Michel and Smith at Leveson as-it-happened
09:46 – Good morning and welcome to what is essentially the trial of Jeremy Hunt. Frederic Michel, James Murdoch's lobbying man in News International, and Adam Smith, Hunt's hapless special adviser (spad) Give evidence today. The communication between these two men, which included giving Michel advance sight of Hunt's parliamentary statements, has been framed as Smith overstepping his job description without his boss' knowledge. The 'without his boss' knowledge' bit seems unlikely to anyone with even a passing knowledge of how the special adviser system works but there you are, it's not for me to decide, it's for Leveson. I mean parliament. I mean the prime minister, or the press, or the public. Whatever. It's not for me. The usual caveats: There will be typos aplenty until things calm down and I correct them all, so no angry emails about apostrophes. I promise I do know how to use them, but speed makes fools of us all.
10:22 – Lord Brooke, who was national heritage secretary between September 1992 and July 1994, is the first witness and is being questioned now. I'll start live blogging properly when he stops. In the mean time you can follow me on Twitter on @iandunt and our hashtage is #LivePolitics. There's also a funky little Facebook box to the right if you want to have a natter.
10:57 – OK, we should be starting in abut five minutes with Michel.
11:03 – And we're off. Michael is smartly dressed. He appears a little nervous and there are the unmistakeable ruined eyes of those who are sleeplessly living at the centre of a political storm. He has a soft, pleasant French accent. Robert Jay is asking the questions, and starts by establishing a chronology of his work for News International.
11:05 – Two minutes in we get our first 'I don't know'. Michel said he was not part of the "small confidentiality club" preparing the bid. Already the power relationship is established. Michel is smiling hopelessly. Jay is leaning arrogantly on his stand, asking brisk questions about when Michel knew of the BSkyB bid. It doesn't look like he's going to get an easy ride. Jay suggests it's strange that as the man in charge of the public affairs of the bid, he was only told of the bid the day before.
11:09 – Was it his role to ascertain Vince Cable's role? Yes. Were there internal concerns his view was not favourable? That came when they worried there was no presentation process in place. Jay: "You were putting out feelers everywhere. " They could quickly work out who was on side and not on side. Michel: "I was definitely able to ascertain the political climate." Jay: "You no doubt saw it as you role to see which political people you could deploy and those who needed to be worked on because they were anti."
11:14 – Michel said no one explained to him what a quasi-judicial process was. Leveson steps in and says "didn't you want to know?" Michel says he knew the decision rested with the secretary of state, what was uncharted was the kinds of decisions which could be made below that level. Leveson is baffled. Surely News Corp had lawyers for whom it was not uncharted? Michel fudges, but says the gist of the advice was that the secretary of state was to be unbiased. Michel says it was not advised to him that the term 'secretary of state' included civil servants and advisers. He was not told to avoid make representations to them.
11:16 – If inappropriate contact with the secretary of state was off-limits, then it was with the special adviser? Michel says there was no inappropriate contact. Jay smiles and suggests that's by-the-by – what applied to the secretary of state applied to the spad. Michel agrees. Why did you lobby other government departments who had no role in the decision? Jay asks. Michel says they faced a closed door at Cable's office. It was part of his work to "at least air the arguments" on plurality and all that. Jay asks if his aspiration was to make another department, like the media department, influence the department in charge – the business department.
11:18 – "You wouldn't have wasted your time if you thought that wouldn't happen would you Mr Michel?" Jay says. Michel agrees but says it was his job – he spoke to the opposition too. He says Labour was "very interested in hearing our case". Jay asks that now he's clarified that JH means special adviser why didn't he make that clear? "I was probably trying to be as quick and generic as I could when writing those," Michel says.
11:21 – This idea that JH didn't mean Hunt will be central to Hunt's defence. "To me it is self-evident a spad represents the sec of state. Tat's what they are there for," Michel says. "Constitutionally it is self-evident," Jay says. But he quotes Smith consulting with Hunt. Was that generic and assumed or specific? Michel says "some of the feedback I was given" had the impression it had been pre-discussed with Hunt himself.
11:25 – Jay reads out an extraordinary amount of emails and texts between Smith and Michel. From Michel its 191 phone calls, 158 emails and 99 texts. Michel says he didn't know if Smith himself supported the bid. What was your view of Smith? Jay asks. Michel says "Adam has always been very warm, professional, available adviser. Always very diligent with his work with me, any interactions were always professional."
11:27 – Now Jay asks if he thought Hunt supported the bid. "It's something I can't say." Jay: "Is it your evidence Hunt was keeping an open mind, was impartial?" Michel: "Yes."
11:28 – Jay points to an email. "Have you spun this in a favourable light to provide reassurance to Mr Murdoch?" Michel: "These were internal…" so they were accurate. he says there when they dealt with Cable, morale was low and "maybe I was trying to keep the morale up internally". That last part will be very useful to Hunt.
11:30 – Leveson picks up on that "morale" line. Michel: "Sometimes I was trying to energetically try to convince an internal audience we still needed to make representation for our case". Leveson picks him up on 'probably'. "Do you mean 'yes, that's what did happen across these emails." Michel says it's very few occasions. Jay asks if he's marking off the period when they dealt with Cable (so before he was sacked). Michel repeats: "It's very few examples." He's not going to be the fall guy for this, and admitting too much exaggeration allows him to become precisely that.
11:32 – OK we're onto specific texts now. 27 Aug 2010, from Michel to Hunt. It relates to a speech Mark Thompson gave on BBC governance. Hunt wrote back "Thanks I agree, nothing about BBC role in competitive market." Michel then expresses an opinion – "My view his speech a failure, a whimper really." he replied: "Because he trained his guns on you he failed to make his case to me." Jay says the purpose of these texts was to find out Hunt's view on Sky and the BBC. Michel says he was making "colourful comments" on the speech but he barely mentioned Sky. "Was this part of a campaign to test out Mr Hunt's opinion and to win him over on the BSkyB bid?" Jay asks. No, Michel says.
11:35 – We move on to a text with Michel asking Hunt if he should send Smith the briefing on plurality. Hunt said "yes please". What was the purpose? Michel said they had but a memo with their arguments.
11:37 – You knew Hunt was "reasonable favourably disposed to the bid" Jay says, adding that that's it being put "at its lowest". The text says the argument is "persuasive". Michel says that's not enough to conclude he was on side. Michel doesn't respond to Jay saying "it's one piece of the jigsaw". That's a problem. It seems disingenuous to suggest otherwise. We move on to a text asking Hunt to meet. He couldn't make it. Michel seems nervous. "What exactly happened on this date is not 100% clear," Jay says. This is the text where Smith said Hunt had received very strong advice not to meet and that the permanent secretary is now involved. But they could talk on the mobile. This is the text Murdoch reacted to by writing "for f**k sake".
11:41 – Was the mobile chat just about the bid or more than that. Michel said Hunt wanted to talk about local TV, they wanted to talk about digital rights. There was a wider debate. "If" the call took place, he doesn't know how long it was. Jay suggests liaising with his team "privately" was clandestine. Michel says the word "private" he used was not appropriate. The text which followed that email was to Hunt. "Thanks for the call to James today, greatly appreciated, we'll work with Adam to make sure we can send you helpful arguments." That's pretty damning. Michel says "he can't remember" if those helpful arguments were about BSkyB. There's our old friend "I can't recall." Hunt's reply, horribly enough, is simply the word "pleasure".
11:47 – Michel is getting more and more nervous. Jay highlights a message from Hunt – an helpful one – which says all contact must be on proper channels. Michel sold this up a bit when talking to the company. "You don't feel you've exaggerated the position in this email?" "No." Leveson asks what Michel meant by "fine to liaise at that political level". Michel explains what a spad is, which irritates Leveson. "I understand that. But are you saying to your team it's fine to be in touch with Mr Smith and that's the way to proceed?" Michel says it wasn't his team. Jay moves on to communications with Smith.
11:54 – Jay moves onto an email saying Michel will work with Ed Vaisey working on a speech. Smith denies this is true. Jay asks if it is. Michel says he is saying he'll work with their offices to help prepare it. Bit of a stalemate. This could end up very much a 'he said she said' thing, which would be useful to Hunt.
11:51 – Jay points to an email pointing to a call from Smith saying there shouldn't be a plurality issue and the UK government would be supportive. "Are you sure he said that?" Jay says. Michel says he can't remember precisely, but he was sure they had a conversation about whether the bid would be good for the UK economy. Jay suggests it;s a spad speaking on behalf of the whole of the UK government. Michel says their conversations were chatty "so he was probably passing comment". Jay suggests the purpose of the calls was to find out if there was support for the bid. Michel says he was "taking the temperature". Jay: "Precisely." He asks why Michel said he wasn't aware Hunt was supportive of the bid. If the spad expresses the view the UK government supported it, "it's a fairly obvious deduction Hunt supported it, which contradicts what you told me earlier".
11:56 – Jay continues to highlight Michel spins as he contrasts texts and emails. "I'm politely suggesting to you this is a piece of exaggeration by you for whatever reason. Would you agree?" Michel: "No."
11:58 – "It's getting worse for Michel, all of which will be news to Hunt's ears. It's not as if it wipes the slate clean, but by making Michel an unreliable witness, so to speak, Hunt can use the muddiness to escape oversight. Michel: "My view is Jeremy Hunt was probably supportive of some of the arguments and he made those arguments public on plurality concerns that had emerged from the bid."
12:00 – Michel is asked why he added work privately to an email when nothing of the sort had been suggested. Michel badly stumbles. He simply can't answer.
12:01 – Ok, Jay says that's the end of that set of exchanges, but there are one or two others. He gets out a new file. Michel can't be happy about that. I can't even imagine what's it like for Smith to watch this and know he's up next. Like watching a man being hanged. He brings up an email to Smith. Did you see a difference between the two accounts? No. The email has an attachment on Sky News audience shares. The memorandum contains commercially sensitive information to its been redacted. Smith then emails saying it was interesting and was passed onto Hunt. Michel then did the same thing on competition emails the next day. The email said Jeremy's response to the information was that it was "persuasive". Jay: "That gave you suitable reassurance did it?" Michel says yes,. there were two items – plurality and competition. He said plurality was a UK thing, competition was a Brussels thing.
12:07 – Jay moves on. he says there was a conference call with him, James Murdoch and Cable. Michel says he didn't see the call, but was briefed afterwards. The message said the Cable call went well. As a joke he said "we should have recorded it". Michel said that was a bad joke – it's actually very ironic, not just in terms of phone-hacking but what happened in the Cable sting later. From there things went downhill in Cable's department.
12:10 – Michel admits he was worried when it became clear the News of three World/Coulson issue would affect the bid and that there would be a "political element" in the secretary of state's decision. It was clear senior Lib Dems and Labour people believed the NOTW issue "was a problem". Ok, Leveson takes a five minute break. I'll take one too.
12:18 – And we're back.
12:19 – We're on an email entitled "mission accomplished" about Alex Salmond. Michel says he'd gone there. He met with a Lib Dem Mp and Salmond's adviser. Again we move on. This is a text from Cable's advisers, saying he had a strong case. Next a Michel message refers to a private call with Cable's spad. It says there were huge risks to Michel to meet with Cable's spad, because they wants to say they were taking an independent view. "He's making it clear the limit of what you can do is provide materials, but another point of contact is inappropriate," Jay says. So wasn't it strange the media department stance was different. "No I thought it was more normal than the one taken by the business department," Michel answers.
12:23 – Leveson – how could you conclude it was more normal if you'd never been involved in a quasi-judicial process? Michel says they were "internally of that view". Jay makes a distinction between formal minuted meetings and more under-the-board arrangements. Michel advocacy with spads is not clandestine – it's advocacy. Jay: "But it's advocacy that Cable's spad was specifically ruling out. How can it be above board if by its very nature people would not find out about it, unless there is a special inquiry such as this?"
12:27 – Jay tries to get Michel to accept that view. If you'd known the antis were having those comunications wouldn't it have concerned you? Jay asks. Michel says no, that would have been appropriate. "As it appeared to you, they were having more access to Dr Cable than you were. Imagine what the coalition would have thought of what you were doing with Mr Smith." Jay moves on.
12:29 – We're on a meeting with George Osborne's spad. He said there were coalition tensions around Cable and his position. We move on. Michel tries to meet Cable's spad again. "You have another go after being told this was off limits," Jay says. "You've been warned off now. Mr Wilks properly says… 'there are huge risks'." Then he comments saying "let us assume" no meetings until the decision is made. He later says "I'm sure we're both equally interested in staying within the bounds of proper conduct, forgive my caution."
12:33 – Leveson intervenes again. He says it's the same day he received Hunt's spad's advise saying he's received strong advice not to meet. SO both departments on same day told him to back off. "The reaction is frustration at the impossibility to make that representation", Michel says.
12:36 – "You're very good at the chat on the mobile phone. That's why they employ you," Jay says. Michel says "I am a compulsive texter". He says they knew the decision would be political from Cable, so the need for representation came from knowing this would not be based on the merits of the case. Jay keeps on about the value of human interaction. "I don't know if I'm good at it," Michel says, smiling. "I apologise if my texts are too jokey sometimes." Jay says these texts were not designed to enter the public domain, it's not a question of jokey.
12:39 – More examples of going above and beyond what could reasonably be concluded are presented, this time comparing meeting notes to Michel's later account of them. We're now onto the Cable tape, by which point Michel's suspicions were confirmed. When the media department took over, there was a "change of style, tone and conduct wasn't there"? Michel says there was a change "of process".
12:46 – Michel says he was given "support so we could help the department as well". The updates from Smith weren't a running commentary, but there were about "atmospherics". After a formal meeting he wrote: "Great to see you today" then goes onto the kids and then "warm regards, Fred." Michel says (fair enough) "I didn't expect this to be as public as it is now – there is noting here which helps my work." Jay goes on, citing his reply saying "Good to see you too. Hope you understand why we have to have the long process." Did you understand why there was a long process? Jay asks Michel. Yes, he says. Another message sees him praise Hunt as "great in the Commons today". Hunt replies saying "merci" and saying he will have a stiff drink.
12:51 – "Is this an example of schmoozing Mr Michel?" Michel says no. it was large drink, by the way, not stiff. My mistake. this is important because "Merci, large drink tonight" is about to viral.
12:53 – Jay brings up a Michel email asking Smith to tell Hunt it's "normal" to have representations during this period. Now we address emails in dispute. Could get serious.
12:55 – "He made a plea to try to find as many legal errors as we can in the Ofcom report" Michel wrote of Smith. Michel admits "plea" was too strong. he prefers "encouragement". But basically he's sticking to his guns there. Jay said anyone reading this would say that if it was accurate Smith was on News Corp's side. But he said Smith was neutral and impartial. "What is your evidence?" Jay asks. Is it this email or what he said earlier? "He was agreeing with me there were areas where we could justifiably find some criticism," Michel says, uselessly. Jay says do you agree or disagree the tenor of the email is indicative of him supporting you at least in terms of the Ofcom report? Michel says yes.
13:03 – Ok, Leveson has broken up for lunch. We'll do he same. Back at 14:00.
14:00 – And we're back, right on the clock, although the session hasn't quite restarted yet. I ran to gym during the break, left it a bit late and had to sprint back. So I am now in my suit, sweating profusely all over my keyboard. It is not, I can assure you, a pretty sight.
14:03 – And the session begins again. Leveson says they will start at 09:30 tomorrow, so it looks like they know they won't finish with Smith today.
14:04 – Jay makes his way through the contested messages again. I have to tell you, although it is entirely irrelevant, that Michel has the perfect French accent. it is just French enough to be charming but not so French it becomes laughable. Anyway. he looks really quite tired and vulnerable.
14:06 – Leveson is weighing in in fairly robust terms. Michel says a message does not constitute "a running commentary". Leveson replies: "What's that if it's not a running commentary?" Jay moves onto another message. It was just after Michel had a 17 minute conversation with Smith. "There's alot of material here which was not in the public domain," Jay says. The time table – that it would "done by February" came from Smith. Jay now brings up that line – "it's almost game over for the opposition". That's heavily contested by Smith and constitutes one of the most damning charges against Hunt. Michel explains it by saying he'd previously used the phrase "game over". Jay suggests there is a change. Michel refuses to say the phrase was constructed by himself – he is sure it was used by Smith. Michel is hesitant, he hedges slightly. "Are all these he's the same person?" Leveson asks. Yes, that's Hunt "through the mouth of Smith", as Leveson puts it. So strictly speaking 'he' is Hunt. "That's the way I approach the process," Michel says.
14:12 – "I was representing News Corp, he was representing the secretary of state," Michel explains. That is an important, strong sentence
14:15 – Jay is pressing Michel hard, saying the only conclusion from these passages is that Smith and therefore Hunt were on side. "Are you agreeing with me that what you were being given was immense reassurance? That;s what mr Smith, rightly or wrongly, was telling you." Michel: "I wouldn't take that leap. I wouldn't have that broad approach." Jay: "What broad approach?" Michel: "I wouldn't take that leap."
14:17 – Another message. This is the one where Kichel said he managed to get some info "although absolutely illegal". Michel said it was "a very bad joke which shouldn't have been made". he adds: "In hindsight I wouldn't have put such words. i have since learned it is not illegal to get pre-notification of a statement in parliament." Jay suggests he did believe he was getting access to something he shouldn't have been and that;s why he wrote it. Michel sort of accepts that.
14:22 – A new message relating to Hunt's statement to parliament. It says Hunt can't say the undertakings in lieu (UIL) (News Corp call them remedies) are too great or people will want them published. Jay suggests Michel's email, which claims JH "needs some space to prevent any accusation of deal-making", is not reflected in texts with Smith.
14:30 – Michel says 85% of the memo is verbatum. That;s damaging. In eird, other side of the moon, sort of way, Michel is bandaging up some of his credibility problems,. because he gives way in some parts, he becomes more convincing when he does not. It's all still dependent on Smith. Jay reads: "JH believes we are in a good place tonight". The idea was the process f presenting the UILs had gone well. "The argument was moving your way wasn't it," Jay says. Michel says the UIls were well accepted and most commentators accepted the plurality concerns were met. Jay skips some messages, saying there's not enough time.
14:34 – Jay is asking about a line saying "don't mention [documents] to OFT (Office of Fair trading) etc" – suggesting the media department is passing on documents to News Corp, although Michel says he didn't get them. The email just said "I'm trying to get the documents but it's difficult". Every so often Leveson comes across a new name and asks Michel who it is. he always smiles weirdly before answering. Leveson then raises his eyebrows and jots the name down with their job description.
14:39 – Michel insists some of Smith's responses to his requests are "pretty firm and pretty strong". A new message refers to "insightful" comment from JH on Ofcom views. Smith says he didn't know the Ofcom rules at that point and there's just a ten second phone call, so where did he get that information from? "I wouldn't have triggered myself to write something like this if I hadn't had feedback," Michel says. Jay is obviously scpetical and presses the point. "I would love to understand the reason it is as it is, but this is a year and a half ago, iIcan't remember…" Jay: "One possible reason I put it gently to you is because there is exaggeration." Michel: "If there was exageration I wouldn't have been able to feed back anything to my colleague."
14:43 – OK! We're on the Swan Lake bit. The Michel email says Smith says he caught Hunt before he went in. Hunt says he never went, if I remember correctly. "Our research shows that Covent Garden wasn't showing Swan Lake that evening," Jay says.
14:48 – Jay reads out: It might be a "green light" agreeing to the Ofcom suggestions. Smith says he can't get his officials to get back to Ofcom because he's not supposed to have the letter. "They are private exchanges of information which are inappropriate," Jay concludes. Michel basically agrees. The messages says he advises Hunt to ignore Ofcom, "show some backbone". Are you sure he said that? Jay asks. Michel: "It's my English, I may have put it in a more dramatic way, but yes." Jay says he wouldn't use words like backbone to the secretary of state personally, surely? Michel says no. Jay: "Some would say you are being cheeky with Mr Smith."
14:51 – Labour think they've got what they need. They are putting out a statement saying Hunt told the Commons in April the only contact he had with Michel were minuted meetings. But released texts would appear to contradict that.
14:52 – A message from Michel saying JH didn't want it to go to Competition Commission as it would sink the bid. "Are you wholly confident that was what was said?" Jay asks. Michel's answers are all 'yes'. Michel constantly glances over at Smith at the back of the room. "They'd made it clear to you they had no choice but to follow expert advice, but the long game was the deal was more likely to be secured," Jay argues. "The impression one might be getting was of an approach that was favourable to you." Michel: "In the conversations they were having with us it was about staying in the game."
14:55 – We're now on March 3rd. Hunt had told parliament he was inded to accept the UILs.During the morning there were many calls and texts. "It was a busy night" Michel says. The statement needed to be ready at 7:30 in the morning – there were lots of redactions that night, They needed the statement out before the markets opened. There had been an article in the FT so it was dangerous not to move quickly. the OFT were up all night discussing the UILs. it was chaos, basically.
14:59 – Leveson notes down another name – an anti-trust lawyer. Michel plays with his pen nervously.
15:01 – Jay highlights another exaggeration, saying a one hour catch up was in fact a 36 minute phone call. "French time," Michel says. Smith says he could not have known Paul Dacres response to the state of play. Michel says he couldn't have known without Smith knowing.
15:03 – Jay asks if Michel can see the irony in calling Hunt "so painfully rigid and careful" over bid. Michel: "I see your point."
15:05 – The pattern continues as it has all day – did you make that up? Nope, why would it be there if it wasn't said. Michel not backing down. Jay: "The clear implication – maybe you're beginning to agree with this now – is that if this is accurate Mr Smith is on your side," Jay says. Michel: "I see your point and why you would infer that. I can also see he wanted to hear all the arguments from all the different parties." Jay: "Yes, but he wasn't going to share News Corps views given to him privately with the coalition (against the takeover)." Michel: "I don't know." Jay: "But you couldn't have thought he would do so."
15:09 – Jay cracks on. I'm not sure we'll have any time for Smith today. Jay says the atmosphere begins to change about now. Michel starts to float the threat that if the process kept dragging on they may withdraw. "I was the reflecting the genuine frustration from high up," Jay says. News Corp was thinking they might as well have gone to the Competition Commission (CC). Now they tried for a meeting with a minister of state, a tactic Jay calls "bold". Smith says: "You couldn't seriously think Ed meeting with News Corp while the bid was going on would not be an issue." Michel called that " a punitive decision". Jay: "You felt victimised Mr Michel." Jay actually laughs at that.
15:16 – Hunt is still 1/2 at Ladbrokes on being the next Cabinet minister to leave government. There's been no movement during the day.
15:18 – OK, we take a break. Back in five.
15:30 – And we're back.
15:31 – Jay continues running through the text, one abut a rumour the Daily Mail were facing a phone-hacking case. One messages asks for Osborne to write to Cable to help out with the bid. Michel says he wanted to see if the Treasury would make "representation".
15:34 – Jay suggests Michel "deviously" wanted a strong statement on phone-hacking from a government minister to draw attention away from the BSkyB bid. Michel obviously disagrees. If the bill went through, would he have expected a big bonus. Michel said that was never put to him. "Bonuses in our company are annually reviewed." And Jay ends. Leveson asks Jay what part of the body of information should form part of the record. Jay says all of it, even though he only referred to about a tenth of it. That doesn't mean the rest of it his not material.
15:38 – Well it looks like we're going to get a bit of Adam Smith.
15:39 – Smith is young with big eyes and quite eager. He is quite nervous. He wears a noticeably cheaper suit than most of the people who have preceded him. Leveson thanks him for preparing a statement and says this "cannot be an easy time for you". Jay reads his CV, from Durham to PR, to assistant to Hunt, to chief of staff when he was made media secretary. After the election he became his spad. Leveson asks how old he is. He's 30.
15:41 – Smith's voice cracks a couple of time. It's difficult not to feel sorry for him, the pressure is enormous. he is asked about the early stages of his working relationship with Hunt. They were small teams, he says. they co-wrote many documents and speeches. "We got to know how each other worked, I got to know what he liked from members of staff." His voice cracks again.
15:44 – The media department didn't have regulatory functions so Smith admits he had to get to grips with quasi-judicial roles pretty quickly. Jay asks if the permanent secretary had a supervisory role over him. Smith says yes. Who was your line manager, Jay asks. "I reported in to Mr Hunt," he answers.
15:50 – Smith says he had meetings roughly every week on the BSkyB issue with Hunt. He says he would speak to him "three or four times a day" when Hunt was in parliament and he was in the department. Obviously when they were in the same building it was much more often. Leveson asks detailed questions about how their work arrangements were laid out. The end point of this questioning is, of course, that Smith could not have operated rogue without Hunt knowing.
15:54 – Smith says they had a close working relationship but only rarely went for drinks. Smith describes how he acted as a buffer to people who wanted to meet Hunt.
15:57 – We're now on Hunt's thinking about the BSkyB bid before September 2010. Smith insists Hunt was not close to the Murdochs, or the News International chief exec. he dealt mainly with Michel. Jay asks if he was aware he put on his personal website that he was a cheerleader for News International. Smith says that quote came from a Broadcast magazine interview and were the journalist's words. Every signs so far Smith intends to be loyal.
16:02 – News Corp's materials on the desirability of the BSkyB bid shows Hunt was sympathetic. "Obviously strictly commercially confidential but very interesting," Smith wrote with one package. Hunt replied: "Very powerful actually." Leveson interjects to ask what any of this had to do with him. Smith, who is not getting any less nervous, says it was really just for information.
16:05 – We're on James Murdoch's furious response to Cable's decision to refer the bid to Ofcom. A Hunt memo to David Cameron says the following: There are concern as News Corp are legally minded. Murdoch wanted to do what his dad with the Wapping strike and create a multi-platform media system around News Corp. They can block on plurality, but the memo says they want it to go through as it could be the UK ahead of the game. Smith says the memo is similar to what Hunt already thought – he didn't see a problem but it would be wrong for government to get involved and it needed to be decided on plurality grounds. "He's a bit more positive than that isn't he," Jay suggests. "If the UK doesn't lead the way it will be block our media sector… sensible controls can be put in to protect the media sector."
16:10 – The PM's spokesman is refusing to answer questions on whether Hunt misled House when he said the only contact he'd had with Michel was at official meetings.
16:12 – That memo is pretty damning. Cameron knew Hunt was for the bid, had said the government shouldn't cave to the Mark Thompson/Channel 4 coalition, and he gave him the BSkyB bid anyway. Hunt had received legal advice from officials "it would be unwise" to intervene on BSkyB bid because Cable handling it. But he wrote to the PM anyway. This is very problematic for the media secretary.
16:17 – Another interesting note. That Hunt memo suggests News Corp planned to bundle Sky with the Times and the Sun – the precise opposite to what they told the outside world. it confirms the worst fears of anti-Murdoch campaigners, who said the bid would be seismic change in the British media landscape. the memo said Murdoch wanted the "world’s first multi-platform media operator, from paper to web to TV to iPhone to iPad”.
16:21 – It's all heating up. Lobby hacks said the PM's spokesman had four opportunities to say hunt had been accurate in his statement to parliament but didn't. Labour are already stepping up the attacks. Opposition front bencher Chris Bryant just tweeted: "Confession. We may have got this all wrong. Is Cameron the culprit, not Hunt?"
16:24 – Smith is explaining what he knew and didn't know about his role in a quasi-judicial process. "I wasn't told I couldn't make contact with interested parties. Hunt alone held the quasi-judicial role," he said.
16:32 – OK here's the full memo from Hunt to Cameron. This will be an important piece of writing in the days ahead.
James Murdoch is pretty furious at Vince's referral to Ofcom … He doesn't think he will get a fair hearing from Ofcom. I'm privately concerned about this because News Corp are very litigious and we could end up in the wrong place in terms of media policy. Essentially what James Murdoch wants to do is to repeat what his father did with the move to Wapping and create the world's first multi-platform media operator, available from paper to web to TV to iPhone to iPad. Isn't this what all media companies have to ultimately? And, if so, we must be very careful that any attempt to block it is done on proper plurality grounds and not as a result of lobbying by competitors. The UK has the chance to lead the way. But if we block it our media sector will suffer for years. In the end, I'm sure sensible controls can be put into any merger to ensure there's plurality. But I think it would be totally wrong to cave into the Mark Thompson/Channel 4/Guardian line that this represents a susbtantial change of control given that we all know Sky is controlled by News Corp now anyway. What next? Ofcom will issue their report saying whether it needs to go to the Competition Commission by 31 December. It would be totally wrong for the government to get involved in a competition issue which has to be decided at arms length. However, I do think you, I, Vince and the DPM should meet to discuss the policy issues that are thrown up as a result.
16:34 – Jay says that there was "arguably a lack of balance" in the extent of his contact with Michel.
16:34 – Hunt didn't tell Smith to be point of contact with Michel. The permanent secretary didn't tell him not to. It just sort of happened that way and would have surprised no-one. "No-one ever said 'you shouldn't be doing that'," Smith says.
16:36 – Hunt is looking at plurality, which is a question of fact, Jay says. It's really for experts evidence – it's not political. "Did you see a tension there?" Jay asks. Smith says his business was just setting things up – to facilitate the process. "But inevitably you attended the meetings, you had your own view on the substantive issues didn't you?" Smith says he did. Was that on more than the enterprise act – on the broader issues? He says his views were based on the evidence. This goes down on that line as to whether quasi-judicial applied just to Hunt or the department (it's the latter). "I couldn't see what everyone was getting so worked up about," Smith says, bafflingly. he generally thought the same as Hunt, he says.
16:40 – And with that we're done for the day. The session starts at 09:30 tomorrow. See you then.
