Special Daily Politics


Special

Andrew Neil presents live coverage of Rupert Murdoch, his son James, and Rebekah Brooks giving evidence to the Culture, Media and Sport Committee on phone hacking.


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Transcript


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It is 2pm here in Westminster and people across the world are on

:00:13.:00:15.

Rupert Murdoch, his son, James, and Rebekah Brooks as they give

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:00:25.:00:41.

evidence to MPs on the great phone Good afternoon. Welcome to the

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special edition of Daily Politics in an unprecedented day for the

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British Parliament. In just half an hour, the most powerful media boss

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on the planet, Rupert Murdoch, and his son, James, who was also at the

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heart of the Empire, will begin answering questions to a select

:00:56.:01:01.

committee of MPs about the phone hacking scandal which has rocked a

:01:01.:01:05.

British public life and already seen 10 arrests, 6 designations and

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the end of the News of the World. Also giving evidence this afternoon,

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Rebekah Brooks, who has had to resign on Friday as chief executive

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of News International, the British arm of the global operations. She

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was released without charge on Sunday and will face questions

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about what she knew of phone hacking when she edited the Sun

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newspaper and the News of the World and then became boss of all of his

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UK papers. This is a major unique and historic parliamentary occasion.

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Members of the public and the press have been queuing for hours for a

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place at the hearings. They had to be moved from the House of Commons

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to a bigger committee room in a nearby portcullis House. Even that

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can't cope with the numbers wanting to be there. We have room for

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everybody with live and uninterrupted coverage of this

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afternoon's session and we will be discussing the implications with

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:02:09.:02:10.

the press, politicians, and the All that to come over the next

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couple of hours. Joining me Alastair Campbell, David Davies and

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a Times columnist David Aaronovitch. Welcome to you all. It is a key day,

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not just in a phone hacking saga but for Parliament. The leader of

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the opposition Ed Miliband spelt out what he wanted to hear. What

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members of the public will want to know is whether Rupert and James

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Murdoch and Rebekah Brooks have some remorse for what happened and

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are willing to apologise and say that they have let down the British

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people and indeed all the victims of the phone hacking, and also to

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account for what they knew about phone hacking and when they knew it.

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I'm sure they are the kind of questions they will be asked.

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Miliband. David Cameron is Bill in Africa. He has had to cut his

:03:02.:03:06.

journey short and will fly back to the UK later today to address the

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Commons tomorrow. The Deputy Prime Minister was out and about this

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morning. He said today marked the beginning of a shift in relations

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between the media and politicians. Why is it, for years and years and

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years, and I can say this, of the other parties spend their time

:03:25.:03:29.

constantly kowtowing to the press in what I think is an extremely

:03:29.:03:32.

unhealthy way. I think that will change and I think it's a good

:03:32.:03:38.

thing. The meeting today is a start of a process of change. Let's get

:03:38.:03:43.

the latest from Laura Kuenssberg. She is outside the committee room.

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I think it is called there will some room. -- will some room.

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have spent a lot of time here in the last few years and I have never

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seen portcullis House quite like this. You can probably see the

:03:58.:04:03.

queue to get into the room to be there when the Murdochs are giving

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evidence. A couple of other members of the committee had been preparing

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furiously and have just passed me and one of them said to me, it is

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certainly very exciting. A couple of minutes ago I saw James Murdoch

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just over their asking officials for a glass of water, surrounded by

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an entourage of five advisers with him. So, not very long to go now

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and I have to say, this feels like it has been the hottest ticket in

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town. Portcullis House is buzzing. Quite a lot of exciting things

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happen here normally but I have to say, I've never seen anything quite

:04:36.:04:41.

like this. Never seen anything like it. Let's start with the basics.

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Why is there such a frenzy surrounding this? Partly because of

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the scale of the scandal. It has engulfed the Murdoch empire,

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getting close to government and has brought about crisis in the

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Metropolitan Police and also I think the fact that Rupert Murdoch

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himself appears so infrequently in public, I think a lot of your

:05:00.:05:04.

regular viewers will be tuning in this afternoon and will be

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intrigued to learn how he speaks. The voice. As you know, he is not a

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very loud person. He mumbles a bit. I wouldn't be surprised if at some

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point, John Whittingdale asks him to speak up. This is one of those

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stories which has been bubbling away for years and years and years,

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and the Milly Dowler things tip that in one direction. Part of this,

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and I have been in these select committees when you do get a sense

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of media frenzy, but I think this one has got through to the public

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and people out there are talking about this. Rebekah Brooks, a month

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ago could have walked down any street without anybody knowing who

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she is, but now everybody is talking about her. People will be

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interested to see the extent of MPs, who are beginning to reassert their

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authority, to see whether they can do a frenzied job of examining

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these guys who are not used to being questioned about this. What

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are the stakes for Rupert Murdoch? Survival of his empire. Absolutely.

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First off, you have the cases which will flow from this, criminal and

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other. You have an inquiry and an outcome which may end up deciding

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fit and proper or not. The Americans are now starting to take

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an interest and his liberal opponents in America are gathering

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impetus, sympathies, like the foreign corrupt practice, to see if

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they can parlay that back into what is after all, the Crown Jewels.

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James Murdoch's career on the line, too? There seems to be as are the

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big questions about it. The question we are talking about today

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is going to be whether or not there was a culture of ignoring what were

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effectively corrupted journalistic practices. That is what people want

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to know. That is what they will concentrate on. It's very dramatic

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because it's one of the few opportunities the Christians get to

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throw the Emperor to the lions, isn't it? I thought for a second, I

:07:15.:07:25.
:07:25.:07:26.

could see television commentators. What will we see today? You have

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famously appeared in front of they commit that committee, you are the

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paperclip stabbed into your hand when you're losing your rag, so

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what will we see? It's a big day for MPs and the Empire. Will we see

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a rigorous but calm inquiry? Or will it be the modern equivalent of

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the stocks? I think one or two will probably have thought through their

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questions. The ones who do it well, like TV presenters...

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The ones who do it well tend to be forensic. I think David is

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absolutely right but the question for James Murdoch about why he

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authorised these massive pay-offs. Reminding David, when I first

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appeared in the select committee, again, he phoned me on the morning

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and gave me some very good advice about the committee. He said, show

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respect, stay calm and don't lose your temper. Hence the club!

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would be surprised at some point, James Andrew but don't get slightly

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irritated because -- James and Rupert, because we don't have

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respect for them but they will have to show it today. Bayern not

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trained inquisitors, are they? -- this is not a trained inquisitors,

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are they? No, they don't say, I have spotted a weakness here so I

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will carry on. However, I have just been watching the other committee

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talking to the police officers. And actually, that is a fairly

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impressive performance by the MPs. It can be done. They learned a

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lesson from last week. Lastly, that same committee was about

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showboating for the No forensics at all. Everybody jumped on that. I

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think this committee has we learnt from this. I think we will see a

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lot of forensics. The we will find out if it is tag wrestling or mud-

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wrestling in a moment. She is Adam with a reminder of the breathtaking

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events of the past two weeks. -- here is Adam.

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This long-running scandal reached a new level a fortnight ago when it

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emerged the voice mails of the murdered schoolgirl Milly Dowler

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may have been intercepted. As her family met the party because, it

:09:52.:09:58.

was alleged that other victims may have included those caught up in 77

:09:58.:10:03.

and service personnel killed in action. Rupert Murdoch flew in to

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quell the crisis engulfing his empire. Asked what his crisis was

:10:09.:10:15.

that proud to was, he said this one. In the coming days, the close to

:10:15.:10:19.

the News of the World. 168 years after it first rolled off the

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presses. He withdrew his bid for BSkyB. And he lost Rebekah Brooks,

:10:27.:10:31.

who resigned as chief executive of News International. And then at

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Number Ten became involved. David Cameron announced an inquiry led

:10:36.:10:40.

into the affair and of the state of the media and had to justify why he

:10:40.:10:46.

had hired the ex News of the World editor Andy Coulson as his PR

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person. He said he didn't know what was happening at the News of the

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World in terms of packing and resigned as a result of this and I

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decided to give him a second chance. That's all I can do. A former Prime

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Minister made a rare appearance in the Commons. Not the misconduct of

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a few rogues and freelancers, but I have to say, law-breaking on an

:11:09.:11:13.

industrial scale. Ed Miliband piled on the pressure. We need leadership

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to get to the truth of what happened. But the Prime Minister is

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hamstrung by the decisions he made and his refusal to face up to them.

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Meanwhile, the police gathered evidence for two investigations,

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Operation Weeting and Operation Elveden into allegations officers

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were paid by the press for information. They have been a

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number of arrests including Andy Coulson, Rebekah Brooks and the

:11:42.:11:45.

former deputy editor of the News of the World, Neil Wallis. He was

:11:45.:11:50.

hired by Scotland Yard to help to their media work with serious

:11:50.:11:54.

consequences for senior officers. At the weekend, this led to the

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resignation of the Metropolitan Commissioner, Sir Paul Stephenson,

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and yesterday John Yates, left as well. Two weeks of revelations that

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have rocked the media, the police and politics.

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Adam planning reporting on a truly breathtaking events -- Adam

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planning. It has dangers to take a sleeper. -- Adam Fleming. Let's

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look at the politics of this with my guests. David Cameron is out of

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the country but very much in the frame. Yes, the Labour Party, Ed

:12:30.:12:37.

Miliband, his try and keep him in the frame, but I think, Alastair

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said this engaging people, but I don't think politics does, frankly.

:12:44.:12:49.

Two polls yesterday, one went in one direction and one went the

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other. What do you say to that? Mr Miliband is getting good press

:12:53.:12:57.

reviews but they're not moving his way necessarily. No, but the terms

:12:57.:13:01.

of the debate a changing and I think David Cameron is losing a lot

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of respect for people at the moment because the one thing people want

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from the Prime Minister is a sense of good judgment. Every time he

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looks like he doesn't get this whole area of concern about his

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relationship with Andy Coulson. Then, I think he just erodes his

:13:18.:13:23.

own respect and authority. I think at some point is going have to say,

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I made a mistake. I shouldn't have done it and I realise that. Here's

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what I want to learn from it but he appears very reluctant to do it.

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it time to admit that it was a mistake? That's one aspect of this

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whole thing, Twenty20 hindsight apply to everybody. Let's take the

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decision to hire Andy Coulson in the first place. He got

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undertakings from him and he carried out a check on him. When he

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came into government, he would have had a positive check. By the time

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he moved into government, the Prime Minister as he had become, knew a

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lot more about the accusations then when he appointed him. Yes, but

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politics is full of accusations and most of them are wrong. He would

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have had a cheque. This plays back into the police. He would have

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consulted with the Metropolitan Police and said, is there anything

:14:23.:14:27.

in this and I suspect, what came back was anything not. --

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absolutely not. Given a choice to listening to Labour comments, on

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the one hand, and what was a concrete review on the other, who

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would you believe? I would believe the review. I doubt... So you don't

:14:43.:14:48.

think he should admit it was a mistake? I think there's been a lot

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of hindsight. He said last week, if it turns out that Andy Coulson lied

:14:52.:14:58.

to him, it will involve prosecution. I think people think it doesn't

:14:58.:15:03.

affect him. This isn't Tyneside because at the time, people were

:15:03.:15:07.

saying this story is not going to go away. There are too many

:15:07.:15:11.

unanswered questions. Why was he so desperate to get this guy and the

:15:11.:15:17.

other guy? He wanted Alastair Campbell. He wanted a lookalike for

:15:17.:15:22.

you, David. Journalistically, you know what this is. Even if somebody

:15:22.:15:27.

like Andy Coulson were not guilty, we don't actually know what he was

:15:27.:15:32.

guilty of, what we do know is he worked in the world of the tabloid

:15:32.:15:36.

press. The tabloid press is famous for this kind of sharp practice,

:15:36.:15:40.

and even if it hadn't done something like this, he would have

:15:40.:15:50.
:15:50.:15:56.

Worded to work before he joined Tony Blair? The tabloid press.

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part of the problem as it has turned out, Alastair Campbell is

:16:01.:16:05.

the Tories wanted their Alastair Campbell. I remember hearing it off

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the record, Lee Mead and Alastair Campbell. Particularly in the

:16:11.:16:14.

summer of 2007 when Mr Brown was doing well when he became leader.

:16:14.:16:20.

That is when Andy Coulson was hired. They wanted someone who had good

:16:20.:16:25.

relations with News International, as you had. It is lucky for Mr

:16:25.:16:29.

Blair and Mr Brown, and for use this has happened on the Andy

:16:29.:16:36.

Coulson, David Cameron watch. It could have happened on yours?

:16:36.:16:40.

could have done. But I don't think we could have been as sucked into

:16:40.:16:45.

it. I did all sorts of things as a journalist, but I am confident I

:16:45.:16:50.

never broke the law. My point is, Mr Cameron is suffering because of

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his very close relations he developed after 2007... You have

:16:57.:17:02.

the same relations? He is suffering because of the judgment he showed

:17:02.:17:07.

in hiring Andy Coulson. And second to that, he is suffering because he

:17:07.:17:13.

allowed himself to be ensnared by the Murdoch empire, having first

:17:13.:17:19.

decided he wouldn't do. It is true, we try to get a better relationship

:17:19.:17:25.

with Murdoch, the Daily Mail and the Express and we exceeded. But we

:17:25.:17:29.

did not do, and in Government what we should have done is take them on

:17:29.:17:36.

in a way Tony did not want to do. It all happened on your watch.

:17:36.:17:43.

should have taken action when the information report was published.

:17:43.:17:49.

Until the last couple of weeks, it was still going on. On the

:17:49.:17:55.

conservative side we know about. But Saturday, July 2nd just gone.

:17:55.:18:00.

Leading Labour figures, James Purnell, Tessa Jowell, the mind you

:18:00.:18:07.

back as leader of the Labour Party, David Miliband partied in the

:18:07.:18:14.

Cotswold with James Murdoch. the director of the BBC if I

:18:14.:18:21.

remember. It was wrong of you to leave out the director of the BBC

:18:21.:18:26.

from that list all the presenter, Jon Snow from Channel Four News. It

:18:26.:18:31.

is about the fear politicians have had, not so much the fear of the

:18:31.:18:35.

press, but the fact they wanted something from the press. They have

:18:35.:18:42.

wanted endorsements and these relationships. There is an issue to

:18:42.:18:47.

this, it is about the fear of the press in the sense Rebekah Brooks

:18:47.:18:53.

in particular, the paper she edited actually went out to damage people.

:18:53.:18:58.

She told Tom Watson she was going to do that. That is like Tom Watson

:18:58.:19:03.

has been so vigorous about this. What is that about? Today isn't

:19:03.:19:09.

just about the Murdochs and Rebekah Brooks answering questions. The two

:19:09.:19:15.

most important policeman in this country were forced to resign. The

:19:15.:19:19.

Metropolitan Police Commissioner, Paul Stephenson and John Yates gave

:19:19.:19:22.

evidence to another select committee about phone hacking. They

:19:22.:19:27.

both came a cropper because they hired former deputy editor of the

:19:27.:19:32.

News of the World, Neil Wallis to provide them with PR advice. Paul

:19:32.:19:35.

Stephenson was asked if he tried to dissuade the Guardian from its

:19:35.:19:39.

phone hacking campaign when he went to see them.

:19:39.:19:43.

The Guardian carried a report a couple of days ago that you have

:19:43.:19:48.

had a meeting with them to say you had tried to persuade them the

:19:48.:19:53.

coverage of phone hacking was exaggerated and incorrect. And that

:19:53.:20:00.

you had a meeting to that effect in December 2009, is that right?

:20:00.:20:04.

Paul Stephenson was then asked why he should question the Guardian's

:20:04.:20:07.

journalism and pointed the finger firmly at Assistant Commissioner

:20:07.:20:13.

John Yates. Why would you go to a newspaper like the Guardian to

:20:13.:20:18.

persuade them they were getting it wrong. I presume you looked at the

:20:18.:20:21.

evidence and over the case to be in a position to give them that

:20:21.:20:27.

assurance? I am the Commissioner of the Met and I have senior grade

:20:27.:20:33.

Chief Constable's like John Yates. He gave me assurances there was

:20:33.:20:38.

nothing new coming out of the Guardian article. I think I have a

:20:38.:20:43.

right to rely on those assurances and I had no reason to doubt the

:20:43.:20:46.

first operation. I went to the Guardian because they continued to

:20:46.:20:50.

run the campaign and I acknowledged in my speech, we should be grateful

:20:50.:20:55.

for them to do that. I went to them because I did not understand it.

:20:55.:20:59.

The resigning head of the Metropolitan Police, probably his

:20:59.:21:02.

last appearance before a select committee in that role, which is

:21:02.:21:07.

still going on. It is a difference select committee to the one we are

:21:07.:21:14.

going to live at 2:30pm. Excepted from John Yates, who had supposedly

:21:14.:21:17.

looked at the inquiry that the Guardian was barking up the wrong

:21:17.:21:25.

tree. You could not get it more wrong could you Alastair Campbell?

:21:25.:21:29.

A feel a bit sorry for him, because I think the man at the top is

:21:29.:21:36.

entitled to trust people one down. The more you hear about this first

:21:36.:21:42.

inquiry and John Yates, you wonder how that man has been in charge

:21:42.:21:44.

against a campaign against terrorism. It is probably a good

:21:44.:21:49.

thing he has gone. The reason people are concerned, the police

:21:49.:21:54.

have relations with all sorts of media, the BBC and other newspapers

:21:54.:21:59.

as well. The reason why the police have entered the frame in the

:21:59.:22:03.

centre, is there is a feeling centre, is there is a feeling

:22:03.:22:06.

evidence is mounting a combination of News International and senior

:22:06.:22:10.

policemen work together to close down the investigation. Do you

:22:10.:22:16.

agree? What you have got his two things. You have incompetence.

:22:16.:22:21.

Whether it is John Yates for Andy Hayman, neither of them have

:22:21.:22:26.

impressed in terms of their handling of this. And second, you

:22:26.:22:31.

have this great big, too difficult basket into which all of the News

:22:31.:22:34.

International stuff was pushed because they knew it mainly to a

:22:34.:22:39.

political problem, a certain amount of bad press in the News of the

:22:39.:22:43.

World. It is not a conspiracy in the normal sense of the word, it is

:22:43.:22:50.

a combination of competence and not wanting to take on that animal.

:22:50.:22:55.

This isn't the finest aspect of policing. Let's not be crass,

:22:55.:23:00.

terrorism is much more fun. It you want to be a policeman, what do you

:23:00.:23:04.

want to spend your time on question of people wonder why this went to

:23:04.:23:08.

the anti-terrorist squad in the first place. If they said they did

:23:08.:23:12.

not have the time, why didn't they pass it on to a more mundane part

:23:12.:23:18.

of the Met? Why after of the 2006 Information

:23:18.:23:23.

Commissioner's report, why wasn't it taken seriously? When Rebekah

:23:23.:23:29.

Brooks gave evidence in 2003, why didn't we jump up and say, it is a

:23:29.:23:35.

criminal offence! Nobody did. me come back to the point then that

:23:35.:23:44.

people wonder about Rupert Murdoch but they have never accused him of

:23:44.:23:53.

being a terrorist. Why did it end up with the anti- terrorist group?

:23:53.:23:58.

Party -- partly an accident because the Royal protection is part of the

:23:58.:24:03.

anti- terrorist group. There was a Royal hacking and that is why it

:24:03.:24:07.

got dealt with. Second, because they trust the counter-terrorist

:24:07.:24:12.

unit to be more secure than others. That is why when Damian Green was

:24:12.:24:16.

arrested, the MP was arrested by the police it was the counter-

:24:16.:24:20.

terrorism unit, who incidentally could not find his house in the

:24:20.:24:25.

village of Kent. They went to the wrong house? It would have been

:24:25.:24:30.

very scary for the man with the biggest house in the village!

:24:30.:24:34.

are just learning John Yates who is giving testimony to the same

:24:34.:24:39.

committee as Paul Stephenson, he said he spoke to her Llewellyn,

:24:39.:24:44.

David Cameron's chief-of-staff, in 2010 and offered to give him a

:24:44.:24:49.

briefing on the language around the phone hacking, but Eddie Llewellyn

:24:49.:24:55.

decline that offer. This is the biggest crisis for the Metropolitan

:24:55.:25:01.

Police in modern times. Agreed? seems most peculiar. When I look at

:25:01.:25:06.

the resignation of Paul Stephenson, I wasn't sure why he resigned. He

:25:07.:25:11.

went to Champney's for free. It was declared in his proper interest,

:25:11.:25:17.

and as far as I know he did not break the code. So how has he got

:25:17.:25:22.

in this business of Neil Wallis being employed, former deputy

:25:22.:25:25.

editor of the News of the World by somebody who turns out to be his

:25:25.:25:30.

friend. Somebody in the Home Affairs Committee said it was the

:25:30.:25:35.

lack of diligence done on the employment of Neil Wallis. He was a

:25:35.:25:38.

friend of the police he was brought in to do it friend of the police

:25:38.:25:45.

job. It is the interlocking network. We have learned it between News

:25:45.:25:51.

International and the politicians on the left and the right. But also

:25:51.:25:55.

between News International and the police. In the Metropolitan Police

:25:55.:25:59.

press department there are former News International employees, why

:25:59.:26:05.

don't they just merge and form one press office? You will know from

:26:05.:26:09.

the days of being an editor, crime correspondents have kept as close

:26:09.:26:15.

as they can to the police. But this has surprised me. Again, I think

:26:15.:26:18.

Paul Stevenson probably reached a judgment that his own judgment

:26:18.:26:22.

would probably be called into question for the fact that with

:26:22.:26:26.

this investigation still going on, it is just as extraordinary that

:26:26.:26:30.

David Cameron could not see the dangers of Andy Coulson, neither

:26:30.:26:37.

could they see the dangers. called for Ian Blair's resignation

:26:37.:26:46.

after the shooting of Jean Paul Dominguez. But he hung on and his

:26:46.:26:56.
:26:56.:26:58.

reputation went down. It is about five minutes to go until we expect

:26:58.:27:02.

the Murdochs to appear in front of the select committee and we will be

:27:02.:27:06.

passing to the Wilson Room in Portcullis House. But let's remind

:27:06.:27:11.

ourselves of the key players in today's performance. First up is

:27:11.:27:16.

the man at the top, Rupert Murdoch. 80 years of age, he is chairman of

:27:16.:27:21.

News Corporation which wanted full control of BSkyB. He has about 40%

:27:21.:27:26.

at the moment. The committee will want to know what he knew about

:27:26.:27:30.

phone hacking at the News of the World. What did he know and when

:27:30.:27:36.

did he know it? Then there will be his son James, chairman of News

:27:36.:27:42.

Corporation in Europe and Asia. The committee will want to know why he

:27:42.:27:47.

authorised payments to victims of hacking. Then at around 3:30pm when

:27:47.:27:51.

they have gone, I assume we will hear from Rebekah Brooks who was

:27:51.:27:56.

until last week, chief executive of News International and was editor

:27:56.:27:59.

of the News of the World when Milly Dowler's telephone was hacked into

:28:00.:28:04.

us. She was arrested and questioned on Sunday but denies any knowledge

:28:04.:28:10.

of what went on at her newspaper. There are two key political figures

:28:10.:28:14.

about to take centre stage. The Conservative MP, John Whittingdale

:28:14.:28:19.

who chairs the culture committee and last week took the step of

:28:19.:28:23.

issuing a Parliamentary summons to compel the Murdochs to attend this

:28:23.:28:27.

committee session. Also sitting on the committee is a Labour MP called

:28:27.:28:32.

Tom Watson. He has been at the forefront of the campaign to expose

:28:32.:28:39.

phone hacking. What are the key points you will be looking out for

:28:39.:28:45.

this afternoon? What do you want to find out? For me it is the James

:28:45.:28:49.

Murdoch authorisation of these huge payments out of court settlements.

:28:49.:28:53.

He said in one of the few statements he has made, he was not

:28:53.:29:00.

in full possession of the fact. Presumably now he is. So what were

:29:00.:29:06.

the full facts? Rupert Murdoch will be questioned whether it it is his

:29:06.:29:11.

culture that has permeated all levels of the organisation. And for

:29:11.:29:15.

Rebekah Brooks, they will be quizzing her about what she said to

:29:15.:29:23.

the committee in the past. During the Watergate scandal a senator

:29:23.:29:31.

became famous for asking "what did Juno And When Did You Know It"?

:29:31.:29:36.

They could take a leaf out of his book? It will be more specific than

:29:36.:29:42.

that. And also at the point when you decide to close the News of the

:29:42.:29:47.

World, a new mood there was a problem. He did not choose to sack

:29:47.:29:53.

Rebekah Brooks, you just shut down been News of the World. Why didn't

:29:53.:30:00.

you get to the bottom of its then and there. And for Rupert Murdoch,

:30:00.:30:08.

this does go back to Les Hinton. has also had to resign. Also the

:30:08.:30:11.

common denominator is Rupert Murdoch. What we your instructions

:30:11.:30:17.

to Les Hinton at that time? David, what would you like to find out

:30:17.:30:23.

this afternoon? I want to know if they decided to close their ears to

:30:23.:30:29.

what is going on. We will shut this down, we won't let it happen. We

:30:29.:30:33.

have some suspicions but we won't run with it. Or whether they

:30:33.:30:37.

genuinely didn't have their eye on the ball until it was too late and

:30:37.:30:41.

then they did not have the capacity to respond. A thing I am the only

:30:41.:30:48.

person in this room who has not met Rupert Murdoch. I shall be very

:30:48.:30:58.
:30:58.:30:58.

interested to see how that question It's about the advice of not losing

:30:58.:31:02.

your temper and being calm, I think if there is the slightest sign of

:31:02.:31:07.

them getting irritated, it will backfire on them. People will be

:31:07.:31:10.

interest the see whether they have worked better strategy. To get

:31:10.:31:14.

themselves though it. I'm not sure 1 hour will be long enough. It

:31:14.:31:19.

could overrun. And I hope it does because there's a lot of serious

:31:19.:31:24.

questions. The demeanour is incredibly important. They should

:31:24.:31:28.

take the emotion out of the questions and find the facts in the

:31:28.:31:34.

questions put up and deal with the facts. Rupert Murdoch is not used

:31:34.:31:39.

to this kind of public accountability. Hasn't he appeared

:31:39.:31:46.

before the Senate in the USA. was pretty uncontroversial. It

:31:46.:31:51.

wasn't like this. We are just watching pictures of people going

:31:51.:31:57.

into the committee. It has gone at 2:30pm, so they are running late.

:31:57.:32:04.

Would it be sensible if either of the Murdochs intentionally gave us

:32:04.:32:08.

new information today? If I was them, I would. I would start with

:32:08.:32:15.

an apology, up front, and a completely unlimited apology, not

:32:15.:32:19.

try to be reticent about it. I'm sorry my employees let you down

:32:19.:32:25.

kind of thing. I would try and say, what I have managed to find out in

:32:25.:32:31.

the time since the crisis blew up, as it were, and at least Telegraph

:32:31.:32:37.

to the committee that I intend to be straightforward with them.

:32:37.:32:41.

People have said Murdoch will announce his resignation. I will

:32:41.:32:48.

believe that when I see it. resignation in favour of who?

:32:48.:32:51.

it is difficult for two men, particularly the older one, who is

:32:51.:32:57.

used to be so powerful, being interviewed by people they employ,

:32:58.:33:01.

and used to being treated with huge respect and deference by

:33:01.:33:05.

politicians, some of them, I suspect, are now going to give them

:33:05.:33:10.

a tough time. One big problem with people this powerful is they do

:33:10.:33:13.

attract coteries and so on. They have people running around after

:33:13.:33:18.

them. They tell them they are effectively immortal. I think that

:33:18.:33:28.

happens. It happens everywhere. Power attracts it. This is a

:33:28.:33:30.

wonderful experience if the committee do it right because what

:33:31.:33:35.

it shows is that nobody is so powerful they are not answerable to

:33:35.:33:38.

a committee. The committee has got to ask the questions correctly

:33:38.:33:41.

force up my understanding is they had been training over the past

:33:41.:33:47.

couple of days for this. The way the party leaders trained for the

:33:47.:33:53.

debates. They have been having mock sessions and so on. The one thing

:33:53.:34:02.

they have to avoid, I would suggest, is the, "You can't handle the

:34:02.:34:11.

tricky" Moment. Because anger it could rebound on them. -- you can't

:34:11.:34:20.

handle the truth. We can see, with police protection to help him get

:34:20.:34:24.

through the people forming along the corridor, in this relatively

:34:24.:34:30.

new building, portcullis House, James Murdoch and Rupert Murdoch,

:34:30.:34:34.

his father, going into the committee room. You can see the

:34:34.:34:40.

rather lovely atrium there. They will be nervous. I remember that

:34:40.:34:45.

little walk and I was nervous on several occasions. These MPs, some

:34:45.:34:50.

of them will have done their homework. I think most important

:34:50.:34:56.

thing is they have bought through every possible question and answer.

:34:56.:35:00.

They are taking their seats now in front of the committee. Mr Murdoch

:35:00.:35:04.

senior on the left. And James Murdoch on the right. Get your

:35:04.:35:12.

glass of water, I suspect. Mr Murdoch is not used to speaking

:35:12.:35:22.
:35:22.:35:27.

off-the-cuff. He is more used to We would like the opportunity to

:35:27.:35:33.

make a statement. Would you allow us? The committee discussed that

:35:34.:35:42.

earlier and we do feel be a lot of questions and we hope all you want

:35:42.:35:46.

to say well, to question. If you feel that is not the case, please

:35:46.:35:50.

make the statement at the end. Excuse me, can we not have that,

:35:50.:35:54.

please? The in that case, we would like to submit the statement in

:35:54.:36:01.

writing. That would be acceptable. Could we please remove the people

:36:01.:36:11.
:36:11.:36:23.

STUDIO: We are keeping the cameras on the chairman of the committee.

:36:24.:36:28.

There was a bit of a protest just as we got out of the way as James

:36:28.:36:33.

Murdoch asked for the committee's permission to make a statement. It

:36:33.:36:43.
:36:43.:36:44.

wasn't really granted. They have This is a special meeting of the

:36:44.:36:49.

committee. A follow-up to the committee the committee held in the

:36:49.:36:52.

2009 into press standards, privacy and libel during which we took

:36:52.:36:56.

evidence on the extent of the phone hacking which are taking place in

:36:56.:37:01.

the News of the World. In our report last year, we stated that we

:37:01.:37:05.

thought it was inconceivable that only one reporter had been involved.

:37:05.:37:10.

In the last few weeks, it has emerged that, not only evidence has

:37:10.:37:15.

come out which I think has vindicated this conclusion, but

:37:15.:37:18.

also abuses have been revealed which have shocked the entire

:37:18.:37:24.

country. It's also clear parliament has been misled. We are very

:37:24.:37:27.

conscious in the committee that there is an ongoing police

:37:27.:37:30.

investigation. And possible criminal proceedings to follow.

:37:30.:37:35.

This committee would not wish to jeopardise that. However, we are

:37:35.:37:38.

encouraged by the statements which have been made by all the witnesses

:37:38.:37:42.

this afternoon that they wish to co-operate with the committee and

:37:42.:37:46.

help us to establish the truth. So, as our first witnesses this up in,

:37:46.:37:53.

can I welcome Rupert Murdoch and the deputy chief operating officer

:37:53.:37:56.

and chairman and chief executive of News Corp International, James

:37:56.:37:59.

Murdoch. Can I thank you for making yourself available to the committee

:37:59.:38:07.

this afternoon. Thank you, Mr Chairman. We are more than prepared

:38:07.:38:12.

to. If I could start the James Murdoch. You made a statement on

:38:12.:38:17.

7th July in which you stated the paper had made statements to

:38:17.:38:20.

Parliament without being in possession of the facts and that

:38:20.:38:24.

was wrong. You essentially admitted Parliament had been misled in what

:38:24.:38:29.

we had been told. Can you tell us to what extent where we misled when

:38:29.:38:33.

you became aware of it? Thank you very much and first of all I would

:38:33.:38:41.

like to say just how sorry I am and how sorry we are two particularly

:38:41.:38:45.

the victims of a legal voice mail interceptions and to their families.

:38:45.:38:52.

It's a matter of great regret. Mind, my father's, and everyone at News

:38:52.:38:56.

Corporation and these are standards, these actions do not live up to the

:38:56.:39:02.

standards that our company aspires to. It is our determination to both

:39:02.:39:07.

put things right, make sure these things don't happen again, and to

:39:07.:39:12.

be the company that I know we have always aspired to be. As for my

:39:12.:39:18.

statement, which I believe it was around the closure of the News of

:39:18.:39:28.
:39:28.:39:30.

the World newspaper,... This is the most humble day of my life.

:39:30.:39:34.

statement around the closure of the News of the World newspaper, where

:39:34.:39:41.

I stated that the company had not been in full possession of the fact

:39:41.:39:44.

when certain statements were made to this committee, was referring to

:39:44.:39:51.

the emergence of new facts, largely that came about at the end of 2010,

:39:51.:39:56.

as the due process of a number of civil trials reached their point

:39:56.:40:00.

Word document disclosure and evidence disclosure made it

:40:00.:40:07.

apparent to the company and to myself at that time that, indeed,

:40:07.:40:10.

there was reason to believe that, potentially, more people had been

:40:10.:40:14.

involved in the News of the World illegal voice mail interceptions

:40:14.:40:21.

from before. That was new evidence and information at the time that

:40:21.:40:25.

post-dated the 2009 hearings. That is what I was referring to.

:40:25.:40:29.

Subsequent to our discovery of that information, in one of the civil

:40:29.:40:38.

trials at the end of 2010, which I believe was the CNN Mellor trial,

:40:38.:40:42.

the company immediately went to look at additional record around

:40:42.:40:48.

the individual involved -- CNN a laugh. We alerted the police who

:40:48.:40:53.

restarted on that basis, the investigation that is now under way.

:40:53.:40:59.

And, since then, the company has admitted liability to victims of a

:40:59.:41:03.

legal voice mail interception, apologised unreservedly, which I

:41:03.:41:08.

repeat today, to those victims, and the company has also set up a

:41:08.:41:11.

compensation scheme independently managed by a former High Court

:41:11.:41:17.

judge to be able to deal with legitimate claims coming from

:41:17.:41:21.

victims of those terrible incidents. Voice mail interception. Those are

:41:22.:41:27.

the actions which were taken as soon as new evidence emerged, so

:41:27.:41:31.

when I made a statement about not being in possession of the fact, it

:41:31.:41:36.

was those facts at that point, were in the future, and it was the due

:41:36.:41:43.

process of the civil trial that that evidence really emerged for us.

:41:43.:41:50.

And we acted as swiftly and transparently as possible. When

:41:50.:41:55.

this committee took evidence in at 2009, we heard from the managing

:41:55.:42:00.

editor of the News of the World, the legal manager of News

:42:00.:42:06.

International and News of the World editor, the former editor Andy

:42:06.:42:11.

Coulson and Les Hinton, the former chairman. All of them told us that

:42:11.:42:14.

there had been a thorough investigation, no evidence had ever

:42:14.:42:18.

been found that anybody else was involved for that clearly was not

:42:19.:42:26.

correct. Were any of them lying to his committee? Mr Thurnham, the

:42:26.:42:35.

company relied on three things -- Mr Chairman. Until the new evidence

:42:35.:42:45.
:42:45.:42:46.

emerged, the company relied on a police investigation in 2007,

:42:46.:42:51.

before I was involved. I became involved in at News Corporation at

:42:51.:42:58.

the end of 2007. In the 2007 period, there was a police investigation,

:42:58.:43:03.

successful prosecutions against two individuals, and the editor of the

:43:03.:43:08.

News of the World resigned. The company relied on both the police

:43:08.:43:13.

having closed the investigation and repeated assertions that there was

:43:13.:43:16.

no new evidence for them to reopen their investigation, the company

:43:16.:43:24.

relied on be PCC, but said there was no more to this at the time.

:43:25.:43:29.

The company relied on the legal opinion, outside counsel, that was

:43:29.:43:34.

brought in a related to those matters with respect to their

:43:34.:43:37.

review, and had issued a clear opinion that there was no

:43:37.:43:44.

additional illegality than the two individuals involved before. The

:43:44.:43:51.

company relied on those facts and for the company in at 2008-nine, it

:43:51.:43:55.

was not clear that there was a reason to believe that those

:43:55.:44:00.

matters were anything other than settled matters and in the past.

:44:00.:44:03.

visit your test the need to this committee the individuals who gave

:44:03.:44:07.

us evidence in 2009, none of them knew at that time what's been going

:44:07.:44:12.

on? -- Is it your testimony? I do not have direct knowledge of what

:44:12.:44:16.

they knew and what time, but I can tell you that the critical new

:44:16.:44:22.

facts, as I saw them, and as the company saw them, really emerged in

:44:22.:44:28.

the production of documents and evidence in the civil trial at the

:44:28.:44:38.

end of 2010. And the duration from 2008 until the end of 2010, the

:44:38.:44:43.

length of time it took for that to come Clear and for that real

:44:43.:44:49.

evidence to be there, is a matter of deep frustration, because I know

:44:49.:44:53.

and sympathise with the frustration of this committee. It is a matter

:44:53.:44:58.

of real regret that the facts could not emerge and could not be got

:44:58.:45:07.

into, to my understanding, Foster. -- faster. You are made it clear

:45:07.:45:11.

the information we were giving was incorrect. Have you established, as

:45:11.:45:21.
:45:21.:45:23.

well as Clive Goodman, was involved I am sorry, can you repeat that?

:45:23.:45:27.

Who as well as Clive Goodman was involved in phone hacking at the

:45:27.:45:31.

News of the World? As I think you made it clear earlier Mr Chairman,

:45:32.:45:35.

there have been a number of arrests of former News of the World

:45:35.:45:41.

employees. These are matters for current criminal investigations,

:45:41.:45:46.

and I think it is difficult for me to comment in particular around

:45:46.:45:51.

some of those individuals. Have you carried out your own investigation

:45:51.:45:56.

since the discovery of this information, to find out the extent

:45:56.:46:05.

of involvement in phone hacking at the News of the World? We have

:46:05.:46:09.

established a group in the company co-operating very closely with the

:46:09.:46:14.

police on their investigations. Their investigation is brought with

:46:14.:46:18.

respect to journalistic practices and in particular journalistic

:46:18.:46:22.

practices at the News of the World. And the policy and direction the

:46:22.:46:27.

company has given them is to co- operate with the police and provide

:46:27.:46:31.

information and evidence that the company believes and they believe

:46:31.:46:37.

is relevant to those investigations. Sometimes prayer -- pro actively

:46:37.:46:42.

and sometimes in response to those requests. I think the provision of

:46:42.:46:45.

the new information to the police in the first place when there was

:46:45.:46:52.

no ongoing police investigation, led to, in part, the reopening of

:46:52.:46:59.

this new investigation being established. I hope that can be

:46:59.:47:04.

established as being proactive to getting to the right place in

:47:04.:47:08.

finding out the facts, understanding all of the

:47:08.:47:14.

allegations that are coming in and moving forward to help the police

:47:14.:47:18.

in the successful completion of the important, serious work they are

:47:18.:47:24.

doing. And a departure from your company in the recent few days of

:47:24.:47:29.

Tom Crone, of Rebekah Brooks and of Les Hinton, is it because any of

:47:29.:47:39.

them acknowledged phone hacking? have no knowledge, and there is no

:47:39.:47:46.

evidence that I am aware of, that Rebekah Brooks, or Les Hinton or

:47:46.:47:51.

any of those executives had knowledge of that. And their

:47:51.:47:55.

assertions, certainly Rebekah Brooks and her assertions to meet

:47:55.:48:01.

that her knowledge of those things has been clear. Nonetheless, those

:48:01.:48:05.

resignations have been accepted but it is important on the basis there

:48:06.:48:11.

is no evidence today that I have seen or I have any knowledge of,

:48:11.:48:15.

but there was any impropriety by them. I am going to turn to Tom

:48:15.:48:19.

Watson. Mr Murdoch's senior, Good

:48:19.:48:25.

afternoon.. You have stated News Corp has a

:48:25.:48:29.

zero tolerance to wrongdoing by employees, is that right? It is,

:48:29.:48:35.

yes. In 20th October 10 Did you still it believed to be true when

:48:35.:48:45.

you made your speech, when you said "let me be clear we will go in

:48:45.:48:53.

search of the truth". Yes. That is what the police are investigating

:48:53.:48:57.

and we are helping them with. acknowledge you were misled?

:48:57.:49:05.

Clearly. Can I take you back to 2003? Are you aware in March of

:49:05.:49:07.

that year Rebekah Brooks gave evidence to this committee

:49:07.:49:14.

admitting paying the police? I am now aware of that. I was not aware

:49:14.:49:20.

of it at the time. I'm also aware she amended that considerably very

:49:20.:49:26.

quickly afterwards. I think she amended its seven or eight years

:49:26.:49:31.

after it. Sorry! Did you or anyone else at your in this --

:49:31.:49:38.

organisation investigate this at the time? No. Can you explain why?

:49:38.:49:47.

I did not know of it. I am sorry, if I can just say something? This

:49:47.:49:55.

is not an excuse. Maybe it is an explanation, the News of the World

:49:55.:50:01.

is less than 1% of the company, I employ 53,000 people around the

:50:01.:50:07.

world hoo-ha great and ethical and distinguished people. They are

:50:07.:50:14.

professionals in their own right. And I am spread watching and

:50:14.:50:22.

appointing people with whom I trust to run those divisions. I do accept

:50:22.:50:27.

you have many distinguished people who work for your company. You what

:50:27.:50:31.

ultimately responsible for the Government source of News Corp. So

:50:31.:50:38.

I want to establish who knew about wrong doing at the time. If I can

:50:38.:50:44.

take you to 2006, and when Clive Goodman was arrested and convicted

:50:44.:50:51.

of intercepting voice mails, where you made aware of that? I was

:50:51.:50:56.

certainly made aware of it when he was convicted. What did News

:50:56.:50:59.

International do subsequent to the rest of Clive Goodman and Glenn

:50:59.:51:05.

Mulcaire to get to the facts? worked with the police with a

:51:05.:51:09.

further investigation and eventually we quickly appointed a

:51:09.:51:19.
:51:19.:51:21.

Bury leading firm of lawyers in the city to investigated further.

:51:21.:51:25.

would like to finish my line of questioning. What did you

:51:25.:51:30.

personally do to investigate that after Clive Goodman went to prison?

:51:30.:51:38.

You were obviously concerned about it. I spoke to Les Hinton, who told

:51:39.:51:48.
:51:49.:51:49.

me about it. Can I ask in 2008, why did you not dismiss News of the

:51:49.:51:53.

World chief reporter, Neville far back following the Moseley case?

:51:53.:52:03.
:52:03.:52:04.

had never heard of him. Despite a judge at making clear that he set

:52:04.:52:08.

out he went out to set out to blackmail two of the women involved

:52:08.:52:14.

in the case? That is the first I have heard of that. So none of your

:52:14.:52:17.

UK staff draw your attention to this serious wrongdoing even though

:52:17.:52:27.

the case received extensive media attention? Maybe my son can answer

:52:27.:52:33.

that. I will come to your son in a minute. And despite blackmail

:52:33.:52:36.

resulted in a 14 year sentence, nobody in your UK company brought

:52:37.:52:42.

this to your attention? blackmail charges, no. Do you think

:52:42.:52:49.

that is because they thought you might think nothing of it? No. I

:52:49.:52:56.

cannot answer, I do not know. you agree with Mr Justice e d when

:52:56.:53:00.

he said the lack of action discloses a remarkable state of

:53:00.:53:08.

affairs at News International? Mr Murdoch, a judge found a chief

:53:08.:53:16.

reporter guilty of blackmail. It was widely reported, he said it was

:53:16.:53:23.

a remarkable state of affairs. didn't he put him in jail? It was a

:53:23.:53:31.

civil case. Were you aware that News

:53:31.:53:33.

International commissioned an investigation into News

:53:33.:53:36.

International e-mails by the solicitors' firm, Harbottle &

:53:36.:53:46.

Lewis? Yes, I did not appoint them but I was told of it happening.

:53:46.:53:49.

claimed in the Wall Street Journal Harbottle & Lewis are made a major

:53:49.:53:59.
:53:59.:54:03.

mistake. What a mistake way you referring to? -- what mistake way

:54:03.:54:13.
:54:13.:54:15.

you referring to? I think again that is a question for James. But a

:54:15.:54:18.

we re-examined that. We found things we admittedly went to

:54:18.:54:25.

council with to get advice on how to present it to the police.

:54:25.:54:29.

their written response to these questions, are you aware News

:54:29.:54:33.

International stated that both John Chapman and Daniel cloak reviewed

:54:33.:54:37.

these e-mails before RIF -- affording them to Harbottle &

:54:37.:54:43.

Lewis? Know. So nobody in the company told you that two of your

:54:43.:54:48.

executives had reviewed the e- mails? I thought then, everything

:54:48.:54:54.

had been sent to them. You are a word Lord MacDonald QC has refute

:54:54.:55:02.

the e-mails on behalf of News International are you not? Yes.

:55:02.:55:10.

you aware he stated evidence... reported them to News International.

:55:11.:55:16.

He found evidence of indirect hacking, breaches of national

:55:16.:55:20.

security and evidence of serious crime in the Harbottle & Lewis

:55:20.:55:26.

file? I did indeed. I can address these in some detail

:55:26.:55:30.

if you will allow me. It is your father who is responsible for

:55:30.:55:34.

corporate governance and I want to know what he knew but I will come

:55:34.:55:40.

back to you. He was aware of how awful and there was findings at a

:55:40.:55:50.
:55:50.:55:51.

News International? It went to the senior officials of News Corp.

:55:51.:55:57.

Certainly the top legal officer. Tom crone or Les Hinton? No, they

:55:57.:56:05.

were not the top legal officers. Who are the top legal officers?

:56:05.:56:09.

John Chapman was the top legal officer at news International and

:56:09.:56:15.

Mr John crone was head of legal affairs at News Group Newspapers.

:56:15.:56:20.

Away you informed about the findings by your son, Mr Murdoch or

:56:20.:56:30.
:56:30.:56:33.

by Rebekah Brooks? I forget, but I suspect it was my son. I was in

:56:33.:56:37.

daily contact with them both. we were informed about the payments

:56:37.:56:47.

are made to Gordon Taylor and Max Clifford? Know. You were not

:56:47.:56:55.

informed? Know. At no point you knew that Gordon Taylor and Max

:56:55.:57:04.

Clifford were made payments? You never informed the chief executives

:57:04.:57:09.

at News Corp that you made payments and authorise payments to Gordon

:57:09.:57:14.

Taylor as a result of him being a victim of a crime? The settlement

:57:14.:57:18.

with Mr Taylor, and I am happy to address the matter of Mr Taylor in

:57:18.:57:25.

some detail if you would like. My father became a were after the

:57:25.:57:30.

settlement was made in 2009, I believe after the confidential

:57:30.:57:35.

settlement had become public. As a newspaper reported on the out of

:57:35.:57:41.

court settlement afterwards. Please understand the settlement of an

:57:41.:57:45.

out-of-court settlement of a civil claim of that nature and with that

:57:45.:57:49.

quantum is something that normally in a company car size, the

:57:49.:57:54.

responsible executives in the territory of the country would be

:57:54.:57:59.

authorised to make. And that is the way the company is functioning and

:57:59.:58:09.
:58:09.:58:11.

it is below the approval threshold, if you will. There are other

:58:11.:58:15.

questions I could ask, but there are other colleagues who have

:58:15.:58:19.

specific questions on this Mr Murdoch. I will move back to your

:58:19.:58:23.

father. Mr Murdoch when did you find out criminality was endemic at

:58:23.:58:33.
:58:33.:58:38.

the News of the World? Endemic is a very wide-ranging what. I also have

:58:38.:58:46.

to be careful not to prejudice the course of justice taking place now.

:58:46.:58:56.
:58:56.:58:57.

That has been disclosed. I became aware as it became apparent. I was

:58:57.:59:01.

absolutely shocked, appalled and ashamed when I heard about the

:59:01.:59:10.

Milly Dowler case. That was only two weeks ago. I was graciously

:59:10.:59:14.

received by the family. Did you read our last report into the

:59:14.:59:18.

matter when we referred to the collective amnesia of your

:59:18.:59:25.

executives who gave evidence to a committee? I have not heard that.

:59:25.:59:30.

Nobody brought it to your attention? So a Parliamentary

:59:30.:59:33.

inquiry found your senior executives in the UK guilty of

:59:34.:59:40.

collective amnesia and nobody brought it to your attention? I

:59:40.:59:45.

don't see why you think it is not very serious? You are not saying

:59:46.:59:50.

Anisha, you would be saying they were lying? We found your

:59:50.:59:54.

executives guilty of collective amnesia. I would have thought

:59:54.:59:58.

somebody would have brought back to your attention and that it would

:59:58.:00:07.

concern you? Did they forget? I don't think so. What has been

:00:07.:00:12.

obvious to most of the observers from the summer of 2009 phone

:00:12.:00:16.

hacking was widespread. You knew in January of this year the one road

:00:16.:00:26.
:00:26.:00:31.

report a line was false. Is that right? -- Road reporter. I forget

:00:31.:00:39.

the days. Why was he the only person to leave the News of the

:00:39.:00:46.

World last January? We have given all of our files and all of our

:00:46.:00:52.

knowledge and everything to the police. They have not asked for

:00:52.:00:58.

Glenn Mulcaire's diaries, so we do not know what was in that. There

:00:58.:01:06.

was eight-page which appeared to be addressed... Again my son can

:01:06.:01:11.

answer that. Perhaps it would be helpful to the committee if you

:01:11.:01:13.

would like to go through that particular detail around why

:01:13.:01:17.

decisions were made by the management team at News

:01:17.:01:20.

International and the precise chronology, would be more helpful

:01:20.:01:25.

if I could answer those questions as the chief executive of the

:01:25.:01:35.
:01:35.:01:38.

regional businesses across Europe. Your father is responsible. He is

:01:38.:01:41.

revealing what he doesn't know and what executives chose not to tell

:01:41.:01:45.

him so, with respect to you, I will pursue my line of questioning and

:01:45.:01:51.

come back to you later. Why was no one fired in April when the News

:01:51.:01:55.

International finally admitted that the News of the World have been

:01:55.:02:02.

engaged in criminal interception of voice mails? It was not our job to

:02:02.:02:06.

get in the course of justice. It was up to the police to bring those

:02:06.:02:11.

charges and carry out their investigation which we were 100%

:02:11.:02:15.

co-operating with. In April, the company admitted liability for

:02:15.:02:23.

phone hacking and nobody took responsibility for it then. No one

:02:24.:02:28.

was fired. The company admitted they had been involved in criminal

:02:28.:02:33.

wrongdoing and nobody was fired. Why was that? There were people in

:02:33.:02:38.

the company which apparently were guilty. And we have to find them

:02:38.:02:44.

and deal with them appropriately. If I can clarify, is to the

:02:44.:02:48.

individuals implicated in the allegations there, had long since

:02:48.:02:53.

left the company. Some of that were still there, you mention one,

:02:53.:03:01.

Exeter the business as soon as To he co-operate with the police to

:03:01.:03:07.

aid them with the things they wanted to do. But many of the

:03:07.:03:13.

individuals that were potentially implicated in those civil

:03:13.:03:16.

litigation and a criminal matters had already left the building and

:03:16.:03:23.

were not in the News of the World at this time. The executives and

:03:23.:03:28.

journalists at the time, many of whom were not there, in a 2006-

:03:28.:03:35.

seven, so some of them had already left. Thank you. Mr Murdoch, why

:03:35.:03:40.

did you decide to risk the jobs of 200 people before pointing the

:03:40.:03:44.

finger at those responsible for running the company at the time of

:03:44.:03:49.

the illegality? Your son and Rebekah books? When a company

:03:49.:03:54.

closes down, it's natural for people to lose their jobs. In this

:03:54.:03:58.

case, we are continuing to make effort to see those people are

:03:58.:04:03.

employed in other divisions of the company. If they are not part of

:04:03.:04:11.

the small group of, whatever group was involved. Did you close it

:04:11.:04:21.
:04:21.:04:26.

because of the criminality? Yes, we felt ashamed of what had happened.

:04:26.:04:33.

People lied to you and to their readers. We had broken our trust

:04:33.:04:41.

with our readers. The important point was we had broken our trust

:04:41.:04:45.

with our readers. Were you aware there was other forms of illicit

:04:45.:04:48.

surveillance being used by private investigators used by News

:04:48.:04:58.
:04:58.:05:00.

International? Other forms of? Computer hacking, tracking cars?

:05:00.:05:04.

All news organisations have used private detectives and do so in

:05:04.:05:09.

their investigations from time to time. I don't think illegally.

:05:09.:05:15.

it could be shown to you that private investigators working for

:05:15.:05:18.

newspapers and News International used other forms of illicit so they

:05:18.:05:22.

don't like computer hacking, would to immediately introduce another

:05:22.:05:27.

investigation? That would be up to the police, but we would certainly

:05:27.:05:32.

work with the police. If they wanted to do it, they would do it.

:05:32.:05:42.
:05:42.:05:44.

Can I ask you, when did you first meet Mr Alex Marincek? I don't know.

:05:44.:05:51.

He worked for the company for 25 years. I may have shaken his hand

:05:51.:05:55.

at one day in the office, but I have no memory. The bank you. Jim

:05:55.:06:05.
:06:05.:06:07.

Could I ask you a number of short questions? Why did you enter the

:06:07.:06:11.

back door at Number Ten when you visit to the Prime Minister

:06:11.:06:20.

following the last general election? Because I was asked to.

:06:20.:06:24.

You were asked to come in the back door of Number Ten? Yes, to avoid

:06:24.:06:31.

photographers in the front, I would imagine. I just did what I was told.

:06:31.:06:34.

It's strange but heads of state managed to go in the front door.

:06:34.:06:44.
:06:44.:06:45.

Yes. But you had to go in the back door? Yes. That's up to the Prime

:06:45.:06:51.

Minister or their staff. So it was under the Prime Minister's direct

:06:51.:06:54.

instructions you come through the back door? I was asked to come

:06:54.:06:59.

through the back door. I don't think my father had any direct

:06:59.:07:05.

knowledge of arrangements to go into any building, respectively.

:07:06.:07:13.

Have you ever imposed any preconditions... Which a visit to

:07:13.:07:19.

Downing Street are you talking about? Following the general

:07:19.:07:23.

election. I was invited for a cup of tea to be thanked for support by

:07:23.:07:29.

Mr Cameron. No other conversation took place. And that's the one when

:07:29.:07:35.

you came into the back door? Yes. I have also been asked by Mr Brown

:07:35.:07:40.

many times. Through the back door? Yes.

:07:40.:07:48.

My family went there many times. Have you ever imposed any

:07:48.:07:51.

preconditions on a party leader in the UK before giving them the

:07:51.:07:56.

support of your newspapers? I have never guaranteed any one support of

:07:56.:08:03.

the newspapers. We had been supporting the Thatcher government,

:08:03.:08:12.

the Conservative government, and we felt it was a good time and we

:08:12.:08:17.

changed and are supported the Labour Party whenever it was, 13

:08:17.:08:23.

years ago, with the direct loss of 200,000 circulation. Did you ever

:08:23.:08:29.

impose any preconditions on the Labour Party? No. None whatsoever?

:08:29.:08:34.

The only conversation I had with him, Tony Blair, we were arguing

:08:34.:08:44.
:08:44.:08:47.

about Europe. Mr Blair visited you are halfway around the world before

:08:47.:08:53.

the 1997 election. It doesn't matter. It was something Mr

:08:53.:09:03.

Campbell arranged. Yes. It is understood that the FBI are

:09:03.:09:04.

investigating the 9/11 victims. Have you commissioned an

:09:04.:09:09.

investigation into these allegations? We have seen no

:09:09.:09:14.

evidence of that at all and as far as we know, the F B I haven't

:09:14.:09:19.

either. If they do, we will treated exactly the same way as we treat it

:09:19.:09:24.

here, and I cannot believe it happened. Anyone in America. The

:09:24.:09:31.

News of the World, where the Glenn Mulcaire took it upon themselves to

:09:31.:09:36.

do it, I don't know. I will come back to you in a moment for so I

:09:36.:09:41.

just want to clarify, if these allegations are true whatsoever,

:09:41.:09:43.

will you commission an investigation into them?

:09:43.:09:50.

absolute it. -- absolutely. must be horrified by the scandal

:09:50.:09:56.

and the fact it has cost to the BSkyB transaction and led to the

:09:56.:10:01.

closure of the News of the World. Who do you blame for that? A lot of

:10:01.:10:10.

people had different agendas, I think. Tried to build this hysteria.

:10:10.:10:14.

All our competitors in this country formally announced a consortium to

:10:14.:10:23.

try and stop us and they caught us with dirty hands and booked us.

:10:23.:10:28.

was your competitors that stop you getting at? No, and mood developed

:10:28.:10:37.

which made it impractical to go ahead. We have been very clear that

:10:37.:10:41.

serious allegations of wrongdoing have been levelled to the News of

:10:41.:10:48.

the World. We believed that the News of the World, the actions of

:10:48.:10:52.

some reporters and people some years ago, have a fundamentally

:10:52.:10:56.

tarnished the trust the News of the World had with its reserves --

:10:56.:11:01.

readers, and this is a matter of huge and sincere regret, mind, my

:11:01.:11:08.

father's, the companies. The company's priority very much so is

:11:08.:11:14.

to restore that trust, to operate in the right way, to make sure that

:11:14.:11:20.

the company can be the company it is always aspired to be. And the

:11:20.:11:28.

removal of the offer to make, the proposal to make an offer to BSkyB

:11:28.:11:33.

shareholders, is simply a reflection of that priority moving

:11:33.:11:38.

forward. I have every sympathy with what you're saying, but do you

:11:38.:11:42.

understand that people who have been the victims of the News of the

:11:42.:11:48.

World, based on allegations, will find that a bit strange? It is our

:11:48.:11:58.
:11:58.:12:00.

absolute priority,... What happened at the News of the World was wrong.

:12:00.:12:04.

I have apologised profusely and unreservedly for that. And my

:12:04.:12:10.

father has, as well. These are very, very serious matters and we are

:12:10.:12:14.

trying to establish the facts of any new allegations as they come up.

:12:14.:12:20.

We are working closely with the police to find out where the wrong

:12:20.:12:24.

doing was and hold people accountable. I think, importantly,

:12:24.:12:29.

as well, to the victims of illegal voice mail interceptions, not just

:12:29.:12:33.

if we apologise, but we have admitted liability, the company has

:12:33.:12:37.

admitted liability, and we have set up the appropriate third party

:12:37.:12:42.

compensation scheme to deal with that. These are all matters that we

:12:42.:12:46.

are fully engaged in. Just turning to your father, I know it's a very

:12:46.:12:53.

stressful time for yourself, but, Mr Murdoch, do you accept

:12:53.:12:59.

responsibility for this whole fiasco? No. Who is responsible?

:12:59.:13:06.

people that I trusted and then maybe the people they trusted. I

:13:06.:13:12.

worked with Les Hinton for 22 years and I would trust him with my life.

:13:12.:13:16.

Are you satisfied that the cash payments made by the News

:13:16.:13:22.

Corporation companies to informants for stories were registered with

:13:22.:13:31.

appropriate tax authorities? don't know anything about that, no.

:13:31.:13:41.
:13:41.:13:43.

If people were given money... In order to accomplish stories, was

:13:43.:13:52.

that notified? All of our financial affairs and, as a public company, a

:13:52.:13:59.

transparent, audited, the tax jurisdictions all around the world,

:13:59.:14:04.

our work transparently and thoroughly. Tax compliance is an

:14:04.:14:12.

important priority for any business and we comply with the laws. Does

:14:12.:14:17.

that include people in a regular monthly retainers, registering

:14:17.:14:24.

their affairs? I have no knowledge of separate people on a retainers

:14:24.:14:28.

in the company, their own tax arrangements, but I can't speak for

:14:28.:14:33.

the company's tax arrangements and, to the best of my knowledge, we are

:14:33.:14:41.

a company which takes tax compliant, transparency, hugely seriously. It

:14:41.:14:50.

is something we are very proud of. Can I just turn to James, you will

:14:50.:14:56.

be aware of the situation with Tommy Sheridan, who is currently in

:14:56.:15:06.
:15:06.:15:07.

prison. The jury was misled in the Tommy Sheridan's perjury trial.

:15:07.:15:14.

Your company has not disclosed the internal e-mails for that before

:15:14.:15:18.

the wires that? I have no knowledge of that and I apologise for that. I

:15:18.:15:22.

have additional questions on that and in future I will supply a

:15:22.:15:26.

written answers but I don't have direct knowledge. I can't answer

:15:26.:15:36.
:15:36.:15:39.

James, could you please confirm or deny whether any News Corporation

:15:39.:15:42.

company is the subject of an investigation by the Serious Fraud

:15:42.:15:48.

Office? I have no knowledge of that at this point. Could you also

:15:48.:15:53.

confirm or deny whether any News Corporation company is the subject

:15:53.:15:56.

of an investigation by the financial services authority?

:15:56.:16:01.

don't believe so, but not to my knowledge. Please confirm or deny

:16:01.:16:05.

whether any News Corporation company is the subject of an

:16:05.:16:10.

investigation by HMRC? Not to my knowledge, we have ongoing dialogue

:16:10.:16:15.

with the HMRC and the various subsidiaries here. As far as

:16:16.:16:19.

investigations are concerned, I have no knowledge of one.

:16:19.:16:23.

Mr Murdoch, who made the recommendation to close down the

:16:23.:16:32.

News of the World to the board of News Corp? I assume it was a board

:16:32.:16:42.

decision made by News Corp? It was a discussion between my son, myself

:16:42.:16:47.

and senior executives and Rebekah Brooks one morning. We called the

:16:47.:16:51.

board of News Corporation, the whole board to seek their agreement.

:16:51.:16:56.

You have already suggested he felt ashamed. It is not suggested it was

:16:56.:17:03.

a commercial decision? Far from it. Moving on to the financial

:17:03.:17:08.

governance arrangements within News Corp. James Murdoch, you suggested

:17:08.:17:13.

the payments to Gordon Taylor were not notified at News Corp level

:17:13.:17:19.

because of the finance thresholds? Could you tell us more about that?

:17:19.:17:24.

I understand you had to agree for the payment to Mr Taylor, could you

:17:24.:17:30.

tell us, was it financial or a managerial decision? It is a good

:17:30.:17:37.

question, I am happy to discuss the matter of Mr Taylor. The out of

:17:37.:17:42.

court settlement with Mr Taylor was related to a voice mail

:17:42.:17:48.

interception that had occurred previously and was one of the

:17:48.:17:55.

counts, as I understand of the 2007 trial of Glenn Mulcaire. It is

:17:55.:17:59.

important to think back to 2008 to understand what we knew them and

:17:59.:18:05.

what the Ince -- information was in the context. It was not a disputed

:18:05.:18:11.

fact. It was the advice, and further to that it was the advice

:18:11.:18:15.

and the clear view of the company that if litigated, the company

:18:15.:18:20.

would lose that case, it was almost certain to lose the case because

:18:20.:18:26.

the underlying fact was not in dispute. Third, the company sought

:18:27.:18:31.

distinguish outside counsel to understand that if the case was

:18:31.:18:36.

litigated and to be lost, which was the great likelihood, what it would

:18:36.:18:41.

cost the company. It was advised that with expenses, legal expenses

:18:41.:18:48.

and damages, it could be between �500,001 million, or they're about,

:18:48.:18:57.

I don't recall the exact number of the advice, I think it was 250,000,

:18:57.:19:02.

plus expenses. This was in a context in the first half of 2008

:19:02.:19:06.

and this was my first real involvement with any of these

:19:06.:19:10.

issues, where there was no reason at the time to believe the issue of

:19:10.:19:15.

the voice mail interceptions was anything but a settled matter. And

:19:15.:19:20.

that it was in the past after the successful prosecution of the two

:19:20.:19:26.

individuals we discussed, as well as the resignation of the editor.

:19:26.:19:31.

So the out-of-court settlement was made in that context. And it was

:19:31.:19:36.

within the authorities, as I understood it, of News

:19:36.:19:39.

International to be able to make those out of court settlements in

:19:39.:19:46.

due course without going to the global level company. At the time,

:19:46.:19:52.

I was the regional head for Europe and Asia of News Corporation. And I

:19:52.:19:56.

directed it was all right to settle that, but did not get involved in

:19:56.:20:03.

any of the Nicosia Asians directly about that settlements but I do

:20:03.:20:08.

recall in 2008, those were the things that were done. Can I just

:20:08.:20:13.

add, my son had only been with the company for a matter of a very few

:20:13.:20:18.

weeks in this instance. It was a few months, but I had come back to

:20:19.:20:25.

the company at the end of 2007 in the middle of December. This was

:20:25.:20:32.

some time in the first half of 2008. Giving you renewed to the company,

:20:32.:20:39.

what level of financial payments could news International executives

:20:39.:20:44.

sanctioned, people like Rebekah Brooks without recourse to you as

:20:44.:20:52.

the chairman? Generally speaking, the way the company will operate,

:20:52.:20:57.

as any company will operate, is within certain financial parameters

:20:57.:21:02.

and financial planning perspective. Much like a house will manage its

:21:02.:21:07.

budget, and say how much money do we have to spend? As long as they

:21:07.:21:14.

stay within those guidelines the belief is, they should be empowered

:21:14.:21:20.

to make those judgments to spend the money and achieve the end as

:21:20.:21:28.

they can. I don't have at the tip of my fingers, the precise

:21:28.:21:34.

financial authorities in that. I can discuss after the committee

:21:34.:21:37.

hearing with you, what exactly you would like to know and discuss

:21:37.:21:43.

whether or not it is right to come back to you with that. What level

:21:43.:21:48.

of financial payout would it have taken an authorisation from the

:21:48.:21:53.

board of News Corp? A thing for the full board it is in the millions.

:21:53.:21:57.

But her don't know the exact answer. Do you know how much has been paid

:21:57.:22:05.

out to people, authorised by your executives? Paid out in what way?

:22:05.:22:10.

Pay out in settlements? Illegal settlements? I do not know of the

:22:10.:22:16.

total number. Around the world it is customary to reach out of court

:22:16.:22:20.

settlements in civil litigation is an civil matters. It is something

:22:20.:22:24.

that rather than go through the lengthy and expensive litigation

:22:24.:22:28.

process and what the risk that often entails, sometimes at his

:22:28.:22:34.

best to reach out of court settlements in many cases. We have

:22:34.:22:37.

a very strong board committee at News Corporation which would know

:22:38.:22:43.

about this. Neither of us are members of that, they are outside

:22:43.:22:48.

directors and they will review all of these things. Building on that,

:22:48.:22:52.

how is it possible to make payments to people if they do not invoice

:22:52.:22:58.

you or they are not an employee of News Corp subsidiaries? How is it

:22:58.:23:02.

possible to transfer cash or some other form of remuneration to

:23:02.:23:08.

people who do not invoice you, or who are not employees of News Corp

:23:08.:23:13.

subsidiaries? I don't know the exact arrangements of that. I don't

:23:13.:23:20.

do that myself. Sometimes in certain instances, it is

:23:20.:23:26.

appropriate for journalists or managers in a certain environment

:23:26.:23:31.

to have the ability to use cash and in some instances, it is customary

:23:31.:23:38.

for those to be recorded and all of the cash expenses, as well as

:23:38.:23:44.

invoice expenses should be looked at and recorded. So things like the

:23:44.:23:48.

use of petty cash could be big sums of money or small? At the moment

:23:48.:23:55.

you just record the journalist gave it to somebody? I don't have direct

:23:55.:23:58.

knowledge of all of those arrangements. I was going to ask if

:23:58.:24:04.

payments could have been made to family members of those alleged to

:24:04.:24:08.

have been hacked? But can other forms of renumeration be used in

:24:08.:24:13.

your company other than cash, things like travellers' cheques,

:24:13.:24:16.

things that can be redeemed for cash? And don't have any knowledge

:24:16.:24:24.

of that. Looking at some of your own code, page two and page four

:24:24.:24:27.

talking about directors and employees and if officers acting

:24:27.:24:33.

for News Corporation including consultants, agents and suppliers

:24:33.:24:38.

and business partners must adhere to the standards. We would never

:24:38.:24:43.

ask any third party to perform any act to violate the standards. How

:24:43.:24:48.

do you try and make that happen as an organisation? How we work is,

:24:48.:24:58.
:24:58.:25:03.

each newspaper has its own editor or manager. But, they have to

:25:03.:25:10.

approve the expense claims up every reporter. The reporter has no

:25:10.:25:19.

authority to pay money out. So the managing editor often manages a lot

:25:19.:25:24.

of expenses and budgets. And should do so, and is directed to do so

:25:24.:25:29.

with propriety. Do you require your executives to make annual

:25:29.:25:34.

statements that they have abided by your code of conduct and ethics?

:25:34.:25:38.

Every employee, every colleague around the world of News

:25:38.:25:47.

Corporation receives the code of conduct, a set... It is a pamphlet

:25:47.:25:51.

that has some detail in it. It is not too much so people read it,

:25:51.:25:59.

with respect to what ethical conduct is required. It is about

:25:59.:26:06.

ethical conduct, the law, breaking the rules and so on. Everyone he

:26:06.:26:11.

becomes an employee is required to do that. Our legal internal council

:26:11.:26:20.

conducts workshops around the world with staff, in Mumbai to Manchester

:26:20.:26:25.

around those rules and that code of conduct and it is something we

:26:25.:26:29.

tried to communicate as crisply as we can to everyone in the business.

:26:29.:26:34.

And finally, I appreciate Mr murder's statements at the

:26:34.:26:39.

beginning. Giving you have been in the media spotlight and not

:26:39.:26:43.

appreciated the attention you have had, will this make you think again

:26:43.:26:48.

on how you approach your headlines, your targets in future? That could

:26:48.:26:53.

the people from the Hillsborough 96, celebrities or others. We you think

:26:53.:27:03.

again about what your headlines will say in future? I think all of

:27:03.:27:09.

our editors certainly will. I am not aware of any transgressions as

:27:09.:27:14.

a matter of taste. It is a difficult issue we have in this

:27:14.:27:19.

country. We have a wonderful variety of voices and naturally

:27:19.:27:28.

very competitive. I am sure headlines, can occasionally give

:27:28.:27:34.

offence. But it is not intentional. Mr James Murdoch? It is important

:27:35.:27:43.

to say one of the lessons from all of this for us is we do need to

:27:43.:27:48.

think, as a business as well as an industry, in this country more

:27:48.:27:52.

forcefully and more thoughtfully about journalistic ethics. About

:27:52.:27:59.

what exactly the codes of conduct should be, not just for News

:27:59.:28:04.

International, are UK publishing subsidiary, but for the industry as

:28:04.:28:08.

a whole. And what sort of Government should be around this

:28:08.:28:15.

whole sort of area and we welcomed last week the Prime Minister's

:28:15.:28:18.

announcements for a judicial inquiry into journalistic ethics,

:28:18.:28:23.

and relationships between the police and politicians. It is a

:28:23.:28:27.

good thing for the country and for all of the interested parties to

:28:27.:28:32.

engage with. One of the specific actions we have taken to try to be

:28:32.:28:39.

as proactive as we can around us, is we have set up what we call a

:28:39.:28:42.

management and Standards Committee, that is outside the actual

:28:42.:28:46.

management of our publishing company and reports to the

:28:46.:28:50.

independent directors through the independent directors of our global

:28:50.:28:54.

public board. They will be looking at this issue around, first the

:28:55.:28:59.

specific issues, how we co-operate with the investigations, how we

:28:59.:29:04.

deal with allegations of wrongdoing and get to the bottom of it. Also,

:29:04.:29:10.

it is important how we co-ordinate and productively engaged with the

:29:10.:29:14.

judicial enquiries and how we set a code of conduct and a code of

:29:14.:29:17.

ethics that we think, and that it thinks is something that can both

:29:17.:29:23.

be apparent on top of all of our newspapers, and all of the industry

:29:23.:29:28.

and also something that has teeth and can hold the company to account.

:29:28.:29:33.

It is independently chaired, this management and Standards Committee

:29:33.:29:38.

and we think it is going to be a much better way to go in the future.

:29:38.:29:44.

We would like, over the next six months and years to be judged on

:29:44.:29:49.

the actions the company takes to put that right and to put it in

:29:49.:29:56.

place. I would like to say it does not take the weight off what we

:29:56.:30:06.

have been saying, our apologies. But this country does greatly

:30:06.:30:10.

benefit from having a competitive press and therefore have a very

:30:10.:30:14.

transparent society. That is sometimes very inconvenient to

:30:14.:30:24.
:30:24.:30:27.

people. But I think we are better Is it your intention to launch a

:30:27.:30:33.

new Sunday tabloid newspaper? have made no decision on that.

:30:33.:30:38.

There is no decision on that. the moment there's no plans to

:30:38.:30:42.

other News International title coming out on Sunday? No immediate

:30:42.:30:50.

plans for that. We had talked in the past two moving to seven-day

:30:50.:30:57.

news rooms, speculation about the sun on Sunday. I think we will

:30:57.:31:01.

leave those options open. It's not the company's priority now. In the

:31:01.:31:10.

last week, it has come up. But, you know, our direction is that this is

:31:10.:31:14.

not the time to be worrying about that. The company has to move

:31:14.:31:18.

forward on all of these other actions and really get to grips

:31:18.:31:23.

with the facts of these allegations and understand them as fully as we

:31:23.:31:28.

can. Can I appeal both to the witnesses and indeed to members to

:31:28.:31:35.

try to keep brief because we have a lot to get through?

:31:35.:31:45.

In your statement on 7th July 2011, to James Murdoch, you said the

:31:45.:31:49.

company paid out court settlement approved by me, and I did not have

:31:49.:31:53.

a complete picture when I did so. What do you know now that you did

:31:53.:32:03.

not know then? I think, essentially, the new information that image to

:32:03.:32:08.

that is critical here, is the information that came out of the

:32:08.:32:13.

ongoing process of civil litigation in 2010 -- emerged. At the end of

:32:14.:32:18.

2010, the presentation of the evidence would not be in opposition

:32:18.:32:23.

previously from this civil litigation, that widen the circle

:32:23.:32:29.

definitively, at least made it very apparent, the circle was wider than

:32:29.:32:39.

the two individuals, Glenn McKerr. But information was critical. --

:32:39.:32:48.

Glenn Mulcaire. If I go back to my earlier comment, the commercial and

:32:48.:32:55.

legal rationality around that was very clear. The underlying fact was

:32:55.:33:01.

not in dispute for the it was known from previous trials. The a device

:33:01.:33:05.

was very, very clear as to what sort of damages could be expected

:33:05.:33:10.

to be paid and it was quite clear and likely that if litigated, the

:33:10.:33:15.

company would lose that case. In the context of none of this other

:33:15.:33:19.

information, and full before some of the new allegations in the press

:33:19.:33:25.

a rose, from afar, and there was no reason to believe at the time it

:33:25.:33:31.

was anything other than in the past. Knowing them what I know now, would

:33:31.:33:38.

I still have directed to negotiate to settle that case? I would,

:33:38.:33:42.

actually, but I would have coupled it with the other actions we have

:33:42.:33:46.

taken since the new evidence emerged at the end of September

:33:46.:33:54.

2010, and that is to immediately go and look at whatever we could find

:33:54.:33:59.

internally around the individuals involved, to immediately contact

:33:59.:34:07.

the police about information which may be of information -- interest

:34:07.:34:12.

to them. To put in place the process, which I think we did in

:34:12.:34:17.

the early part of 2011, editing liability to the civil litigants,

:34:17.:34:20.

putting a process in place to get to the bottom of what legitimate

:34:21.:34:28.

allegations their work, apologising unreservedly to the victims of the

:34:28.:34:33.

voice mail intercepts which were inexcusable, and having a system of

:34:33.:34:39.

compensation there. If I knew then what I know now, with the benefit

:34:39.:34:43.

of hindsight, we can look at all these things. But if I knew then

:34:43.:34:47.

what I know now, we would have taken more action around that and

:34:47.:34:52.

moved faster to get to the bottom of these allegations. Were the

:34:52.:34:55.

settlement paid by News International, News Corp or News

:34:56.:35:04.

Group Newspapers? I don't recall. I would imagine it's News Corp or

:35:04.:35:07.

News International. I'm sure we can provide you with that information

:35:07.:35:13.

of this up what advice did Colin Myler give you in relation to

:35:13.:35:23.
:35:23.:35:26.

That the underlying factor in the case was a previous fact which came

:35:27.:35:33.

up in the trial of Glenn Mulcaire. Were you aware the case included a

:35:33.:35:39.

criminal act of phone hacking? Pardon me? Were you aware the case

:35:39.:35:42.

involved the criminal act of a phone hacking? That was my

:35:42.:35:46.

understanding that that was what the litigation was four, damages

:35:46.:35:49.

for the illegal voice mail interception. When did you get this

:35:49.:35:59.
:35:59.:36:02.

advice? In the first half of 2008. In 2009, and they said they would

:36:02.:36:09.

settle this claim based on external legal advisers. Was this received

:36:09.:36:15.

from Farrer and Co solicitors? have done work for us. I don't know

:36:15.:36:18.

precisely which external council they engaged on that, but I can

:36:18.:36:28.

clarify it. Did you see the advice? No, the advice I had was oral from

:36:28.:36:35.

Tom Crone and Colin Myler. What was that advice? As I described it.

:36:36.:36:40.

Outside legal advice have been taken with respect to quantum of

:36:40.:36:46.

damages and the advice was the cases would be lost and the advice

:36:46.:36:50.

was in the absence of any new evidence, certainly no new evidence

:36:51.:36:57.

was made aware to me, this was simply a matter to do with events

:36:57.:37:03.

which had come to light in 2007 and the criminal trials before I was

:37:03.:37:07.

there, and that this was in the past. And the police, as well, and

:37:07.:37:10.

closed their case and said there was no new evidence there, so the

:37:10.:37:14.

context was that it was about events which were a year or more

:37:14.:37:24.
:37:24.:37:24.

world, underlying staff previous to that. Was part of the advice given

:37:24.:37:28.

that the High pavement was that the matter would be kept confidential?

:37:28.:37:30.

Not at fault. The confidential nature of an out-of-court

:37:30.:37:35.

settlement is a normal thing. -- not at all. I don't know many which

:37:35.:37:39.

are not kept confidential files I'm sure there are some, but there was

:37:39.:37:43.

nothing about confidentiality. I think I understand were you are

:37:43.:37:50.

going with this, but no, the amount paid and the advice there was on

:37:50.:37:54.

advice from outside counsel, with respect to the amount we would be

:37:54.:37:59.

expected to pay in damages plus expenses in litigation costs.

:37:59.:38:05.

you question why such high payments were made to Mr Taylor and Mr

:38:05.:38:13.

Clifford? It's so just have to be �700,000 and �1 million

:38:13.:38:17.

respectively for privacy when the record amount opera was the damages

:38:17.:38:22.

awarded by a court remains �60,000, ironically against the News of the

:38:22.:38:27.

World. I did question the amount but not in relation to the 60,000.

:38:27.:38:32.

If you recall, as I'm sure you do, the chronology here, the settlement

:38:32.:38:36.

made with respect to �60,000 against the News of the World what

:38:36.:38:42.

I believe was the Moseley case, was after the authorisation the advice

:38:42.:38:46.

that we sought from senior distinguished outside counsel with

:38:46.:38:50.

respect to the quantum of damages expected to pay which, in damages

:38:50.:38:55.

terms, was a quarter of a million pounds plus expenses and litigation

:38:55.:39:01.

costs expected to be between �500,000 and �1 million. I think

:39:01.:39:05.

that chronology is important and afterwards you would obviously have

:39:05.:39:11.

different information but it wasn't afterwards, it was before. You have

:39:11.:39:14.

since said when you approved the settlement you did not actually

:39:14.:39:21.

have all the facts. What do you know now that you didn't then?

:39:21.:39:31.

have testified, the key facts and evidence, that came to light as the

:39:31.:39:34.

lengthy due process of the civil litigation involving these matters

:39:34.:39:38.

to their cause, it was of that process which unearthed the key

:39:38.:39:45.

evidence there, and it was really only after that, that any one said

:39:46.:39:48.

they should start the investigation is in as we had that new

:39:48.:39:53.

information. It indicated to us that there was a wider involvement.

:39:53.:40:02.

We acted on it immediately. Crone said he did not know why he

:40:02.:40:06.

left News Group Newspapers. Why was he asked to leave after 26 years of

:40:06.:40:12.

service? Well, last week, the News of the World, two weeks ago, I

:40:12.:40:22.
:40:22.:40:23.

guess, Tom Crone was very involved over the years, but the company

:40:23.:40:27.

believed and the management of the company believed that it was time

:40:27.:40:32.

to part ways. I was not involved in those direct discussions with Tom

:40:32.:40:35.

Crone and I can't comment on their nature and content. I don't have

:40:35.:40:42.

information. The New Statesman it carries a story last week that News

:40:42.:40:45.

International subsidised Andy Coulson's wages after he left your

:40:46.:40:51.

employee. Can you shed any light on that? I have no knowledge of Andy

:40:51.:40:56.

Coulson's wages after he left the company. Finally, are you familiar

:40:56.:41:06.
:41:06.:41:14.

with the term will fall blindness? -- wilful. It came up in the ENRON

:41:14.:41:20.

scandal, a legal term which states that if there is information you

:41:20.:41:24.

choose not to have, you are still responsible. Do you have a

:41:24.:41:31.

question? The question was, are you aware of that? I'm not aware of

:41:31.:41:41.
:41:41.:41:42.

that phrase. I have heard of that phrase before and we were not ever

:41:42.:41:52.
:41:52.:41:54.

guilty of that. When we had our inquiry in a 2009,

:41:54.:41:59.

the evidence given by News International executives was at

:41:59.:42:04.

rather hopeless, really. They came with a game-plan, to tell us that

:42:04.:42:07.

they didn't know anything, they couldn't remember anything, and

:42:07.:42:13.

they didn't know anybody who would know anything. I just wonder, so we

:42:13.:42:17.

can get off on a reasonable footing, what coaching you have had to date

:42:17.:42:21.

and who has advised you on how to handle this session and what their

:42:21.:42:31.
:42:31.:42:33.

advice was? With respect to today, after scheduling this appearance,

:42:34.:42:37.

we took some advice around what the context of this sort of setting

:42:37.:42:43.

would be. This is our first time in a committee meeting like this.

:42:43.:42:48.

Mostly logistics and so on, what sort of questions we would be asked,

:42:48.:42:51.

and we were advised fundamentally to tell the truth. And then come

:42:51.:42:58.

and be as open and transparent as possible. And that is hour intent,

:42:58.:43:04.

intention, and I hope we can show you that is what is happening.

:43:04.:43:09.

answering questions from at Mr Watson, you seemed to indicate you

:43:09.:43:13.

had a rather hands-off approach to your company, and the point you

:43:13.:43:18.

made was that the News of the World was less than 1% of your entire

:43:18.:43:21.

worldwide business and so you wouldn't really be expected to know

:43:21.:43:25.

the ins and outs of what was going on. Could you just give us an

:43:25.:43:30.

illustration of how many times, how often you would speak to the editor

:43:30.:43:34.

of your newspapers? How often you speak to the editor of the Sun, for

:43:34.:43:44.
:43:44.:43:47.

Very seldom. Sometimes I would ring the editor on a Saturday night and

:43:47.:43:54.

say, have we got any news tonight? Keeping in touch. I ring the editor

:43:54.:44:01.

of the Sunday Times nearly every Saturday. Not to influence what he

:44:01.:44:08.

has got to say, at all. I'm always careful not to promise any remark I

:44:08.:44:18.
:44:18.:44:25.

I'm not really in touch. I have got to tell you, the editor I have

:44:25.:44:33.

spent most time with, it's the Wall Street Journal. To say that we are

:44:33.:44:41.

hands-off is wrong. I work a 12 hour day and I cannot tell the

:44:41.:44:48.

multitude of issues which come my way. The News of the World, I lost

:44:48.:44:56.

sight of it, maybe because it was so small in the general frame of

:44:56.:45:06.
:45:06.:45:09.

our company. But we're doing a lot If I can help you out. It some of

:45:09.:45:14.

the had told me you would speak to somebody like the editor of the Sun

:45:14.:45:17.

newspaper daily and twice a day, wouldn't you recognise that

:45:17.:45:23.

description? No. You wouldn't historically, traditionally spoke

:45:23.:45:28.

to the editor of the Sun newspaper that a number of times? No. I would

:45:28.:45:34.

like to, but no. When you said you speak to the editor of the News of

:45:34.:45:38.

the World may be on a Saturday night before the publication, not

:45:38.:45:43.

to influence what they say, I understand that. I am intrigued as

:45:43.:45:48.

to how these conversations go? I would imagine it would go something

:45:48.:45:51.

along the lines of to the editor of the News of the World, anything to

:45:51.:45:57.

report? Anything interesting going on? And the editor of the News of

:45:57.:46:03.

the World says, no, it's been a standard way, we have paid Gordon

:46:03.:46:10.

Taylor �600,000! He never said that last sentence. In your weekly

:46:10.:46:13.

conversations with the editor of the News of the World, something as

:46:14.:46:19.

big as that, paying somebody �700,000, you would have expected

:46:19.:46:23.

the editor of the News of the World to drop it into the conversation at

:46:23.:46:32.

some point? No. I would have called him at least once a month I guess.

:46:32.:46:42.

What we do discuss with him? What was on the agenda? I would say,

:46:42.:46:47.

what is doing? What sort of response which are expect? He might

:46:47.:46:53.

say we have a great story exposing this or that. Or he would say,

:46:53.:47:03.
:47:03.:47:05.

actually nothing special. James,... He might refer to the fact extra

:47:05.:47:10.

pages have been added to the football that week. But he wouldn't

:47:10.:47:18.

refer to a �1 million pay-off? James, we do acknowledge in your

:47:18.:47:26.

view, you overpaid Max Clifford and Gordon Taylor? I cannot speak about

:47:26.:47:29.

the arrangements of Max Clifford because I don't have direct

:47:29.:47:36.

knowledge in terms I wasn't involved in those pieces. With

:47:36.:47:42.

respect to Gordon Taylor, I made a judgment given the advice of

:47:42.:47:47.

counsel, given the advice of the executives involved and going back

:47:47.:47:51.

and looking at what we knew in 2000 inmates and looking at that advice

:47:51.:48:01.
:48:01.:48:02.

and remembering that advice. -- 2008. It we look back from now, it

:48:02.:48:12.
:48:12.:48:15.

was a decision, given that context, I would still stand by, I think.

:48:15.:48:22.

Apparently there was a contract with Max Clifford. It was cancelled

:48:22.:48:27.

by Andy Coulson. I don't know about that. I don't have knowledge about

:48:27.:48:36.

that. It just seems strange to me... I don't know what was in the

:48:36.:48:43.

contract. We might ask you to come back with details about that. But

:48:43.:48:50.

it seems odd to me as a layman, 600,000, a million pounds, Andy

:48:50.:49:00.
:49:00.:49:00.

Gray had his phone hacked but he did not get 600,000, 500,000 or

:49:00.:49:05.

even 50,000. He got 20,000. Somebody else gets their phone Act

:49:05.:49:11.

and they get 600,000 or one million. And surely you can see the

:49:11.:49:14.

difference most people draw is one was when it was all out in the open

:49:15.:49:19.

and everybody knew about these things, Andy Gray. And the other

:49:19.:49:25.

one was paid when it was all trying to be kept quiet, 600,000. Do you

:49:25.:49:31.

not see, to most people looking at that it smells a bit? I understand

:49:31.:49:36.

why you are coming from. These are big sums of money we are talking

:49:36.:49:44.

about, 100,000, 200,000, 600,000. It is a lot of money. He would ask,

:49:44.:49:49.

why would a company do that? I would go back to my answer to Mr

:49:49.:49:53.

Sanders's question, be precise about the chronology. I'm not a

:49:53.:50:03.
:50:03.:50:04.

lawyer, but at my understanding is that the 60,000 settlements in the

:50:04.:50:12.

Moseley judgment case, which was after the advice given around the

:50:12.:50:20.

Gordon Taylor settlements, is an important chronology. And courts

:50:20.:50:25.

and judges have set a different standard here. What we knew and

:50:25.:50:29.

what I knew at the time was we had seen your distinguished outside

:50:29.:50:34.

counsel who had said if this case is as -- if this case is litigated

:50:34.:50:38.

and the company will lose the case, what sort of damages would we

:50:38.:50:43.

expect to pay? And the company received an answer that was

:50:43.:50:50.

substantial. The answer was 250,000, so you settle for 600? It is

:50:50.:50:59.

important to be clear. The 600,000, 700,000, included damages, legal

:50:59.:51:04.

fees and an estimation of what it would have cost otherwise. Because

:51:04.:51:11.

the other side is negotiating. So it is damages plus costs that get

:51:11.:51:16.

you to that number. It is important to be clear about that. I want to

:51:16.:51:20.

concentrate on payments you make to your staff. Going back to the trial

:51:20.:51:26.

of Glenn Mulcaire and Clive Goodman. Clive Goodman was pleading guilty

:51:26.:51:35.

to phone hacking, criminal offence. Did News International pay Clive

:51:35.:51:41.

Goodman's legal fees for his trial? I do want to be clear about the

:51:41.:51:47.

chronology, I don't have first-hand knowledge of those times. Remember,

:51:47.:51:54.

my involvement in these matters started in 2008. In 2007 in

:51:54.:51:58.

December I was focused in my role of a public company and I was not

:51:59.:52:03.

involved. Who would know? contrite to answer the first

:52:03.:52:13.
:52:13.:52:16.

question first. It is customary, certainly with employees and with

:52:16.:52:21.

litigation to pay some set of legal expenses on behalf of those, to try

:52:21.:52:26.

to bring all of the evidence to a court and so on. That has all been

:52:26.:52:30.

done in accordance with, since any involvement I have had any

:52:30.:52:34.

knowledge, in accordance with legal advice about the proper way to do

:52:34.:52:42.

things. I can speed -- I cannot speak about the 2007 arrangements.

:52:42.:52:47.

Clive Goodman employed the services of a QC called John Kelsey-Fry. I

:52:47.:52:53.

don't know whether you ever came across him? We don't know him.

:52:53.:52:57.

is probably one of the most expensive and eminent more is in

:52:57.:53:03.

the country. He is the go to a lawyer celebrities. Steven Gerrard

:53:03.:53:07.

used him recently. It seems odd to me a journalist on the News of the

:53:07.:53:12.

World who is pleading guilty to a crime, uses in mitigation, probably

:53:12.:53:17.

the most expensive lawyer in the country which obviously leads some

:53:18.:53:23.

people to suspect his legal fees were not being paid for by himself.

:53:23.:53:26.

But were being paid for by News International. Given he was

:53:26.:53:32.

pleading guilty to a criminal act, phone hacking, which presumably

:53:32.:53:37.

needs to summary dismissal, gross misconduct? Why would News

:53:37.:53:43.

International even think about, even dream about playing -- paying

:53:43.:53:47.

the legal fees of somebody engaged in criminal activity and committed

:53:47.:53:53.

something which was clearly gross misconduct? I don't have any direct

:53:53.:53:56.

knowledge of the specific legal arrangements of Clive Goodman in

:53:56.:54:05.

2007. I cannot answer the specifics of that question. I have asked the

:54:05.:54:10.

question as well more recently than that. With respect to who the

:54:10.:54:14.

company pays legal fees, what contribution to legal fees do we

:54:14.:54:21.

make, or does the company make? I think I can tell you that in asking

:54:21.:54:25.

the question I have been surprised, and this is legal counsel telling

:54:25.:54:32.

me this, it is customary in here it is sometimes made contributions to

:54:32.:54:37.

the legal costs of either co- defendants or defendants in related

:54:37.:54:41.

matters. But I have no direct knowledge of that particular

:54:41.:54:45.

instance you mentioned. If you have any additional specific questions

:54:45.:54:50.

about that, perhaps Mr chairman, we can follow up with you on that and

:54:50.:54:56.

I am happy to do so. These are issues that go back some time, I am

:54:56.:55:00.

surprised you have not followed upon them already. Where any

:55:00.:55:05.

payments paid subsequently to Glenn Mulcaire and Clyde and following

:55:05.:55:11.

their convictions? -- Clive Goodman. It is a good question and it is a

:55:11.:55:18.

specific question. To my knowledge, and upon asking because allegations

:55:18.:55:25.

had been made that legal fees had been paid after that time in 2007.

:55:25.:55:29.

I asked the question myself and I was very surprised to find the

:55:29.:55:32.

company had made certain contributions to legal settlements.

:55:33.:55:38.

I don't have all are the details around each of those. Not legal

:55:38.:55:43.

settlements sorry I mean legal fees. I was surprised, very surprised.

:55:43.:55:50.

Who authorised them? They were done, as I understand it, in accordance

:55:50.:55:56.

with legal counsel and strong advice. I'm not asking who advised,

:55:56.:56:00.

who signed it off? Q-side the Czechs at News International and

:56:00.:56:09.

agreed to make those of payments? have no idea. The talk about the

:56:09.:56:13.

managing editor, would the managing editor have made them? It would

:56:13.:56:19.

have been the management of the legal cases I would think. I am

:56:19.:56:24.

happy to go back and look at that, but it was not something that came

:56:24.:56:32.

to my attention. It wouldn't have anything to do with the managing

:56:32.:56:37.

editors. Would it have been above the managing editor or below?

:56:37.:56:43.

would have been above. It would have been on legal advice, had to

:56:43.:56:47.

handle payments in legal litigation has. I don't have direct knowledge

:56:47.:56:52.

of the current status of those. But I was surprised as you are to find

:56:52.:56:58.

some of those arrangements had been made. Mr Murdoch senior, I seem to

:56:58.:57:03.

be getting further with you. Would it have been Les Hinton? Would he

:57:03.:57:07.

have agreed and signed those cheques? It could have been. Would

:57:07.:57:13.

have been or could have been? have been. The who else could it

:57:13.:57:19.

have been? The chief legal officer. They both had authority to sign

:57:19.:57:26.

cheques. It would have been on the instructions of the chief legal

:57:26.:57:32.

officer. James, you said you were not involved in the decision to get

:57:32.:57:37.

rid of Tom Crone, whose decision was that? The management of the

:57:37.:57:43.

company at the time, recently the chief executive, Rebekah Brooks.

:57:43.:57:49.

it was her decision? She is the chief executive of the company and

:57:49.:57:54.

senior personnel decisions are made by her. When Stuart left the

:57:54.:57:59.

company, he left the day after all on the day allegations were made in

:57:59.:58:05.

the Guardian, allegedly about her own -- phone hacking. What happened

:58:05.:58:11.

to Stuart cut no, how did he leave the company? That I do not know.

:58:11.:58:15.

And that would have been at the time, a News of the World matter

:58:15.:58:23.

for them. It would be for you to ask him. Why did Les Hinton resign?

:58:23.:58:33.
:58:33.:58:37.

Les Hinton resigned sadly last Friday following Rebekah Brooks's

:58:37.:58:44.

resignation saying I was in charge of the company during this period

:58:44.:58:54.
:58:54.:58:55.

we are getting criticism for. He said he felt he Muster down.

:58:55.:59:01.

Rebekah Brooks, Les Hinton, were they asked to leave? They both

:59:01.:59:07.

asked to leave. Why did you not accept Rebekah Brooks resignation

:59:07.:59:13.

when she first offered to do it? Because I trust her. Why did you

:59:13.:59:20.

accepted the second time round? was insistent. She was at a point

:59:20.:59:26.

of extreme anguish. How much have all of these characters been paid

:59:26.:59:31.

off? How much financial settlement have they been given on their

:59:31.:59:36.

departure from News International? I cannot tell you, but in the case

:59:36.:59:41.

of Les Hinton, it will be considerable because there will be

:59:41.:59:49.

pensions for 52 years' service. Would it be 10 million, 5 million?

:59:49.:59:56.

It is confidential. Is there any confidentiality in the pay-off they

:59:56.:00:01.

are not supposed to speak about what happened, with their time at

:00:01.:00:11.
:00:11.:00:16.

When somebody leaves the business in circumstances like this, there

:00:16.:00:21.

are commercial confidentiality agreements but nothing that would

:00:21.:00:25.

stop or inhibit the executives from co-operating fully with

:00:25.:00:29.

investigations or being transparent about any wrong doing or anything

:00:29.:00:32.

like that. It's important to know in these agreements, they are made

:00:32.:00:37.

on the basis of no evidence of impropriety, and if evidence of

:00:37.:00:43.

impropriety images, or was their prior to that the party, then you

:00:43.:00:48.

would have a different piece, but that's an important pointer to be

:00:48.:00:54.

clear about. My final question is, it seems to me on the face of it,

:00:54.:00:58.

the News of the World was sacrificed in order to try and

:00:58.:01:02.

protect Rebekah Brooks's position at News International, in effect,

:01:02.:01:10.

rather than her being, having her departure announced, the News of

:01:10.:01:14.

the World was offered up to deal with the whole thing. Do you regret

:01:14.:01:19.

making a decision, closing the News of the World to try to save a

:01:19.:01:23.

Rebekah Brooks and, in hindsight, do you wish you had accepted her

:01:23.:01:29.

resignation to start with, in order that that paper could probably

:01:29.:01:32.

continue and all of the people now out of work, struggling to find a

:01:32.:01:37.

job, could still be in work? regret the fact people won't be

:01:37.:01:44.

able to find work. The two decisions are totally unrelated.

:01:44.:01:50.

Absolutely and totally unrelated. When you came into the UK, your

:01:50.:01:56.

priorities was Rebekah Brooks. not sure I said that. I went aside

:01:57.:02:00.

my flat and I had about 20 microphones stuck in my mouth, so

:02:00.:02:07.

I'm not sure what I said. You were misquoted. I'm not saying that.

:02:07.:02:14.

It's important that the closure of a newspaper with a history 160

:02:14.:02:22.

years, is something which the great thing, something which is a serious

:02:22.:02:28.

matter of regret for as, for the company, but much more serious than

:02:29.:02:34.

that is the seriousness of the violation of privacy, the her to

:02:34.:02:39.

that certain individuals the News of the World caused to the victims

:02:39.:02:46.

of voice mail interceptions and their families -- hurt. I advocated

:02:46.:02:51.

that this was a step that we should take. This was a newspaper and

:02:51.:02:55.

title which had fundamentally violated the trust of its readers.

:02:55.:03:01.

It is something which was a matter of great regret, real gravity but,

:03:01.:03:11.
:03:11.:03:13.

under the circumstances, and with respect to the bad things that

:03:13.:03:16.

certain things happened at the News of the World a couple of years ago,

:03:16.:03:20.

it was the right choice for the paper to cease publication. Now, it

:03:20.:03:26.

is important to note, and they want to be clear on this, the company is

:03:26.:03:31.

doing everything it can to make sure that journalists and staff at

:03:31.:03:34.

the News of the World to add nothing to do with any of these

:03:34.:03:38.

issues, who are completely blameless, in any of these things,

:03:38.:03:42.

and many have done a tremendous work journalistically,

:03:42.:03:46.

professionally, commercially, and for the business, that we find re-

:03:46.:03:50.

employment for them whenever we can and I think the company is being as

:03:50.:03:57.

generous as we can be under the circumstances. The company is being

:03:57.:04:00.

as thoughtful and compassionate for them and their families to get

:04:00.:04:04.

through this, but it is a very regrettable situation and one that

:04:04.:04:14.

we did not take lightly in any way. I'm going to ask for numbers. We do

:04:14.:04:20.

still have some way to go. Thank you, John. I want to return

:04:20.:04:27.

to how John opened the session and the evidence given previously. In

:04:27.:04:30.

connection with Mr Davies's question, there was one key

:04:30.:04:36.

question he omitted to ask. James, through all the civil actions, have

:04:36.:04:43.

you been paying Glenn Mulcaire lack of legal fees, not personally?

:04:43.:04:53.
:04:53.:04:53.

said earlier,... Let's keep it short. Yes or no. I don't know the

:04:53.:04:59.

current status. Have you been paying legal fees for Glenn

:05:00.:05:03.

Mulcaire during the civil actions? I don't know the details of the

:05:03.:05:10.

civil actions but I do know that certainly, legal fees were paid for

:05:10.:05:15.

Glenn Mulcaire by the company. I was as shocked to learn that as you

:05:15.:05:20.

off. Can you understand that people might ask why a company might wish

:05:20.:05:24.

to pay the legal fees of a convicted felon who has been

:05:24.:05:31.

involved in the destruction of a reputation? Was it to buy his

:05:31.:05:35.

silence? I can understand that. That's exactly why I ask the

:05:35.:05:42.

question. When the allegations came out I said, are we doing this? Is

:05:42.:05:48.

this what the company is doing? On a legal advice, and again, I don't

:05:48.:05:51.

want to be legalistic, I'm not a lawyer, but these are serious

:05:52.:05:54.

litigation has. It's important for all the evidence from the

:05:54.:05:57.

defendants to get to court of the right time and the strong advice

:05:58.:06:04.

was, from time to time, it was customary to pay co-defendants's

:06:04.:06:10.

legal fees. I have to rest on counsel's advice on some of these

:06:10.:06:13.

litigation matters. If the organisation still contributing to

:06:13.:06:20.

his legal fees? I don't know the precise status of that now but I do

:06:20.:06:29.

know that I asked for those things to cease. Will you let us know?

:06:29.:06:39.
:06:39.:06:40.

happy to follow up on that. Murdoch senior, is it not time for

:06:40.:06:44.

the organisation to say enough is enough? This man allegedly hacked

:06:44.:06:50.

the phone of the murdered schoolgirl Milly Dowler. Is it not

:06:50.:06:55.

time for the organisation to say, do your worst? You have behaved

:06:55.:07:00.

disgracefully. We're not going to pay any more of your costs. I would

:07:00.:07:06.

like to do that. I don't have the status of what we're doing a or

:07:06.:07:10.

indeed what his contract was and whether it still has any course.

:07:10.:07:14.

The if the organisation is still paying his fees, will you give the

:07:14.:07:18.

instruction now that that will stop? Provided it's not in breach

:07:18.:07:26.

of contract, a legal contract, yes. I just want to return now to the

:07:26.:07:30.

question of making statements to Parliament without being in full

:07:30.:07:35.

possession of the facts. During our inquiry into 1009, all the

:07:35.:07:42.

witnesses who came to us testified to been intimately involved, in

:07:42.:07:47.

particular a huge lot but e-mails after the arrival of Colin Myler.

:07:47.:07:51.

It seems over the past few days, they have been quick to distance

:07:51.:08:01.
:08:01.:08:03.

themselves from that investigation according to the newspapers. It has

:08:03.:08:07.

made clear that that investigation uncovered no new evidence. James

:08:07.:08:13.

Murdoch, can you tell us about the e-mails, the internal reports,

:08:13.:08:23.
:08:23.:08:24.

discovered allegedly in the offices of Harbottle & Lewis? Can you tell

:08:24.:08:28.

us when you first came to know about it? What is in it? I first

:08:28.:08:34.

came to know about but earlier this year, in a 2011. Can you be more

:08:34.:08:44.

precise? It would have been around springtime of I don't remember the

:08:44.:08:52.

exact date. Before April? April or May. I can try to find the media

:08:52.:09:01.

schedules and come back for so a few months ago. I can speak a

:09:01.:09:05.

little bit about it, but as to the activity that was carried out in at

:09:05.:09:14.

2007, again, I pieces back together from the past, be formed any of my

:09:14.:09:20.

involvement, but the company at the time, I think you're referring to a

:09:20.:09:26.

dismissal case that was brought by a Mr Goodman, and that was the

:09:26.:09:34.

basis for conducting the period of the convictions. That is what we

:09:34.:09:42.

inferred in our report last year. It was right at the time Colin

:09:42.:09:45.

Myler had come in and the code of standards have been talked about,

:09:45.:09:55.

this was before my time, and an investigation was done around this

:09:55.:10:02.

and there was an outside council brought in, Harbottle & Lewis, by

:10:02.:10:05.

the company at the time, and I understand that the Legal

:10:05.:10:10.

executives, Mr Chapman at the time, along with Colin Myler who

:10:10.:10:17.

testified, took a report and from that, the opinion was clear that,

:10:17.:10:25.

as to their review, there was no additional illegality with respect

:10:25.:10:30.

to phone hacking at in that file. As to their review, that was the

:10:30.:10:34.

opinion. The company really rested on a number of things from then on

:10:34.:10:39.

and they certainly know in at 2009, when additional allegations came in

:10:39.:10:44.

the summer, the company rested on a handful of those things for I want

:10:44.:10:51.

to move right up to date to what was discovered in the offices of

:10:51.:10:57.

Harbottle & Lewis. So, in at 2010, after the civil

:10:57.:11:07.
:11:07.:11:07.

litigation has had put a spotlight on the company, new information had

:11:07.:11:11.

not been there before and the police investigation started off.

:11:11.:11:16.

One of the things which was locked up, I suppose, in the spring, by

:11:16.:11:20.

senior people at a News International, was that file. It

:11:20.:11:25.

was looked at again, and it was rapidly brought to our attention

:11:25.:11:32.

that this was something. When was this look that? Between May, April

:11:32.:11:41.

May-June. Who looked at it first? William Lewis? The people managing

:11:41.:11:44.

the work on behalf of News International from earlier this

:11:44.:11:54.
:11:54.:11:54.

year, led by Mr Lewis, that's correct. What is in that file? A

:11:54.:12:02.

collection of 300 e-mails, loosely bandied? As you know, there's an

:12:02.:12:05.

ongoing criminal investigation and I think it would be wrong of me to

:12:05.:12:13.

talk about specific information and evidence subject to, which could

:12:13.:12:17.

make problems to the police. don't thing it could cause problems

:12:17.:12:27.
:12:27.:12:29.

if you tell us whether it was in a It is pay but also of his e-mails,

:12:29.:12:39.
:12:39.:12:40.

documents. -- It is paper. But also e-mails. Have you read it all?

:12:40.:12:45.

things have been shown to me. I have not read it. Did you use an

:12:45.:12:51.

expletive when you first read some of these e-mails? I try not to.

:12:51.:12:56.

Occasionally when you do? reaction immediately was to agree

:12:56.:12:59.

with the recommendation of the executives involved but this was

:12:59.:13:03.

something we should bring to the police with respect to the ongoing

:13:03.:13:07.

investigations and perhaps a new ones. When was it given to the

:13:07.:13:14.

police? June 20th? Up to inform the board. That date is accurate?

:13:14.:13:24.
:13:24.:13:26.

yes. The Sunday Times, great newspaper, portrayed a picture on

:13:26.:13:31.

10th July from this file that showed a six gatekeepers of the

:13:31.:13:38.

news desk who dealt with Glenn Mulcaire. And they were named for

:13:38.:13:43.

that Clive Goodman. James Weatherall. Ian Edmondson. Do you

:13:43.:13:49.

recognise that summary from the file? Mr Farrelly, respectfully, I

:13:49.:13:54.

would ask you to please understand it but detailed questions about any

:13:54.:14:00.

of the evidence, information we are passed to the police in relation to

:14:00.:14:06.

the ongoing criminal inquiries are difficult for me to answer. I would

:14:06.:14:10.

appreciate it if we would allow the police to undergo the important

:14:10.:14:14.

work that they are undergoing. There is a process which is

:14:14.:14:18.

important. We are co-operating with it and provide the information on a

:14:18.:14:23.

regular basis. On a regular basis as needed by the police. I really

:14:23.:14:28.

believe we have to allow the police to conduct their investigation and

:14:28.:14:33.

told the people who did wrong to account in this area. OK, I will

:14:33.:14:43.
:14:43.:14:44.

On anything now. It could result in guilty people... I fully understand

:14:44.:14:53.

that and I respect that clearly. The descriptions and the press said

:14:53.:14:57.

they mentioned the e-mails implicate Andy Coulson in knowledge

:14:57.:15:00.

of payments to the police but they were not expected to comment on

:15:00.:15:05.

that so I will just turn to the Harbottle & Lewis letter provided

:15:05.:15:15.
:15:15.:15:15.

to ask by Rebekah Brooks as evidence during her inquiry, the e-

:15:15.:15:25.

mails have produced nothing more. That letter from Lawrence Abraham,

:15:25.:15:31.

senior partner of Harbottle & Lewis, I mention that e-mails have been

:15:31.:15:35.

reviewed of Andy Coulson, Stuart coupler, Ian Edmondson, Clive

:15:35.:15:42.

Goodman, and Jules Stenson, and that nothing had come to light in

:15:42.:15:48.

that review which contradicted the report -- a lone reporter working

:15:48.:15:52.

with Glenn Mulcaire. Knowing what you know now, from the other

:15:52.:15:59.

evidence you discovered, have you looked back in detail at the basis

:15:59.:16:09.
:16:09.:16:20.

And why they gave such a clean bill of health? Having looked at some of

:16:20.:16:26.

the things in that and the advice of the senior people inside the

:16:26.:16:30.

company more recently that went and looked at that, it was the view of

:16:30.:16:34.

the company's self- evidently, it was right to bring this to the

:16:34.:16:38.

attention of the police and go forward. And that opinion from the

:16:39.:16:43.

council was something the company rested on and it was a clear

:16:43.:16:49.

opinion about a review that was done around those records. And in

:16:49.:16:52.

addition in conjunction with the police continuing to say there was

:16:52.:16:57.

no new evidence and there was no reason to open a new investigation,

:16:57.:17:02.

and in conjunction with the PCC saying they had done their review

:17:02.:17:06.

an inquiry and there was nothing new. It was viewed it was a settled

:17:06.:17:11.

the matter. It was only when you evidence emerged those three things

:17:11.:17:16.

began to be undermined. In the follow up to the session, can you

:17:16.:17:19.

provide us with the instruction that was given to Harbottle & Lewis,

:17:19.:17:24.

the information, the extent of the information given to them out of

:17:24.:17:28.

the totality of the information available? That detail would help

:17:28.:17:34.

us conclude... If there is additional detail required around

:17:34.:17:41.

some of those legal instructions we will consult and come back to the

:17:41.:17:46.

chairman in a way to satisfy you with the information you have.

:17:46.:17:54.

review coincided not so much with Mr miler's a rival but in timing

:17:54.:18:00.

with the industrial tribunal action that Clive Goodman and Glenn Moore

:18:00.:18:06.

clerk were planning. Do you know it was limited to the six individuals?

:18:06.:18:13.

I don't know, I think... I was not there at the time and they cannot

:18:13.:18:16.

tell you the conversations people had with Harbottle & Lewis and the

:18:16.:18:24.

terms of reference of that. Be it had been viewed after the fact it

:18:24.:18:30.

had been a thorough look at information based on that reviewed

:18:30.:18:35.

that opinion was issued. Neville further back is one of mission that

:18:35.:18:41.

is immediately jumping out. Again, in hindsight we can all say that

:18:41.:18:45.

somebody had looked at this, and if somebody had known some think that

:18:45.:18:50.

it was unknown at the time, I cannot comment on why the terms and

:18:50.:18:58.

wider scope was what it was. proceedings by a Clive Goodman and

:18:58.:19:05.

Glenn Mulcaire for unfair dismissal, not withstanding their criminal

:19:05.:19:08.

conditions never saw the light of day because they were settled

:19:08.:19:13.

because then we do not know what they were planning to serve on you.

:19:13.:19:19.

The you-know-what allegations they were making? Have you satisfied

:19:19.:19:23.

yourself with what types of allegations they were making?

:19:23.:19:28.

think some of these individuals are subject to criminal investigation.

:19:28.:19:32.

Some of them have been arrested recently and they are important

:19:32.:19:37.

matters for the police now. It is important I am not lead into

:19:37.:19:41.

commenting specifically about individuals for allegations made in

:19:41.:19:47.

the past. Have you satisfied yourself as to what Clive Goodman

:19:47.:19:51.

and Glenn Mulcaire were alleging in discussions that led up to the

:19:51.:19:55.

settlements, if they brought industrial tribunal proceedings

:19:55.:20:00.

against you? That was the question. Not what they were alleging, but

:20:00.:20:04.

have you satisfied yourself about what they were alleging? As for

:20:04.:20:08.

Glenn Mulcaire I am not aware of allegations at the time and other

:20:08.:20:14.

things. And in 2007, with Clive Goodman again, before I was there,

:20:14.:20:18.

it is my understanding that is what Harbottle & Lewis were helping to

:20:18.:20:23.

do with and they did satisfy the company at the time and the company

:20:23.:20:28.

rested on that opinion for a period of time. Would you like to take the

:20:28.:20:33.

opportunity to withdraw this letter as an accurate portrayal as to what

:20:33.:20:38.

went on at the News of the World? This is the Harbottle & Lewis

:20:38.:20:44.

letter? It is something I am glad you have asked about. It is a bit

:20:44.:20:50.

of the legal advice from senior council that was provided to the

:20:50.:20:55.

company and the company rested on. It goes some distance in providing

:20:55.:21:00.

information as to why it took so long to provide that information.

:21:00.:21:05.

It was one of the basis for a push back the company made against new

:21:05.:21:09.

allegations. It is one of the pillars are the environment around

:21:09.:21:14.

the place that led the company to believe that these matters were

:21:14.:21:19.

from the past and new allegations... The question was different Mr

:21:19.:21:23.

Murdoch. I astute whether this letter, which is still lying on the

:21:23.:21:28.

record as evidence to Miss -- this committee, would you like to

:21:28.:21:36.

withdraw it? Respectfully, I'm not a were of the legal technicalities

:21:36.:21:42.

of withdrawing that or submitting it on the record. It is a relevant

:21:42.:21:47.

document in trying to understand how News International was thinking

:21:47.:21:53.

at the time. I can say no, but I come back after taking Council.

:21:53.:22:00.

want to wind up, given the time but I have a few more questions. As you

:22:00.:22:05.

have described it, and as Colin Myler described it, the

:22:05.:22:12.

investigation was carried about by the IT department and was overseen

:22:12.:22:15.

by the Director of Legal Affairs, John Chapman and the page are

:22:15.:22:21.

director, Daniel cloak. Is that your understanding? Pardon me, what

:22:21.:22:28.

is the question? The investigation yourself, you describe it to us and

:22:28.:22:32.

Colin Myler describe it to us, it was carried out by the IT

:22:32.:22:37.

department and overseen by the Director of Legal Affairs, John

:22:37.:22:41.

Chapman and the page are personnel director, Daniel cloaks. Is that an

:22:41.:22:47.

accurate description? That is my understanding. Why has John Chapman

:22:47.:22:53.

left the organisation? John Chapman and the organisation decided it was

:22:53.:22:58.

in mutual interest to part ways. I think one of the pieces here it is

:22:58.:23:04.

for the company to move forward, and it is for, and I think this is

:23:04.:23:08.

important, many of the individuals, even if there is no evidence of

:23:08.:23:16.

wrongdoing, or anything like that and no evidence of impropriety,

:23:16.:23:21.

many individuals have chosen it is time to part ways. I was not

:23:21.:23:26.

involved with the discussions with Mr Chapman. You have no information

:23:26.:23:30.

of complicity by Mr Chapman to cover up the file? I have no

:23:30.:23:35.

knowledge. Can you tell us their employment status of Daniel cloak?

:23:35.:23:41.

He left some time ago, I don't know what he is doing. He is not in the

:23:41.:23:46.

business. He was director of human resources for a number of years,

:23:46.:23:53.

not that many, I am not sure. quickly, the witnesses who came to

:23:53.:24:03.
:24:03.:24:04.

us. In respect of the file you have discovered this year, regarding Les

:24:04.:24:09.

Hinton, when did he first become aware of this collection of the e-

:24:09.:24:19.
:24:19.:24:19.

mails and paper, you disk covered - - discovered, when did he hear

:24:19.:24:26.

about it? I cannot speak to his knowledge of that. Are you

:24:26.:24:32.

referring in 2011 or 2007? This document that was left... In 2007?

:24:32.:24:39.

I cannot speak to his knowledge, but I know Les Hinton was aware of

:24:39.:24:43.

the work that had been carried out and I think he has testified to

:24:43.:24:49.

this committee as to that effect. Mr Murdoch's senior, had you asked

:24:49.:24:56.

lessons at last -- Les Hinton if he knew about this document? No.

:24:56.:25:04.

not? About? The document that was discovered in April, May in the

:25:04.:25:14.
:25:14.:25:15.

offices of Harbottle & Lewis? have not asked him. And I think he

:25:15.:25:20.

has testified to this, as the chief executive of News International at

:25:20.:25:26.

the time wouldn't have been expected to read hundreds and

:25:26.:25:31.

thousands of e-mails, but it would rely on the opinion of council.

:25:31.:25:39.

Colin Myler aware of this evidence lying with Harbottle & Lewis?

:25:39.:25:47.

cannot speak to other individuals knowledge in the past. I simply

:25:47.:25:54.

cannot speak for them. And Stuart cut and a? The same goes, I cannot

:25:54.:26:02.

speak for them. And Rebekah Brooks? I simply cannot speak. I cannot

:26:02.:26:06.

speak about the knowledge of Rebekah Brooks when she was chief

:26:06.:26:10.

executive of this, but she brought it to my attention as a new thing.

:26:10.:26:19.

To finish off this questioning, we are left now in a situation, you

:26:19.:26:23.

having looked into this affair, having co-operated with the police,

:26:23.:26:30.

cannot tell us who lodged the file with Harbottle & Lewis. He was

:26:30.:26:36.

aware of its contents and who kept you from being in the full

:26:36.:26:42.

possession of the facts, evidence that is clearly now being submitted

:26:42.:26:47.

to the police which contradicts all of the assurances we were given,

:26:47.:26:53.

not in one but in two select committee inquiries? Frankly, I

:26:53.:26:58.

hope he would agree it is unsatisfactory? I can say the

:26:58.:27:04.

company at the time engaged in -- engaged an outside law firm to

:27:04.:27:09.

review a number of these e-mails. They reviewed an opinion based on

:27:09.:27:14.

the review issued to the company of a respected law firm and the

:27:14.:27:20.

opinion was clear. The company rested on that. I cannot speak to

:27:20.:27:25.

individuals knowledge at different times because I simply don't know.

:27:25.:27:31.

The company rested on that, rested on the fact the police told us

:27:31.:27:34.

there was no new evidence and no reason for a new investigation and

:27:34.:27:39.

rested on the opinion of the PCC there was no reason to carry it

:27:39.:27:42.

further. It wasn't until new evidence emerged from the civil

:27:43.:27:49.

litigation is that it would go in on that the company immediately

:27:49.:27:54.

went to the police, restarted this. And the company has done the right

:27:54.:27:59.

thing. This was evidence that was lying with your lawyer's at the

:27:59.:28:09.
:28:09.:28:12.

same time, it did not emerge simply out of litigation. It was looked at

:28:12.:28:16.

in conjunction with the new and restarted criminal investigation.

:28:16.:28:21.

These are serious matters and we take them seriously. When it was

:28:21.:28:25.

looked at, it was deemed these things would be of interest to the

:28:25.:28:31.

police, we brought in additional council, Lord MacDonald, who you

:28:31.:28:35.

mentioned earlier, to help advise the company on the appropriate way

:28:35.:28:39.

forward in terms of full transparency and co-operation with

:28:39.:28:43.

the police investigations were. They are serious matters and the

:28:43.:28:50.

company took them at very seriously. Mr Rupert Murdoch, two questions.

:28:50.:28:58.

The situation I painted, we are now here, not knowing who at News

:28:58.:29:06.

International, News of the World was complicit in keeping that file

:29:06.:29:11.

containing however many bits of paper, we are no where near a

:29:11.:29:15.

knowing who knew what and when about that file. Evidence that

:29:16.:29:20.

clearly contradicts, not only statements given to the select

:29:20.:29:27.

committee, but evidence as it would appear that it leads your closest

:29:27.:29:31.

and trusted aide over many years, Les Hinton to give misleading

:29:31.:29:37.

evidence. Defined it a satisfactory state of affairs? No, I do not.

:29:37.:29:41.

What do you think the company should do in the follow-up to this

:29:41.:29:47.

select committee inquiry? Chapman, who was in charge of this

:29:47.:29:57.

has left us. And, he had that report for a number of years. It

:29:57.:30:02.

wasn't until Mr Lewis looked at it carefully we immediately said we

:30:02.:30:08.

need legal advice, go to the police with this and how we should present

:30:08.:30:17.

it. The file was what the law firm and there wouldn't have been any

:30:17.:30:22.

reason to look at it. The opinion was clear based on the review that

:30:22.:30:28.

was stunned. As soon as it was in a new criminal investigation, it was

:30:28.:30:38.
:30:38.:30:39.

deemed appropriate to look at and Given the picture painted of

:30:39.:30:43.

individuals on the newsdesk, asking it -- acting as a great cure for a

:30:43.:30:48.

private investigator, do you think it's possible at all what editors

:30:48.:30:52.

of your newspaper would not have known about these activities? Do

:30:52.:30:58.

you think it's remotely possible? can't say that because of the

:30:58.:31:08.
:31:08.:31:09.

police inquiry. And the coming judicial proceedings. That's all I

:31:09.:31:18.

can tell you except it was my understanding... I better not say

:31:18.:31:25.

it... That Colin Myler was appointed by a Mr Hinton to find a

:31:25.:31:35.

what the hell was going on and he commissioned that inquiry. Now,

:31:35.:31:41.

that is my understanding of it. I cannot see where to the accuracy of

:31:41.:31:48.

it. Thank you. I am going to appeal for brevity because we have been

:31:48.:31:58.
:31:58.:31:59.

going for two hours now. James Murdoch, it's a mystery to us

:31:59.:32:03.

how Sunday newspapers are run. I'm familiar with the engineering

:32:03.:32:10.

industry. Can you paint a picture of a week's operation at the News

:32:10.:32:17.

of the World? What period were you controlling the News of the World?

:32:17.:32:24.

My involvement overseeing Europe and Asia, in at 2008, the middle of

:32:24.:32:29.

December, I was chief executive for Europe and Asia, the television

:32:29.:32:36.

business, and the UK publishing business. One title of which is the

:32:36.:32:40.

News of the World. I can't say that I was ever intimately involved with

:32:40.:32:46.

the workings of the News of the World. What results would come to

:32:46.:32:52.

you seven days after publication? Presumably the advertising, sales,

:32:52.:32:58.

income, and to run the paper on the profitability, week by week,

:32:58.:33:08.
:33:08.:33:09.

presumably? I know Rupert Murdoch is far removed from that. Yes,

:33:09.:33:14.

these are enterprises. Sales and advertising figures. Personnel

:33:14.:33:18.

numbers and all those things, they are relevant. Managers look at

:33:18.:33:27.

these things. We understand that when it comes to legal issues,

:33:27.:33:32.

settlements of claims, that is taking out side from the day-to-day

:33:32.:33:41.

management of the newspaper. Each group of companies will have their

:33:41.:33:44.

own legal executives who will deal with things like libel and other

:33:44.:33:47.

things and we'll try to check that something does not going to the

:33:47.:33:51.

paper which will be wrong etc. Sometimes it's right, sometimes

:33:51.:33:57.

it's wrong, but each has its own resources. Each manager is involved

:33:57.:34:07.
:34:07.:34:09.

in that. The editor of the News of the World... My son's typical week

:34:09.:34:19.
:34:19.:34:21.

could well have been a day in a Munich, or in a Italian Sky TV. We

:34:21.:34:30.

had a difficult situation with a tricky competitor. He had a lot on

:34:30.:34:37.

his plate. I will leave a more of the mundane issues, then. It became

:34:37.:34:42.

clear from the first couple of questions to you, Rupert Murdoch,

:34:42.:34:49.

you were kept in the dark quite a bit. On serious issues. Not in the

:34:49.:34:54.

dark. I may have been lax in not asking but it was such a tiny part

:34:54.:35:00.

of our business. But you wouldn't be here if it was an extremely

:35:00.:35:07.

serious. It has become extremely service. -- serious. Is there no

:35:07.:35:12.

written rules that certain things have to go straight to the very

:35:12.:35:21.

top? It sounds as if there are no such things. Anything seen as a

:35:21.:35:28.

crisis comes to me. I think it's important to know the difference

:35:28.:35:31.

between being kept in a dark and a large company, the management of

:35:31.:35:35.

which is delegated, two managers of different companies within the

:35:35.:35:41.

group and so on and so forth. I think to suggest that my father and

:35:41.:35:45.

myself were kept in the dark is a different thing from suggesting the

:35:45.:35:50.

management and the running of these businesses are often delegated to

:35:50.:35:56.

chief executives, and editor, and managing editor, and decision-

:35:56.:36:00.

making has to be there. There are threshold of materiality, if you

:36:00.:36:06.

will, whereby things have to move upstream so something has to be

:36:06.:36:10.

brought to the attention. From a financial point of view, we address

:36:10.:36:14.

that earlier would respect of settlement out-of-court settlement

:36:14.:36:20.

with Mr Taylor. But also from the standpoint of things like alleged

:36:20.:36:25.

criminality, violations of our code of conduct, things like that, those

:36:25.:36:30.

are things which the company's internal audit function, as well as

:36:30.:36:33.

the audit committee and senior executives of the committee are

:36:33.:36:39.

expected to be made aware of. As they were in the case of the

:36:39.:36:47.

criminal prosecutions in 2007. Whatever efforts were made and

:36:47.:36:52.

whatever rules their work, we have reached News International Mac was

:36:52.:36:57.

crisis point, otherwise you wouldn't be here today and the News

:36:57.:37:00.

of the World wouldn't have been closed. Who do you hold responsible

:37:00.:37:06.

for that failure? You say people should have told you. You're really

:37:06.:37:10.

saying to us now, not that they should have told you, but you will

:37:10.:37:16.

let them get on and manage it. What has gone wrong? It's a good

:37:16.:37:20.

question but I'm not saying somebody should have told me. To my

:37:20.:37:25.

knowledge, certain things were not known. When a new information came

:37:26.:37:30.

to light in respect to my knowledge of these events and the

:37:30.:37:35.

understanding of new information coming to light, the company acted

:37:35.:37:42.

on it in a right and proper way as best it could. But it is difficult

:37:42.:37:45.

saying the company should have been told something if it's not known

:37:45.:37:50.

but a thing was a known fact to be told. Now, I have been asked today

:37:50.:37:55.

about what other new people knew then, and I can only tell you what

:37:55.:38:02.

they told me or what they have told you in previous hearings, and I

:38:02.:38:05.

understand completely your frustration about this. You can

:38:05.:38:10.

imagine my own frustration in the 2010 When this civil litigation

:38:10.:38:17.

came to a point where these things were coming out and I suddenly

:38:17.:38:24.

realised, actually, the denial of allegations made earlier,

:38:25.:38:29.

particularly in a 2009, had been too strong. And that is a matter of

:38:29.:38:34.

real regret because all the facts were not known when that was done

:38:34.:38:39.

and that is a matter of deep regret. That is why we are here today with

:38:39.:38:44.

you trying to be as transparent as you possibly can. I suppose this is

:38:44.:38:49.

a rhetorical question. I'm sure your answer will be what I expect,

:38:50.:38:54.

but it is admirable that fact you have had such long-term employees

:38:54.:39:04.
:39:04.:39:06.

who have become very close friends. Rupert explained that with his

:39:06.:39:10.

determination to look after Rebekah Brooks, so it is admirable, but

:39:10.:39:15.

there was a lot of criticism at the time. This is not a criticism,

:39:15.:39:25.
:39:25.:39:26.

James, of your ability, but that it was nepotism to a point you. --

:39:26.:39:36.

appointee. -- a point you. Do you regret it has become a family

:39:36.:39:46.
:39:46.:39:49.

organisation? When the job became available as head of BSkyB, several

:39:49.:39:59.

people applied, including my son. They passed all sorts of board

:39:59.:40:07.

committees, outside experts, etc, who came to the conclusion that he

:40:07.:40:17.
:40:17.:40:22.

a field day. When he left to go to, I promoted him to take charge of

:40:22.:40:31.

much wider responsibilities, we had calls from all the big shareholders

:40:31.:40:34.

saying it was a terrible thing to take him away because he had done

:40:34.:40:43.

such a great job. I wasn't disputing his ability. The fact

:40:43.:40:47.

that you didn't know about so many of these criminal activities which

:40:47.:40:52.

went on, do you not think that was made more likely because of the

:40:52.:40:57.

family history? I'm talking about people are not direct members of a

:40:57.:41:06.

family but became friends? No. I don't think that. It has been

:41:06.:41:11.

mismanaged. I don't think Les Hinton this led me for me but you

:41:11.:41:16.

must find out that and make your own conclusions. Other people who

:41:16.:41:19.

gave evidence may have been misleading you, but he certainly

:41:19.:41:23.

did not know of anything. Thank you very much. I have a two more

:41:23.:41:30.

members. I would like to make a short

:41:30.:41:33.

declaration of my own which was something previously declared to

:41:33.:41:38.

the committee to say my wife is employed by News Corporation has

:41:38.:41:44.

never worked on his account and has no access to information on this.

:41:44.:41:49.

Mr Rupert Murdoch, you said earlier on that we live in a transparent

:41:49.:41:52.

society. Do you think it's right people in public life can expect

:41:52.:42:02.
:42:02.:42:03.

total privacy? No. I noticed in the Watergate investigation for example,

:42:03.:42:07.

personal banking and phone records were used belonging to one of the

:42:07.:42:12.

witnesses, relevant that investigation. To what extent you

:42:12.:42:16.

think the use of confidential private information, phone records,

:42:16.:42:21.

phone hacking, is permissible? Phone hacking is something quite

:42:21.:42:25.

different but I do believe that investigative journalism,

:42:25.:42:31.

particularly competitive, does lead to a more transparent and open

:42:31.:42:41.
:42:41.:42:46.

society. I think we're a better society because of it. We are

:42:46.:42:50.

probably more an open society than the USA. Where do you draw a line

:42:50.:42:54.

on that? Where are the boundaries of legitimate investigation? What

:42:55.:43:04.
:43:05.:43:12.

is out of bounds? I'm sorry to say this, when the Daily Telegraph

:43:12.:43:19.

bought a series of stolen documents of all the expenses of MPs, it

:43:19.:43:24.

caused a huge outcry. One of which I feel has not been properly

:43:24.:43:32.

addressed. There is an answer to it. We ought to look at the most open

:43:32.:43:38.

and clear society in the world, Singapore, where every minister

:43:38.:43:42.

gets at least a million dollars a year and the Prime Minister a lot

:43:42.:43:46.

more and there is no temptation, and it is the cleanest society you

:43:46.:43:50.

will find anywhere. Good luck in selling that idea!

:43:50.:43:59.

I mean that seriously. It is ridiculous. People were reduced to

:43:59.:44:05.

doing what they did. I think it's a very good question and an important

:44:05.:44:09.

question and I understand it's going to be one of the subjects of

:44:09.:44:12.

the judicial inquiry which the Prime Minister announced last week,

:44:12.:44:18.

which, as a company, we immediately welcome and look forward to. This

:44:18.:44:22.

question of public interest, the question of what is acceptable and

:44:22.:44:25.

what isn't in terms investigative techniques is an important one but

:44:25.:44:29.

let me be clear, the codes of conduct of News Corporation

:44:29.:44:32.

globally for our employees, journalist and otherwise, are very

:44:32.:44:37.

clear, that breaking the law is a very, very serious matter and

:44:37.:44:41.

people who are law-breakers should be held to account. In the matter

:44:41.:44:45.

of something like phone hacking and payments to police, and things like

:44:45.:44:48.

that, we just don't think they should have any place in our

:44:48.:44:53.

business. You would be very clear within your company, your

:44:53.:44:55.

organisation, senior people should have been aware phone hacking was

:44:56.:45:04.

not only illegal but totally unacceptable? I think after the

:45:04.:45:08.

successful prosecutions and convictions of the individuals

:45:08.:45:13.

involved in 2007, it could not be taken more seriously and if new

:45:13.:45:17.

evidence emerges, as it has in cases, the company acts on it very

:45:17.:45:25.

very quickly. The what extent do think of a cultural problem? Duping

:45:25.:45:28.

people only tell you things you want to hear and even people who

:45:28.:45:32.

have been your trusted advisers simply withhold information because

:45:32.:45:42.
:45:42.:45:48.

No, not my trusted advisers. should hear the conversations in my

:45:48.:45:56.

office. A lot of you trusted advisers... A lot of people say I

:45:56.:46:01.

have crazy ideas. A lot of your trusted advisers have left your

:46:01.:46:07.

company? We are a very big company. I'm sure I get people who try to

:46:07.:46:12.

please me. That could be human nature and it is up to me to see

:46:12.:46:21.

through that. What is the pressure on senior managers and editors to

:46:21.:46:26.

get scoops that leads them to take risks and clearly in the case of

:46:26.:46:32.

the News of the World, push boundaries that broke the law?

:46:32.:46:37.

you ask that again, I am sorry. you think there is a pressure on

:46:37.:46:41.

editors of Your News papers which leads them to take risks and break

:46:41.:46:46.

boundaries? In the legal -- in the News of the World, there was

:46:46.:46:51.

illegal action and people but the law to get scoops? The to totally

:46:51.:47:01.

wrong. There is no excuse for breaking the law at any time. It is

:47:01.:47:05.

right for all newspapers, when they wish to to campaign for a change in

:47:06.:47:10.

the law. But never to break it. Just two further questions if I

:47:10.:47:20.
:47:20.:47:26.

make? -- if I may. I was brought up by a father who was not rich, but

:47:26.:47:36.
:47:36.:47:42.

made a great journalist. And he, just before he died left a piece of

:47:42.:47:47.

paper in his will, specifically giving me the chance to do some

:47:47.:47:57.
:47:57.:48:01.

good. He gave me the chance to expose the scandal at Gallipoli.

:48:01.:48:05.

Which I am very, very proud of. Which goes to the suggestion it is

:48:05.:48:13.

a family business. Rupert Murdoch, you said earlier on you have had

:48:13.:48:17.

frequent meetings with prime ministers during your career. In

:48:17.:48:24.

the period after the arrest... wish they would leave me alone.

:48:24.:48:27.

arrest of Clive Goodman, which you said earlier on you were aware of

:48:27.:48:32.

the situation when Clive Goodman was sent to prison. In the years

:48:32.:48:36.

after that, when there were numerous reports and investigations,

:48:36.:48:41.

he rings at this Committee, did any senior politicians are you were in

:48:41.:48:45.

contact with during that period of time raise this as an issue with

:48:45.:48:50.

you, about phone hacking? Absolutely never. The prime

:48:50.:48:56.

ministers I met in those days was Mr Brown when he was Chancellor of

:48:56.:49:06.
:49:06.:49:06.

the X Cheshire. -- Chancellor of the Exchequer. His wife and my wife

:49:06.:49:12.

struck up a great friendship. We had great values that we shared, I

:49:12.:49:17.

am sorry we have come apart and I hope we can put it together again.

:49:17.:49:22.

You said in the interview you gave to the Wall Street Journal, your

:49:22.:49:26.

fellow executives at News Corporation had handled this crisis

:49:26.:49:31.

very well with just a few minor mistakes. Do you stand by that

:49:31.:49:34.

statement or do you believe the level of mistakes was far greater

:49:34.:49:43.

than that? They seem much bigger now. What we did was terrible. The

:49:43.:49:50.

handling of the crisis. I am sorry, I had just been told not to

:49:50.:50:00.
:50:00.:50:01.

gesticulate. They don't believe that either he or Les Hinton made

:50:01.:50:07.

any great mistakes. But were mistakes made within the

:50:08.:50:15.

organisation? Absolutely. People I trust it, people they trusted, we

:50:15.:50:21.

were betrayed, yes. Finally, James Murdoch, it was reported while

:50:22.:50:26.

Rebekah Brooks wrote to staff or when the News of the World closure

:50:26.:50:30.

was made, she said in a year's time they might understand why the paper

:50:30.:50:40.
:50:40.:50:41.

had to close. Are you expecting there to be more revelations to

:50:41.:50:45.

come out that made the closure of the News of the World with

:50:45.:50:50.

hindsight, inevitable? I cannot speak to what she was specifically

:50:50.:50:57.

referring to, she made those comments herself. And when she was

:50:57.:51:04.

saying goodbye, sadly to the staff. But I can say, what happened at the

:51:04.:51:11.

News of the World and the events leading up to the 2007 affairs and

:51:11.:51:16.

prosecutions and at what we know about those things now, were bad.

:51:16.:51:21.

And there are things that shouldn't have any place in our organisation.

:51:21.:51:27.

There were things we unreservedly, and since Sealey are sorry for. We

:51:27.:51:31.

haven't seen the end of this in terms of the ongoing police

:51:31.:51:35.

investigations that of her. As you know, there are a number of people

:51:35.:51:40.

who have been arrested. We don't know what is going to happen in the

:51:40.:51:47.

future around those things. Given the breach of trust, given the

:51:47.:51:53.

allegations that were emerging at a rapid pace, you know it was clear,

:51:53.:51:57.

to me anyway and I think the future will bear this out with any

:51:57.:52:01.

specific knowledge of the future obviously, it was the right thing

:52:01.:52:07.

for the paper to cease publication. Your father said in his Wall Street

:52:07.:52:13.

Journal interview, he acted as fast as he could, the moment he could.

:52:14.:52:18.

Does that suggest you have been held back at any point, had he been

:52:18.:52:24.

frustrated during this process in the past few weeks? This has been a

:52:24.:52:31.

frustrating process and my frustration, my real anger to learn

:52:31.:52:38.

there was new evidence emerging as late as the end of 2010, was real

:52:38.:52:45.

and is real. What I have done and what the company has tried to do is

:52:45.:52:49.

take new information, at just the course, behaved with propriety, the

:52:49.:52:55.

Hague quickly and behave in a humble way with respect to what has

:52:55.:53:00.

happened and with respect to trying to put it right. That is what we

:53:00.:53:05.

are trying to do. It does not mean I have any knowledge of anyone

:53:05.:53:10.

intentionally misleading me in the company, I don't. Which makes it

:53:10.:53:15.

even more frustrating. We are where we are, new information emerge

:53:15.:53:19.

through a legitimate due process of the civil trial. The company acted

:53:19.:53:26.

on it as fast as could possibly be expected. Add new allegations are

:53:26.:53:32.

emerging that the company, we are trying to deal with him as best way

:53:32.:53:42.
:53:42.:53:42.

as possible. And finally, the good news is I am your last questioner

:53:43.:53:46.

and I will try to have a few specific questions that I would

:53:46.:53:52.

like to ask you. Starting with you, Mr James Murdoch. I know we have

:53:52.:53:59.

been over at length, the differences in the settlements, the

:53:59.:54:05.

Taylor sufferance -- settlement, did that include a confidentiality

:54:05.:54:15.
:54:15.:54:21.

clause and maybe the other This hearing is suspended for 10

:54:21.:54:28.

minutes. We are leaving the committee

:54:28.:54:33.

hearing there has been some sort of altercation. We could not help but

:54:33.:54:37.

we will let you know, somebody had moved to attack Rupert Murdoch, or

:54:37.:54:43.

it was happening at his side of the table. We have had to cut away from

:54:43.:54:46.

the committee hearing and it has been postponed for at least 10

:54:46.:54:51.

minutes to get back to some order. We have heard a lot already, my

:54:51.:54:55.

three guests are still with me. I will get their overall reactions.

:54:55.:55:01.

Alastair Campbell? I think people will have been surprised how

:55:01.:55:06.

distant Rupert Murdoch seemed from everything. I thought he be came a

:55:06.:55:09.

bit more cogent in the second half. But in the first half, it was

:55:09.:55:14.

almost like, I don't really know what has gone on anyway. James

:55:14.:55:18.

Murdoch as well, there were a lot of questions where I thought, in

:55:18.:55:22.

the time he has had to research and prepare for this, he would have

:55:22.:55:26.

known the answers. He looked most uncomfortable in relation to the

:55:26.:55:33.

specific questions to Glenn Mulcaire's legal bills, and he

:55:33.:55:38.

should have known the answer. And Gordon Taylor, Louise Mensch was

:55:38.:55:42.

going when that incident occurred, and Gordon Taylor situation looks

:55:42.:55:48.

where they feel a bit vulnerable. Over all, you had a feeling of two

:55:48.:55:52.

people in charge of a company that was saying, we were not in charge

:55:52.:55:57.

of this. The theme that seemed to be coming through, sometimes from

:55:57.:56:00.

questioning that was less than penetrating, but did reveal things

:56:00.:56:07.

in the end, was the implication of a lot of the questions was, a new

:56:07.:56:13.

revelation, he continued to pay Glenn Mulcaire and Clive Goodman,

:56:13.:56:17.

the two who went down. The Guardian you that, and now we know it is

:56:17.:56:23.

definitely true. We are just giving you live pictures as I speak. We

:56:23.:56:30.

are not sure what has happened. The police moved in very quickly, or on

:56:30.:56:34.

attendance, security attend and moved very quickly when the

:56:34.:56:39.

incident happened. We saw it, just as he was seeing it, with a look of

:56:39.:56:42.

shock on the face of John Whittingdale, the chairman of the

:56:42.:56:48.

committee. It was then we knew something was happening at

:56:48.:56:50.

Portcullis House. There is very strong security in the sense you

:56:51.:56:55.

have to go through the detectors you have to go through at airports

:56:55.:56:58.

and bags are checked and so on. That does not mean somebody could

:56:58.:57:04.

at least getting he wanted to be up to no good. We will stay on these

:57:04.:57:09.

pictures for a second. I will continue with David. The

:57:09.:57:13.

implication, is that we have shut them down by paying money. The

:57:13.:57:17.

other implication of the questioning was to Mr Taylor and Mr

:57:17.:57:21.

Max Clifford, we paid them a shed load of money and that shut them

:57:21.:57:28.

down, too? That goes right to the question, which have two outcomes

:57:28.:57:31.

is this? Is it gross negligence in terms of the management not going

:57:31.:57:39.

on, or is it to cover up? wilful blindness argument. James

:57:39.:57:45.

Murdoch answered, after Mosley, the �60,000 settlement, it dropped away.

:57:45.:57:50.

He had been given advice, it will be more than this, but then it

:57:50.:57:55.

dropped away. What was interesting as well for me, I said to you at

:57:55.:58:01.

the beginning this might mean the end... I am being told, my

:58:01.:58:05.

understanding is it looks as if somebody, a woman tried to grab

:58:05.:58:10.

Rupert Murdoch from behind. And that was kind of the indication we

:58:10.:58:16.

were getting. It did look like that. Another report, Kevin Maguire of

:58:16.:58:22.

the Daily Mirror, a long-standing friend of this programme, also

:58:22.:58:29.

trying to attack Rupert Murdoch and Wendy Murdoch, Rupert Murdoch's

:58:29.:58:33.

wife who was sitting right behind him moved in to intervene when she

:58:33.:58:38.

saw that happening. These are early reports, they are not confirmed yet,

:58:38.:58:45.

so as soon as we get confirmation, we will bring it to you. I said

:58:45.:58:50.

this may be the end of the Empire, but what was interesting in

:58:50.:58:56.

watching the Emperor in action. Tom Watson's initial long series of

:58:56.:59:00.

questions serve to show essentially, Rupert Murdoch did not know what

:59:00.:59:04.

was going on in his organisation, in this part of his organisation,

:59:04.:59:10.

at all. I don't know how that will play in America, how will the

:59:10.:59:14.

shareholders look at that? How can you be at the centre of this storm,

:59:14.:59:20.

come before a select committee and appeared to be ignorant of what

:59:20.:59:24.

previous select committee inquiries had stated. He honestly look like

:59:24.:59:30.

the collective amnesia point. It was the first time anybody had ever

:59:30.:59:34.

suggested that to him! So all of the briefings, rehearsals and

:59:34.:59:41.

preparation... Which they admitted to. As if nobody had given him a

:59:41.:59:46.

chronology. My feeling is anybody could have given him any chronology

:59:46.:59:51.

than they wanted to. You did not get the impression of somebody he

:59:51.:59:56.

was going to be big on the detail of this and was even going to

:59:56.:00:02.

necessarily recall the details. We saw the real human drama about the

:00:02.:00:06.

succession of one generation by another. James Murdoch's narrative

:00:06.:00:16.
:00:16.:00:17.

is interesting. He says, I come in in 2007, and it is not until 2010,

:00:17.:00:23.

it was all shut down. We had no reason to believe it was bigger.

:00:23.:00:28.

But Les Hinton has asked Clive miler to look at the details which

:00:28.:00:38.
:00:38.:00:39.

So, the underlying question is, are you trying to find out what is

:00:39.:00:44.

going on? Or trying to close it down after this case and say,

:00:44.:00:50.

whatever has happened, we don't want to talk about it any more?

:00:50.:00:56.

When they were preparing for this, they must have realised they would

:00:56.:01:04.

be asked about Glenn Mulcaire's legal bills although James Murdoch

:01:04.:01:10.

was like, I don't know about that. Andy Coulson's salary. That is be a

:01:10.:01:14.

long-running theme. Surely that is it, find me the facts, just in case

:01:14.:01:23.

it comes up? I'm surprised at the extent to which James was not on

:01:23.:01:29.

top of this. I thought you did the Glenn Mulcaire staff on the Aegean.

:01:29.:01:39.
:01:39.:01:47.

-- Staff of stuff on the chin. Now! You can see there, it looked

:01:47.:01:57.
:01:57.:01:58.

like someone did move to attack or at least do something to Rupert

:01:58.:02:03.

Murdoch and it was spotted by a Wendy Murdoch, the lady in the pink,

:02:03.:02:06.

though you may have seen is sitting immediately behind Rupert Murdoch

:02:06.:02:11.

during the testimony, sometimes touching him on the shoulder. I

:02:11.:02:18.

think that slap you here is Mrs Murdoch attacking the attacker.

:02:18.:02:22.

will get a very good response. don't beat anybody would blame her.

:02:22.:02:30.

No. That sort of demonstration will get a huge amount of attention.

:02:30.:02:36.

Alas, in my view, because it takes away from the serious questions.

:02:36.:02:46.
:02:46.:02:46.

One of the constant themes alluded to his, let's accept Rupert Murdoch

:02:46.:02:51.

is remote from this, James Murdoch is in there and have to get across

:02:51.:02:55.

the past as well as organise the future. When he is asked, did you

:02:55.:03:00.

see the legal counsel that advised you to do something? He said no, I

:03:00.:03:04.

just took advice from the in-house lawyers. They had seen the legal

:03:04.:03:11.

counsel. Did he really know what is in the e-mails? No, I don't think

:03:11.:03:16.

Les Hinton did either. He is an American-trained manager. Americans

:03:16.:03:23.

are prone to take senior counsel. They take legal counsel as their

:03:23.:03:27.

line of protection because so much of American life is very intrusive

:03:27.:03:33.

on companies. You can go to jail for anti-trust breeches and so on.

:03:33.:03:43.

I suspect he looked at the lawyer's For I understand that, but if

:03:43.:03:49.

you're going to take over a company from the Cheviots -- previous chief

:03:49.:03:56.

executive, and the e-mails are pretty dynamite, wouldn't you say

:03:56.:04:00.

to the previous executive, did you see these e-mails? Do you know what

:04:00.:04:09.

is in them? Probably. From a British perspective, you would. It

:04:09.:04:13.

is said of James, and I don't know James Murdoch, but he does not love

:04:13.:04:18.

newspapers. He likes electronic media and so on. His focus was on

:04:18.:04:22.

BSkyB. He would have assumed the team in place would have run it for

:04:22.:04:27.

the one of the interesting thing is here it is Les Hinton's resignation.

:04:27.:04:32.

He was there when all of the structure was set up. One doesn't

:04:32.:04:35.

want to prejudice what happens to them but it looks like it was set

:04:35.:04:42.

up, not to expose, but to shut down. Any question you would ask at that

:04:42.:04:46.

stage is, is there any more of this to come? That is the first thing

:04:46.:04:49.

you would say. You would love to know what the answer was for that

:04:49.:04:56.

when a dossier had been compiled? Looking at some of the various news

:04:56.:05:04.

wires, it looks like a young man is being held in handcuffs and it

:05:04.:05:12.

looks like he either had shaving foam or one of these Pisces, a

:05:12.:05:22.
:05:22.:05:23.

cream pie, -- pies. Peter Mandelson garden like this. The public figure

:05:23.:05:29.

doesn't know what this person has got in their hand. Many years ago,

:05:29.:05:35.

it happened to me. Wendy and James were clearly on to it. Laura

:05:35.:05:40.

Kuenssberg is on top of the stories and said it looks like the young

:05:40.:05:45.

man is being held in handcuffs and it looks like shaving foam all over

:05:45.:05:55.
:05:55.:05:55.

his face. Having thrown up high at Rupert Murdoch. Right. -- having

:05:55.:06:03.

thrown a Paris. Who is to know it is not an acid spray? -- having

:06:03.:06:12.

thrown a pie. Living in America, you have incidents like this.

:06:12.:06:18.

Blair, in his book, talks about doing a massive speech and it just

:06:18.:06:26.

takes one person to come along and they can move the agenda on. Like

:06:26.:06:33.

water Wolfgang. How would they get the shaving foam into the building?

:06:33.:06:40.

It is not metallic. It may not show up as a there's a lot of able and

:06:40.:06:48.

Parliament wandering around. Let's go to Nick Robinson. Can you update

:06:48.:06:54.

us? I am just being ushered back into the hearing because they are

:06:54.:06:59.

about to resume it. I will have to be brief, but you saw for yourself

:06:59.:07:03.

the pictures there. No one in the room had any sense of what was

:07:03.:07:07.

happening until this plate of what appears to be shaving foam was an

:07:07.:07:12.

inch away from Rupert Murdoch's face. The horror on his son's face

:07:12.:07:17.

was palpable. The anger of his wife, Wendy, was clear. She picked up the

:07:17.:07:23.

plate and are backed her husband's assailant with it and said, "I got

:07:23.:07:32.

him, I got him". It's not clear what the guy who attacked Rupert

:07:32.:07:40.

Murdoch said. There was fury from a James Murdoch and the Murdoch party

:07:40.:07:46.

that his father was attacked in this way in the full view of and

:07:46.:07:51.

protection of the police. Do we know if this attack actually struck

:07:52.:07:57.

Rupert Murdoch? Yes, no doubt at all, it went straight into his face.

:07:57.:08:06.

He was covered. It's a paper plate full of of Bowmer. The sort of in a

:08:06.:08:13.

climate would do at a circus. -- full of foam. Rupert Murdoch barely

:08:13.:08:17.

reacted to what had happened. Perhaps out of shock, perhaps out

:08:17.:08:22.

of anger, perhaps not knowing what to do. The reaction came from his

:08:22.:08:27.

wife, Wendy, who jumped up on her feet, she was sitting behind her

:08:27.:08:32.

husband, and proceeded to attack the assailant. He made no effort to

:08:32.:08:37.

get away, no effort to shout and scream, he had made his point. And

:08:37.:08:41.

that was the end of it. I briefly saw him outside being held by

:08:41.:08:49.

police. I don't know who he was and what he said. He refused to say,

:08:49.:08:53.

saying it was now subject to a police investigation.

:08:53.:08:58.

That finance so we have heard quite a few times today, Nick Robinson. -

:08:58.:09:02.

- that is an answer we have had quite a few times today. They are

:09:02.:09:06.

about to reconvene. There will serious plea be some questions to

:09:06.:09:16.
:09:16.:09:18.

I thank you for this. My questions will be just as tough

:09:18.:09:22.

as ever they would have been had that unfortunate incident not have

:09:22.:09:26.

occurred. Mr James Murdoch, if I can take you back briefly off

:09:26.:09:30.

before you were so rudely interrupted to the question of the

:09:30.:09:34.

disparity between the settlements, could you tell me whether the

:09:34.:09:40.

Taylor settlement involved a confidential leak caused -- clause

:09:40.:09:44.

which has not involved previously? I cannot tell you that it was a

:09:44.:09:51.

confidential settlement. As to other settlements, post that, some

:09:52.:09:56.

have been confidential, and some not. I don't believe any have been

:09:56.:10:00.

confidential, but I can certainly follow up as to whether they have

:10:00.:10:10.
:10:10.:10:10.

been any. It is customary to have both parties agreeing

:10:10.:10:14.

confidentiality. There is nothing unusual about an out-of-court

:10:14.:10:20.

settlement agreed to be confidential, but, with respect to

:10:20.:10:23.

to the bases of the question, but the disparity and amount of money

:10:23.:10:29.

involved, there was nothing in the Taylor settlement in respect

:10:29.:10:33.

confidentiality that spoke to the amount of money. The amount of

:10:33.:10:39.

money was derived, as I testified earlier, from a judgment made about

:10:39.:10:42.

what the likely damages would be and are likely expenses and

:10:42.:10:47.

litigation costs. Had the company taken the litigation to its end tos.

:10:47.:10:53.

Yes, you have been very clear about it. I merely put it to you that in

:10:53.:10:57.

front could be drawn if Bollada supplements containing

:10:57.:11:01.

confidentiality clauses did not, that, despite what to say about it

:11:01.:11:06.

being a pragmatic decisions, based on the cost to the company, and in

:11:06.:11:09.

front could be drawn up silence was being bought by the confidentiality

:11:09.:11:17.

clause. But in France would be false. OK, fair enough. -- that

:11:17.:11:24.

inference would be false. People would find it hard to believe that

:11:24.:11:29.

two executives had such little knowledge of widespread criminality

:11:29.:11:37.

at your flagship papers. Mr James Murdoch, when did you become aware

:11:37.:11:40.

that the phones are not only of the royal family and celebrities but

:11:40.:11:45.

victims of crime that had been hacked? When did you become aware

:11:45.:11:54.

that the phone at Milly Dowler had been hacked? The terrible incidents

:11:54.:12:00.

of boys will deception around -- Voicemail deception around the

:12:00.:12:04.

Milly Dowler case only came to my attention when it was reported in

:12:04.:12:10.

the press a few weeks ago. Only when the Guardian reported it?

:12:10.:12:14.

can tell you it was a total shock. It was the first I had become aware

:12:14.:12:20.

of it. Is that the same for hacking of other victims of crime? Have you

:12:20.:12:24.

been made aware prior to the Milly Dowler story breaking that your

:12:24.:12:29.

reporters hacked into the phones of any other crime victims? No, I was

:12:29.:12:36.

not aware of that. Just for the record, you want this earlier but

:12:36.:12:44.

it's very much interest to the USA, the actor Jude Law has said his

:12:44.:12:48.

phone was tapped on US soil, but given that allegation, you are

:12:49.:12:54.

confident no employee or contract up of News Corp or its contractors,

:12:54.:13:01.

packed the phones at 9/11 victims? Or their families? We have no

:13:01.:13:11.
:13:11.:13:15.

incredibly serious allegations. Are they have come to light fairly

:13:15.:13:20.

recently. We do not know the veracity of his allegations and are

:13:20.:13:25.

trying to understand precisely what they are and an investigation is

:13:25.:13:32.

under way. I remember well, September 11th attacks, I was in

:13:32.:13:38.

the Far East. It is just appalling to think that anyone associated

:13:38.:13:44.

with one of our papers would have done something like that. I am

:13:44.:13:50.

aware of no evidence about that. I am well aware of the allegations

:13:50.:13:55.

and will eagerly co-operate with any investigations or tried to find

:13:55.:13:59.

out what went on at that time was up these are new allegations, just

:13:59.:14:05.

a few days old, I think. But they are very serious and that sort of

:14:05.:14:09.

activity would have absolutely no place. It would be appalling.

:14:09.:14:14.

the information provided to you so far, Rupert Murdoch back was answer

:14:14.:14:19.

was emphatic. Your answer, James Murdoch, was more nuanced. Have you

:14:19.:14:23.

had any information which give you cause for concern that employees of

:14:23.:14:30.

News Corp may have indulged in a kind of thing? No, we have only

:14:30.:14:36.

seen the allegations made in the press. I think it is in the mirror.

:14:36.:14:42.

And we are actively trying to know what the allegations are and how to

:14:42.:14:47.

understand them. You have seen no internal documents or recede any

:14:47.:14:52.

verbal reports that any employee hacked the phone? Definitely not.

:14:52.:14:59.

Have you, as a result of a wider view, heard from any of your

:14:59.:15:02.

employees of papers in other countries that phone hacking and

:15:02.:15:12.
:15:12.:15:18.

illegal practices may have been Are you doing a global review and

:15:18.:15:22.

have you heard of any allegations of home hacking in any of your

:15:22.:15:27.

other terror Tories? I have never heard of those allegations, but I

:15:27.:15:33.

would go back to the code of ethics and code of conduct all of our

:15:33.:15:35.

colleagues at News Corporation globally, whether they are

:15:35.:15:41.

journalists, or management's are required to have when they joined a

:15:42.:15:46.

company and are briefed on those things. It is a matter of real

:15:46.:15:51.

seriousness. The journalistic ethics of any of the newspapers or

:15:51.:15:57.

television talons -- channels within the group, certainly on a

:15:57.:16:02.

global basis, we want to be consistent. We want to be doing the

:16:02.:16:06.

right thing and when I say illegal behaviour has no place in this

:16:06.:16:13.

company, that goes for the whole company. Mr Rupert Murdoch you are

:16:13.:16:16.

ahead of the global company, everything stops with you. Given

:16:16.:16:21.

these allegations you have said, when you opened the session you

:16:21.:16:27.

said it was the most humiliating day of your life. Sorry, I beg your

:16:27.:16:33.

pardon "the most humble day of your life". You feel humbled by these

:16:33.:16:39.

events and you are in charge of the company. Given your shock these

:16:39.:16:42.

things are laid out before you and you did not know anything about

:16:42.:16:48.

them. Have you instructed your editors around the world to make

:16:48.:16:53.

sure this is not been replicated in other News Corp papers around the

:16:53.:17:02.

globe? If not, we you do so? I am more than prepared to do so.

:17:02.:17:09.

final question, he touched earlier, Mr James Murdoch briefly, you

:17:09.:17:16.

touched on the general culture of phone hacking, blagging and illegal

:17:16.:17:19.

practices that in the past has happened in this country. If I can

:17:19.:17:24.

put a couple of things to you? Piers Morgan, who is a celebrity

:17:24.:17:30.

anchor at CNN, you don't seem to have asked him about phone hacking,

:17:30.:17:36.

a former editor of the Daily Mirror. A little trick of entering a

:17:36.:17:42.

standard four digit code allowing people to hear that message in that

:17:42.:17:48.

book. He said using that a little tricky was able to get the scoop on

:17:48.:17:53.

the former England manager, Sven- Goran Eriksson. He was very open

:17:53.:18:00.

about his use of phone hacking. And indeed he was a former News of the

:18:00.:18:04.

World executive. He was boasting about a story when he was editor of

:18:04.:18:10.

the Daily Mirror. Paul Baker of Associated Newspapers said to a

:18:10.:18:15.

committee, in my view the Daily Mail has never in its history run a

:18:15.:18:20.

story based on phone hacking or blagging in any way. Yet Operation

:18:20.:18:27.

motorman, which Mr James Murdoch, your advisers will have made you

:18:27.:18:31.

aware, had 50 journalists paying for 902 pieces of information

:18:31.:18:35.

obtained by the private investigator, Steve Whitmoor who

:18:35.:18:40.

had been found to have used some of the docks methods. You said your

:18:40.:18:44.

advisers in prepping you to come before this committee had told you

:18:44.:18:49.

to simply tell the truth, which I think is excellent advice. Isn't it

:18:49.:18:55.

the truth of the matter, journalists at the News of the

:18:55.:18:59.

World felt entitled to go out there and use blagging, deception and

:18:59.:19:04.

phone hacking because that was part of the general culture of

:19:04.:19:08.

corruption in the British tabloid press and they did not kick it up

:19:08.:19:14.

the chain to you because they felt they were entitled to use the same

:19:14.:19:19.

methods as everybody else? Isn't that a matter? I am aware of the

:19:19.:19:25.

reports, the questions around other newspapers and they use of private

:19:25.:19:30.

investigators. All I can really speak to in this matter is the

:19:30.:19:35.

behaviours and the culture at the News of the World, as we understand

:19:35.:19:41.

it. How we are trying to find out what really happens in the period

:19:41.:19:49.

in question. Also, it is not for me today to impugn other newspapers,

:19:49.:19:54.

of the journalists and things like that. I am asking if the News of

:19:54.:19:59.

the World felt in your to engaging in these practices, particularly

:19:59.:20:05.

phone hacking because it was so wide in British tabloid journalism.

:20:05.:20:11.

They did not see it as evil as it was because it was so widespread?

:20:11.:20:18.

don't accept that if the journalist on one of our papers, television

:20:18.:20:24.

channel or internet news operation feels they don't have to haul

:20:24.:20:30.

themselves to a higher standard, I think it is important we don't say,

:20:30.:20:35.

listen everybody was doing it and that is why people are doing this.

:20:35.:20:39.

At the end of the day we have to have a set of standards we believe

:20:39.:20:44.

in, titles and journalists who operate to the highest standard.

:20:44.:20:48.

And we have to make sure if they don't live up to that, they are

:20:48.:20:53.

held to account and that is the focus to us. Mr Rupert Murdoch,

:20:53.:21:03.

have you considered suing Harbottle & Lewis? Hughes said in your first

:21:03.:21:09.

answers is that you relied on the investigation by the police, the

:21:09.:21:13.

investigation by the PCC and the investigation undertaken by your

:21:13.:21:17.

solicitors, Harbottle & Lewis. Under whose care this enormous pile

:21:17.:21:23.

of documents was found. There is an old saying, if you want something

:21:23.:21:30.

doing, you should do it yourself. In this investigation you relied on

:21:30.:21:35.

three people whose actions were seriously lacking. Have you

:21:35.:21:41.

considered suing Harbottle & Lewis? Any action, is an action for the

:21:41.:21:45.

future. This today is about how we actually make sure these things

:21:45.:21:50.

don't happen again. So I won't comment or speculate on any future

:21:50.:21:56.

legal matters. The file of evidence, you were asked by my colleague if

:21:56.:22:02.

you have read it. You said no. Under the circumstances, you relied

:22:02.:22:07.

on other people and they let you down. Do you not think you should

:22:07.:22:11.

take the time and read through everything in that file your cells,

:22:11.:22:16.

personally? For clarity, I did say I did read some of the contents of

:22:16.:22:22.

that, they were shown to me. What I saw was sufficient to know that the

:22:22.:22:28.

right thing to do was to Handy's over to the authorities. You were

:22:28.:22:33.

shown a representative sample which can be tricky. But under the

:22:33.:22:37.

circumstances and reputation will damage has been done to News Corp,

:22:37.:22:40.

do-nothing a senior executives you should take the time to read

:22:40.:22:45.

through the entire file so you are not relying on anybody else? I am

:22:45.:22:51.

happy to do so. I have seen a bit of it. My last question is for Mr

:22:51.:22:57.

Rupert Murdoch. You said that your friend of 52 years I think, Les

:22:58.:23:01.

Hinton had stepped down and resigned because he was in charge

:23:01.:23:05.

of the company at the time. In other words he said he was the

:23:05.:23:10.

captain of the ship and he resigned. Is it not the case you are the

:23:10.:23:15.

captain of the ship? You are the chief executive officer of News

:23:15.:23:20.

Corp, the global corporation question marks that is a much

:23:20.:23:26.

bigger ship. If is a bigger ship, but you are in charge of it. He

:23:26.:23:30.

said yourself you're not a hands- off chief executive. You work 10 to

:23:31.:23:34.

12 hours a day, this happened on your watch, Mr Murdoch, have you

:23:34.:23:41.

considered resigning? No. Why not? Because I feel people I have

:23:41.:23:47.

trusted, I don't know who, or at what level, have let me down. They

:23:47.:23:54.

have behaved disgracefully, betrayed the company and more, me.

:23:54.:24:00.

It is for them to pay. I am the best person to clean this up.

:24:00.:24:04.

say, I appreciate your immense courage in having seen this session

:24:04.:24:14.

through despite the common assault that just happen to you. I will

:24:14.:24:19.

allow Mr Watson a very brief question.

:24:19.:24:27.

James, when you signed off the Gordon Taylor payment, did you see

:24:27.:24:35.

or were you made aware of the full transcript? I was not aware of the

:24:35.:24:41.

time. But you paid an astronomical sum of money and there was no

:24:41.:24:46.

reason to? There was every reason to settle the case, given the

:24:46.:24:54.

likelihood of losing a case and given the damages the council said

:24:54.:25:03.

would be levied. If Gordon Taylor and Max Clifford are prepared to

:25:03.:25:07.

release their confidentiality, we you release them from their

:25:07.:25:10.

confidentiality clause so we can get to the full facts of this

:25:10.:25:20.

matter? As to the Taylor matter, it is a confidential matter. The facts

:25:20.:25:25.

of this case might help us get to the truth. If he allows his papers

:25:25.:25:32.

to be released,... Is is a hypothetical scenario and I am

:25:32.:25:34.

happy to correspond with the chairman about what specifically

:25:34.:25:44.
:25:44.:25:45.

more you would like to know. Can I carry on with a few more questions

:25:45.:25:50.

so I can get to the end of this? I think we have covered this at

:25:50.:25:56.

some considerable length. Actually Mr Chairman, we haven't.

:25:56.:26:01.

Your wife has a very good left hook Mr Murdoch.

:26:01.:26:05.

Mr Murdoch, I know you did ask if you could make a closing statement

:26:05.:26:12.

and we are entirely content for you to do so.

:26:12.:26:17.

Members of the committee, I would like to read a short statement. My

:26:17.:26:21.

son and I came here with great respect for all of you, for

:26:21.:26:25.

Parliament and the people of Britain for whom you represent.

:26:25.:26:30.

This is the most humble day of my career. And all that has happened,

:26:30.:26:38.

I know we needed to be here today. James and I would like to say how

:26:38.:26:44.

sorry we are for what has happened. Especially with regard to listening

:26:44.:26:50.

to the voicemail of victims of crime. My company has 52,000

:26:50.:26:56.

employees, I have led it for 57 years and I have made my share of

:26:56.:27:02.

mistakes. I have lived in many countries, employed thousands of

:27:02.:27:09.

honest and hard-working journalists. I have owned in nearly 200

:27:09.:27:12.

newspapers of various different sizes, and followed countless

:27:13.:27:17.

stories about people and families around the world. At no time do I

:27:17.:27:23.

remember feeling as seconds as to when I heard about what Milly

:27:23.:27:29.

Dowler's family had to endure. Nor do I recall being as angry as when

:27:29.:27:33.

I was told the News of the World could have compounded their

:27:33.:27:41.

distress. I want to thank the family for graciously giving me the

:27:41.:27:44.

opportunity the of -- the opportunity to apologise in person.

:27:45.:27:49.

I would like all the victims of phone hacking to know how

:27:49.:27:55.

completely deeply, sorry I am. Apologising cannot take back what

:27:55.:28:00.

has happened. I want them to know the depth of my regret for the

:28:00.:28:07.

horrible invasions into their lives. I fully understand their anger, and

:28:07.:28:13.

I intend to work tirelessly to merit their forgiveness. I

:28:13.:28:16.

understand our responsibility to co-operate with this session, as

:28:16.:28:23.

well as with future enquiries. We now know things went badly wrong at

:28:23.:28:31.

the News of the World. For a newspaper failed when it came to

:28:31.:28:38.

itself. The behaviour that occurred went against everything I stand for

:28:38.:28:47.

and for my son, too. It not only betrayed my readers and made, but

:28:47.:28:52.

the many thousands of magnificent professionals in other divisions

:28:52.:28:56.

around the world. So let me be clear in saying, invading people's

:28:56.:29:03.

privacy by listening to their voicemail is wrong. Paying police

:29:03.:29:08.

officers for information is wrong. They are inconsistent with our

:29:08.:29:13.

codes of conduct and doesn't have any place in any part of the

:29:14.:29:19.

company that I run. But saying sorry is not enough. Things must be

:29:19.:29:26.

put right. No excuses. This is why News International is co-operating

:29:26.:29:32.

with the police, whose job it is to see that justice is done. It is our

:29:32.:29:38.

duty not to prejudice the outcome of the legal process. I am sure the

:29:38.:29:43.

committee will understand this. I wish we had managed to see and

:29:43.:29:50.

solve these problems much earlier. When two men were sent to prison in

:29:50.:29:55.

2007, I thought this matter had been settled. The police and bend

:29:55.:29:58.

it the -- ended their investigations and I was told News

:29:58.:30:04.

International conducted an internal review. I am confident when James

:30:04.:30:08.

later rejoined News Corporation, he thought the case had closed, too.

:30:08.:30:14.

These are subjects you will no doubt wish to explore. And you have

:30:14.:30:20.

explored them today. This country has given me, our companies and

:30:20.:30:27.

employees are many opportunities. I'm grateful for them, I hope our

:30:27.:30:31.

contributions to Britain will one day also be recognised. A but all,

:30:31.:30:35.

I hope we will come to understand the wrongs of the past and prevent

:30:35.:30:41.

them from happening again and in the years ahead, restore the

:30:41.:30:47.

nation's trust in our company and in all British journalism. I am

:30:47.:30:57.

committed to doing everything in my Thank you for giving up your time

:30:57.:31:02.

for coming here and about to apologise for the Holy

:31:02.:31:05.

irresponsible treatment you receive from a member of the public. Thank

:31:05.:31:12.

you, all members. The committee will now have a break for 5 minutes

:31:12.:31:18.

before we move to the next part. STUDIO: And that brings to an end

:31:18.:31:24.

the testimony of Rupert and James Murdoch. It lasted for a little bit

:31:24.:31:29.

shy of two hours. Interrupted by this amazing event which could have

:31:29.:31:35.

been so dangerous but, in the end, seemed to be a prank when someone

:31:35.:31:40.

tried to smash a custard pie, shaving foam, in to Rupert

:31:40.:31:46.

Murdoch's face. The assailant was attacked by Wendy Murdoch, who was

:31:46.:31:51.

from China. She gave him quite a slap, giving a new meaning to the

:31:51.:31:57.

term a tiger mum up, and she will be regarded as the hero of the ire.

:31:57.:32:04.

-- our. Just shy of three hours, I should stay -- say. It's now just

:32:04.:32:11.

coming up to 5:30pm. If you're just joining us on BBC Two, you are

:32:11.:32:14.

watching a live and uninterrupted coverage of the testimony of the

:32:14.:32:19.

Rupert and James Murdoch to the Culture Select Committee on the

:32:19.:32:23.

hacking scandal. The committee, having had three hours, is taking a

:32:23.:32:27.

short five-minute break, and will be followed by the testimony of

:32:27.:32:33.

Rebekah Wade, now known as Rebekah Brooks. She was chief executive of

:32:33.:32:37.

News International at the weekend. She was the editor of the News of

:32:37.:32:40.

the World and the sun. The News Of the World at the centre of the

:32:41.:32:43.

hacking scandal for that we will bring you that coverage live when

:32:43.:32:47.

they reconvene and we will stick with it until 6pm put up then you

:32:48.:32:55.

can follow it on the BBC News Channel. We will go straight to

:32:56.:33:01.

Rebekah Brooks as soon as the committee reconvenes but let's just

:33:01.:33:05.

get an overall reaction from Alastair Campbell. I think Wendy

:33:05.:33:13.

will be, if Tom Watson can be moved to congratulate her on her left

:33:13.:33:17.

turn, she will be a big part of the coverage. American cable television,

:33:17.:33:22.

it's now going to be a big story. Who has got the pictures? Why don't

:33:23.:33:29.

we show it again. We know how to behave, like American cable TV.

:33:29.:33:39.
:33:39.:33:53.

You can see a police man at running their two-try and intervene but not

:33:53.:33:59.

before Wendy Murdoch got in herself. We believe that was the sound of

:33:59.:34:06.

Mrs Murdoch attacking the assailant who tried to put this custard pie

:34:06.:34:10.

in to Mr Murdoch. We are not exactly sure who it is a but there

:34:10.:34:16.

are some reports that it was some body from UK and cut, but the

:34:16.:34:20.

person has been bundled off and no doubt will be charged, leaving

:34:20.:34:24.

serious questions because although it ended up just being shaving foam,

:34:24.:34:28.

a frightening thing, particularly if you are 80 years old, but it

:34:28.:34:35.

could have been much more than shaving foam. That will be asked

:34:35.:34:40.

about later. Where are we now? What do we know now that we didn't know

:34:40.:34:45.

three hours ago? We know for sure that News International paid some

:34:45.:34:50.

of the legal bills for Glenn Mulcaire, the private detective

:34:50.:34:55.

doing the hacking. I think people will be, even though we thought

:34:55.:35:00.

that, I think there was a sense of that being a new revelation. I

:35:00.:35:05.

think we know a lot about what they didn't know. And I think, with

:35:05.:35:08.

regard to Rupert Murdoch, there seems to be an understanding from

:35:08.:35:14.

the committee, this is a small part of his overall global enterprise,

:35:14.:35:19.

but I felt from James, in particular, there were things I

:35:19.:35:23.

thought he would have been able to explain more clearly than he did.

:35:23.:35:29.

And I think, actually, I suspect John Whittingdale will have a

:35:29.:35:33.

pretty long follow-up letter to write to James Murdoch about some

:35:33.:35:38.

of the areas we seemed to know some but not all the background. There

:35:38.:35:42.

may be speculation that they both came along, particularly James

:35:42.:35:48.

Murdoch, will fully, intentionally, under briefed. That was the point

:35:48.:35:52.

somebody made. It's nobody's defence to be wilfully blind. It's

:35:52.:35:57.

hard to know. Rupert Murdoch didn't know what was happening in his

:35:57.:36:04.

empire at all. That will be an issue for the shareholders. And, as

:36:04.:36:11.

you say, James rest of everything on the fact he arrived after the

:36:11.:36:16.

events happened. I have a slightly different impression of this. When

:36:16.:36:23.

one talks but the Murdoch empire, and it's a throwaway thing, one

:36:23.:36:26.

thing about emperors, they are quite personal. What you're

:36:26.:36:30.

beginning to get the image of is a series of interpersonal

:36:31.:36:35.

relationships which complicate the business of who would you trust,

:36:35.:36:40.

who you don't, who you follow upon, will you?. Who would defend and who

:36:40.:36:45.

don't. I have a growing suspicion that in this area, the

:36:45.:36:50.

interpersonal relationships, senior international news figures, who

:36:50.:36:55.

could have followed this up after 2007, may be part of the answer as

:36:55.:36:59.

to how this happened. impression Rupert Murdoch gave,

:36:59.:37:03.

that he was under hands on any more as far as the News of the World was

:37:03.:37:05.

concerned, which is a huge difference from the 1980s when he

:37:05.:37:12.

was certainly calling the News of the World usually on a Thursday

:37:12.:37:15.

night to get a taste of what was being prepared and then on Saturday

:37:15.:37:21.

to find out what the front page was. Now seemingly, he has stepped back

:37:21.:37:26.

but only three years ago, to the Lords committee on media matters,

:37:26.:37:30.

he testified, as far as the tabloids were concerned, not the

:37:30.:37:35.

Times and the Sun, he was in effective editorial control. That

:37:35.:37:41.

was 2008. I heard your spluttering when he was talking about that

:37:41.:37:45.

because you, being one of his editors, you know how hands-on he

:37:45.:37:55.
:37:55.:37:57.

The point is, this is the second generation of the dynasty. The

:37:57.:38:02.

first generation was created by the boss. The second generation, was

:38:02.:38:07.

very different. They may not tell him anything uncomfortable. That

:38:07.:38:13.

question, who, within the culture, people only told you what you

:38:13.:38:17.

wanted to hear, he sort of went along with that a bit. I wonder if

:38:17.:38:21.

that wasn't getting a little bit to the heart of the matter. And how

:38:21.:38:29.

would he know, actually? How would you mark the card of the committee?

:38:29.:38:34.

I thought they were pretty good, actually. A lot of good questions.

:38:34.:38:41.

Remarkably little grandstanding. Tom Watson's questioning, other

:38:41.:38:46.

people will call it cruelty, will remain in my mind for a long time.

:38:46.:38:51.

James Murdoch saying, I can answer your questions and Tom Watson

:38:51.:38:55.

saying, I am going to go for Rupert Murdoch. It brought home to be just

:38:55.:39:00.

what situation this man is in. That's unusual. You don't usually

:39:00.:39:04.

determine who answers the question. You're there to gather information,

:39:04.:39:07.

whoever volunteers of up not to declare some of the innocent and

:39:07.:39:11.

guilty. I was quite surprised that John Whittingdale didn't allow them

:39:11.:39:15.

to do the opening statement because what Rupert Murdoch was reading at

:39:15.:39:21.

the end of the opening statement. He was editing it as he went along.

:39:21.:39:25.

Normally that is prefixed. surprised it was not sorted out

:39:25.:39:30.

beforehand. His people should have talked to their people. It happens

:39:31.:39:35.

and nearly all of these committees. I thought the select committee was

:39:35.:39:40.

pretty good. The substance of what was going on, paying sums of money

:39:40.:39:46.

to Glenn Mulcaire and Mr Goodman long after the trial itself, and

:39:46.:39:51.

then Mr Taylor adding large sums of money and Max Clifford, all that

:39:51.:39:56.

will play in the subsequent inquiries into the fit and proper

:39:56.:40:03.

issues. It will also play in to cover up. If you cover up

:40:03.:40:07.

wrongdoing by definition, you're not fit and proper. I thought Tom

:40:08.:40:13.

Watson was getting somewhere at the end in relation to... James didn't

:40:13.:40:18.

like being asked about whether he would waive the confidentiality if

:40:18.:40:24.

Taylor-Wood. He's not a politician so he doesn't know what to say. He

:40:24.:40:28.

didn't understand what the guy meant by were to withdraw the

:40:28.:40:32.

letter? I think that's an area where, I'm not criticising them,

:40:32.:40:36.

but I don't think they got to the bottom of the tailor cover

:40:36.:40:44.

settlement. If you look the Times both the Murdochs let down by the

:40:44.:40:50.

News of the World newsroom, let down by the private detective, and

:40:50.:40:53.

then let down by the lawyers, let down by Les Hinton, who didn't seem

:40:54.:40:58.

to know what's going on, in his own company, let down by subsequent

:40:58.:41:02.

inquiries, too, let down by the Taylor deal, in the end, would do

:41:02.:41:06.

not had just said, I had bad a day control of theirs and read all of

:41:06.:41:11.

this myself. Exactly for the put least for the inquiry. Let alone

:41:11.:41:15.

before for that I was surprised by that. When he said I saw some of

:41:15.:41:21.

the file. Wouldn't you want to read all of it? Even for curiosity? As a

:41:21.:41:25.

journalist, we are paid to be curious. What we know about the

:41:25.:41:30.

story, since it broke break, News International have been behind it,

:41:30.:41:36.

at every stage, trying to catch up with it, working out where it was

:41:36.:41:44.

failing to grasp it, not realising it was going to be so big. And I

:41:44.:41:49.

think the pattern is absolutely clear. You insulate James Murdoch

:41:49.:41:56.

from the Prix 2007 decisions. He said they didn't know until 2010. I

:41:56.:42:02.

think he actually has a pretty decent answer on the question of

:42:02.:42:05.

the payments for instance to the PFA. But the question is, whether

:42:05.:42:10.

or not they would waive the confidentiality agreements. My own

:42:10.:42:15.

suspicion, and it's worth very little, there isn't much there.

:42:15.:42:21.

Where does this leave David Cameron, now flying back from Africa as we

:42:21.:42:26.

speak? Being fully briefed in what is being said, he appears before a

:42:26.:42:30.

Commons tomorrow to make a statement. I'm told it is 11:30am,

:42:30.:42:37.

and we will possibly be live with another Daily Politics special.

:42:37.:42:41.

don't think a changes things fundamentally because it didn't get

:42:41.:42:44.

into the Cameron relationship. Rupert Murdoch was fairly clear.

:42:44.:42:47.

Let me interrupt you and that's go straight back now to the Commons

:42:47.:42:57.
:42:57.:43:08.

Select Committee. Rebekah Brooks I would like to thank you for your

:43:08.:43:14.

willingness to come forward. We are very much aware there's an ongoing

:43:14.:43:17.

police investigation which could lead to criminal proceedings. We

:43:17.:43:20.

will bear that in mind but he also appreciate your statement when he

:43:21.:43:25.

resigned from the company that you want to be as helpful as possible

:43:25.:43:33.

to various inquiries under way. Can I just start, News International

:43:33.:43:37.

issued a statement when you're chief executive in July 2009 saying

:43:38.:43:42.

there never has been evidence to support allegations that News of

:43:42.:43:46.

the World journalist have access the boy spells of any individual,

:43:46.:43:51.

instructed private investigators or third parties to do it, all that

:43:51.:43:55.

there was systemic corporate illegality by News International.

:43:55.:44:01.

Would you accept now that that is not correct? Thank you, Mr Chairman.

:44:01.:44:08.

Firstly, just before I answer that question, I would like to add my

:44:08.:44:12.

own personal apologies to the apologies James and Rupert Murdoch

:44:12.:44:18.

made today. Clearly, what happened at the News of the World and

:44:18.:44:24.

certainly when the allegations of voice interception was limited to

:44:24.:44:27.

victims of crime, it was pretty abhorrent, so I just want to

:44:27.:44:32.

reiterate that. I also was very keen to come here and answer

:44:32.:44:38.

questions today. As you know, I was arrested and interviewed by the

:44:38.:44:43.

police a couple of days ago. So, I have legal representation here just

:44:44.:44:49.

so I don't impede those criminal proceedings, which you would expect,

:44:49.:44:54.

but I intend to answer everything as openly as I can and do not use

:44:54.:44:59.

that if at all possible. I know you add a brief thing around the same

:44:59.:45:06.

thing. We are grateful for that. Perhaps I can invite you to comment

:45:06.:45:11.

on whether or not you now accept that the statement issued a saying

:45:11.:45:17.

that news there will journalist had access to voice mails work

:45:17.:45:27.
:45:27.:45:27.

instructing investigators to do so As you have heard in the last few

:45:27.:45:34.

hours, the fact is that since since the Sienna Miller civil documents

:45:34.:45:42.

came into our possession at the end of December 2010, that was the

:45:42.:45:45.

first time we, the senior management of the company at the

:45:45.:45:52.

time had actually seen some documentary evidence actually

:45:52.:45:58.

relating to a current employee. I think we acted quickly and

:45:58.:46:03.

decisively then, when we had that information. As you know it was our

:46:03.:46:09.

evidence that it opened up the police inquiry in 20th January 11.

:46:09.:46:14.

And since then we have admitted liability on the civil cases,

:46:14.:46:19.

endeavour to settle as many as possible. We have appointed Sir

:46:19.:46:23.

Charles Gray, so victims of phone hacking, if they feel they want to

:46:23.:46:28.

come directly to us and not incur expensive legal costs, they can

:46:29.:46:33.

come and be dealt with very swiftly. The court process is taking its

:46:33.:46:39.

time and those cases won't be heard until I think 20th January 12, so

:46:39.:46:43.

the compensation scheme is there in order for people to come forward.

:46:43.:46:48.

Of course there were estates made in the past, but I think and I hope

:46:48.:46:53.

you will agree, since we saw the evidence at the end of December we

:46:53.:46:57.

have acted properly and quickly. until you saw the evidence which

:46:57.:47:01.

was produced in the Sienna Miller case, you continue to believe the

:47:01.:47:04.

only person at the News of the World who had been implicated in

:47:05.:47:12.

phone hacking was Clive Goodman? Just the sequence of events, in

:47:12.:47:19.

2009, I think was the first time that all of us, and I know some

:47:19.:47:24.

members of the committee have spent a long time on the story and

:47:24.:47:28.

looking at the whole sequence of events, so I know you know it's

:47:28.:47:34.

pretty well. But just to reiterate, in 2009 when we heard about the

:47:34.:47:39.

Gaydon -- Gordon Taylor story appeared in the Guardian, I think

:47:39.:47:48.

that is when information unravelled. But the very, very slowly. We had

:47:48.:47:51.

conducted many internal investigations. I know you spends a

:47:51.:47:56.

lot of time talking to James and Rupert Murdoch about them. But, we

:47:56.:48:01.

had been told by people at the News of the World at the time, they

:48:01.:48:07.

consistently denied any of these allegations in various internal

:48:07.:48:13.

investigations. It was only when we saw the Sienna Miller documentation

:48:13.:48:19.

we Europe -- realised the severity of the situation. Just to point out

:48:19.:48:26.

one of the problems in this case is our lack of visibility and what we

:48:26.:48:33.

have seemed in Glenn Mulcaire's home. We have had zero visibility

:48:33.:48:37.

and we can only see it during the Civil Procedure and then we act on

:48:37.:48:46.

it accordingly. It is now your view, based on that evidence, you were

:48:46.:48:50.

lied to by senior employees? Because of the Criminal Procedure,

:48:50.:48:57.

am not sure it is possible for me to infer guilt until those criminal

:48:57.:49:02.

proceedings have taken place. understand. Tom Watson.

:49:02.:49:06.

There are many questions I would like to ask, but I won't be able to

:49:06.:49:11.

do it today because you are facing criminal proceedings. So I will be

:49:11.:49:16.

narrow in my questioning. Why did you sack Tom crone? We did not sack

:49:16.:49:21.

him. What happened was, when we made the very regrettable decision

:49:21.:49:27.

to close the News of the World at the 168 years, Tom crone has

:49:27.:49:36.

predominantly been the News of the World lawyer. His status as legal

:49:36.:49:41.

manager was spent most of the time, 99% of his time was spent on the

:49:41.:49:46.

News of the World. The rest of the company and rest of the titles, we

:49:46.:49:51.

have appointed new lawyers. There wasn't a job for him once we close

:49:51.:49:58.

the News of the World and he left. Someone is still dealing with the

:49:58.:50:03.

News of the World legal cases presumably? The civil cases are

:50:03.:50:12.

being dealt with, the standards and management committee we have set up.

:50:12.:50:17.

You have seen the announcements on that it recently and I won't go

:50:17.:50:23.

over it. But also Farrer and Co, have sunk test cases are coming up

:50:23.:50:27.

before the judge in January and there are people dealing with it.

:50:27.:50:32.

But Tom's role was as a hands-on legal manager of the News of the

:50:32.:50:38.

World. And when we close the paper there wasn't a job. I must have

:50:38.:50:42.

misunderstood what James Murdoch said. He implied you had sacked him.

:50:42.:50:50.

It has been a busy day, but as an editor and journalist in the News

:50:50.:50:54.

of the World and the Sun newspaper, how extensively did you work with

:50:54.:51:00.

private detectives? On the Sun newspaper, not at all. When I was

:51:00.:51:05.

editor of News of the World, as you know I'd be came editor of the Sun

:51:05.:51:13.

newspaper and came and spoke at the committee. I think back then, we

:51:13.:51:17.

answered extensively, questions about the use of private detectives

:51:17.:51:23.

across Fleet Street. He chart was published of which, I cannot

:51:23.:51:27.

remember whether News of the World was on it, I think it was four. I

:51:27.:51:33.

think the Sun newspaper, on the table was below take a break

:51:33.:51:38.

magazine. The top five or was the Observer, the Guardian, the News of

:51:38.:51:48.

the World... Can I declare, I worked for the Observer, but left

:51:48.:51:56.

in 2001. It is not in the top four. The top-six event. If to was on the

:51:56.:52:01.

table. You extensively work with private investigators, is that if

:52:01.:52:08.

your answer? No, the use of private detectives in the later 1990s and

:52:08.:52:18.

2000, was a Phoebe Street practice. -- Fleet Street. In the main, the

:52:18.:52:22.

use of private detectives was stopped. It was all about the Data

:52:22.:52:28.

Protection Act and changes to VAT, which were made. That is why we had

:52:28.:52:35.

the committee in 2003. Just for the third time, how extensively did you

:52:35.:52:40.

work with private detectives? News of the World employed private

:52:40.:52:45.

detectives like most newspapers in Fleet Street. So you were aware of

:52:45.:52:51.

and approve payments to private detectives? I was aware of the use

:52:51.:52:55.

of private detectives. He would have approved payments to them?

:52:55.:53:01.

That is not how it works, but I was aware we use them. He would have

:53:01.:53:05.

approved payments? The payments system in a newspaper, which has

:53:05.:53:11.

been discussed, the editor's job is to acquire the over all budgets

:53:11.:53:16.

from the senior management for the paper. It is then given to the

:53:16.:53:19.

managing editor to allocate to different departments. Each person

:53:19.:53:25.

in that department has a different level of authorisation. But the

:53:25.:53:28.

final payments are authorised by the managing editor, unless there

:53:28.:53:36.

is a particularly big item, a set of photographs or something that

:53:36.:53:40.

needs to be discussed on a wider level and the editor will be

:53:40.:53:44.

brought in. So Stuart Cook will have discussed...

:53:44.:53:49.

We have been on air since 2pm, with this Daily Politics special,

:53:49.:53:53.

bringing you live coverage of the culture committee hearings. First

:53:53.:53:58.

of Rupert and James Murdoch, now of Rebekah Wade, now known as Rebekah

:53:58.:54:04.

Brooks. It is a session now that the public is not allowed in

:54:04.:54:08.

because of that attack on Rupert Murdoch. Fortunately nobody was

:54:08.:54:13.

harmed. If you want to continue to see her testimony you can do so on

:54:13.:54:17.

the BBC News Channel. Let's have some final thoughts from my guests

:54:17.:54:21.

who have been with me all day on this marathon. Alastair Campbell,

:54:21.:54:28.

where do we go from here? I said before these hearings I think the

:54:28.:54:32.

inquiry led by a judge will be important and of long-term

:54:32.:54:35.

significance. There was a bit of theatre there today, there were

:54:36.:54:39.

some things we learnt. The committee acquitted themselves

:54:39.:54:43.

perfectly well. People will be shocked to the extent Rupert

:54:43.:54:47.

Murdoch appeared to be very divorced from it all. And people

:54:47.:54:51.

will be surprised that James Murdoch appeared not to be on top

:54:51.:54:58.

of the detail. As it but tomorrow with David Cameron, I don't think

:54:58.:55:03.

it is taking any closer to him but the question in his judgments

:55:03.:55:07.

relating to Andy Coulson are still there. I suspect that will be

:55:07.:55:14.

centre stage in the Commons tomorrow. Given we suspect James

:55:14.:55:20.

and Rupert Murdoch will appear before the judicial inquiry, with

:55:20.:55:26.

firms saying I don't know, I didn't bother to find out for stumpy

:55:26.:55:30.

cannot get away with that? I think that will take place after the

:55:30.:55:33.

court cases and we will have a couple of years of prosecutions in

:55:34.:55:40.

front of us. When full disclosure? Everybody will know precisely what

:55:40.:55:44.

the score is. I think this is a four year soap opera we are looking

:55:44.:55:50.

at. It is sad we have List -- missed the last part, because I

:55:50.:55:55.

suspect something will come out with Rebekah Brooks. Where does

:55:55.:56:01.

this leave News International? People would look at James

:56:01.:56:06.

Murdoch's performance. I have never met either of them. I was struck, I

:56:06.:56:11.

think James Murdoch is a very impressive character. He had a

:56:11.:56:15.

narrative to give and he gave that narrative. And all of their body

:56:15.:56:20.

language, they got all of it right. Whether people looking at that, and

:56:20.:56:24.

investors look at Rupert and say, maybe it is time for somebody else,

:56:24.:56:30.

is a big and open. After the early part of that performance. Later on

:56:30.:56:35.

he got it together but early on it was striking. Where do you think it

:56:35.:56:41.

leaves News International? Is still has a 40% share in BSkyB and three

:56:41.:56:45.

national newspapers? They are fundamentally damaged. I am not

:56:45.:56:49.

convinced what they did today repairs the damage. People still

:56:49.:56:53.

feel shocked and angry about what went on. I am not saying James

:56:53.:56:57.

Murdoch did not perform perfectly well, but there were some questions

:56:57.:57:01.

that were so obvious that would be asked, and I was surprised he did

:57:01.:57:08.

not have the answers. I think his house -- case held together, but

:57:08.:57:11.

with weak edges. I would be surprised in five years' time it

:57:11.:57:16.

the papers at least are still in their control. Is that the feeling,

:57:16.:57:21.

David? I certainly hope that is not the case because the they are very

:57:21.:57:25.

good owners of the Times and very good runners of journalism and

:57:25.:57:29.

organisations like the Times. IC other potential owners and to be

:57:29.:57:34.

honest, I don't prefer any of them. It is not an improvement, I don't

:57:34.:57:39.

fancy the idea of a Russian oligarch owning the Times. We are

:57:39.:57:45.

going to have to leave that there. I can reveal this is the story that

:57:45.:57:49.

keeps on giving. Laura Kuenssberg from the BBC reporting Neil Wallis,

:57:50.:57:54.

the executive editor just arrested recently and also had been

:57:54.:57:58.

appointed to Scotland Yard to advise them on PR had been advising

:57:58.:58:04.

Andy Coulson while Andy Coulson was working as David Cameron's chief

:58:04.:58:09.

spin-doctor. We don't know any more of that, it was in the run-up to

:58:09.:58:14.

the election, but it is another twist and turn which will cause

:58:14.:58:19.

David Cameron some problems when he appears before the Commons tomorrow.

:58:19.:58:24.

We will be back. We are meant to be on our summer holidays, but we are

:58:24.:58:28.

so hard working, we will be back with another Daily Politics special

:58:28.:58:35.

tomorrow. We will start on BBC Two at 11:00am. We will have the lead-

:58:35.:58:38.

up to the statement by the Prime Minister in the Commons. We suspect

:58:38.:58:42.

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