Wednesday, December 22, 2010

Tory links to Murdochs scrutinised

Culture secretary Jeremy Hunt held private talks with James Murdoch shortly after News Corp announced BSkyB offer

Rupert Murdoch's close links to the Conservative party were thrown into the spotlight today after it emerged that the culture secretary, Jeremy Hunt, held a private meeting with the tycoon's son, James, at which no civil servants were present.

The meeting took place on 28 June, shortly after News Corp said it had made an offer to buy the 61% of BSkyB it does not already own.

James Murdoch is chairman of BSkyB and chief executive of News Corp in Europe and Asia.

Hunt's relations with the Murdochs are now under fresh scrutiny since he was handed official responsibility for ruling on News Corp's bid to take full control of BSkyB.

The business secretary, Vince Cable, was forced to relinquish control of the decision after he was recorded boasting that he was "at war" with Rupert Murdoch.

A spokesman for the Department for Culture, Media and Sport said: "I can confirm that this was an informal first meeting between Jeremy Hunt as secretary of state and James Murdoch, and there was no written agenda or briefing. Officials did not sit in on the meeting."

Hunt has previously said publicly that he does not object to the takeover.

Referring to Hunt's meeting with James Murdoch, the Labour MP Tom Watson said: "It seems unprecedented that such a high level and legally significant meeting would not have civil servants present taking notes. I will be asking the chairman of the culture, media and sport select committee to ask Jeremy Hunt to explain himself to us as soon as possible".

Civil servants normally record details of meetings between ministers and commercial interests to keep colleagues up to speed with discussions that are taking place across government.

It has also emerged that civil servants took no minutes of a second meeting between Hunt and BSkyB's chief executive, Jeremy Darroch.

According to documents released after a Freedom of Information request from the Guardian, an unnamed civil servant told Hunt before the meeting on 21 July that Darroch was likely to ask about changes to media regulation.

"Key things which they [BSkyB] would like from government" included "reform of communications act competition framework (as part of our proposed communications act review)", wrote the official.

The government is planning a new communications act later this parliament, which could sweep away strict rules on media ownership that prevent companies creating local monopolies.

It is not unusual for cabinet ministers to hold routine meetings with companies that are affected by their policies.

The meeting between Darroch and Hunt was held at a sensitive time, however, as News Corp had tabled an �8bn bid for BSkyB on 10 June.

Hunt also attended a dinner hosted by News Corp on 20 May, within weeks of coming into office, with his aide Adam Smith. That followed a speech James Murdoch made at University College London arguing for robust legislation to protect copyright.

Hunt is due to receive a report by the regulator Ofcom on whether News Corp's proposed takeover of BSkyB threatens "media plurality" by 31 December.

It was ordered by Cable in November after he decided to intervene on public interest grounds.

Hunt will now consider Ofcom's findings before announcing whether to refer the bid to the Competition Commission for further investigation next month after parliament returns from its Christmas break.

Rupert Murdoch was one of the first visitors to Downing Street after David Cameron became prime minister in May this year.

On 12 July the communications minister, Ed Vaizey, had lunch with Rebekah Brooks, chief executive of News International, at its Wapping headquarters.

An official from the Department for Culture, Media and Sport wrote beforehand: "News International will argue that government has no role in trying to compete with commercial enterprises."

Brooks was likely to argue that "the BBC's free news web pages deny commercial media in the UK from making money from online media".

News International executives have complained publicly that the BBC's news website undermines their drive to force consumers to pay for access to their own news websites.

The official added that Brooks might raise "the British Library's stated intention to provide free public access to the news archive".

Sources close to News Corp say it had far more contact with officials and ministers in the Labour government than it does with the current administration.

It is understood that News Corp executives found it difficult to secure a meeting with Cable, who rebuffed repeated requests to meet the company.

Official records show that other media companies have regular contact with government ministers.

Rupert Murdoch has proved adept at using the political power wielded by his British newspapers, which include the Times, Sun and the News of the World, to extract concessions from governments.


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