening submissions. For the avoidance of any doubt though it should be made clear to everyone that it was your decision to sequence the proprietors' evidence before the politicians. This was obviously right in principle, because the politicians needed to know what the proprietors were saying more than the other way around. I hope that it may be thought to be of some value if I were to outline the issues which in my view occupy the heartland of Module 3. There are also some hinterland issues which I will touch on and which the evidence you will receive will address. In some important respects, there are themes common to Modules 2 and 3. During the course of opening the previous module, I explained that a healthy relationship between the press and the police was essential to the sound workings of a mature democracy and the same observation may surely be made with even greater force to this module. The role of the press is to inform, to communicate, to facilitate public debate, to comment, and perhaps most importantly to hold power to account in the public interest. Although the printed word of Fleet Street, whether literally printed on newspaper or electronically delivered, is less important now than it was in the past for the obvious reasons many witnesses have explained, the press still provides an essential function as a disseminator of news and comment. Politicians also need an outlet to get their message across and the press needs to understand and reflect the range of their readers' views. The fact that particular titles may not provide a politically balanced or neutral viewpoint on events is irrelevant to this issue. Newspapers are entitled to be partisan in a democracy, to campaign in favour of causes, policies and political parties, and were the state to legislate otherwise, that would be undemocratic as well as, under our current settlement, an abrogation of human rights. The only boundaries on free comment are those imposed by the criminal law, the law of defamation and broadly analogous constraints, themselves imposed in the interests of democracy and the public at large. Informal contact between journalists and politicians off the record can also be a function of the healthy relationship I am describing. Here, as some witnesses will explain, there may be differences between government ministers and party politicians, although the former will, of course, be wearing two hats. Save in limited circumstances, politicians, unlike the police, are not generally required to act in a capacity which demands independence and impartiality, and the sort of considerations you were investigating in Module 2 do not usually apply. These things having been said, the relationship becomes less healthy if, for whatever reasons, and whether as a result of the behaviour of journalists or of politicians, the public is misled or cannot assess for themselves the truth or accuracy of what is reported. Or put another way, if journalists seek to make the news rather than to report it, the politicians pay more attention to the reporting of a policy than its benefit to the country. In the words of one Module 3 witness whose statement I have studied but who is remaining anonymous for the time being, I quote: "Of course there are risks in this, although the risks for politicians being detached from the media and therefore the public are greater for all involved. The key risks are that the relationships become incestuous, manipulative and self-serving, the politicians allow themselves to be influenced by agendas generated by media organisations in order to secure favourable coverage for themselves, their party and their government." These are some of the hinterland issues, which I will touch on later. The healthy relationship I am describing is not free from the risks of contagion. These risks are in danger of maturing when the fair balance of power between the press and politicians is distorted. For example, if politicians had the ability to control the political content of newspapers, this would be the consequence of the fair balance of power having shifted decisively to one side of the equation. Such a press would be subservient, unable to hold political power to account and quite unrecognisable in fact from the press which has thrived in this country since the Second World War. The fearlessness and vibrancy of our press is something of which we should be enormously proud and which we cannot take for granted. Why the British press possesses these attributes is capable of being explained in a number of ways, but at root the reasons are historical and cultural. I could elaborate here, but I will not. Module 3 of this Inquiry is not about the balance of power having shifted in favour of the executive. It is primarily concerned with the consequences of that balance arguably having shifted in favour of the press, in particular the potential harm to the democratic process and what some have called the democratic deficit. The concentration of political influence in the hands of a few press barons has, it is true, always been a feature of political life in this country since the mid-19th century. We have just heard from the current Viscount Rothermere the fourth, but with respect to him, the influence exerted by his great grandfather the first Viscount Rothermere, in the second and third decades of the last century, was probably much greater. I will not dwell on aspects of his performance during the 1930s. Lord Beaverbrook became the first Minister for Information towards the end of the First World War, a Minister of Aircraft Production and later Minister of Supply in the second. Whether this was a manifestation of some sort of "I'll scratch your back if you scratch mine" phenomenon is now only of historical interest. If powerful newspaper moguls have always been a feature of the British political landscape, what then is the problem? Put another way, is the problem an inevitable by-product of the fact that the state does not own national newspapers, which we all agree would be undesirable, leaving political power free to follow the concentration of economic power? At the heart of the problem is putting the matter at its lowest a perception that the press is capable of influencing voter choice or public opinion on key issues or personalities and that the trade-off for political support is the deliverance by government of media policies which favour by act or omission the commercial interests of newspapers in general or of particular newspaper groups. Or put more broadly, the espousal by government of other policies which correspond with the world or political views of influential newspaper proprietors or editors whether or not they're presented as personal views or the views of their readers. I use the noun perception because I suspect that it could never be proved that press support for a political party has in fact influenced the outcome of an election. Taking the example of the 1992 election, it is arguable that the Sun's support for the Conservatives, or accurately its hostility to the Labour Party, was causative of the result, but it is also arguable that such support was reflective of public opinion, which would have delivered the same result in any event. We will never know. However, Mr Murdoch's own reaction to the "It's The Sun Wot Won It" headline, "the biggest bollocking of my life", Mr Kelvin McKenzie, speaks volumes, and politicians must still believe that newspapers are capable of making a difference. If they did not, why else would they go to such lengths to cultivate support and afford such access to men such as Mr Murdoch? Either his insights are such that anyone would want to hear them for no other reason or is it envisaged that he can deliver something which politicians want. Mr Murdoch denied the charge that there were any express deals. His account when he was giving evidence in April suggested that it was all a matter for the politicians, many of whom he criticised. He told us many times that politicians want his support, which is understandable, but that he asked for no favours in return and received none. It is for you to decide, on the evidence you've already heard and will hear, whether any explicit request for favours was either made or offered, but the modus operandi of sophisticated people is likely to be far more subtle. It is implausible that Mr Murdoch would have asked Baroness Thatcher for express favours at that lunch at Chequers on 4 January 1981, and Mr Ingham's no doubt carefully crafted memorandum indicates that no such request was made, nor would Baroness Thatcher have offered any regulatory favours either, and the memorandum shows that as well. However, it is arguable that we are witnessing here the interplay being two extremely powerful individuals where messages are being transmitted by and to finely tuned antennae and implied understandings reached. Mr Murdoch invited himself to that lunch. Baroness Thatcher did not know what was on the agenda. He pushed lightly on the door and it sprung open. The initial talk was all about the new US administration and what Mr Murdoch described as the new right. Mr Murdoch stressed that the problem lay with the print unions, by implication that their power needed to be reduced. He and Baroness Thatcher were altogether on the same page. Mr Murdoch used this opportunity to get his message across to the Prime Minister in like manner as modern politicians so often hope that the press will avail them. By getting his message across, it is arguable that what he was doing was advertising his personal qualities to Baroness Thatcher. That is why face-to-face interaction matters. Instinctively he knew which buttons to press. On 4 January 1981 Mr Murdoch could not predict whether he would be given a rough or an easy ride in the context of the Fair Trading Act 1973, recognising always that the locus of decision-making would reside with the Secretary of State for Trade and Industry. But he must have been able to surmise that the Labour Opposition would oppose his acquisition of the title without a reference to the MMC and there was at the very least the risk that the Secretary of State would take the political line of least resistance, in other words, in the parlance of the 1980s, a wet rather than a dry approach. As it happens, the documentary evidence shows that at their meeting on 26 January 1981 Mr Biffen told Mr Murdoch that he was minded to refer the bid to the MMC and Mr Murdoch stated that he would not withdraw his bid if that happened, although everyone understood that this would cause delay, uncertainty and problems with Thomson. Some might say that a direct threat to withdraw the bid might have backfired. Later that afternoon at Cabinet Subcommittee, the merits of a referral to the MMC were discussed and it was concluded first that the statutory conditions for non-referral were met and secondly that there were no commercial or political advantages in favour of a referral. Whether there were any private conversations between Baroness Thatcher and Mr Biffen is both unknown and now unknowable. They would not have been recorded if they had taken place. There is no direct evidence that the Prime Minister gave her Secretary of State a nod and a wink, but for present purposes it may be sufficient to state that Mr Murdoch knew that if she were consulted, Baroness Thatcher fully understood and empathised with his position and that there was common ground between them. You may think that this vignette affords illuminating insights into the subtle and sophisticated way in which press moguls and politicians operate. You may, on the other hand, come to the conclusion, which I am sure will be News International's submission, that this whole issue demonstrates the truth of what Mr Murdoch has been saying all along, namely that he does not asks for favours and that politicians ask for none either. There is a further reason why it's appropriate to think very carefully indeed about the events of January 1981, in particular the luncheon engagement. Until the Thatcher Foundation released the relevant papers in March 2012, Mr Murdoch had apparently no recollection of it whatsoever. His evidence to you was that he still does not, to be honest, as he put it. One does at least have to question whether this is selective amnesia. Mr Murdoch told us in evidence that he did not enjoy frequent encounters with Baroness Thatcher. The acquisition of the Times and its associated titles must have been one of the most important in his commercial life. This was a time of heightened emotion. Could an intimate lunch at Chequers really have been forgotten? Human recollection is notoriously patchy and unreliable, we all know that, and the fact that I, for example, would be 100 per cent certain that I would be able to remember an event such as this occurring 30 plus years ago is not going to assist you in coming to a conclusion either way. If you accept Mr Murdoch's evidence on this topic, the point goes no further, but if you do not, the consequences are capable of being wide-ranging. Not merely would the selective amnesia appear to be convenient but inferences might be drawn as to Mr Murdoch's true motives and intentions in seeking out the Prime Minister's ear in January 1981. Furthermore, this issue is capable of bearing on Mr Murdoch's integrity. Looking more broadly now at the history of the last 30 years and the inferences to be drawn from it, the proposition that there is an implied trade-off needs to be examined with care. Key to this may well be the observation that Mr Murdoch likes to back the winning party. This enhances the mystique that he has some sort of power or influence over the outcome. This perception, regardless of its foundation in fact, is an immensely valuable asset and serves to reduce the risk that the political party be inclined to harm his interests whilst in power. Political endorsement by a newspaper is a commodity of perceived value, and the greater the readership of that paper, the greater the value may be. But that value is compounded, as it were, if the readership comprises significant numbers of floating voters. Thus, the Sun has enjoyed an iconic status in this respect and politicians will fly halfway round the world to win its endorsement. The fact that Mr Murdoch arguably played hard to get in the run-up to the 1997 election, taking just one example, serves to reinforce the point. His opponents would say by the time he did confer his support he had won the maximum concessions he was ever likely to in terms of policy. His supporters would say that cause and effect is unproven and even to the extent that policy may have been modified to reflect the Murdoch world view, that is more likely to have been because politicians were appreciating for independent reasons that the viewpoint was sound and popular rather than because politicians were acting responsively to Mr Murdoch's wishes.
Q. This is not to say that Mr Murdoch expressly asked for any such concessions. There is little or no direct evidence that he did and so one is left speculating about private conversations which were never recorded or noted. It would not be safe to base any findings on such speculations. On the other hand, patterns of behaviour may be revealing, and so the argument runs, politicians would know where Mr Murdoch stands on the big questions of the day and would also know what would in the interests of his companies. All these things would be made obvious over the years, whether or not his so-called lieutenants or gurus would be communicating his views to those in power. The balance of power is on this narrative predominantly with the newspaper magnate, although it might wax and wane slightly over the course of an electoral cycle and be disrupted by major events. Of course, if the newspaper magnate is powerful enough it might not matter over much if he backs the wrong horse. Five-year electoral cycles are short and the party in power may already be looking ahead to the next election. Thus far, I have solely examined the position of Mr Murdoch. News International, with 35 per cent of the national newspaper market share, as reported in the Times on 25 April 2012, has the greatest potential influence, but Associated Newspapers are scarcely without importance at 22 per cent, although their influence would appear to derive more from their being a litmus paper for the thinking of Middle England than their ability to impinge on floating voter opinion at election time. Furthermore, in contrast perhaps to News International, their influence is seen as operating more through the personality of their editor than any economic power wielded by their proprietor. I'm not excluding from account any influence flowing from other newspapers, nor am I suggesting that influence is directly proportional to market share, but there is likely to be a correlation. What if anything is the vice of all of this? I referred in opening the first of your modules back in November to the alleged subterranean influences operated by the press on the democratic process but without full democratic accountability. The issue of implied trade-offs and tacit quid pro quos has nothing to do with the sort of overt campaigning we might see in the Times in relation to cycling safety or the News of the World in relation to Sarah's Law. Instead we are in the realm of possible back-scratching and unspoken reciprocations, with each side of the equation knowing full way the aspirations if not the expectations of the other. In terms of possible influence over media policy, the Inquiry will no doubt be examining issues such as the enactment of Section 12 of the Human Rights Act 1998, the passage of the Communications Act 2003, the fate of the amendments to Section 55 of the Data Protection Act and, looking more broadly, the failure of successive governments to tackle the issue of press regulation as well as the approach of successive governments to questions of media ownership. It has also been suggested that the press has been using their contacts, influence and covert lobbying to impact upon the course of wider government policy. Here interesting areas would appear to include matters such as criminal justice reform, immigration policy and European policy. Related but subsidiary questions arise in relation to the press or powerful sections of the press intervening in ministerial or shadow ministerial appointments, especially to law and order positions. There is an important theme which I would wish to emphasise, because this is arguably a recurrent theme and one which interlocks with paragraph 1(d) of your terms of reference, namely the extent to which there's been a failure to act on previous warnings about media misconduct. Other the years we have seen Royal Commissions, the response to Calcutt 1 and 2, the reaction to the death of Princess Diana, the response to Operation Motorman et cetera and in each case where I refer to "response" or "reaction" I am also to be interpreted as referring to the lack of it. Questions clearly do arise as to the underlying reasons for this: these might include a genuine disinclination to clip at the wings of the press, and by so doing harm or at least attenuate its power to hold the right people to account, as much as a more concerning lack of political will to interfere with the powers and privileges of those who are well able to do both short- and long-term damage. In all the various respects I've outlined it may be difficult to convert rumour, hearsay and surmise into hard fact. The Inquiry has already seen, for example, that the rumours put about by at least one political commentator that Mr Murdoch had some role in Mr Gordon Brown's decision not to call a snap election in October 2007 are unlikely to be true because the Prime Minister's decision was made before the former arrived at Chequers that weekend. Other aspects of the matter may be difficult to prove for this separate reason, that government may well have wanted to pursue policy X or not to pursue policy Y for reasons disassociated with the wishes and objectives of media moguls. In relation to the last Labour government's policy on the euro, we know the Prime Minister was more comfortable with entry than was his Chancellor of the Exchequer, and the latter set conditions which were unlikely to be fulfilled, he would say in the public interest. Mr Murdoch's wishes may well have been wholly coincidental. That said, these are all issues which the Inquiry will need to address within the constraints of its terms of reference and the timescales imposed on it by the Prime Minister. At the very least, you may conclude, as many have now accepted, that not merely did governments get too close to News International but that human nature being as it is, a clear perception arises that electoral support would receive its reward. Furthermore, the point has already been made that the reward may have been, either in perception or as a matter of reality, the disinclination of governments to intervene in areas which they would otherwise have wished. Particular attention has been directed in recent days to the Coalition Government's treatment of News Corporation's bid to acquire the remaining publicly owned shares in BSkyB and in particular the interchanges and exchanges between the Conservative Party in opposition and News Corporation in the period leading up to the last election, and the interplay between the bidder and personalities in government once the bid was launched in June 2010. Unsurprisingly, perhaps, the 163 pages of emails comprising exhibit KRM18 have attracted close scrutiny both within this room and outside. The terms of reference of this Inquiry are not such as to require you to determine the immediate political career of the Culture Secretary in the context of alleged breaches of the Ministerial Code or otherwise, and you have made it crystal clear you have no intention of doing so or of being drawn into that political debate. However, this Inquiry is examining the proposition that the press, or here a section of the press, has exercised excessive influence over government, and correlatively that government or individuals within it have permitted themselves to the acquire an excessive degree of propinquity to News International. I'm putting this in a deliberately roundabout way. I could I suppose be much blunter. The issue is whether a Minister of the Crown exercising a quasi-judicial role may have failed to fulfil it because he has demonstrated through his actions that he was too close to News International or News Corporation (these two companies are interchangeable in this respect). Having heard all the evidence, you may conclude that there's nothing to support this proposition and that the quasi-judicial function was exercised entirely properly. If on the other hand you were to conclude otherwise, there is a range of possible findings. The least serious finding is that an appearance of bias arises in relation to the specialist adviser's dealings with News Corporation's European Head of Public Affairs. The most serious is that the nature of the relationship was such that the Secretary of State was prepared expressly to authorise his special adviser to conduct what in effect were covert communications with the lobbyists or, put another way, provide a running commentary on the bid, giving assurances along the way that the bid would ultimately be successful. In between these two poles there's a range of possible findings which would amount to attributions of intermediate severity. The real point here, and it's the point which needs to be examined if only to be rejected in due course if that is where the evidence leads you, is that the BSkyB bid is really an example in microcosm of an over-cosy relationship giving rise to the appearance if not the fact of past favours being traded in, or the perception that future support may be provided. In setting out the issues in this way, I should be interpreted as expressing no view one way or another as to where the evidence might lead. However, it is right that I should echo the note of caution you sounded on 26 April. If the emails in KRM18 were direct communications between the Culture Secretary and Mr James Murdoch the case would be relatively clearcut, but they are not. What we see, speaking metaphorically, is light retracted through two intermediate prisms. Inevitably perhaps we are seeing not white light but many of the colours of the rainbow. In addressing the issue of an overcosy relationship, one must recognise that politicians are entitled to be friendly with whomsoever they might choose. The issue here is where the line should be drawn. These are the principal issues arising from the language of paragraph 1(a) of your terms of reference. There are two subsidiary issues. The first concerns treatment of politicians by or in the press as a means of influencing policy or seeking to determine their political careers. Politicians, it goes without saying, choose to place themselves under public scrutiny and we have examined in the context of your first module many of the issues raised by the desire of public figures to protect their privacy and reputations while maintaining a public profile. I doubt we need to revisit these issues here. The issue is not "politician as victim" but the press seeking to interfere with the democratic process by unfair and intrusive means. The second subsidiary issue concerns the whole topic of spin, which might be visualised as one facet or function of the relationship between the press and politicians. The former would say that spin leads to public misinformation and itself justifies the use of more robust or journalistic methods to strike at the truth. The latter would say that presentation is a legitimate response to the way in which the press are constantly manipulating the truth to attain their "story". Expressed in these terms, spin is no more or less than a manifestation of the shifting balance of power between the governing classes and the fourth estate. The reason why it is a subsidiary issue is because it does not inhabit the same sort of terrain as the issue which occupies centre stage in this module and which I have already outlined. Additionally, it is difficult to see what recommendations you might make to address it. This is a convenient moment to address the issue of recommendations. Under paragraph 2 of part 1 of your terms of reference you are required (missing out irrelevant words): "To make recommendations: "(a) for a new more effective policy and regulatory regime which supports the integrity and freedom of the press, the plurality of the media et cetera. "(b) for how future concerns about media policy, regulation and cross media ownership should be dealt with by all the relevant authorities, including Parliament, Government, et cetera; "(c) the future conduct of relations between politicians and the press." It may be convenient to take these in reverse order. Any recommendations as to the future conduct of relations between politicians and the press are highly unlikely to be enshrined in any form of general legislative change. When the Prime Minister said last July that the relationship between politicians and the press needed to be reset, he is unlikely to have been thinking about a new law to do so. At the very least, he may have been referring to the fact that this Inquiry and the ongoing political process would themselves lead to a culture shift amongst politicians so that they would no longer wish to tolerate any risk of being seen as too close to the press. In the context of paragraph 2(c) of your terms of reference, the principal focus you may think is the conduct of politicians rather than the behaviour of the press. Put bluntly, if Mr Murdoch pushes on a door and it springs open, that without more involves no issue which might trouble this Inquiry. Bully for him, one might say. As a businessman, he's surely entitled to seek to lobby in support of his views as much as anyone else. The fact that Mr Murdoch occupies such power that the door springs open with the exertion of miniscule force might involve issues under other subparagraphs of paragraph 2 of your terms of reference. So the focus in this specific context is on appropriate and ethical conduct by politicians and in this regard you may be considering in due course possible amendments to the Ministerial Code, including in the area of greater transparency. Recommendations as to how concerns about regulation and cross media ownership should be dealt with by the relevant authorities fall into the next subcategory, paragraph 2(b). Fortunately the terms of reference are not so ambitious that you are required to rewrite competition law or the law regarding media plurality. As we saw in relation to the evidence of Mr James Murdoch, the former is largely EU based and the latter is domestic. But the substantive law is beyond the scope of this Inquiry. What you are concerned with is how concerns should be addressed. If Ofcom or any other regulatory body with jurisdiction over these matters wishes to explore the current state of affairs in relation to BSkyB or whatever, that would be entirely for them and outwith the scope of your Inquiry. What would be within scope, however, is whether understandable public concern is being adequately addressed by a system which permits decisions of this nature to be taken by ministers rather than by regulators free from the biases forged in the political arena, or less encumbered by them. The phrase "a minister carrying out a quasi-judicial function" sounds almost oxymoronic if the nature of that function is correctly understood in this context: that a politician is expected to apply a fair, unbiased and disinterested mind to a topic which inevitably arises strongly felt views either way. Some might say that these problems are capable of being avoided only if decisions of this sort are removed from the bailiwick of ministers altogether. I have not overlooked that paragraph 2(b) of your terms of reference also requires you to address how future concerns as to media policy should be addressed by the relevant authorities. I see no difficulty here regarding the role of the independent regulators, and their responsibility for media policy; but much of that policy is determined by government. In order to address the concern that the media policy of government has been generated by an overly close relationship with News International, it might be argued that government should have no or a lesser role in this area. Having said this, it is difficult to see how constitutionally this could be so. The answer can lie only in greater transparency and accountability. Under paragraph 2(a) of your terms of reference you are required, I paraphrase, to make recommendations for a better policy and regulatory regime which supports amongst other things the plurality of the media. In this context, the policy and regulatory regime being referred to is not a regime which replaces Ofcom or the OFT but a regime which either improves or wholly replaces the existing system of so-called press regulation, namely the Press Complaints Commission. Thus the new or successor body as one of its aims should uphold the plurality of the media as much as the highest professional and ethical standards also referred to in paragraph 2(a). It ought not to be overly difficult to achieve this policy directive since the public will find it easy to accept that you would not want to engineer a state of affairs whereby any enhanced or new regulatory system either impeded the independence of the press or jeopardised the plurality of the media. Only a regulatory system which drove existing publishers out of business would create that jeopardy, and one may be confident that would not be your intention. In opening the previous module I did indicate in general terms the identities of the witnesses the Inquiry intended to call. Well, the names of some have already entered the public domain. Beyond that, I'm not providing any further intelligence. It would not be fair to do so. What I will say is that the Inquiry has done its best to sequence the evidence in a logical and intelligible fashion, but ultimately it has had to defer on occasion to the availability and convenience of busy individuals. I conclude these short opening remarks by noting the apparent similarity of thinking underlying paragraph 90 of the witness statement of Mr Rupert Murdoch and page 96 of Mr Blair's memoir. First quote, this is Mr Murdoch: "As for the 'value' to me of these meetings, my view is that if an editor or publisher is invited or otherwise has an opportunity to meet with a head of government or political leader, you go This is Mr Blair: "Again, now, it seems obvious: the country's most powerful newspaper proprietor, whose publications have hitherto been rancorous in their opposition to the Labour Party, invites us into the lion's den. You go, don't you?" LORD JUSTICE LEVESON Thank you very much. What we're going to do is go back, if it's possible now, to consider the position of the article in the Independent on Sunday and we will call the evidence of this afternoon, that is Mr Coulson, at 2 o'clock. Yes, Mr Barr? MR BARR Mr Mullin is in the building and is just being brought over. LORD JUSTICE LEVESON Thank you. (Pause). MR JOHN MULLIN (sworn) Questions by MR BARR MR BARR Could you confirm to the Inquiry your full name, please?
A. John Mullin.
Q. Are the contents of your witness statement true and correct to the best of your knowledge and belief?
A. They are indeed.
Q. You provided a witness statement to the Inquiry in response to a statutory notice asking questions about the circumstances in which the Independent on Sunday came to publish an article about Mr Coulson on 6 May. You are the editor of the Independent on Sunday, aren't you?
A. That's correct.
Q. It follows from holding that position that you are responsible for what the newspaper publishes, but in particular in this case it's right, isn't it, that you were personally involved in the decision to publish this story?
A. That's correct.
Q. You tell us in your witness statement that you were aware of the order made by the Chairman on 26 April 2012. You tell us in paragraph 13 of your witness statement that the order had been served on the Independent on Sunday and at paragraph 16 you say: "Although we are fully aware of the orders which restrict the use of the witness statements and exhibits And then you assert that you've always abided by them. In those circumstances can I take you to the order, and perhaps we could have a copy on the screen, please. Before I go into the details, can I be absolutely clear, so that there are no semantic misunderstandings, is it right then that you at all material times knew about and were aware of the contents of the restriction order?
A. Yes, indeed.
Q. If we look at the preamble and the last of the paragraphs which commences "And upon it reads: "And upon the Chairman considering that it is conducive to the fulfilment of his terms of reference and in the public interest that witness statements provided to the Inquiry should not be published before they are put into evidence by a member of the Inquiry Team as the case may be without the express permission of the Chairman or a member of the Inquiry Team." You knew from that that it was part of the basis for the Chairman's restriction order that he considers it in the public interest that witness statements should not be leaked?
A. Indeed.
Q. And if we look now at paragraph 1, which reads: "Prior to its publication on the Inquiry website, no witness statement provided to the Inquiry whether voluntarily or under compulsion, nor any exhibit to any such statement, nor any other document provided to the Inquiry as part of the evidence of the witness (not otherwise previously in the public domain) shall be published or disclosed, whether in whole or in part, outside the confidentiality circle comprising of the Chairman, his assessors, the Inquiry Team, the Core Participants and their legal representatives." That's a provision that's drafted in very wide terms, wouldn't you agree?
A. Indeed.
Q. And you were again, it follows, fully aware of that?
A. Yes.
Q. Paragraph 2, you would have been aware that the order binds all persons, and you don't dispute, do you, that it binds you?
A. I don't dispute that.
Q. In paragraph 3 it reads: "Any person (including any company) affected by this order may apply for it to be varied pursuant to Section 20 of the Inquiries Act 2005." So again you were well aware of your right to apply for the order to be varied?
A. Indeed.
Q. Is that correct?
A. That's correct.
Q. Now can we come to Mr Coulson's witness statement. You tell us in paragraph 12 of your witness statement that late last Thursday the Independent on Sunday and you say it is vital to emphasise that you confirmed the shareholding prior to this received Mr Coulson's statement to the Inquiry. Can I ask you, first of all you make clear in your statement that it didn't come to you from a core participant or a member of the Inquiry Team. Did it come to you from someone who was within the confidentiality circle?
A. I'm not prepared to go any further than what I've said in this statement there.
Q. Can you help us, if not with the identity of the person concerned, then with the method by which the statement had been obtained? In particular was it obtained through an intermediary or was it obtained by some form of subterfuge?
A. No form of subterfuge on our part, but beyond that I can't comment any further.
Q. You say no form of subterfuge on your part; was subterfuge used by the person who obtained it?
A. No.
Q. You word your statement as saying that the Independent on Sunday received the statement, but in email communications this morning you have said that you were shown it but have not retained a copy.
A. That's right.
Q. Is that correct?
A. That's right.
Q. Did you retain a copy or a transcript of any part of the witness statement?
A. No, I did not.
Q. So is it your evidence that you were simply physically shown a copy which you read?
A. It is.
Q. Can we move now to why it was that you were prepared to read the statement at all, knowing of the restriction order? Why did you read it?
A. I think it's human nature that if you're presented with something and you're a journalist that you would read it. I think in retrospect it would have been much better all round had I not read that statement.
Q. Because you're at pains to tell us in your witness statement that the subject of the article, which is shareholdings by Mr Coulson, was a matter on which you already had three sources?
A. That's correct.
Q. But the effect of reading the statement was that you then had a fourth source, didn't you?
A. Well, I wouldn't put it like that. How I would put it is that we are a Sunday newspaper, publishing on Sundays. Had we been a daily newspaper, we would have been perfectly able to have gone ahead and run exactly the same story that we published in the Independent on Sunday last Sunday on the Thursday before even receiving this statement, so the story stands absolutely on what we had on the Wednesday evening.
Q. Mr Mullin I'm not interested in hypotheticals, I'm interested in actuality, and the reality was that on Thursday you got a fourth source of the information?
A. I did not view that as a fourth source of the information.
Q. You're not denying, are you, that you read in the witness statement about Mr Coulson's shareholdings?
A. No, I'm not denying that, but we had three sources to confirm the story.
Q. Are you seriously trying to suggest that a signed statement from Mr Coulson himself telling you about his shareholdings is not further confirmation of the matter?
A. What I'm saying to you is we had the story copper-bottomed on the Wednesday evening. LORD JUSTICE LEVESON It's not quite the point, is it? Because if you hadn't been interested in what Mr Coulson said, then you wouldn't have read the statement, and you've just explained that no journalist wouldn't read the statement in those circumstances.
A. I accept that, sir. MR BARR So when the time came for you to publish on the Sunday, you had four sources?
A. We didn't use the statement as a source.
Q. Can I just explore very quickly the other three sources, and I'm not going to ask you to identify who they were.
A. Sure.
Q. But you say that you were shown a document by a source which was not, you say, part of a witness statement. Was it an exhibit?
A. No.
Q. And you say that you had two further sources who corroborated your first source. Did they provide you with any documents?
A. They did not.
Q. Did they show you any documents?
A. They did not.
Q. Now, when you came to make the decision to publish last Sunday, knowing that you had the witness statement which contained Mr Coulson's confirmation of his shareholding and knowing of the restriction order and knowing of the provision to apply for a variation, why didn't you contact the Inquiry Team and say, "Look, I've got this story by four sources, only one of them is the Inquiry, which came to me last, I would like to apply for permission"
A. Because my view of the story was we had three sources of the story, none of them relied on Mr Coulson's statement and I believed that meant the order didn't apply to our story.
Q. And isn't the effect of that that you went ahead regardless of a legally binding order and published material
A. No, I really don't
Q. derived from the statement?
A. I really, really don't accept that. Nothing that appeared in our story didn't come from the three sources that I've outlined LORD JUSTICE LEVESON Let's put it the other way round, can we, please. Let's assume, and we've actually had some experience of this in the Inquiry, that you'd seen the statement first, and you'd picked up from the signed document a fact which was of real interest to you and you'd then seen, well, that's very interesting, I can now go backwards and prove it. How am I going to prove it? Well, I could ask this person, I could ask that person, I could ask the other person. And so you get three sources to back up the story. Would you agree that would be a breach of the order?
A. Well, to quote the gentleman here, that's a hypothetical situation, isn't it? LORD JUSTICE LEVESON Well
A. But I think that that probably is a breach of the order, if that helps. LORD JUSTICE LEVESON It becomes very difficult, then, doesn't it, because the problem then becomes for me how I can unpick this. Let me make it very clear. I am very anxious to ensure that the evidence that we're going to deal with it presented in an orderly fashion.
A. I understand that. LORD JUSTICE LEVESON I have no problem about it being I'm not trying to censor it, as somebody has suggested. I'm not trying to keep it secret. Tonight
A. I understand. LORD JUSTICE LEVESON everybody will see it, and it will be spoken about this afternoon, but the risk is that by doing what you've done you've created a dialogue in the public with questions being asked and allegations being made, people having to respond before we've even heard it, and that, do you see, is likely to disrupt the process that I am trying to advance?
A. Well, from my point of view, I'm an editor of a newspaper. We may not be the world's greatest newspaper, in fact we may not be the greatest newspaper in our own building, but we're good honest journalists and we try and do our job as best as we can do it. This is an issue of massive public importance. The fact that your Inquiry is going on shouldn't stop us from doing good honest journalism as we go ahead. It was our misfortune that through good honest journalism we got this statement after we had already substantiated the story. LORD JUSTICE LEVESON Hang on a minute. I might take issue with the words "good honest". Somebody has broken the confidentiality agreement. Somebody. It may not be the person who gave it to you
A. Hang on, hang on, we stood the story up without the statement. LORD JUSTICE LEVESON Mr Mullin, you've just said "through good honest journalism we got a fourth", namely the statement, but the statement came from somebody, and I'm never going to find out who, who failed to comply with the terms of the confidentiality agreement. Now, that might itself be something that would be of interest to journalists who are doing the job of trying to explain what should happen and what shouldn't happen. I'm not saying it was the person who gave it to you, it's not very difficult to see that somebody within the confidentiality circle gives it to somebody who isn't within the confidentiality circle who gives it to you, so you never know the link. That's one of the problems that I can never unpick, and I recognise that. But that is why it's important, and the concern I have is that knowing the effect of the order, and knowing the inevitable story that would then start to generate, yet knowing that this was going to be the subject of evidence this afternoon, you published it.
A. Can I ask you a question? If I had those three sources, all confirmed, and had the story confirmed on the Wednesday evening, and never received the document, would you say we still could not publish that story? LORD JUSTICE LEVESON I am not here to give you advice, Mr Mullin, actually, but let me postulate that you could have published the story, because you would not know what Mr Coulson was going to say in his statement, and you would not know you could honestly sit there and say, "I simply didn't appreciate that this was going to come up", but by Thursday night you knew exactly what was going to come up.
A. We have used nothing from his statement in our story. Nothing. LORD JUSTICE LEVESON Well, we may not entirely agree about that. Anyway, yes, Mr Barr. MR BARR You asserted in your answers to Lord Justice Leveson that the story was in the public interest, and that's a matter which you picked up at paragraph 14 of your witness statement. You say that: "The Independent on Sunday believes its story was in the public interest. We were revealing that Downing Street's communication chief, at a time when News Corp was bidding for BSkyB, it was bound to be a political issue, held shares and so had a financial interest in what the government might decide." Let's examine that. You were revealing something, to use your verb, that was going to be made public and which you knew was going to be made public by an independent judge-led Inquiry in four days' time, didn't you?
A. Yes, I think that's true.
Q. And you knew from the restriction order that Lord Justice Leveson had concluded that there was a public interest in the witness statement and its contents not being divulged
A. Which is why we never used any of the witness statement.
Q. There we will have to disagree. But isn't the position this: there was in fact no public interest in revealing something that was going to be revealed in Inquiry proceedings four days later?
A. Can I just set a little bit of context here? The key question that we have followed from Andy Coulson going to the Conservative Party office as director of communications, whatever his title was then, is who knew what when? So who knew what when about Andy Coulson's involvement in phone hacking, we've never really got to the bottom of that. As of November, a long time back, six months ago, we learned that there was some issue over his financial settlement with News International when he left in the aftermath of the Clive Goodman and Glenn Mulcaire convictions. If that is an ongoing financial relationship, that clearly is a matter of great significance in which the issue of who knew what when, and that is the key question now we're getting onto the sharp end of the Leveson Inquiry that demands to be answered. Now, my job as an editor of a newspaper is to put in the public domain the key question that has to be answered in this affair, and that's a key question that has to be answered as we go forward in this, and I think putting that in the public mind before Mr Coulson gives evidence is perfectly defensible journalism.
Q. It misses a point, doesn't it, that answer, because you're right that the issue is a matter of public interest, but it's not in the public interest to publish it four days earlier than it's going to come out in a proper and orderly way in a public Inquiry?
A. I don't know what was going to come out in the Inquiry and I don't know how you conduct the Inquiry. I can only speak for the people I edit and we have followed this story, probably behind the Guardian only, for five years and it's quite important to our readers.
Q. That's nonsense as well, isn't it, because you knew full well that the Inquiry was dealing with the shareholding issue because it was in the witness statement?
A. But I don't know how you're going to deal with the shareholding issue. LORD JUSTICE LEVESON You knew the statement was going to be published, didn't you? Because we've published every single statement.
A. Yes, of course. LORD JUSTICE LEVESON We can dance around the topic, Mr Mullin. Let me asks you this question, if you don't mind. Do you understand why I might be concerned about this order of events?
A. Yes, I fully understand that. Of course I do. LORD JUSTICE LEVESON You see, it might be said that for you, the scoop was just too irresistible. Would that be fair?
A. No, I don't think so. I think if we had been that excited about it, we might have put it on the front page. I mean, it's a very good story and it puts in the public mind the key question in the week that Mr Coulson is going to have to give evidence, the key question that has to be answered: who knew what when? LORD JUSTICE LEVESON You are right, perhaps you shouldn't have looked at the statement, because then it would all have been very much easier.
A. I agree with that. LORD JUSTICE LEVESON Which actually might be taken as a message to everybody, that it wouldn't be sensible to look at any of these statements unless you're using them for the purpose of the Inquiry, and if that message gets across, at least something will be achieved. MR BARR You make something of an apology at paragraph 17 of your witness statement. In the light of our debate, would you like to repeat and possibly amplify that apology?
A. Certainly. I made a decision ahead of pressing the button on publication on Saturday and I made that decision with the facts and calculations I made at that time. I think with hindsight, and of course hindsight is a wonderful thing, there certainly would have been scope for me to at least have sought some informal guidance from the Inquiry, but I wouldn't want that to be taken as an acceptance that that decision I made on Saturday night was entirely incorrect. I do apologise for the trouble this has caused the Inquiry and I do apologise for the effort you've had to go to today. It wasn't our intention. We are motivated only by trying to get to the bottom of this issue, as is the Inquiry. LORD JUSTICE LEVESON All right. MR BARR Thank you. Those are all my questions. LORD JUSTICE LEVESON Thank you for coming, Mr Mullin. Thank you for responding to the notice when you did. I appreciate that I used the force of law to require you to, so you didn't have much choice but I'm grateful
A. Delighted to be here. LORD JUSTICE LEVESON I am going to think about what you've said very, very carefully. Thank you very much.
A. Thank you. LORD JUSTICE LEVESON Right. 2 o'clock. (1.00 pm)


Gave a statement at the hearing on 10 May 2012 (AM) ; and submitted 4 pieces of evidence
Gave a statement at the hearing on 10 May 2012 (AM) ; and submitted 2 pieces of evidence


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