Chapter 4: The Conservative Revival and the Coalition1

Chapter 4: The Conservative Revival and the Coalition1

1. Introduction and background 1.1 In common with a number of politicians of his generation, the Rt Hon David Cameron MP has spent most of his adult life in politics. He began his political career working for the Conservative Party Research Department, before becoming a general political SpAd, first to Norman Lamont at the Treasury (1992-1993) and then later to Michael Howard at the Home Office (1993-1994).2 During this period he witnessed first-hand the national press' treatment of both Lord Kinnock and Sir John Major. He also forged numerous professional relationships with political journalists:3 "…probably in terms of political journalists I got to know, I would have said that was more related to the time when I was a special adviser, because I was dealing with political journalists then and some of them are still around today." In some cases, these became personal friendships.4

¶1.2 The working life of Mr Cameron which was beyond politics was spent in the media. Between 1994 and 2001 he worked for Carlton Communications Plc (Carlton). There, his role involved public affairs, Government relations, investor relations and communicating with the financial press.5 By his own account this was a period formative of his views on media policy and, in particular, about television:6

¶"I would say my time at Carlton probably taught me more about the television industry, about how it was regulated, and maybe we'll come on to this, a lot of the views I formed about media, media policy, media regulation, the BBC – Carlton was quite a formative period because I was working for a big part of the British broadcasting industry, ITV effectively, and I formed a lot of views and opinions there which I still hold today".

¶1.3 Mr Cameron retained his interest in politics whilst at Carlton and was elected to Parliament as the member for Witney on 7 June 2001.7 This was the period of New Labour's potent new media strategy. His close political ally and near contemporary, George Osborne, put it this way: "…we came of political age – myself, David Cameron and others –during that political

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¶On the basis that current relationships between the press and the Prime Minister have been the subject of considerable recent interest – and have each been ventilated at length during the course of the Inquiry – this section is considerably longer than those covering other periods of time and administrations where the issues are less immediate period …".8 As a backbencher, Mr Cameron wrote a column for the Guardian Online.9 His perspective has therefore been informed by more than twenty years of political activity and wide contact with national newspaper journalists, covering most of the period considered by the Inquiry in Module Three.

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¶1.4 This subsection of the Report concentrates upon the relationship between Mr Cameron with national newspapers during the periods in which he was Leader of the Opposition and then Prime Minister. It considers how his media strategy developed in Opposition, including the recruitment of Mr Coulson, and the gradual winning of widespread support in the national newspapers, most notably The Sun's dramatic abandonment of Gordon Brown in September 2009. Was the switch in allegiance the product of a 'deal' or did it have other origins? The diminution in Mr Cameron's contacts with the media which followed the general election of 2010 is explored, as are Mr Cameron's own contacts with the national newspapers, especially their proprietors and senior executives. The emergence of the phone hacking scandal is traced, both as it affected Mr Coulson's position as Director of Communications, and in the way that it led to the setting up of this Inquiry. Finally, Mr Cameron's well known view that politicians have become "too close" to the media is assessed.

2. Mr Cameron's relations with the press whilst Leader of the Opposition 2.1 Mr Cameron was elected Leader of the Conservative Party on 6 December 2005 and thereby became the Leader of the Opposition.10 He explained the inherent disadvantage which Opposition parties face in getting their message across to a media which usually accords more priority to covering the Government of the country than it does to reporting the prospective policies of the Opposition. Consequently, he saw a particular need for Opposition politicians carefully to develop their relations with the media:11

¶"All politicians are keen to have the opportunity to explain the policies they advocate but the media generally considers comments made by Ministers as more newsworthy. In Opposition, political parties operate on a much smaller scale and sometimes struggle to gain media coverage. It is much more difficult to make the public aware of the relevance and impact of Opposition policies. For obvious reasons, attention and focus is directed on the party or parties in power. Senior politicians in Opposition therefore tend to have to focus even more on developing their relations with the media in order to get their message across. As I said in the Commons on 13 July 2011: "As Leader of the Opposition, you spend quite a lot of time trying to persuade newspapers and others to support you, because you want to explain your policies, I your vision and what you are doing for the country."

¶2.2 The practical product of this analysis was a considerable effort on his part to engage with the media whilst in Opposition. In terms of scale, the effort was reflected in the sheer number of meetings and interviews with the media which Mr Cameron had in Opposition: 1,404 in the four year, five month period from December 2005 to May 2010: an average of 26 meetings or interviews per month.12 These meetings and interviews encompassed a very wide range of media contacts in both broadcast and print media, which resulted from a strategy of building "...a relationship with all the relevant media, including political editors, editors and proprietors".13 The volume and breadth of these contacts did not prevent a careful and deliberate focus on "...those with the biggest audiences and those best placed to get my message across..."14 which was no doubt intended to maximise the return on the investment of time and effort. In practice, for Mr Cameron that meant the BBC and "...in terms of newspapers, my focus has been on those who either already held and supported Conservative views, or could be persuaded to do so".15

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¶2.3 There was some evidence that Mr Cameron's approach to the media in the period between December 2005 and 2007 differed significantly from the period that followed. It was said that Mr Cameron sought to establish a relationship with more distance and less deference to the media, with reference to Rupert Murdoch in particular. Recalling and interpreting the period, Andrew Neil wrote in his evidence that:16

¶"It is one of the ironies of the current state of relations between press and politicians that Mr Cameron did not set out to replicate a Blair/Brown style relationship with the Murdoch press. He told me not long after becoming Tory leader in 2005 that he would not go cap-in-hand seeking Mr Murdoch's blessing, denigrating Mr Blair's decision to fly to the other side of the world in 1995 to parade before Mr Murdoch and his lieutenants. Rather he would transform the Tory party as he saw fit and, if Mr Murdoch liked what he saw, would happily accept his endorsement. But he would not seek to ingratiate himself with the media tycoon or recreate the extensive and close nexus that existed between the Murdoch Empire and New Labour. This strategy lasted until the summer of 2007, by which time Mr Brown was the new Prime Minister and enjoying an (albeit brief) honeymoon with the British people so advantageous that there was a widespread expectation that he would go to the country in the autumn and win. Mr Cameron, for his part, found himself friendless: the left-leaning press were rallying to Mr Brown while right-leaning newspapers were becoming increasingly critical of the Tory leader and his modernising agenda. It was in this predicament – with a fourth defeat for the Tories staring them in the face – that Mr Cameron reached out for Mr Murdoch and his newspapers, with consequences that are now being revealed and documented."

¶2.4 George Eustice MP served as David Cameron's Press Secretary for almost two and half years between May 2005 and October 2007. Not inconsistently with parts of Mr Neil's evidence, he has said of his work for Mr Cameron:17

¶I "When I was his press secretary, we pursued a strategy of quietly puncturing the arrogance of both editors and proprietors and raising the status of what I term real journalism."

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¶2.5 Mr Cameron recognised that early on he had not enjoyed much personal support from the press:18

¶"...I'd won the leadership of the Conservative Party without the support of I think any newspapers frankly. I had a pretty rocky time with them during the leadership election, and I think I'd won the leadership basically through what I'd said at Conservative Party Conference and it was television that had helped me to get my message across."

¶2.6 He also acknowledged that initially there were different views about how best the Conservative Party could get its message across. For his part, he placed emphasis on television, which he believed had been so instrumental in his successful bid for the leadership of the Conservative Party:19

¶"I wanted us to have a good relationship with newspapers. I knew we needed to win over more support, but to start with there were certainly some in my office who were very keen on trying to do things completely differently and communicate much more through the Internet and what have you. I would say I was more cautious about that, thinking we wanted to work very hard on television, we should do what we could with the newspapers, but I think that's the way it was..."

¶2.7 It is worth pausing to note the early emphasis on television which has been retained throughout Mr Cameron's leadership of the Conservative Party. The importance accorded to television reflects the enormous reach which television has to mass audiences and its power to communicate political messages notwithstanding the duty of impartiality to which broadcasters are subject. It is one of a number of indicators that, whilst the support of national newspapers remains very important to modern politicians, that importance has to be seen in perspective relative to television and increasingly also to the internet.

¶2.8 Mr Cameron confirmed that he had wanted more distance and a different approach to the media. Significantly though, he recalled them as eliding into one another rather than being tried sequentially. Given the opportunity to respond to Mr Eustice's observation, quoted above, he said:20

¶"I think parts of it are right, in that we did want to have this – we didn't want to go down the same route as everything Labour had done. We did want to have a bit more distance, but if you look at the record of the sort of meetings I was having and the rest of it, I was still, you know, flying off to meet proprietors and trying to win people over, so I don't think it totally squares up that there was one approach that was tried and failed and then another approach. There's slightly more elision between the two, my reflection on it."

¶I 2.9 Mr Cameron's evidence that he had been trying to "win people over" (that is to say, build political support) from the time of his appointment is amply borne out by the record of his meetings with the media. The record shows a modest increase in the frequency of meetings from 2007 onwards, but nothing like a step change.21 His entry in the Register of Members' Interests dated 27 September 2006 records a helicopter flight from London to Brecqhou, provided by Aidan Barclay. The entry was made the day after he met Sir David and Sir Frederick

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¶Barclay, owners of the Telegraph Media Group for a general discussion, thus showing that Mr Cameron was indeed meeting with media proprietors as early as 2006.22

¶2007: The appointment of Andy Coulson 2.10 Whether or not the strategies employed by Mr Cameron merged or were distinct and sequential, it is clear that by 2007 he was looking significantly to strengthen his media operation. He explained that:23

¶"After my first year or so as Leader of the Party, it became increasingly clear that the Conservative Party needed a heavyweight media operator, someone who had operated at the highest levels and who knew how a newsroom was run..."

¶2.11 The need to recruit a media heavyweight was attributed to the huge pressures upon modern political media operations:24

¶"...I was looking for someone who was a big hitter, and I was looking for someone who could really cope with the huge media pressure that you're under, and tabloid editors and leading executives on a tabloid newspaper I think do have – they bring something that others wouldn't, and so there wasn't a particular wish list, but it was trying to get the right person with the right skills."

¶2.12 The object was not simply to absorb the pressures but to change and improve the Conservative Party's media operation:25

¶"I had this very good guy, George Eustice, who was doing a good job. If I was going to bring someone in above him, I wanted somebody who really would be able to materially alter and improve the way we did things, particularly in the face of this massive pressure you face."

¶2.13 Self evidently, the appointee would need to be sympathetic to Conservative views as well as have very considerable experience in the media and particularly of operating successfully in an intensely pressured media environment. In practice there was a very small pool of potential recruits. Yet Mr Coulson was not the only person considered for the post. Mr Cameron recalled seeing at least four people personally about the position:26

¶"How many people did I see? Obviously Guto Harri, who's outed himself or been outed, I did have conversations with him. There was someone senior from a broadsheet newspaper. There was someone else very senior in the BBC. There was this tabloid I journalist..."

¶2.14 It was Mr Osborne who proposed that Mr Coulson should be approached. At first glance, it might be thought surprising that Mr Osborne should have made this particular suggestion. As the editor of the News of the World (NoTW), Mr Coulson had been responsible for a damaging front page headline about Mr Osborne: "TOP TORY, COKE AND THE HOOKER".27

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¶Whilst it is true that the story also ran in the Sunday Mirror with a leader far less kind than that contributed to by Mr Coulson, a reflection perhaps of the differing political perspectives of the two titles, it is certainly impossible to regard the NoTW's headline as helpful to Mr Osborne.28 As the author of the headline "HUG A HOODIE", Mr Coulson had not helped Mr Cameron's popular profile either.29 The Prime Minister described it as "...the most effective and destructive headline about me that anyone's managed..."30

¶2.15 The most that could be said about the stance of the NoTW on Mr Cameron's bid for the leadership of the Conservative Party was that it had not been against him. More generally, although the paper had engaged William Hague as a columnist between December 2003 and 2005, when he returned to the Shadow Cabinet, the NoTW under Mr Coulson had supported New Labour, backing Mr Blair at the 2005 general election.31 The importance of Mr Coulson to the Labour Party is well illustrated by the fact that when Mr Coulson resigned from his position as editor of the NoTW in 2007 both Mr Blair and Gordon Brown contacted him to commiserate with him on the turn of events.32

¶2.16 That Mr Coulson had resigned in response to the conviction and imprisonment of one of his journalists added yet another reason to question why it was that Mr Coulson's name came to Mr Osborne's mind.

¶2.17 Mr Osborne's explanation for suggesting Mr Coulson to Mr Cameron was that he sensed that Mr Coulson was in fact instinctively sympathetic to Conservative views:33

¶"...I had met Mr Coulson on a handful of previous occasions when he was editor of the News of the Word, although we had not met privately before. Under his editorship the newspaper had supported the Labour Party in the previous general election. However, in my conversations with him, I had sensed that his personal view of political issues was more closely aligned with the Conservatives – although I had never asked him as editor whether he was someone who had voted Conservative."

¶2.18 On this point Mr Osborne's intuition proved to be correct.34 The circumstances in which Mr Coulson had come to resign did not deter Mr Osborne from advocating an approach to Mr Coulson because he assumed that the matter had been fully investigated by the police and, in any event, he could ask Mr Coulson about it:35

¶"I was, of course, aware from media reports that Mr Coulson had resigned as editor of the News of the World following the convictions of the paper's Royal correspondent Clive Goodman and private investigator Glenn Mulcaire for phone hacking. I assumed that since the matter had been subject to a police investigation and a criminal trial that all the relevant facts had come to light. I also intended to ask Mr Coulson himself about the issue – and later did (as set out below)." (emphasis added)

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¶2.19 He thought that as a recently resigned editor of the NoTW, Mr Coulson would be a very strong candidate for the task which was envisaged, explaining:36

¶"... First of all, he had been the editor of a major national newspaper, so he had an enormous amount of professional experience, and what we needed was someone who was going to be able to handle the communications of a large organisation, the Conservative Party, and develop a media strategy, but also be able to handle, on an hour by hour basis, the problems that were thrown at us ... I thought that Andy Coulson had that experience, as someone who had run a large newsroom, was used to the pressure of dealing with fast-changing stories."

¶2.20 Mr Osborne denied that Mr Coulson's associations with or contacts with News International were relevant factors, whilst emphasising that his experience as the editor of a big newspaper and prospects of succeeding in the new role were:37

¶"Q. Are you saying that his associations with or contacts with News International were not relevant factors at all? They were not relevant as far as I was concerned, or certainly, as far as I'm aware, David Cameron was concerned. The fact that he had edited a big newspaper was the relevant fact, and as I say, the other candidates we considered were not people who were working for News International. I think if Mr Coulson had, for example, been editing the Mail on Sunday, then we would have also hired him. So I think it wasn't relevant that he was a News International ex-employee. LORD JUSTICE LEVESON: But relevant that he was very experienced in the ways of the press? A. That was the relevance, sir. I mean, I have seen people suggest that the reason we hired him was because of his connections with the Murdochs or Rebekah Brooks or his knowledge of the internal workings of News International. I can tell you that was not a consideration. What we were interested in hiring is someone who was going to do the job going forward ..."

¶2.21 Mr Cameron had a similar, although not identical, view about the relevance of Mr Coulson's News International background. He was at pains to say that there was no calculation that a former News International editor would facilitate winning over the NoTW:38

¶I "Q. Is it your evidence that his News International background was irrelevant to the decision, in other words it was a factor. A. No, it wasn't irrelevant, clearly. As I said, his contacts, his knowledge, his work at a newspaper, all of that mattered. But if what lies behind the question [is] were you after a News International executive because this was going to make it easier to win over the News of the World or whatever, no, that wasn't the calculation. The calculation was: who is going to be good enough, tough enough, to deal with what is a very difficult job?"

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¶2.22 The right person for the job, to Mr Cameron's mind, regardless of whether or not he or she had a News International background, was someone who was going to be able to "...handle tough stories and meet fast deadlines, particularly for tabloid newspapers..." whilst at the same time engaging "...more systematically with the broadcast media who ...have huge influence in terms of political coverage and discussion".39

¶2.23 Mr Osborne took forward his suggestion by arranging to meet Mr Coulson for a drink at a central London bar, on 15 March 2007, two months after he had resigned from the NoTW. Mr Coulson recalled discussing what the Conservative Party should do to organise its communications in readiness for a general election. He expressed views which are very similar to those held by Mr Cameron, placing an emphasis on television and the need to promote good relations over the whole spectrum of the media:40

¶"I told him that my view of communications was that it needed to be first and foremost professional, that we needed to have good relationships with as many media representatives as possible right across the spectrum, and I also told him in that conversation and again later in a conversation with Mr Cameron that my firm belief was that television would play a crucial part in any General Election campaign. My view was more so than it had done previously." (emphasis added)

¶2.24 Mr Coulson felt that it was: "...clear from the off that they were interested in hiring me" and did not feel as if he was being interviewed at all.41 He confided in Rebekah Brooks about the Conservative Party's approach.42

¶2.25 Mr Osborne recalled asking Mr Coulson at the meeting whether he would be interested in being considered for the post of the Conservative Party's Director of Communications. In his witness statement he described Mr Coulson saying that he would think about it and calling, some days later, to say that he was indeed interested, an answer which Mr Osborne passed on to Mr Cameron.43 Mr Coulson's recollection was slightly different. He believed that Mr Cameron had called him later the same night: "...to say that Mr Osborne had told him of our conversation and that he would like to meet".44 In his oral evidence, Mr Osborne's account was consistent with Mr Coulson's:45

¶"Q. And then in paragraph 8.1, after Mr Coulson, a few days later, confirmed that he was interested in the job, you had a conversation with Mr Cameron about it; is that correct? A. Yes. I think I spoke to him pretty soon, actually, David Cameron. My recollection is that I probably spoke to him on the way back from the drink I'd had with Mr Coulson on the telephone".

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¶2.26 Nothing turns upon which recollection is correct; both men were trying to recall a minor detail some five years ago.

¶2.27 Whatever the precise mechanics were, the initial meeting was certainly followed up. A meeting with Mr Cameron was arranged at his office in the Norman Shaw Building, probably later in March 2007. Mr Cameron described this meeting as having been significant: "... the key meeting about deciding whether or not to employ him...".46 Having met Mr Coulson and discussed his possible appointment with Mr Osborne and Steve Hilton, Mr Cameron decided in principle that he wanted to appoint Mr Coulson as the Conservative Party's Director of Communications and Planning. He asked the Party Chairman, the Rt Hon Francis Maude MP, and his Chief of Staff, Ed Llewellyn, to meet with Mr Coulson to discuss practical arrangements.47

¶2.28 These discussions occurred, and at some stage in the process Mr Coulson also spoke to Mr Hilton.48 Final acceptance of the job appears to have occurred in May 2007 after that year's local elections, during the course of a telephone call between Mr Cameron and Mr Coulson.49 Mr Coulson commenced his employment with the Conservative Party on 9 July 2007.50

¶2.29 An issue on which all the witnesses were agreed is that during the recruitment process Mr Coulson was asked about phone hacking. However, recollections differed as to precisely who asked what and when they did so. Mr Osborne recalled asking at his very first meeting whether there was anything more on phone hacking that he should know about that was not already public. He stated that he received a reply in the negative.51 Mr Cameron could not recall being told about this but had no reason to doubt Mr Osborne.52 Mr Cameron's own recollection was that not only did he personally raise the matter with Mr Coulson but also that it was raised when Mr Coulson met with Mr Maude and Mr Llewellyn:53

¶"I believe that three such meetings took place: one with both Francis Maude and Ed Llewellyn. These were about the terms and conditions of the appointment. In the meeting they held together, they also asked him specifically about his involvement in the well-publicised hacking that had taken place while he was editor of the News of the World and which had led to the convictions of Clive Goodman and Glenn Mulcaire. He denied any knowledge of the hacking but said that he took responsibility for what had happened on his watch and had therefore resigned. This was consistent with what he had said at the time of his resignation as Editor" (emphasis added).

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¶2.30 So far as his own investigation of the issue was concerned, in his oral evidence Mr Cameron described raising the issue at the face-to-face meeting which he had with Mr Coulson in March 2007. He said:54

¶"My recollection is that I raised the issue of phone hacking and sought the assurance in the face to face meeting we had in my office. That's my recollection. I vaguely remember the further telephone call, but that's – I've obviously racked my brains to try and remember exactly the sequencing, but my recollection is that I knew it was very important that I needed to ask him that question, and therefore did so, as it says in my evidence".

¶and, in response to the suggestion that the issue was raised only during the May 2007 conversation, he said:55

¶"That's not my recollection. My recollection is that the assurances I sought were in the face-to-face meeting, but it may be there was a further specific question I needed to ask in the phone call, I can't remember. What I'm absolutely sure about is I remember the conversation with Ed Llewellyn was how important it was to see the assurance, and I remember very clearly seeking that assurance and getting the assurance..."

¶2.31 The suggestion that the issue had been raised only once by Mr Cameron was put to him because that was how his witness statement appeared to read. Having dealt with the March face-to-face meeting without mentioning the issue, and the subsequent meetings with Mr Maude and Mr Llewellyn to discuss practical arrangements, at which they had asked Mr Coulson about phone hacking, the witness statement continued:56

¶"[Francis Maude and Ed Llewellyn] reported these assurances orally to me, but said that since these were serious allegations I should personally satisfy myself as to these assurances by putting these questions directly to Andy Coulson in my own conversations with him, and before formally offering him the job. I then had a further conversation with Andy Coulson in which I also asked him specifically about his involvement in the hacking case. He repeated what I understood he had said to Francis Maude and Ed Llewellyn, that he had no knowledge of the hacking but said that he took responsibility for what had happened on his watch and had therefore resigned as Editor. I also recall asking him at the same time whether there was anything else which I should be aware of which might embarrass the Conservative Party. He said he did not believe that there was."

¶2.32 Mr Coulson recalled being asked by Mr Cameron during the course of the telephone I conversation in May 2007: "He also asked me about the Clive Goodman case".57

¶2.33 The witnesses were trying to recall the precise timing of conversations some five years ago now and it is not surprising that in those circumstances that there were some discrepancies. I make no criticism of them for that. Whether the issue was raised with Mr Coulson once, twice, three times, or four times (ie 7 March 2007, at the March 2007 face-to-face meeting with Mr Cameron, at the meeting with Messrs Maude and Llewellyn, and during the May telephone conversation) I am entirely satisfied that it was raised; given the significance of the issue, it was most probably raised on each of the four occasions.

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¶2.34 However many times the hacking issue was raised during the recruitment process, what is clear is that the inquiries did not go beyond asking Mr Coulson about the issue and accepting his assurances. Mr Osborne described consciously considering whether the circumstances of Mr Coulson's departure ruled him but concluding that it did not. In doing so, he fairly pointed to the context at the time which must have been reassuring:58

¶"I did consider whether the circumstances surrounding Mr Coulson's departure from the News of the World ruled him out as a Director of Communications. But I made what I believed was the reasonable assumption at the time that the police had uncovered all the relevant evidence. Mr Coulson had also confirmed to me that this was the case. It is worth noting that I was not the only person who accepted this. Before the appointment was confirmed on 31 May 2007, the Press Complaints Commission said: There is no evidence to challenge Mr Myler's assertion that: Goodman had deceived his employer in order to obtain cash to pay Mulcaire; that he had concealed the identity of the source of information on royal stories; and that no one else at the News of the World knew that Messrs. Goodman and Mulcaire were tapping phone messages for stories."

¶2.35 Mr Cameron similarly pointed to the fact of the police investigation and the subsequent prosecution of Messrs Goodman and Mulcaire. He did not shrink from taking responsibility for the decision but he understandably reminded the Inquiry of the indisputable importance of judging the decision without the benefit of hindsight:59

¶"The responsibility for employing him on the basis of the assurances that he gave is mine. I took the view that because he had given me repeated assurances that he had no knowledge of hacking, he deserved a second chance. If anyone had given me any evidence that Andy Coulson knew about or was in any way involved with phone hacking, I would not have employed him. And as I said in my statement in the Commons on 20 July 2011, with 20:20 hindsight and all that has followed, I would not have offered him the job, and I expect that he would not have taken it. As I said then, you do not make decisions in hindsight; you make them in the present".

¶I 2.36 Before Mr Coulson started work at Conservative Party Headquarters not only had the PCC made a reassuring statement about the extent of hacking at the NoTW, so too had the Chairman of News International. James Murdoch's evidence was that:60

¶"...the company told the Select Committee in March 2007 that it believed that Clive Goodman was the only person who knew what was going on, and the Committee noted in its report dated 3 July 2007 "the assurances of the Chairman of News

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¶International that Mr Goodman was acting wholly without authorisation and that Mr Coulson had no knowledge of what was going on".

¶2.37 Dealing with the Terms of Reference of what is described as Part 1 of the Inquiry that I am conducting, particularly in the light of the current prosecution that Mr Coulson faces, it is simply not fair or appropriate to inquire into precisely what Mr Coulson knew or did not know about phone interception at the NoTW. On the other hand, however, it is relevant to consideration of Mr Cameron's decision to recruit Mr Coulson to take into account the then prevailing positions of both PCC and News International.

¶2.38 Mr Osborne was unequivocal about his reason for recommending Mr Coulson for appointment: "I recommended that Mr Cameron appoint Mr Cameron because I thought that he was the best candidate for the job".61 He described having been "very impressed" by Mr Coulson.62 Mr Cameron was similarly focused on Mr Coulson's skills when appointing him:63

¶"Well, obviously his knowledge of the industry, his contacts, his work as an editor were all important, but the most important thing was: is this person going to be good at doing the job of managing the press and communications for the Conservative Party? I wasn't just after some –any old person from News International or from the Daily Mail or from wherever. I wanted somebody really good who was going to be able to stand up to the pressure that were under and would face in the run-up to an election campaign. That was the absolutely key consideration." (emphasis added)

¶2.39 Both Mr Cameron and Mr Osborne recognised that there was a risk in hiring Mr Coulson, but both were content to accept that risk. Mr Osborne put it in these terms:64

¶"Q. Why did you run that risk? A. Because I thought in the end, the balance was that it was worth hiring someone with real talent and ability and weathering the adverse publicity that appointing someone who had had to resign from the News of the World would bring...".

¶2.40 Mr Cameron identified not only the potential controversy arising from the circumstances of Mr Coulson's departure from the NoTW but also the fact that he was a tabloid editor. His evidence was as follows:65

¶"Q. When you accepted the assurances, did you assess there to be any risk? A. What I assessed was that this was clearly a controversial appointment for two reasons. One was that bad things had happened at the News of the World while he was editor and he had resigned. So he had left his last job after resigning because of things that had happened. So that was obviously – as I said in my evidence, I was I giving him a second chance.

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¶"The second reason it was – there was controversy [sic] is this was a tabloid editor and there are some people who would say, you know, "Don't have a tabloid editor", to which my answer would be: it's a very tough job, dealing with the press for a major political party. You need someone who has the skills, who has the knowledge, who can really help you through what can be an absolute storm, and so I thought it was the right thing to do..."

¶2.41 The confidential nature of the recruitment process prevented the taking up of formal references. Both Mr Cameron and Mr Osborne did, however, speak informally to Mrs Brooks about Mr Coulson. Mr Osborne recalled a brief conversation which took place in the context of the recruitment process:66

¶"Well, I spoke to her after I'd seen Mr Coulson and after we'd been considering it for a couple of weeks, and I don't recollect the precise day or anything like that, but I remember a conversation where I asked her: "Tell me about Andy Coulson. Tell me, is he a good person? Is he a good person to work with? What do you think of him?" It was never a question about: "Is he going to bring his News International connections?" or: "Tell me more about the circumstances of Andy's resignation." I was just simply asking her opinion of him as professional".

¶2.42 Mr Cameron was unsure whether his conversation with Mrs Brooks about Mr Coulson had taken place before or after the decision was made, although there would only really have been a point to such a conversation before the decision was taken:67

¶"I wasn't seeking a reference. I mean, when you're employing someone like this who's been an editor of a newspaper, you can't seek sort of formal references. I'm sure I would have asked how effective he would be, but this conversation may well have taken place after I had made the decision. I can't recall exactly when the conversation took place. But in the end it was my decision. I was satisfied this was the right thing, to have a former tabloid editor to help us with our media and communications, and it was my decision."

¶2.43 Although Mrs Brooks was aware of the recruitment process at the time, Rupert Murdoch denied any direct or personal involvement. He described himself as "...just as surprised as anybody else..." when he heard the news.68

¶2.44 An obvious question was the extent to which the decision of the Conservative Party to hire Mr Coulson had been influenced by the success in opposition of Alastair Campbell for New Labour. Mr Osborne recognised some influence, but both he and Mr Cameron were keen to stress that Mr Campbell and Mr Coulson were different men. Mr Cameron's evidence on this I point was:69

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¶"Q. To what extent were you looking at the example of Alastair Campbell as being obviously politically in a different place but the sort of man in terms of temperament and robustness who would be of assistance to you? A. Not necessarily. I don't think, you know, Alastair Campbell had – he was much more political than Andy Coulson, and I think in all sorts of ways there were occasions when clearly he'd overstepped the role of what he should have been doing."

¶2.45 Mr Osborne put the matter in this way:70

¶"LORD JUSTICE LEVESON: Well, is it more that actually he brought skills which you'd seen evidenced by New Labour in Mr Campbell? A. I think it is undoubtedly the case that Tony Blair had seen that hiring someone from the media would bring an added dimension to the communications effort, and the Conservative Party had, in opposition, hired a number of people subsequently who had been journalists, indeed one person who had been an editor of the paper. So that was true, but I don't think that Mr Coulson and Mr Campbell are cut from the same cloth, I would suggest. Alastair Campbell was a political editor. I thought Andy Coulson brought a broader experience, as an editor of a paper, so managing a large newsroom, and as I say, I think subsequently the way he did the job shows that he was very well qualified to do that job."

¶2.46 Having been appointed as Director of Communications and Planning, Mr Coulson's role was to oversee all of the party's communications departments including press, broadcast and online. He specifically oversaw all of the communications for David Cameron and his Shadow Cabinet and was included in the small group of people with responsibility for the strategic planning and execution of the General Election campaign. He attended Mr Cameron's morning and afternoon meetings, along with other key staff, and was a part of the general planning team. His job was to make sure policy was properly communicated and to advise on the likely media impact of policies. The remit was wide enough to encompass speeches, press conferences, interviews, and articles given or written by Mr Cameron. He monitored broadcast coverage and assumed a central role in crisis management, for example responding to the MPs' expenses scandal.71

¶2.47 There has been speculation as to whether Mr Coulson had continued to be paid by News International whilst working for the Conservative Party. Disclosure by Mr Coulson of a compromise agreement by which his employment with News Group Newspapers Limited was terminated explained what had happened. Mr Coulson did not resign unilaterally without regard to his contractual entitlements. His employment was terminated on terms which he agreed with his employer and which were set out in the compromise agreement.72 I Mr Coulson was paid in lieu of his employer's contractual notice period and compensated for the termination of his employment. The sums due to him pursuant to the compromise agreement were paid in two tranches, the second of which was in November 2007, after Mr Coulson had started work for the Conservative Party. He also received a quantity of restricted

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¶News Corp stock units which vested in him in August 2007, again after the commencement of his employment with the Conservative Party.73

¶2.48 In other words, Mr Coulson did receive both cash and shares from his former employer whilst he was working for the Conservative Party, but these were payments made in respect of the termination of his employment with News International and agreed at the time of his departure from that company. There was no evidence that he was receiving a retainer from News International whilst he worked for the Conservative Party.

¶2.49 Having appointed Mr Coulson there were further developments which must have reassured Mr Cameron. In July 2009 Mr Coulson gave the same assurance to the Culture Media and Sport Select Committee that he had given to Mr Cameron: "I have never condoned the use of 'phone hacking and nor do I have any recollection of incidences where 'phone hacking took place". The Committee concluded that it had "seen no evidence that Andy Coulson knew that phone-hacking was taking place". Mr Coulson also denied knowledge of hacking under oath in the trial of Tommy Sheridan which was held in December 2009: "I'm saying that I had absolutely no knowledge of it. I certainly didn't instruct anyone to do anything at the time or anything else which was untoward".74 As is discussed later in this section, in 2010 there were to be a number of less reassuring developments and, ultimately, Mr Coulson resigned from his post in January 2011.75

¶Strategy and tactics 2.50 Mr Cameron described the approach to planning his media effort in the context of his overall strategic planning:76

¶"Well, the strategy mapped out at the beginning of the year are the things you want to achieve, the policies you want to get across, the ideas that you want to champion, and then after that, you think: right, how do we do that? What's the mixture of newspapers and television and direct campaigns and the rest we want to do? Then following that, you're looking at: where are we going to have impact?"

¶2.51 When it came to assessing the relative importance of newspapers, television and direct campaigns, Mr Osborne shared with both Mr Cameron and Mr Coulson the view that broadcasting was becoming increasingly important. In particular, Mr Osborne challenged the view that newspapers set the agenda and broadcasters follow. He explained how broadcasters now quite often set the news agenda themselves and described their power as enormous:77

¶"Q. Do you feel, as some have said again, that the news agenda tends to be driven I by the printed media and the BBC and other broadcasters follow suit, or do you feel it's the other way around or a mixture of the two? A. I saw Tony Blair's evidence on this, and I think that might have been the case perhaps when he was Prime Minister. Speaking personally as someone active in front line politics today, I would say the broadcasters are incredibly important. It is not clear that they're always following a newspaper judgment. I would say the significance of a story is massively elevated if it is right at the top of one of the big news shows and that's often the judge of whether something is really going to have an impact in the political sphere. Now, quite often they will be picking up indeed stories from newspapers, but quite often they'll have their own investigations and quite often those – you know, the BBC, for example – and I'm a supporter of the BBC, so this is not – I'm not seeking to criticise the entire institution, but they will run a special report, a Panorama report, then put that top of the Today programme and suddenly we're all expected to treat that as the most important thing happening in Britain that day. So I wouldn't say it's a straightforward process whereby the newspapers run a story and the journalists – the broadcast journalists cover it. I think it's more complicated than that, and I think the power of the broadcasters is enormous. It is power exercised with responsibility, but nevertheless it's significant."

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¶2.52 Mr Coulson described how he vigilantly monitored broadcasters' output, especially the BBC's, and took issue with it as he thought necessary, whilst keeping open as many lines of communication with the organisation as he possibly could:78

¶"Another aspect of my job was to monitor broadcast coverage, in particular the BBC, given its audience dominance. My approach was to keep as many lines of communication as possible open with the BBC, and to argue our case. I never took the view that ranting at producers and editors was either proper or productive. But I would monitor the BBC's coverage, including online, and firmly register our view when I thought it was appropriate."

¶2.53 As for the newspapers, Mr Osborne described a general strategy with achievable objectives:79

¶"I don't think it was a particular strategy for the Sun newspaper. It was a strategy for the newspapers. We wanted the full throttled support of Conservative-leaning papers like the Telegraph and the Mail. We wanted to win over some of those more neutral broadsheets like the Times and the FT. We didn't have much hope of the Mirror and the Guardian, and obviously we wanted to win the support of the Sun. But it was a general media strategy and it mainly consisted of setting out our argument about why the Labour government had forfeited the right to remain in office and why we thought a Conservative government would be better for Britain."

¶2.54 Mr Cameron, who was essentially agreeing with an observation of Mr Brown's, identified a problem with what he described as the newspapers' volume knob. It is a feature of modern I newspaper coverage of politics with which all current politicians have to deal and which one supposes must give them an added incentive to make as much effort as possible to cultivate good relationships with the press. Mr Cameron put it this way:80

¶"Q. Can I ask you to address Mr Brown's point that reporting is hyperbolic, it's sensationalised. He said the politicians don't simply make errors of judgment, their motives are always put into question. Do you associate yourself as a matter of generality with that point or not? A. I think there are occasions when that can happen. As I've said, it links back to this thing about newspapers being under pressure to find something special and different and go for impact, and sometimes that can mean questioning motives. So you do – I don't want to make this sound like sort of politicians complaining about – of course we should have a vigorous press and they should give us a good going over and they do and that's fine. Sometimes it is frustrating when you feel your motives are endlessly being questioned, and – but, you know, there's bound to be a certain amount of that, but I think the way I put it is that the volume knob has sometimes just been turned really high in our press and I'm not sure sometimes that does anyone any favours."

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¶2.55 Mr Coulson aimed to meet or talk to most editors, political editors and some columnists on a reasonably regular basis (as he also did with broadcast journalists), considering it to be an important part of his job. He occasionally met with proprietors or senior executives. These meetings were mostly off the record and with an informal agenda. Amongst other things, Mr Coulson sought to use the meetings to clear up inaccuracies or misunderstandings which had been printed or broadcast or simply to promote the Prime Minister's message. Together with Mr Cameron and other senior Conservative politicians he would also occasionally attend meals hosted by newspapers, for example at the party conference when the Telegraph, the Daily Mail and The Times all hosted their own dinners. The conference itself was a period of intense contact with the media. They would also give speeches at events organised by various newspapers.81

¶2.56 Mr Cameron said that he had sometimes directly asked titles for support: "…But obviously on occasion you'd say, "We'd love a bit more support from your paper".82

¶2.57 Although Mr Cameron was in any event spending a great deal of time cultivating good relations with the media and seeking to spread his message through them, it is clear that Mr Coulson brought a renewed vigour to this activity with a particular emphasis on ensuring not just formal but also informal face-to-face contact with journalists:83

¶"I attended coffee meetings between David Cameron and other journalists, at various times. In opposition, David and Samantha Cameron would also host occasional dinners at his home for media. These included newspaper and broadcast journalists. I would usually, although not always, attend. I played a central role in organising this diary of activity but David Cameron was not always an entirely willing participant. I Given the choice, I think he would have preferred to be doing other work or enjoying a night home with his family. However, he understood, and reluctantly agreed, that it was important to meet with journalists, formally and informally."

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¶2.58 Notwithstanding Mr Cameron's reluctance on occasion to give up his time to cultivate media contacts, he did not express to Mr Coulson the view that press and politician were becoming too close:84

¶"Q. The Prime Minister said in July 2011 words to the effect that "We all got too close to News International". You probably recall that, Mr Coulson, don't you? A. Yes. Q. Is that a view he expressed to you before July 2011, in particular before you left, which I think was in January 2011? A. No, I don't remember him doing so."

¶2.59 Nor did he express that view to Mrs Brooks:85

¶"Q. Mr Cameron also said publicly: We all got too close to News International." Or words to that effect. Was that a view he ever communicated to you personally? "A. No."

¶2.60 Mr Coulson advanced three reasons to explain why he felt that contact of the nature and extent which he was orchestrating had become essential:86

¶"It was important for three reasons. Firstly, you stood a better chance of getting your message across and of stopping misunderstandings quickly if you had good relationships. In a perfect world as Prime Minister you would issue a statement, give an interview, or stage a press conference and your message would be communicated to the public in fair, even-handed reports. Modern politics doesn't work that way. What we did and said required explanation and at times I needed to fight our corner for fair coverage. Secondly, I took the view that it was important that journalists saw David Cameron in a relaxed and informal mode, as well as at work. Again, modern politics demands this. I felt it was important to show his authentic life away from work, not least as the Labour Party was working hard to convince the public that he spent his private moments lounging around a mansion, in top hat and tails, sipping champagne and nibbling on caviar. This was an important myth to dispel. Thirdly, journalists want to meet politicians. There is no substitute in journalism for face to face contact. It was also important for David Cameron to hear what some of the journalists had to say on behalf of their readers and viewers. I believe I was even- handed in who had access to him".

¶I 2.61 These are revealing insights into what motivated Mr Cameron's Director of Communications to seek even closer proximity to the media for a principal who was already highly active and experienced in his dealing with the media. Mr Coulson clearly felt that this extra effort was required to achieve the legitimate media goals which are incorporated into the reasons quoted above: fair and even handed reporting, the rapid resolution of misunderstandings, an authentic picture of the politician and receipt of reader and viewer feedback. One might easily add to this list.

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¶2.62 It is self evident that any solution to a problem of over proximity between the press and senior politicians must involve a proper distance or, at least, transparency. But if that is to be achievable in practice, the politician's legitimate media objectives, such as those identified above, must be attainable from that proper distance and with appropriate transparency. Otherwise, the temptation to get too close will be irresistible. I shall return to this issue when concluding this Part of the Report and making recommendations.

¶2.63 Mr Coulson drew on his experience in the media to advise about the Conservative Party's communications effort, including matters such as how best to talk to proprietors and editors, as Mr Osborne explained:87

¶"Q. But was Mr Coulson able to give advice as to how best to obtain the Sun's support, even if, as you say, it was far less important than many commentators have claimed? A. Well, I think his advice was how to handle our communications effort. Yes, how to talk to proprietors and editors and so on ..."

¶2.64 Mr Cameron's strategy of maintaining a very wide range of media contacts met with Mr Coulson's entire approval. He said:88

¶"... I think the party had very good relationships with the Guardian. I think I probably wouldn't include the Daily Mirror, in truth, or the Sunday Mirror. I didn't put an awful lot of effort into either of those papers, although we met and we talked, actually. But yes, I – and more importantly David Cameron – took the view that we had to talk to as many people as possible. The Tories had a – the party had an electoral mountain to climb, it was of historic proportions. So we wanted to touch as many readerships as we possibly could and get our message across as far and wide as we could." (emphasis added)

¶2.65 When considering individual titles the Conservative strategy was not limited to those at the top of the organisation but extended to developing contacts and promoting contacts in depth. Mr Coulson explained that the rationale for doing so was to maximise the chance of favourable coverage:89

¶"... I was keen actually that we had good relationships throughout – as much as we could throughout the paper. Same goes for – if I can keep adding this – for other newspapers. It is not – newspapers don't work that way. You know, you can't rely I on a call to an editor to guarantee anything, and nor should you. What you were attempting to do was build a series of relationships where when you had something positive to say you would give yourself the best possible chance of getting the best possible coverage, and so it was actually a range of relationships throughout all the newspapers."

¶2.66 Returning to one of the concerns which he expressed when explaining why informal face-to- face contact was important, Mr Coulson identified a growth in the importance of individual personality in politics and stressed the need for a great deal of effort to ensure that an "authentic view" of Mr Cameron in particular was being expressed in the media.90

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¶Relations with Telegraph Media Group 2.67 Mr Cameron met Aidan Barclay, Chairman of TMG, numerous times whilst in Opposition, sometimes in formal surroundings and sometimes informally. Two of the meetings occurred during the contest for the leadership of the Conservative Party, in the form of a meeting at Mr Barclay's office and then a short while later, breakfast at the Ritz (which is owned by the Barclay family). There were two more meetings, on 27 April 2006 and 12 June 2007, in the period between the leadership election and Mr Coulson's appointment; both were meals at the Ritz. Thereafter, there was a dinner on 25 February 2008, a meeting at Mr Barclay's office on 3 November 2009, before Mr Cameron invited Mr Barclay to his home for dinner on 25 November 2009. The final meeting in opposition was a breakfast at the Ritz on 22 March 2010, a few weeks before the general election.91

¶2.68 A text message the day after the pre election meeting evidences the fact that the election campaign had been discussed and plans laid for there to be a daily call between the Telegraph and the Conservatives during the campaign:92

¶"David good to see you congratulations to you both on the prospect of an addition to the family spoken to tony G and repeated our conversation asked him to be in touch to arrange daily call during campaign as discussed. Regards Aidan"

¶2.69 In his evidence, Mr Barclay explained the background to the text and, in particular that he had suggested that there be a daily call between Mr Cameron and the editor of the Telegraph in order most easily to enable Mr Cameron to get his message across:93

¶"A. Well, as you probably realise, in any large organisation sometimes you have difficulty communicating a message across to the right person, particularly if it gets passed down the line, and so I suggested to the Prime Minister that if he wanted to get the attention of the editor and wanted to get his message across in the most efficient manner, he should make a habit of phoning him on a daily basis and I recommended that's what they should do. Q. Sorry, is it the Prime Minister calling – A. It's whichever way around it was, but there should be a daily call – Q. Between the editor and the Prime Minister? A. Yes"(emphasis added). I 2.70 Mr Cameron did not think that a daily personal call between him and Mr Gallagher had been discussed but he agreed that a call between the Conservative Party and Mr Gallagher had been agreed and that its purpose was to facilitate putting across the Conservative message:94

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¶"A. I don't think so. I think the daily call was between the Conservative Party and Tony Gallagher. I don't know whether it was necessarily going to be me, but I think this was me wanting to make sure that the Telegraph knew our policies and our plans and all the rest of it. I think that's what it was about."

¶2.71 The advantages for both Mr Cameron and the Telegraph arising from this example of informal contact with the proprietor of a friendly title are plain to see. By this time Mr Cameron had already secured the clear support of the Telegraph and the discussions on 22 March 2010 concerned only the mechanics of best communicating Mr Cameron's message. That the 'full throttled' support of the Telegraph (as Mr Osborne described the Conservative Party's goal) had been won was made unequivocally clear both during and after Mr Cameron and Murdoch MacLennan, the Chief Executive of TMG, had dinner together in February 2010. In his follow up letter dated 9 February 2010, Mr MacLennan wrote:95

¶"As I said when we sat down for dinner, we desperately want there to be a Conservative government and you to be our next Prime Minister. We'll do all we can to bring that about and to give you great support in the gruelling months ahead, and as we are no fairweathered friend, we'll be there with you too when you're in Downing Street." (emphasis added)

¶2.72 These successes for Mr Cameron were of course not simply the result of dinner with Mr Barclay and Mr MacLennan. The Telegraph's support of the Conservative Party was predictable and there had been numerous meetings between senior Conservatives and editors and senior executives from TMG over the years. But they vividly illustrate the power of face to face meetings to maximise both the personal support of a sympathetic title for an individual political leader and the communication of a political party's message through it.

¶Relations with News Corporation and News International 2.73 Mr Cameron was understandably keen to win back the support of News International's titles from New Labour. As he put it:

¶"No politician who wishes to get his message across to the public could afford not to take into account the scope of News International's coverage when deciding which people to meet".96 When he assumed the leadership of the Conservative Party he hoped that: "...in time, we would have the support of News International's papers. After all, these papers fundamentally share the same views on society and the free market as the Conservative Party".97

¶I Rupert Murdoch 2.74 Contact with Rupert Murdoch had in fact begun during the leadership contest. Mr Murdoch first recalled meeting Mr Cameron socially at a picnic hosted by his daughter Elisabeth.98 He dispelled rumours that his first impression of Mr Cameron was of a 'lightweight' politician.99 Rather, he said that he had been impressed with Mr Cameron as a family man.100 The first contact of a strictly business nature was when the two men met at The Sun's offices in Wapping in October 2005 before the leadership election.101

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¶2.75 Thereafter they met face to face, or were at the same events, on at least ten occasions whilst Mr Cameron served as Leader of the Opposition.102 There was some discrepancy between the schedules of contact provided by the witnesses.103 There were many potential reasons for the discrepancies and no indication that those who had compiled the schedules on behalf of their principals had done anything other than their best from old records, diaries etc, which were never intended to record precisely what contact had actually occurred.104

¶2.76 The contact usually took place at meetings over a meal, or at News Corporation functions but there was also some social contact. Both men were present, as were Mr Blair and Mr Brown, at the wedding of Rebekah Wade to Charlie Brooks on 13 June 2009. Six months later, on 19 December 2009, Mrs Brooks arranged a dinner attended by the Camerons, the Osbornes, Mr Brooks, Rupert, James and Kathryn Murdoch. This event took place not long after The Sun had, in September 2009, switched its support from Mr Brown to Mr Cameron, and it is easy to envisage it cementing the newly warmed relationship between News International and Mr Cameron.

¶2.77 Describing what passed between them during the course of the working meals which they had together, Mr Cameron emphasised Mr Murdoch's global perspective and interests:105

¶"…I mean, in most of my lunches or breakfasts with Rupert Murdoch, the conversation has always been predominantly about economic issues, security geopolitical issues, he was very interested in what was happening in Afghanistan, very interested in global markets. I think it's – of course all businesses have their interests and the rest of it, but in my dealings with Rupert Murdoch, most of the conversation has been about big international political issues."

¶2.78 Mr Murdoch did not recall the detail of the conversations but his recollection generally of his conversations with Prime Ministers certainly bore out that these were topics which he spoke to senior politicians about and was interested in. His keen interest in geopolitics was very probably raised and, in particular, the conduct of the war in Afghanistan and perception of public opinion on the circumstances in which British troops were fighting was to play a role in

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¶The Sun's transfer of support away from Mr Brown to Mr Cameron.106 His strength of feeling on this issue was well illustrated by the following evidence which he gave about his views on Mr Brown's handling of equipment issues:107

¶"…And Afghanistan I felt very strongly about. First, I thought it was right – this was, I think, beyond us going in there. I felt very strongly, particularly when I came here and saw the photographs of the great young British soldiers who'd either been wounded or killed there, I felt very strongly when the charge was made that they weren't being properly protected, and I was dissatisfied with Mr Cameron's [sic] answer that they were better protected than any other Europeans. Our argument was that they should be as well protected as the Americans. And although we kept the relationship always with Mr Cameron – I'm sorry, Mr Brown, you'll note in the letters between he and I, we always finished with best wishes to our families."

¶2.79 Mr Murdoch's interest, and that of The Sun, in British soldiers included News International Supply Company Ltd funding the Leader of the Opposition's Combat Stress Summit at the House of Commons, as declared in Mr Cameron's entry for 15 July 2009 in the Register of Members' Interests.108 Mr Brown was the subject of strongly worded criticism by The Sun on matters relating to Afghanistan.

¶2.80 Mr Cameron said that he had not had a conversation either with Mr Murdoch or any other proprietor akin to that which Sir John Major had had with Mr Murdoch in which the latter had made clear that he could not support the Conservative Party unless policy on Europe was modified.109

¶2.81 On questions of media policy, Mr Murdoch denied discussing broadcasting regulation with Mr Cameron, BBC license fees, or Ofcom's role. He said, surprisingly, that the BBC and Ofcom had not come up in conversation even to the extent of his view being sought:110

¶"LORD JUSTICE LEVESON: – I'd like to ask you to separate out in your mind the question whether you might be discussing some topic or issue for commercial advantage – you've told Mr Jay that you never did – from the separate question: whether in fact these were topics that were worthy of discussion and on which you had a view. So, for example, you've mentioned that you talked about Afghanistan, and it would be perfectly reasonable for you to have a view on that. Lots of people will. And your view may be informed by your worldwide contacts through the businesses that you operate. That's merely your view. But, therefore, your view on, for example, the regulation of television would itself be of value and may be of interest to those who I are formulating policy, not because it necessarily would affect News Corp, but because this is a business to which you have devoted your life, therefore it's not surprising you will have strong views and I'm just slightly surprised – A. I understand.

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¶LORD JUSTICE LEVESON: – if nobody did ask your view. A. I understand, sir. I just wish to say that I'd long since become disillusioned and it was a waste of time to talk to politicians about the BBC, and that was about all there was to it. And Ofcom, no, I did not speak to him about that. It would have been asking for something, probably, and I didn't do that."

¶2.82 Mr Murdoch was at pains to point out that if his priority had been to secure the most benign regulatory environment for his business interests then he would always have supported the Conservative Party which, of course, has not always happened. He said:111

¶"No, Mr Jay, you keep inferring that endorsements were motivated by business motives, and if that had been the case, we would have endorsed the Tory Party in every election. It was always more pro business. I could have been like the Telegraph. I could even have texted him every day. But I didn't. I was interested in issues." (emphasis added)

¶And later:112

¶"If I'd been interested in commercial interests, I would have supported the Tory Party in every election, because they were always more pro business –"(emphasis added)

¶2.83 He did not pretend though that his interest in issues was entirely divorced from his business interests: "…it was also in my interests to reflect the views or to talk to our readers, and maybe attract more readers."113

¶2.84 For his part, Mr Cameron was emphatic that there had been no 'deals' between the Conservative Party and News International. He rejected the suggestion that there had been either express or implied deals with the media with this answer:114

¶"A. I don't accept that. First of all, on this idea of overt deals, this idea that somehow the Conservative Party and News International got together and said, "You give us your support and we'll wave through this merger", that by the way we didn't even know about at that stage, I think the idea of overt deals is nonsense, and you've heard that from lots of people in front of this Inquiry. I also don't believe in this theory that there was a nod and a wink and some sort of covert agreement. Of course, I wanted to win over newspapers and other journalists, editors, proprietors, broadcasters. I worked very hard at that because I wanted to communicate what the Conservative Party and my leadership could bring to the country. I made those arguments. But I didn't do it on the basis of saying, either overtly or covertly, "Your support will mean I'll give you a better time on this policy or that policy", and there are plenty of examples I of policies that I believe in that the people who were backing me didn't believe in."

¶2.85 One meeting which was to prove important from the point of view of public perception, if not of substance, was that which occurred on board a yacht, probably Elisabeth Murdoch's, off the Greek island of Santorini, on 16 August 2008.115 The meeting, which resulted a brief faceto-face encounter in a social context, involved some convoluted travel arrangements which were made possible by the provision of a private jet owned by Matthew Freud, Elisabeth Murdoch's husband and a longstanding friend of Mr Cameron.116 Mr Cameron, who declared the flight in the Registry of Members' interests, explained the lengths to which he had been prepared to go to meet Mr Murdoch:117

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¶"My wife and two of my children flew on Mr Freud's jet from Farnborough to Istanbul, where I met them on the way back from a visit to Georgia (which had recently been invaded by Russia). We then flew on the jet to Santorini where I met Mr Freud on his yacht before meeting Rupert Murdoch. After that we returned on the jet to Dalaman for a family holiday. My family and I did not fly back to London on the jet and I paid for my air fare as well as that of my family."

¶2.86 The excursion to Santorini was proposed to Mr Cameron by Mr Freud. For Mr Cameron it was an opportunity to try and win support from Mr Murdoch, by engaging directly at a personal level:118

¶"Well, from my point of view, it was just a better opportunity to try to get to know Rupert Murdoch better. Obviously I was trying to win over his newspapers and put across my opinions, so for me it was just an opportunity to try and build that relationship." "It was quite a long way to go and all of that, but it seemed a good opportunity".

¶2.87 For Mr Murdoch, the meeting was less memorable. He did not recall it and had had to check with his wife and daughter to remind himself.119 He regarded the lengths to which Mr Cameron had gone to meet him as not unusual and one got the feeling that Mr Murdoch was well used to political leaders seeking him out: a telling indicator of the power and importance of one of the biggest media proprietors:120

¶"A. Well, I think I've explained that politicians go out of their way to impress people in the press, and I don't remember discussing any heavy political things with him at all. There may have been some issues discussed passingly. It was not a long meeting. As I say, I don't really remember the meeting. I think that's part of the democratic process. They – all politicians of all sides like to have their views known by the editors of newspapers or publishers, hoping that they will be put across, hoping that they will be – that they will succeed in impressing people. That's the game."

¶The proprietor later added:121

¶
• I — 116

¶p57, lines 18-21, David Cameron, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Transcript-of- Morning-Hearing-14-June-2012.pdf

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¶"Mr Cameron might, of course, think stopping in Santorini would impress me. I don't know. But I certainly didn't – ... I didn't, I don't have any fealty to the Tory Party or to the Labour Party ..."

¶2.88 Mrs Brooks' recollection was that Mr Cameron had spent "… an afternoon and an evening …" with them.122 She had been a party to some but by no means all of the conversation between Mr Cameron and Mr Murdoch and concluded that:123

¶"Well, it seemed to – it was a very cordial meeting and it went well. Like I say, it lasted for either an afternoon or an evening, so it wasn't particularly long".

¶James Murdoch 2.89 Mr Cameron saw more of James Murdoch than Rupert Murdoch whilst in Opposition. There were at least 15 meetings during this period.124 The type of contact was similar, typically taking place over meals or at events.125 Mr Cameron's purpose in meeting James Murdoch was to get across his political message in the hope of winning the support of News International:126

¶"… most of these meetings were really about me trying to promote Conservative policy, the Conservative approach and the rest of it, but sometimes, because I'm interested in media issues and have longstanding views on them, sometimes I'm sure we would have discussed them."

¶2.90 There were wide ranging discussions including defence and economy.127 As James Murdoch put it: "… discussions were on a broad range of subjects, from foreign policy to other things".128

¶2.91 Of particular interest to the Inquiry, they also discussed both the role of Ofcom and the BBC, subjects on which each held different views. Speaking about the BBC and Ofcom, Mr Cameron put it this way:129

¶"… I'm sure that over the years I've discussed some of those issues with James Murdoch. He has very strong views on them, I have very strong views, they're not really the same views, and I'm sure we would have had discussions about it. Perhaps particularly – well, I think probably on both. I don't recall the specifics, but I'm sure we must have discussed our views."

¶2.92 These differences of view did not prevent News International ultimately coming to the view that The Sun should stop supporting Mr Brown and instead support Mr Cameron. When that time came, it was James Murdoch who first signalled the change of course to Mr Cameron. Both the differences of view and the circumstances of The Sun's political change of mind are discussed further below.130

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¶Rebekah Brooks 2.93 Influential, and supremely connected, Rebekah Brooks (née Wade) was editor of The Sun when Mr Cameron became Leader of the Opposition. She remained in that role until September 2009 when she was promoted to become Chief Executive of News International.131

¶2.94 The Inquiry took evidence from both Mr Cameron and Mrs Brooks about their contacts. Both provided lists of their contacts, Mr Cameron a list of meetings with media figures as Leader of the Opposition and Mrs Brooks a list of meetings with leaders of political parties.132 As has already been adverted to above, there were many straightforward reasons why Mr Cameron's list could not be 100% accurate or comprehensive.133 Similar considerations applied to Mrs Brooks' list and she accepted that hers was not comprehensive.134 It is plain enough that neither list is comprehensive insofar as it relates to contact between the two because each contains a number of entries relating to such contact not found in the other. Nevertheless, they were useful starting points for piecing together enough of their contact to form a reliable impression of what had passed between them in this period. Supplemented by the oral and documentary evidence, the Inquiry was able to build a picture, amply sufficient for its high level Terms of Reference. The account which follows is drawn from the totality of the evidence.

¶2.95 After the leadership contest, contact started on 18 January 2006, when Ms Wade (as she then was) was one of a party of senior News International figures who accompanied Rupert Murdoch when he lunched with Mr Cameron.135 During the leadership race itself, Mrs Brooks did not recall supporting any particular candidate. She said:136

¶"Q. Mrs Brooks, we're onto Mr Cameron now, According to his biography, in 2005, you actually supported Mr Liam Fox for the Conservative leadership. Is that correct or not? A. I don't think that is correct. I can't – I don't think the Sun came out for a particular candidate in the leadership. We probably didn't support Ken Clarke because of Europe, but I don't remember actually having a particular line in the paper for the leadership".

¶2.96 Ms Wade next dined with Mr Cameron, in the company of Trevor Kavanagh on 28 March 2006. Further dinners followed on 30 September and 1 October 2006, both in the company of a number of journalists from other media companies.137 Ms Wade's record of contact also included a meeting at a hotel on 15 June 2006.138

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¶2.97 Meetings with Mr Cameron in 2007 started with a lunch on 16 January 2007, attended by colleagues from both The Sun and the NoTW and included a dinner on 1 October 2007, at which Les Hinton and journalists from The Sun were present, as well as drinks on 30 December 2007. As has already been discussed above, it was during the course of this year that Mr Coulson was recruited by Mr Cameron who spoke to Mrs Brooks about him.139 Mrs Brooks' schedule of meetings with party leaders records a dinner with Mr Cameron on 24 March 2007.

¶2.98 As for telephone contact during this period, including mobile phone contact, Mr Cameron described telephoning less than once a week. Less often, he thought, than Mr Brown:140

¶"In opposition, perhaps particularly sort of 2006, 2007, not a huge amount. I mean, I always felt when I did ring her, ... it felt like I was telephoning a lot less than Gordon Brown, which I thought was interesting, that he was the Prime Minister and I was the leader of the opposition. My sense was I was in contact a lot less than he was. But I can't put numbers on it.

¶But certainly, you know, in 2006, 2007, not necessarily every week, I don't think".

¶2.99 In 2008, Mr Cameron and Ms Wade lunched on 23 April 2008. They were both at a social event on 5 July 2008 and an event on 10 July 2008. On 16 August 2008 they were both at a dinner with Matthew Freud and Elisabeth Murdoch (this being the occasion on which Mr Cameron flew to Santorini and also met Rupert Murdoch). Relations between Mr Cameron and Ms Wade were already warm by this stage. She accepted that by then she was "quite friendly" with Mr Cameron.141 Ms Wade and colleagues from The Sun dined with Mr Cameron on 29 September 2008.

¶2.100 The Rt Hon Dominic Grieve MP was the Shadow Home Secretary between June 2008 and January 2009.142 There was animated discussion about the Human Rights Act at a dinner at which Ms Wade, Mr Grieve and other shadow cabinet members, but not Mr Cameron, were present. The discussion turned upon the Conservative Party's interest in the possibility of repealing the Human Rights Act and replacing it with a British Bill of Rights. According to Mrs Brooks, Mr Grieve was "just making the legal point that it was very difficult to do". Mrs Brooks denied rumours that she later sought to persuade Mr Cameron to remove Mr Grieve from his portfolio as Shadow Home Secretary, asserting that it was his colleagues who were in disagreement with him at the time:143

¶"No, I did not tell Mr Cameron to move him. What – the conversation – as I say, it was a very heated conversation, borne out by – his colleagues were trying to almost silence him at the table because he was, in effect, saying one of the promises the Conservatives had made to the electorate was they were going to repeal – and it was almost the opposite way around, that they were concerned that his view was not to I be taken seriously, and as it turned out, he was entirely correct".

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¶2.101 Mrs Brooks also denied expressing a view in any way to Mr Cameron about Mr Grieve.144

¶2.102 Mrs Brooks' list of meetings with the leaders of political parties refers to a breakfast meeting with Mr Cameron at the start of the year, on 22 January 2008 and to a New Year's Eve Party on 31 December 2008. Neither of these entries is in Mr Cameron's list. The New Year's Eve Party was held at the Brooks' farm and was in fact hosted by Mr Brooks' sister. By 2008, Mr Cameron counted Ms Wade as a good friend, notwithstanding her paper's support, and her personal support, for Mr Brown.145 The growing friendship had been helped along by the fact that Mr Cameron had known Charlie Brooks, whom Mrs Brooks was to marry in 2009, for over 30 years.146 It did not prevent her newspaper giving its continued support to Mr Brown's Government and remaining critical of the Conservatives. For example, on 14 October 2008, The Sun criticised Conservative opposition to extending the detention time for terrorist suspects to 42 days.147

¶2.103 There was a dinner on 29 January 2009 at which a number of newspaper editors and Robert Peston were present. Mr Cameron and Mrs Brooks were both at Mr Brooks' book launch on 1 April 2009. Mr Cameron was then one of a number of high profile politicians who attended the wedding of Ms Wade to Mr Brooks on 13 June 2009. As has been explained he was a friend of both the bride and groom. The wedding further cemented Mr Cameron's friendship with Mrs Brooks. In his words: "… our relationship got stronger when she married Charlie Brooks, who I've known for some time and who's a neighbour".148

¶2.104 It was during this month that Mrs Brooks recalled initial internal discussions with Rupert and James Murdoch about transferring The Sun's political support.149 Although it was not Mrs Brooks who informed Mr Cameron of The Sun's decision to abandon its support for Mr Brown, Mr Cameron had felt that she was onside months rather than weeks before it actually took place.150 On 21 September 2009, a few days before The Sun announced its change of allegiance, James Murdoch, Mrs Brooks and Mr Cameron had dinner together. The three also shared breakfast on 2 November 2009 and on 19 December 2009 Mr Cameron dined with Mrs Brooks and Rupert Murdoch at the Brooks'.

¶2.105 Mrs Brooks' list of meetings with party leaders for 2009 includes a lunch at the home of James and Kathryn Murdoch on 3 May 2009, a meeting on 1 September 2009 and dinner at the Camerons' home on 24 October 2009. None of these meetings appeared in Mr Cameron's record. As best she could recall, Mrs Brooks thought that the European constitution debate and Afghanistan were discussed on 3 May 2009.151

¶
• I — 144

¶p111, lines 3-7, Rebekah Brooks, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-of- Morning-Hearing-11-May-2012.pdf

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¶2.106 The increasing social contact that Mr Cameron was having with Mrs Brooks brought about a commensurate increase in telephone contact. When asked about such contact in the years 2008 and 2009, Mr Cameron put it this way:152

¶"I think as we got closer to the election and the decision of the Sun and also the wedding and she's moved in to Charlie Brooks' house, which is very near where I live in – where we live in the constituency, then the level of contact went up, and we saw each other socially more."

¶And then:153

¶"It's very difficult because I don't have a record and I don't want to give you an answer that isn't right, so, you know, sometimes I expect we would have been talking to each other quite a bit, particularly around the time perhaps of the wedding or when we were both in Oxfordshire, we would have had more frequent contact" (emphasis added).

¶2.107 A check by Mr Cameron with Mrs Samantha Cameron's diary was able to provide more detail, enabling Mr Cameron subsequently to add: "…[Mrs Cameron] points out that we were only in the constituency 23 weekends in 2008,²³²³ p13, lines 12-22, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/leveson-inquiry- transcript-060911.pdf pp4-5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-Statement-of-Professor-Susan- Mendus.pdf p12-13, ibid p1, para 1.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-Thomas- Mockridge.pdf pp103-104, lines 24-3, Lord Patten, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of- Morning-Hearing-23-January-2012.pdf pp8-9, paras 20-23, ibid ibid, pp63-65 p206, para 272, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-Stephen- Abell.pdf No records of these approaches were kept before May 2010 p41, lines 4-7, Alexander Owens, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-of- Afternoon-Hearing-30-November-2011.pdf p17, para 22, ibid http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Witness-Statement-of-Ian-Hurst.pdf pp57-58, lines 18-5, William Lewis, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of- Afternoon-Hearing-10-January-2012.pdf Ms Marshall claims that this was replicating Mr Paxman's interview of a well-known politician in the 1970s pp89-90, lines 24-12, Daniel Sanderson, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Transcript- of-Morning-Hearing-15-December-20111.pdf p37, lines 3-16, Gerry McCann, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-of- Afternoon-Hearing-23-November-2011.pdf p16, para 29d ibid pp84-85, lines 8-20, Peter Wright, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript- of-Morning-Hearing-11-January-2012.pdf; p11, para 35, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/02/Witness-Statement-of-Paul-Dacre.pdf; p6, para 17, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/01/Witness-Statement-of-Dawn-Neesom.pdf; pp1-2, paras 5 – 6, http://www.levesoninquiry.org.uk/wp- content/uploads/2012/01/Witness-Statement-of-James-Welsh.pdf; p4, para 13, http://www.levesoninquiry.org.uk/ wp-content/uploads/2012/01/Witness-Statement-of-Peter-Wright.pdf pp102-103, lines 15-3, Elizabeth Filkin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/03/Transcript- of-Morning-Hearing-5-March-2012.pdf p7, para 18, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/03/Witness-Statement-of-Lord-Blair.pdf p70, lines 1-12, Paul Peachey, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/03/Transcript-of- Morning-Hearing-14-March-2012.pdf para 4.2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/03/Report-by-Elizabeth-Filkin.pdf pp23-24, Richard Thomas, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Transcript-of-Morning- Hearing-9-December-2011.pdf p4, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Second-Witness-Statement-of-Richard- Thomas-CBE1.pdf; p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Third-Witness-Statement-of- Richard-Thomas-CBE1.pdf http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Philip-Coppel-QC-redacted.pdf p29, Richard Thomas, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Exhibit-1.pdf p99, lines 14-18, Lord Mandelson, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-of- Morning-Hearing-21-May-2012.pdf p9, lines 3-6, Tony Blair, ibid p74, para 221, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Witness-Statement-of-David- Cameron-MP.pdf ibid p32, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Exhibit-VC1-1-to-Witness-Statement-of-Vince- Cable-MP.pdf p56, lines 13-16, Alex Salmond, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Transcript-of- Afternoon-Hearing-13-June-2012.pdf Part K, Chapter 7 pp7-8, para 32, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Claire-Enders- Enders-Analysis.pdf The majority of the press core participants have argued in favour of a public interest defence for journalists, see for example News International closing submissions at para 64, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Closing-Submission-from-News-International.pdf, Associated Newspapers closing submissions at para 31 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-Submission-from-Associated- J Newspapers-Ltd.pdf, Guardian News closing submissions at para 17 http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Closing-Submission-from-Guardian-News-and-Media-Ltd.pdf. See also part 5, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf; Part 6, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-Roy-Greenslade-of-City-University.pdf which support a general public interest defence for journalists Appendix 4 p40, lines 3-6, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-of- Morning-Hearing-7-February-2012.pdf p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Covering-Letter-from-Ofcom.pdf; p10, para 23, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-of-Brentwood1.pdf; p8, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf; p20, para 3.35, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1.pdf; p11, http:// www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-on-behalf-of-the- National-Union-of-Journalists.pdf; p13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission- by-Coordinating-Committee-for-Media-Reform.pdf pp106-107, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-Morning- Hearing-9-July-2012.pdf p60, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf Part H K Defamation Act Schedule 2.10, ibid p70, lines 1-3, James Murdoch, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/04/Transcript-of- K Afternoon-Hearing-24-April-2012.pdf Part K, Chapter 7, para 3.14 Discussed in detail in Section 3 of this AnnexShow full note weekends in 2009 and I think 15 in 2010. And she reckons we probably didn't see them more than on average once every six weeks, so that is a better answer than what I was able to give you earlier."154

¶2.108 Mr Cameron and Mrs Brooks also used SMS text messages to keep in touch. Mrs Brooks estimated that she exchanged texts on average once per week with Mr Cameron, more during the subsequent general election campaign:155

¶"Probably more – between January 2010, maybe – during the election campaign, maybe slightly more, but on average, once a week".

¶2.109 Text contact between Mr Cameron and Mrs Brooks reflected the close and friendly relationship which both explained had developed. This was not in issue because Mr Cameron agreed in general with the gist of her evidence about the quantity and tone of text messages.156 If illustration is needed, when asked how the messages were signed off, Mrs Brooks said:157

¶"A, … He would sign them off "DC" in the main" Q. Anything else? A. Occasionally he would sign them off "LOL", "Lots of love", actually until I told him it meant "laugh out loud", then he didn't sign them like that any more. But in the main, DC, I would have thought." I

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¶2.110 It is important that I repeat what I made clear during the hearing. Like everyone else, politicians are entitled to be friendly with whomsoever they wish and there must remain some space for a private life in even the most public of figures. For the purposes of the Inquiry, concerned with the relationship between politicians and the press, what matters is the extent to which the influence of the press can be manifest not only in public, through the megaphone of newspapers, or formally through transparent access, but also informally in ways which might cause a perception of undue influence. It is unnecessary, intrusive and unhelpful to descend into too much detail of personal contact; only its extent needs to be clear: this also I shall return to in the context of conclusions and recommendations.

¶2.111 That point naturally leads to the quantity of text messages passing between Mr Cameron and Mrs Brooks which were disclosed by News International and thus identifies the approach of the Inquiry to them. Mr Jay explained why only one of these was put into evidence:158

¶"I should make it clear before I read it out that News International have recently disclosed a number of other text messages between Mrs Brooks and Mr Cameron, pursuant to a Section 21 request. A section 21 request is in fact an order under statute requiring people to disclose material. Those relate to the period October 2009, May 2011 and June 2011. In the Inquiry's judgment, all the other text messages I have referred to are irrelevant to its terms of reference. That's why we're only going to look at one. And News International through their solicitors Linklaters have also explained why text messages in other monthly periods are not available, and their letter will be put on our website. So the one we're looking at is 7 October 2009, which I think is during the party conference."

¶2.112 The text in question (which has been the subject of considerable media attention) was sent by Mrs Brooks to Mr Cameron on 7 October 2009 at 16:45hrs, just days after The Sun had abandoned support for Mr Brown. After the first line which was redacted on grounds of relevance, the text read:159

¶"But seriously [which suggests that the first line contains or might contain something of a jocular nature] I do understand the issue with the Times. Let's discuss over country supper soon. On the party it was because I had asked a number of NI [that's obviously News International] people to Manchester post endorsement and they were disappointed not to see you. But as always Sam was wonderful – (and I thought it was OE's that were charm personified!) I am so rooting for you tomorrow not just as a proud friend but because professionally we're definitely in this together! Speech of your life? Yes he Cam!" (emphasis added) I 2.113 The reference in the message to "tomorrow" was to Mr Cameron's speech to the Conservative Party Conference. The background to the message was that Mr Cameron had apologised for not attending the Times' party at the conference.160 The striking phrase "we're definitely in it together" was, in Mr Cameron's words, a reference to the fact that, having parted company with Labour, The Sun wanted to: "…make sure it was helping the Conservative Party put its best foot forward with the policies we were announcing, the speech I was going to make and all the rest of it …" and "…we were going to be pushing the same political agenda."161 The text illustrates how complete the sudden transfer of support was and how close the communication between News International and Mr Cameron was.

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¶2.114 Mr Cameron confirmed that a country supper was the sort of interaction he often had with Mrs Brooks and demonstrates how the discussion of professional matters in a very informal social environment was occurring.162

¶2.115 The only pre-election meeting in 2010 between Mrs Brooks and Mr Cameron recorded in Mr Cameron's schedule of contact with the media in opposition was on 29 January 2010, at an event also attended by the editors of the Times and the Sunday Times.163 This appears to correspond with Mrs Brooks' record which refers to a single meeting at News Corporation's Davos conference in that month.164 More meetings in fact took place. Mrs Brooks recalled meeting the Prime Minister "three or four times" between January 2010 and the election.165

¶2.116 During the general election campaign of 2010 Mrs Brooks put the frequency at twice a week. As to their content, she said:166

¶"Some, if not the majority, were to do with organisation, so meeting up or arranging to speak. Some were about a social occasion, and occasionally some would be my own personal comment on perhaps the TV debates, something like that".

¶2.117 Mrs Brooks did not text either Mr Brown or Mr Clegg during the campaign.167

¶2.118 Tracing the development of the communications between Mr Cameron and Mrs Brooks during opposition reveals clear trends. The volume of contact increased over time, particularly as a result of the increasing social contact. The nature of the contact changed. At the start it can only really have involved Mr Cameron trying to get his political message across to the editor of a newspaper then supporting the opposition. By the end, it was less a matter of Mr Cameron getting his message over to the new editor of The Sun and more a question of News International being "in it together" with Mr Cameron, and seeking to get his message across for him.

¶2.119 It was not only Mrs Brooks who played a part in the developing contact between Mr Cameron and News International. Matthew and Elisabeth Freud (née Murdoch) also moved in similar circles. As has been described, Mr Freud provided his private jet to enable Mr Cameron to meet Rupert Murdoch in Santorini.168 He and his wife had dinner with Mr Cameron and Ms Wade during the course of Mr Cameron's brief visit on that occasion. Rupert Murdoch first met Mr Cameron at a picnic hosted by his daughter Elisabeth.169 Mr Cameron's list of contacts with media figures as Leader of the Opposition records six occasions on which Mr Cameron met either one or both of the Freuds. Three of these occasions are listed as "social" contact I and the remainder as "dinner".

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¶The Sun's transfer of support from Labour to the Conservatives 2.120 As relations warmed between Mr Cameron and Mrs Brooks, so they appear to have cooled between Mr Brown and Mrs Brooks, at least professionally. Criticism of Mr Brown's Government increased and the subject of Afghanistan, in particular, became an issue on which The Sun was highly critical of Mr Brown. The title ran a campaign critical of the equipment and resources being allocated to British forces in Afghanistan, reflecting Rupert Murdoch's strong views on the issue. One of the last headlines which Mrs Brooks published as the editor of The Sun, on 28 August 2009, read "Don't you know there's a bloody war on?".170

¶2.121 Rupert Murdoch, James Murdoch, Mrs Brooks, Dominic Mohan, Trevor Kavanagh and Tom Newton Dunn were all involved in the discussions which led to the decision to abandon Mr Brown.171 The discussions appear to have begun around June 2009.172

¶2.122 By 10 September 2009 the plan to switch support was sufficiently concrete for James Murdoch to meet Mr Cameron at The George and tell him that it was going to happen. Mr Cameron described a short meeting of 30-40 minutes' duration. At that stage Mr Cameron was not given the precise date on which the switch would be announced but he was given an indication that it would be during the conference season. Mr Cameron recalled:173

¶"… It was a drink and a catch-up, but it was – he wanted to tell me that the Sun was going to support the Conservatives and he told me, I think, from my memory, that it was going to happen around the time of the Labour conference, and I remember obviously being pleased that the Conservative Party was going to get the Sun's support, and I think we had a conversation about other policy issues at the time. That's my memory of it".

¶2.123 Mr Cameron could remember discussion of economic policy and defence but not mention of Conservative policy on either the BBC or Ofcom, about which James Murdoch had pronounced views. Both bodies had received trenchant criticism as recently as 28 August 2009 in the controversial MacTaggart lecture that James Murdoch had delivered. Asked directly whether either had been mentioned Mr Cameron said:174

¶"A. I don't recall that, and I think it unlikely. I think that this was – he was very keen to tell me directly that the Sun was going to support the Conservatives, that he felt on the big economic judgment about what Britain needed we had the right argument, the government had the wrong argument, and my memory is that's what the conversation was about. LORD JUSTICE LEVESON: Yes, you said you had a conversation about other policy I issues?

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¶A. Yes, he has lots of enthusiasms that aren't about the media. He's particularly enthusiastic about defence. He takes the view we should have at least six aircraft carriers, I think at the last count, rather than two, so he has lots of enthusiasms and I'm sure we discussed some of those, but the key – my memory is, and it's difficult to recall all of these events, I definitely remember him saying the Sun was going to support the Conservative Party. I wouldn't forget that. I think he gave me a hint of the timing, and my memory is it was mostly about the big economic picture, because that was the key issue of the day".

¶2.124 James Murdoch emphatically denied any mention of regulatory issues on 10 September 2009: "At that meeting I certainly didn't".175

¶2.125 The change, when it came, was calculated to do maximum political damage to Mr Brown.176 It was announced through The Sun headline: "Labour's Lost It", published on 30 September 2009, the day after Mr Brown's speech to the Labour Party Conference.177 The timing and choice of headline bore a significance that went beyond simply communicating the transfer of The Sun's political support, important though that was. The emphasis was placed heavily on the move away from Mr Brown personally rather than the shift towards Mr Cameron.

¶2.126 Mr Coulson would have preferred an endorsement of Mr Cameron timed to coincide with the Conservative Party Conference. He stated: "I felt it was more a rejection of Labour than a positive endorsement of us. If I'd had half the influence on The Sun that some claim, the front page would have looked very different";178 and he said: "… I didn't get involved in the Sun's decision on the timing and frankly, had I done, I would have wanted it to come as a positive endorsement of the Conservatives in our conference."179 Nevertheless, he regarded securing the title's support as "… a serious positive for us …".180

¶2.127 A number of explanations were given by witnesses for the change in support. Rupert Murdoch confirmed that he had been very much involved in the decision. He felt that Labour "was making lots of mistakes"181 and also compared the decision to that which he had made in 1997 only in reverse, stating: "I supported a shift to Labour by NI's titles when I thought the Conservative Party had run out of ideas, and I supported a shift to the Conservative Party after 13 years of Labour rule for the same reason".182

¶2.128 James Murdoch described the discussions which led to the decision in terms of discussion of Labour policies:183

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¶"The Sun is a campaigning paper involved in many policy issues, and there were discussions about some of these issues. The paper had started moving away from the Labour party over lack of funding, supplies and support for British troops in Afghanistan after the government had committed to the conflict there. The consensus was reached after discussing a range of policies and effectiveness at implementing them and resulted in the decision to support a change of Government."

¶2.129 He confirmed that polling data was available, and accepted that they were trying to read the mood of the country. There was also consideration of the individuals involved and the readership.184 The decision had a number of components.

¶2.130 Mrs Brooks described having an instrumental role in the change of support. Asked whether she had played a major role, she said: "I was certainly instrumental in it. I mean, ultimately, Rupert Murdoch's the boss, but I was instrumental in it, as was Trevor Kavanagh, Tom Newton Dunn and the editor, Dominic Mohan".185 She said that the decision was taken because it was "the right thing to do for the paper and for our readership."186

¶2.131 All those from whom the Inquiry received evidence denied that there had been any conditions or exchanges, whether express or implied, upon which The Sun's support was contingent.187 The allegation that the transfer of The Sun's support to the Conservatives was the product of a 'deal' between News International and the Conservative Party was made publicly by Lord Mandelson when he was interviewed on the Today programme on BBC Radio 4, a matter of weeks after The Sun's about turn. He told the Inquiry that the basis for his view was what he perceived to be a coincidence between the views expressed in James Murdoch's MacTaggart lecture and Conservative media policy:188

¶"Q. I'm going to come to that. Your feeling was that some sort of deal had been done between the Conservative Party and News International. You said as much on Radio 4, the Today programme, on 11 November 2009, didn't you? A. I did say that, and I know that, you know, some people have said that I was just, you know, throwing around these claims for specious reasons or without evidence. In fact, I made these comments both on the Today programme and in the House of Lords, when it was clear to me that there was more than a coincidence, if I can put it that way, between the Tory's media policies and the views that were being expressed, for example, by James Murdoch in his MacTaggart lecture. In July 2009, Mr Cameron had pledged to dismantle the hated Ofcom – I mean hated by News International. He said that it was part of the Tories' cutting back of the quango state and he said that under the Conservatives Ofcom will cease to exist as we know it. When I subsequently learned that the team supporting the Conservative Party's media policy developments were the same team and the same people who were helping Mr Murdoch to draft his speeches, including the MacTaggart lecture, I didn't have to go very far to put two and two together to realise that this coincidence of policy had slightly greater meaning and that there was, in fact, a sort of organic link between the two, which is why I said what I did".

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¶2.132 Lord Mandelson's public comments contrast with those which he later expressed on the issue in his autobiographical book, The Third Man, which was published in the following year. He wrote:189

¶"At his [Mr Brown's] urging I spoke out on that issue publicly on a couple of occasions following the Sun's switch. In fact, I suspected that the real reason for the change was simpler, and in a way even more discouraging. The Sun was a mass market paper. It saw its interests as backing a winner. While I was still not convinced, or at least not ready to accept, that a Tory victory at the next election was inevitable, given the yawning gap we would have to make up in the opinion polls, it was certainly looking that way" (emphasis added).

¶2.133 Questioned about the apparent inconsistency, he said that his two statements were not mutually exclusive identifying two reasons why he thought that The Sun would have wanted to support the Conservatives: a desire to back the likely winner and commercial self-interest of its proprietor. Lord Mandelson said:190

¶"First of all, I chose my words in finishing this book in 2010 without any prescience that I might be poring over it line by line, word by word with you in the course of justice, but secondly, and more seriously, two things were operating here, in my view: one, the Conservatives looked as if they were on the up and with a good chance of winning the election, and the Murdochs wouldn't ignore it. Secondly, they would have seen very clearly that their commercial interests would have been suited more by a Conservative victory, given what Mr Cameron was saying in his own public speeches, than they would with a further Labour government, you know."

¶2.134 Pointing to The Sun's campaigns for a referendum on Europe and about "Broken Britain", Mr Brown said that The Sun had never really supported him: "… at no point in these three years that I was Prime Minister did I ever feel I had the support of the Sun".191 Nevertheless, he identified a real change and felt that, under James Murdoch, News International adopted an I "aggressive public agenda" and sought to put its own commercial interests first. He thought the Conservative Party went along with the media policies which News International sought:192

¶"News International had a public agenda. What's remarkable about what happened in the period of 2009 and 2010 is that News International moved from being – I think it was under James Murdoch's influence, if I may say so – to having an aggressive public agenda. They wanted not only not just to buy BSkyB, of course; they wanted to change the whole nature of the BBC. They wanted to change Ofcom, they wanted to change the media impartiality rules, they wanted to change the way we dealt with advertising so that there was more rights for the media company to gain advertisers. They wanted to open up sporting events so that Sky could bid for them in a way that – they were perfectly entitled to put this agenda. That was the agenda they were putting publicly. I think what became a problem for us was that on every one of these single issues, the Conservative Party went along with the policy, whereas we were trying to defend what I believe was the public interest." (emphasis added)

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¶2.135 Whatever the reaction of the Conservative Party to James Murdoch's views about media policy in the United Kingdom (and they are explored below), for his part Mr Brown reached the point where he felt it was no longer worth talking to News International about the subject:193

¶"It became very clear in the summer of 2009, when Mr Murdoch junior gave the MacTaggart lecture, that News International had a highly politicised agenda for changes that were in the media policy of this country, and there seemed to me very little point in talking to them about this."

¶2.136 Mr Brown provided an eleven point note to the Inquiry containing information and quotations from the Murdochs and Conservatives on which he relied in support of his view that "the Conservatives in opposition and in Government shaped their policy to match the demands of NewsCorp – on Ofcom, on the BBC, on TV advertising, on regulation and on the proposed takeover of BskyB".194

¶2.137 Mr Cameron rejected the allegation:195

¶"To respond generally, and frankly it is absolute nonsense from start to finish. I think where it comes from is obviously Gordon Brown was very angry and disappointed that the Sun had deserted him, and as a result, in my view, he has cooked up an entirely specious and unjustified conspiracy theory to try and, I don't know, justify his anger. But I've taken the time to look through the individual parts of policy that he points to, and in almost every case it is complete nonsense. Just to take a couple of examples, he makes the point about the listing of sporting events and particularly the Ashes, and actually it was the Labour government, his government, that delisted the Ashes. He makes a point about us taking a particular view on product placement. Again, it was a Labour government that started the I process of changing the rules on product placement under his oversight. On the BBC, as I've argued before, my position on the BBC is not the same as James Murdoch's position on the BBC. I support the BBC, I support the licence fee. So the Conservative Party, I think, will be submitting a piece-by-piece response to this because it is complete nonsense, but I'm very happy to go through the individual parts. But, as I've said before, there was no overt deal for support, there was no covert deal, there were no nods and winks. There was a Conservative politician, me, trying to win over newspapers, trying to win over television, trying to win over proprietors, but not trading policies for that support. And when you look at the detail of this, as I say, it is complete nonsense."

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¶David Cameron's media policy and manifesto 2.138 Having identified the stance taken by Mr Brown on the one hand and Mr Cameron on the other, the matter can perhaps be left there. What will be important, however, is to examine whether (and, if so, to what extent) the allegation that the relationship between the press (and, more particularly, News International) might legitimately be argued to have affected public policy decisions of the new administration. It is therefore appropriate to consider Mr Cameron's media policy and relevant parts of his general election manifesto. In doing so this subsection concentrates on policy towards the BBC and Ofcom. The BskyB bid is considered elsewhere in this Report.196

¶2.139 By the time of the general election of 2010, the Conservative Party's manifesto contained only a single paragraph about media policy and that concerned local media, particularly local television:197

¶"Our plans to decentralise power will only work properly if there is a strong, independent and vibrant local media to hold local authorities to account. We will sweep away the rules that stop local newspapers owning other local media platforms and create a new network of local television stations".

¶2.140 Of relevance to the Conservative Party's policy towards the BBC, the manifesto contained a pledge relevant to its financing to: "ensure the National Audit Office has full access to the BBC's accounts". So far as Ofcom was concerned, the general pledges to "cut the quango state" and "any quangos that do not perform a technical function or a function that requires political impartiality, or act independently to establish facts" were of relevance as is explained below.198

¶2.141 The principles underlying Mr Cameron's approach to media policy were stated by him to be: "… the need for a strong BBC, backed by the licence fee; plurality of provision; proportionate, not artificial, rules on media ownership; and a greater role for local television".199 That statement of broad principles left plenty of scope as to the detail and during opposition Mr Cameron and his shadow cabinet colleagues debated and explored what that detail should be.

¶The BBC 2.142 In March 2008 the Conservative Party published a discussion document, "Plurality in a new I media age", setting out its then current thinking. It entertained a particularly controversial idea as to the use to which the BBC licence fee might be put, known as "top slicing", which was described in the document in these terms:200

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¶"One option is to consider whether other organisations should be allowed to bid for small parts of the licence fee. This would ensure a plurality of provision in key genres, such as daytime children's TV and current affairs. However such a model would need to avoid the risk of distorting the commercial television market by mixing public and commercial funding, so it may be preferable for it to fund new channels rather than "top up" funding of existing channels."

¶2.143 In October of the same year Mr Cameron wrote an article about The Sun which was published under the headline "Tory chief hits out – Bloated BBC out of touch with viewers". It contained both praise for and criticism of the BBC, expressing particular concern about the negative impact which the BBC could have on small private sector competitors and proposing rules to prevent that from happening. In support of the BBC he wrote:

¶"I am a slightly rare creature – a lifelong Conservative who is a fan of the BBC. I don't just mean the quality stuff … If I tot it all up: rummaging around the BBC news website, Radio 4 every morning, Radio 5 on a Sunday, The Big Cat Diaries and whatever Andrew Davies has written up recently, I get a huge amount from the full range of what the BBC has to offer. And yes, I even approve of the way the BBC is funded."

¶2.144 Mr Cameron then critically observed that:201

¶"We've all seen in our own constituencies small internet businesses, often involved in education or other information provision, working away to create a market, to make some money, and then the BBC comes along and squish, like a big foot on an ant, that business goes out".

¶He proposed:

¶"… a better set of rules that stops the BBC from charging in … and actually putting other people who are struggling to provide a market, out of work".

¶2.145 In a significant speech to the Oxford Media Conference in January 2009, Ed Vaizey, then Shadow Culture Minister, expressed support in principle for the BBC but made clear Conservative concerns about competition, the breadth of the BBC's activities, costs, funding, regulation and management. What he said merits full quotation because it articulates Conservative I thinking at that time:202

¶"We are fans of the BBC. In an uncertain world, the BBC provides a great resource for publicly-funded high-quality content. When looking for a solution to the future of public service broadcasting, we want one that is the least damaging to the BBC's integrity.

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¶"Although we believe in plurality in public service broadcasting, we do not believe the solution to the challenges presented by the internet age is necessarily to try and create another BBC. Having said that, it is equally important that the BBC stop acting like a friendly monopolist, making noises about partnerships, and engages seriously in discussions about how to ensure plurality in public service broadcasting. On other matters: while we support the licence fee, and believe it is the best way to fund the BBC for the foreseeable future, we believe the level of the licence fee is at the top end of what is acceptable to the public. The current settlement – which began in 2006 and lasts to 2012 – built in increases of 13 – 15% over that period. That was a generous settlement when times were good. It may start to look prohibitive as times get increasingly bad. The BBC will have to think very hard about whether substantial licence fee increases can be justified in the coming years. The BBC Trust, under Sir Michael Lyons, has done a good job, and I would like to congratulate him. So what follows is not personal, it is, as they say, business. We think that there needs to be a clearer divide between the regulation and management of the BBC. The BBC and the BBC Trust should be clearly separate. The BBC should have its own chairman, who can cheer lead for the Corporation, while the head of the regulator gets on with regulating. A truly independent regulator would provide a genuine voice for the licence fee payer. Moving on from that, the expansion of the BBC into areas where the private sector is already working needs to be carefully watched. Our watchword will be simple – if the private sector is already doing a good job in the area, or is developing a market in an area, the BBC should be prevented from going in with all guns blazing. Finally, there is the issue of costs. The Ross/Brand row was not just about bad taste, though of course that was important. It was also about the huge amount of money the BBC is paying Jonathan Ross and other stars. A public service broadcaster with guaranteed revenue shouldn't compete with the private sector on top talent salaries. In fact, I would go further and say the BBC actually pushes up the price of talent with its interventions. So we will ensure that the BBC publishes fully audited accounts which will include details of the salaries of all its top talent. The BBC should be prepared to defend salary and indeed all expenditure decisions it makes."

¶2.146 Significantly, Mr Vaizey went on to make clear that the Conservatives were already moving away from the idea of top-slicing the BBC's licence fee. He said:203

¶"There are the solutions that involve the BBC – straightforward top-slicing of the licence fee; partnerships with the BBC and BBC Worldwide, or by using money I ring-fenced for digital switchover; or the sharing of resources such as studios and technology. Then there are the market solutions – a merger with Five, with BBC Worldwide, changing the terms of trade, or a combination of these. We have been careful not to rule out any solution. But as I have indicated, we are less convinced about a solution that involves top slicing of the licence fee." (emphasis added)

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¶2.147 Two months later, in March 2009, in the context of an increasingly difficult economic climate, Mr Cameron personally returned to the question of the BBC's funding. He announced that a Conservative Government would freeze the licence fee:204

¶"... solving Labour's Debt Crisis by making sure government lives within its means and delivers more for less. And it's not just government that has to live within its means – we all do. So today, I want to make an announcement that shows our expectation that government and all taxpayer-funded institutions should start leading by example. The BBC is one of our most important national institutions. It plays a vital role in bringing the country together, and I want to see it prosper and succeed and continue to be a fantastic cultural asset for Britain. But it also needs to maintain public support, and I want to see it leading by example at a time when the whole country is tightening its belt. And so I can announce today that we would freeze the BBC licence fee for one year.

¶I think that would be an important signal to the country of the need for all public institutions, in these difficult economic circumstances, to do more with less."

¶2.148 In April 2009, the Rt Hon Jeremy Hunt MP launched a review of the creative industries which was chaired by former BBC Director General, Greg Dyke. It was one of a number of Conservative Party task forces formed in Opposition. Its work was still ongoing at the time of the general election. Elisabeth Murdoch, as CEO and Chairman of the Shine Group, was a member of the task force, one amongst a number of eminent industry figures.205

¶2.149 In October 2009, Mr Hunt told the Financial Times that he did not support Labour's plan for state supported local television news on ITV, financed by top slicing the licence fee. On the topic of the ambit of the BBC's activities and competition he also said:206

¶"It might sound well and good for [the BBC] to have, say, an angling website, but if it drove out of business every angling magazine in the country, you would have to question if it was the right sort of thing to do".

¶2.150 It was Mr Hunt also ultimately made clear that the Conservatives had rejected top slicing. On the Conservative Party website, he posted: "on top-slicing… We floated this idea two years ago and rejected it".207

¶2.151 In the result, when in power, the Coalition Government froze the BBC licence fee as Mr I Cameron had promised to do. Mr Cameron was keen to point out that the imposition of a freeze left the BBC better off than many in the current climate of austerity and that the policy had fallen far short of what James Murdoch was advocating:208

¶"… We froze the licence fee, much to the anger of James Murdoch, who I think – I think the Chancellor George Osborne [said] thought that it should have been cut. So we had our own policy on the BBC licence fee which I think had been fair and reasonable to the BBC when other organisations have had their budgets cut be considerably more. So, again, this part of the conspiracy theory I think has absolutely no weight at all".

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¶2.152 Mr Cameron rejected the suggestion that in imposing the freeze he had been meeting Mr Murdoch half way. He said:209

¶"I think it's quite difficult to argue, at a time when you know if you get into government you're going to have to be making spending reductions, that you're going to see the BBC licence fee go up and up and up, and I think we had a consistent and long-term argument, which very much flowed from my own views formed at Carlton, that the BBC needed to be strong, it needed the backing of the licence fee. I do think the BBC had gone into areas it shouldn't have done, and I mention that in some of my evidence, but I think this is a fair settlement for the BBC and it's certainly not one that James Murdoch supported."

¶2.153 Mr Osborne recalled James Murdoch's reaction to the decision to freeze the licence fee in these terms:210

¶"Well, I remember – this was a very specifically about the BBC licence fee, rather than – as I say, James Murdoch would often let us have his views in public as well as in private about his view about the BBC, but specifically about the licence fee and our decision in October 2010 to freeze the licence fee but not to dismantle it, and indeed to, in effect, continue for the next five or six years with the current structure of BBC funding.

¶Now, as I say in this statement, I cannot remember exactly how this conversation took place, and it may well have been on the phone, because it's not obvious that there was a meeting where this would have had – but I have a pretty clear memory of him being quite angry about our – the decision we had taken, and I explained to him why I thought it was the right decision and why, in any case – you know, we had always made it clear that we were not setting out to dismantle the BBC or radically cut the licence fee or distribute the licence fee in a different way, but he was clearly disappointed with that decision".

¶2.154 Commenting on James Murdoch's 2009 MacTaggart lecture, Mr Osborne later made clear how significant were the differences between the Conservative Party and Mr Murdoch on the BBC:211

¶"I disagreed with him, basically, and certainly David Cameron also disagreed with him, and I think – you know, he had been agitating for some dramatic change in the

¶I funding of the BBC or the structure of the BBC and he was not going to get that from the Conservatives".

¶Ofcom 2.155 The attitude adopted by Mr Cameron to Ofcom has to be viewed in the overall context of his policy on quangos generally which, in his words, was "to redistribute power away from unaccountable institutions and back to the people". Explaining his approach, and singling out Ofcom as an example, he said during the course of a major speech delivered on 9 July 2009:212

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¶"I have asked the Shadow Cabinet to review every independent public body that currently sits within their portfolio. For each one, they will be asking the key questions: Does this organisation need to exist? If its functions are necessary, which of them should be carried out in a directly accountable way within the department? And which, if any, should be carried out independently, at arm's length from political influence? If there really is a need for an independent quango, how can we make sure it is as small as possible, operating with maximum efficiency, frugality and respect for taxpayers' money? That process of review will go on up to and beyond the election. But today, I want to give you an idea of the scale of change we envisage by setting out what our approach would mean for three specific quangos. OFCOM is the regulator for the communications industry, and it's clear that it has an important technical function. It monitors the plurality of media provision for consumers. It licenses the spectrum in the UK. And it sets the charges and the price caps for BT's control of so much of the industry's infrastructure. OFCOM also has an enforcement function – ruling on breaches of the broadcasting code for instance. These matters relate to the operations of private companies in a commercial market and it is therefore right that they are free from political influence. But Jeremy Hunt has concluded that OFCOM currently has many other responsibilities that are matters of public policy, in areas that should be part of a national debate, for example the future of regional news or Channel 4. These should not be determined by an unaccountable bureaucracy, but by minsters [sic] accountable to Parliament. So with a Conservative Government, OFCOM as we know it will cease to exist. Its remit will be restricted to its narrow technical and enforcement roles. It will no longer play a role in making policy. And the policy-making functions it has today will be transferred back fully to the Department of Culture, Media and Sport." (emphasis added)

¶2.156 It is important to note from the speech that although Mr Cameron was proposing that "Ofcom as we know it will cease to exist" what he was referring to was the repatriation of policy functions back to a central Government department. There was no proposal to dilute Ofcom's technical regulatory functions which the speech expressly recognised should remain I with Ofcom and at arm's length from political influence.

¶2.157 Mr Cameron explained that the decision to use Ofcom as an example was simply a matter of his familiarity with it and had nothing to do with any external influence. He also pointed out that at the time Ofcom was the subject of criticism from diverse quarters:213

¶"One of the reasons I picked Ofcom was because of my own experience from television of remembering what the Independent Television Commission had done, the ITC, the precursor of Ofcom, and also remembering the sort of levels of pay that there were in the ITC compared with Ofcom, and I did think Ofcom was quite a good example of a quango that had got too big, too expensive, and the pay levels were pretty excessive. I would just make the point – I'll shut up in a second – but at this time Ofcom was being actually roundly attacked on this basis by ITV, by the BBC, with which it had almost nothing to do, and also by commentators on the left of politics like Andrew Rawnsley, who were all saying Ofcom seems to have got too big and too bureaucratic. So this was an agenda that was very limited to my own views, not in any way proposed or dictated by others".

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¶2.158 Mr Osborne confirmed that the Conservative Party's concerns about Ofcom were those which it had about quangos in general and did not relate to its media regulatory function:214

¶"Q. [James Murdoch] was also agitating for the neutering, if not quite the dismantling of Ofcom. Did that chime at all with your policy?" A. I never discussed with him Ofcom and I don't remember personally being involved in any great internal discussion within the Conservative Party about the future of Ofcom. There was a general concern that Ofcom had become, like many Quangos, rather bloated, but that was not a complaint about the function of Ofcom, just that like many parts of government, that there had not been a proper regard for cost."

¶2.159 In the result, Mr Cameron explained the impact of Coalition Government on Ofcom policy:215

¶"Q. To take the story forward, as it were, is this right, that the reason this policy was not enacted was that in the pragmatic realities of the Coalition government it wasn't possible. A. That's right. I wasn't involved in the detailed negotiation of the Coalition agreement, but some policies made it through, others didn't, and I suspect this is one that we didn't get agreement on, but we have taken action on pay levels in quangos and we have tried to restrict them".

¶The 2010 General Election campaign 2.160 The 2010 election campaign of course involved all of the contenders doing their utmost to get their competing political messages across using the media, including new media, and otherwise. Mr Cameron had won the much coveted support of News International's politically variable titles. He had secured the 'full throttled' support of the centre right press and enjoyed the support of those other politically uncommitted media titles, the Economist and the Financial Times. But the endorsement of The Sun did not bring outright victory.

¶I 2.161 The political commentator Andrew Neil attributed the outcome to a number of factors: the declining political influence of The Sun; the lack of a long period of sustained press support for Mr Cameron before the election; the overshadowing of newspapers generally by television and, in particular, the introduction for the first time in the United Kingdom, of televised leaders' debates during the campaign. Thought provokingly, he wrote:216

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¶"I have already referred (para 4) to the fact that, despite the overwhelming endorsement of what we still refer to as Fleet Street, Mr Cameron was unable to win an overall majority in 2010, even though the circumstances were widely regarded as propitious for the Tories. The Sun is a shadow of the political influence it enjoyed in the 1980s, peaking in the close-run election of 1992. In the 1997 and 2001 elections it largely piggy-backed on the Blair landslides: it needed to back Mr Blair to show it was in touch with its readers much more than Mr Blair needed its backing (though he did not realise that at the time since he was still obsessed with what had happened to Neil Kinnock). The Sun was following the crowd rather than telling it what to think. In 2005 the Sun was largely irrelevant because it took so long to make up its mind and by then had become half-hearted in its support of New Labour. In 2010 it backed Mr Cameron, though only in the autumn before a spring election, which did not give it time to get strongly behind him. Mr Cameron's hopes of an overall majority faded the more the Sun cheer-led for him; he did not win. Like other newspapers the Sun was overshadowed by the leaders' debates on prime-time TV and unfolding events on the news channels, replayed every night to much larger audiences on network news. The Guardian and other left-leaning papers backed the Liberal Democrats: they lost seats. Newspapers and their proprietors still have what many regard as an inordinate influence on our politics because politicians chose to confer it on them, despite increasing evidence it is not merited. Press proprietor-politician relationships will be transformed, many would say for the better, when the political elite realise that the emperors have no clothes, or are at most scantily clad."

¶2.162 Mr Osborne agreed that the support of The Sun, although important, was not, and probably had never been, determinative, saying:217

¶"… I think the endorsement of the Sun has been elevated to almost mythical status. It was just one of a whole range of things we felt we had to get right in the run up to a General Election, and ultimately, if we had not had the endorsement of the Sun I think we still would have gone on and done well in the General Election".

¶2.163 He further explained why he thought that the role played by support from the Economist and the Financial Times was significant:

¶"I remember also that it was significant we had the endorsement of the Financial Times and the Economist, both publications I think previously at various points had supported the Labour Party. They don't have mass readerships, but they bring a different kind of cachet." I Before concluding:218

¶"So I think in all this process, and I think maybe it stems back to the 1992 election and some of the mythology around that – there is this feeling that the Sun endorsement is all you need to win a general election, and I would say it is far from that, and I certainly think you could win an election without the endorsement of the Sun".

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