Leveson Inquiry

Morning Hearing on 14 May 2012

Lord O’Donnell of Clapham gave a statement at this hearing

Hearing Transcript

(10.00 am) LORD JUSTICE LEVESON Mr Jay, you will be aware that on 6 May there was published an article in the Independent on Sunday which caused concern that there had been a leak of a statement made by Mr Andy Coulson to the Inquiry, which had been published on the Lextranet system. I investigated that leak during the course of last week, and it was indeed confirmed by Mr Mullin, the editor, that he had been provided with sight of the statement, although he said that his story had been independently researched and verified before his sight of that statement. I have considered the circumstances and published today a detailed ruling on the website or will publish today a detailed ruling on the website in relation to this incident. I do not intend to take any action under section 36 of the 2005 Act in relation to this matter but the ruling contains very detailed consideration of the circumstances, and I strongly advise anyone who publishes material likely to emanate from our Lextranet system to read that judgment with care, whether they be a core participant or not. Thank you. Yes, Mr Rhodri Davies? Opening submissions for Module 3 by MR DAVIES MR DAVIES Good morning, sir. Thank you for allowing me a little time this morning. I don't believe that you will need the hourglass which was referred to a Friday. Following the opening which Mr Jay delivered in relation to Module 3 on Thursday of last week, we would like to make some observations on what the Inquiry should be focusing on and how it should approach Module 3, which is concerned with the contacts and the relationships between national newspapers and politicians and the conduct of each. That is a very broad subject, and it's necessary for the Inquiry to identify the area in which it is to focus. There is one obvious area where there is or may be legitimate public concern. That is the possibility that illegitimate deals have been done between press and politicians, in which favourable coverage in the press has been traded for favourable exercises of governmental powers. In order to focus on this area, it's necessary to analyse what constitutes an illegitimate deal. Illegitimacy is present where a newspaper or a media group agrees to alter its coverage from what it would otherwise write and publish in return for a promise by a politician that a governmental power will be exercised in a way in which it would not otherwise be exercised. Such a deal would constitute a fraud by the newspaper on its readers and by the politician on the electorate. Such a deal would be a denial of democracy. But it is quite wrong, as Mr Jay did last week, to muddy the definitions and the boundaries to the point where no differences is seen between a newspaper supporting a politician it agrees with and respects and a corrupt deal between the two. At the top of page 7 of the printed version of Mr Jay's opening, which is now available on the Inquiry website, he identifies what he describes as the heart of the problem, but in doing so he rolls up, without differentiation, at one extreme a case where the trade-off for support from the press is the deliverance by government of media policies which favour the commercial interests of a particular newspaper group, and at the other extreme, the case where the trade-off for support from the press is, and I quote: "The espousal by government of other, that is to say non-media policies, which correspond with the world or political views of influential newspaper proprietors or editors." That amounts to saying that it is sinister indeed, at the heart of the problem for Mr Murdoch and the Sun or Mr Dacre and the Daily Mail to support, through their pages, politicians whose views they agree with. But that is exactly what they are meant to do and are expected to do as agents of a free press in a democracy. The problem comes not when they support politicians they agree with but if they prostitute their papers to support politicians they don't agree with in exchange for favours. The vice, we say, in Mr Jay's formulation is that it muddles right with wrong and fails to define what the Inquiry should be looking for. Indeed, it appeared at times from Mr Jay's opening that it was somehow discreditable to own or edit a newspaper such as the Sun, which has a very large readership, whose readers include those who vote across the political spectrum, whose readers include many who do not always vote for the same party and whose editorial line has been known to favour different parties at different times. Such a paper is, one might think, a valuable element in a vibrant democracy, but in Mr Jay's hands, these characteristics a large readership, floating voters, an absence of immutable party loyalties began to sound sinister, an apple so tempting and shining that politicians could not be trusted to talk to its editors or proprietors without doing underhand deals and somehow a vehicle for wrongdoing, precisely because its readers and its publishers do not reliably adhere to a strict party line. Now, if there is evidence of such underhand deals, the Inquiry must, of course, look at it, but that may be a relatively brief exercise. In the face of the documentary record, Mr Jay rightly disclaimed the notion that Mr Murdoch expressly asked for concessions. There is, he said this is his page 13 little or no direct evidence that Mr Murdoch did so. And, as Mr Jay also said, it would not be safe to base any findings on speculations. Nor, of course, would it be appropriate to level such allegations in the face of compelling evidence that no underhand deals were made. Mr Jay rightly focused considerable attention on the acquisition of the Times and the Sunday Times in 1981, as that has served in popular lore as the original sin of Mr Murdoch's expansion of publishing interests in the United Kingdom, and as was suggested in the written questions posed to Mr Murdoch, a paradigm of how he went about having politicians bend the rules in his favour. From the premise that the rules were bent at his behest in 1981, the Inquiry took him through all of the transactions that followed, from the development of Sky and the merger that created BSkyB, the consideration of investments in Channel 5 and Mediaset, the division of broadcast rights in Premium League events and indeed the whole history of News Corporation and News International's growth over the last 30 years, all of it viewed from the starting point of the 1981 transaction as a paradigm. The documentary evidence, however, did not support the thesis that in 1981 any deal was made, let alone that any rules were bent. In the absence of any such evidence, Mr Jay opened up instead what one can only describe, with respect, as a science fiction theory, that deals with done not expressly but through implied understandings reached through messages and these were his words transmitted by and to finely tuned antennae, without anything actually being said. This is, with respect, a flight from reality. It is an invitation to the Inquiry to depart from an examination of facts, who said what and who did what, and to speculate instead about wordless meetings of minds. This is the stuff of fantasy. Deals cannot be done by telepathy. What are the terms? What is the duration? What is the quid pro quo? When is the deal fulfilled? What is it broken? The sophisticated and powerful people Mr Jay identifies know better than to commit their political and commercial capital without a clear definition of what it is they are getting in return. Nonetheless, by inviting the Inquiry to enter into this world of implied understandings, Mr Jay recognised an important truth: that the documentary record common conclusively establishes that there were no express understandings, but that record leaves no room for implied understandings either. We know what Mr Murdoch and Mrs Thatcher talked about when they had lunch at Chequers on 4 January 1981 because Mr Ingham made a note of it. There was no discussion of the MMC and no promises were made on either side. Mr Jay had an unjustified swipe at Mr Ingham by describing his note as "carefully crafted", but it have to be not merely carefully crafted but positively dishonest if a deal was deliberately omitted from the record. Nobody suggests that. Moving on three weeks to the morning of 26 January 1981, we know because again we have the meeting note that Mr Biffen told Mr Murdoch that he was minded to refer the transaction to the MMC and that Mr Murdoch told Mr Biffen that he would not object to a reference, and furthermore, at Mr Biffen's request, Mr Murdoch promised that he would extend his bid if Thomsons agreed to attend their deadline for a sale in order to allow a reference to the MMC. In other words, the documents conclusively establish that not only did Mr Murdoch not ask the Prime Minister to cut any corners for him; he did everything asked of him to make it possible for the Secretary of State to make a referral to the MMC. That left Mr Biffen with one central problem: to persuade Thomson to extend its deadline. What happened next is plain to see from the documents. The whip hand was held not by Mr Murdoch but by Thomsons. Mr Biffen saw them too on the morning of 26 January and they told him at their meeting, then reconfirmed in a letter that day, which the Inquiry has seen, that they would not extend their deadline for the closure of the papers. They had been held to ransom some by the unions many times too often and at great cost and they would not allow any opportunity for it to happen again. This meant that the delay entailed by a reference to the MMC risked causing the end of the Times and the Sunday Times. When Mr Biffen explained his decision in the House of Commons the next day he told the house this is column 818 in the Hansard record that: "At the heart of the matter was whether it was possible to refer to the Commission and not invoke the proposed closure plans that had been drawn up by the Thomson organisation." Mr Biffen went on to explain that, although he had been urged to call Thomsons' bluff, he did not think that would be a wise posture for someone seeking to act in the public interest. He made it clear to the House that it was his decision and that he took responsibility for it. After the debate, he wrote to John Smith MP to explain the analysis by his civil servants of the solvency of the Sunday Times and arranged for the letter to be deposited in the library of the House of Commons. To suggest that Mr Biffen was a mere front for a deal between Mr Murdoch and Mrs Thatcher is as much an unwarranted charge against him as it is against them. Mr Jay said that whether there were any private conversations between Baroness Thatcher and Mr Biffen is both unknown and unknowable. Although Mr Biffen is no longer with us, that is not to say that there is no record of his thoughts on this subject. In November 1998, after publication of Woodrow Wyatt's claims to have bent the rules for Mr Murdoch, Chris Mullin, the Labour MP, asked Mr Biffen about it. In his entry for 4 November 1998, pages 386 to 7, Mr Mullin records Mr Biffen as saying that he had searched his attic and dug out his pocket book for the period in question. I will not read out the full entry but Mr Biffen recalled no pressure from Downing Street. So far as he knew, everything had been above board. One of the difficulties had been that the only other buyer in sight had been Robert Maxwell. The thesis that Mr Murdoch must have enlisted the Prime Minister in an effort to avoid a referral to the Commission therefore suffers not only from a complete lack of evidence in its favour but from a compelling documentary record to the contrary. The implied deal approach outlined by Mr Jay requires one to conclude that all of Mr Biffen's contemporaneous statements and reasoning were mere camouflage, that contrary to what he told the House of Commons in 1981 and what he told Mr Mullin in 1998, Mr Biffen paid no regard to the deadline impose by Thomsons but instead declined to make a referral to the Monday open his Commission because of a nod and a wink from Mrs Thatcher, who was in turn acting on the basis of an unspoken request from Mr Murdoch. Mr Murdoch managed to bring this all about not by asking the Prime Minister by for help by instead by telling the Secretary of State that not only did he not oppose a referral but he would extend his bid to facilitate one. To call this thesis speculation is to use too dignified a term. With or without Mr Biffen's recollections, the documentary record demonstrates conclusively that there was no express deal and no implied deal either. We agree with Mr Jay that the record of the acquisition of the Times and the Sunday Times is of cardinal importance in the history. As I have said, it's been taken by Mr Jay and others as the paradigm example of Mr Murdoch's supposedly malign dealings with politicians and it took pride of place again in Mr Jay's opening last week. Because of its central place in the history and the mythology, it's vital that the Inquiry should understand the descending plausibility of the theories that have been advanced about what happened in January 1981. The first theory was that there was an explicit deal made between Mr Murdoch and Mrs Thatcher and executed by Mr Biffen. That theory is utterly demolished by the documentary record. The second theory is that if there was no explicit deal then there must have been an implied one. Here, metaphors take the place of evidence or analysis. So we have finely tuned antennae, doors springing open to the lightest of touches, people on the same page, Mr Murdoch knowing which buttons to press and perhaps also Max Weber's theory of charismatic authority. All these beguiling images have in common the cardinal feature that they are unable to explain what the deal was or how it was done. They also are demolished by the documentary record. The third theory emerged only last week. It is a desperate assertion that something must have been up and that Mr Murdoch must be lying when he says that he does not remember anything about it. Mr Jay put it more euphemistically but still in headline-grabbing style when he said it had to be asked whether Mr Murdoch was conveniently suffering from selective amnesia. It is against the rules and for good reason to raise such an issue after the witness is gone rather than when he is here to answer it, but never mind that. This theory fares no better than its predecessors. Mr Murdoch has nothing to lie about. The documents tell the story. It would be easy enough for him to say that now that he's seen Mr Ingham's note it has jogged his memory and it happened just as Mr Ingham record. If he had something to hide, that is exactly what he would have an incentive to say. If he says, in fact: "I still can't remember anything about it", then it is because, 31 years later, he simply can't. The suggestion that he must be lying is not an argument or a theory based on evidence, but a conviction which is determined not to face the evidence. As I have demonstrated, the remarkably full documentary record shows that Mr Murdoch has nothing to hide in respect of the events of January 1981. There is no basis for Mr Jay's delayed airing of doubts over his credibility. That suggestion had no place in Mr Jay's opening for Module 3. What must, however, play a full part in the Inquiry's consideration of Module 3 is the recognition that the first and paradigm allegation of underhand deals between Mr Murdoch and politicians has been demolished. The base for what follows in News International's success in the United Kingdom is not a stolen transaction but a proper acquisition and one that saved the papers from closure or, perhaps, from Mr Maxwell. That is all I wanted to say. If it would assist the Inquiry to have a footnoted version of what I've said with copies of the documents, then we will of course provide that. LORD JUSTICE LEVESON I would certainly like them. Thank you. MR JAY Sir, the first witness today is Lord O'Donnell, please. LORD JUSTICE LEVESON Very good. LORD AUGUSTINE THOMAS O'DONNELL (sworn) Questions by MR JAY MR JAY Your full name, please, Lord O'Donnell?
A. Augustine Thomas O'Donnell.
Q. You have kindly provided the Inquiry with a witness statement on 4 May 2012. Are you content to put this as your formal evidence to your Inquiry?
A. Yes, I am. LORD JUSTICE LEVESON Lord O'Donnell, I'm sure the retirement wasn't intended to be taken up in this way, but thank you very much indeed for the work you've put into providing information.
A. You're very welcome, sir. MR JAY First of all, may I provide some career highlights. 1990 to 1994, press secretary to the Prime Minister, Sir John Major. 2002, permanent secretary of the Treasury. 2005, cabinet secretary and head of the Civil Service. Retired at the end of 2011. January 2012, life peer. Lord O'Donnell LORD JUSTICE LEVESON Sounds like a sentence, Mr Jay. MR JAY At paragraphs 4 to 7 of your statement, you supply your credo, your belief in a free press, and you develop your reasons, and you say that transparency is the key to accountability. That, I'm sure, is plain. Would you like to develop that at all?
A. Well, as I say in the statement, I think there are enormous benefits from having a free press which can hold governments to account. I think that's a massive advantage which we should never ever underestimate. In terms of how you manage the relationship between various bodies, which I know the Inquiry's been looking into and will do in turn politics, police and the like we do need to bear in mind that we have a system which allows rather different rules for different parts of the media, and I think the issue we really need to think about is how, given the technological changes, which have made the different types of media blurred the distinction between the phrase I used is BBC Online versus Times Online. They are both regulated in very different ways. Do the readers understand that and do we have the right regulatory system which can accommodate an area where newspapers are allowed to actively support political parties, whereas broadcasters are governed by a very strict set of rules? I think the answer in terms of the relationship with politicians is that we go for as much transparency as possible.
Q. Okay, we'll pick that idea up in due course. In paragraph 8 this is our page 05340 you begin to identify the problem in the context of a low level of trust in journalists and you lay markers down to possible solutions, including speedy resolution for errors of inaccuracy. Then you say: "There must also be agreement on privacy and what methods of investigation are acceptable." You take that up later in paragraphs 41 and following, and we'll come back to that. May I ask you, please, about your time when you were press secretary to Sir John Major, how you saw your role perhaps in contrast to how your successors might have seen it?
A. Well, I was told by the then cabinet secretary, Robin Butler, that what he wanted me to do in the role as press secretary was to lower the profile of the press secretary as you mentioned, Mr Ingham, now Sir Bernard, had a higher public profile and to establish very clearly the impartiality of the process. Its relationship with the media needed to change. At the time when I took over at press secretary, the lobby briefings had got to a stage where two newspapers, the Guardian and the Independent, had exited the lobby, and my job really was to try and get back to a situation where all newspapers could be represented there and felt able to attend, and indeed the Guardian and the Independent did come back in to the lobby. So it was trying to establish general principles of the Prime Minister's press secretary being there clearly to present, in an impartial fashion, government policy, and to do that equally to all members of the media, both broadcast and newspapers.
Q. For you as a civil servant, that of course did not create any tension or difficulty, did it?
A. No, it didn't. I had been a press secretary in the treasury to briefly Nigel Lawson and then John Major when he was chancellor, so I got used to the fact that that was an important part of the job.
Q. Do you have any reflections on the relationship between press and politicians during that period, particularly in the context of the 1992 election and then the way the press responded to the Conservative government after the financial crisis of that year?
A. You have to understand, when John Major took over from Margaret Thatcher as Prime Minister and I moved in as press secretary, there was a clear presumption that there will be a change of administration at the next election. The opinion polls were showing something between 15 to 20-point lead for Labour, and my job was it was an interesting question of whether my job, going in as press secretary, would be seen as someone who would, by doing that, become politicised and would therefore, if there were a change of administration, as looked very likely, given the opinion polls, have to leave and someone else would come in. As it turned out it is alleged that the media played a big role in that election. I'm not sure that a thorough study of the evidence would back that up, but it's certainly the case that it was a very unusual election in that people lied in the exit polls, basically. So the way they voted and the way they actually said they voted in the exit polls were far different from what's happened in previous and post elections. So my job really was just to be, as it were, the impartial explainer of government policy and I carried on doing that post the election. It was interesting that there was a change of mood. The economy was going through difficult times. We had the exit from the exchange rate mechanism and the mood of the newspapers did indeed change and became more hostile towards the government, something that's not unknown in mid-terms of government, I have to say.
Q. Of course, during that period, if we take the period in particular 1992 to 1997, some would say that that was characterised by the lack of an overcosy relationship between government and the press. Would you agree with that?
A. I think that's true. I think the relationship was much more distant during that period than I have observed it being in later periods, yes. Certainly.
Q. Did you have any sense, though, in government, that this was an opportunity perhaps to bring in press reform in a way which otherwise might not have been possible if there had been an overcosy relationship?
A. Well, at that stage I think the case for having to reform things wasn't as great. I mean, there were some issues, but in the end I think politicians weren't convinced that that was something that actually was so bad that it needed to be resolved, certainly not in a statutory way.
Q. We may come back to that issue with another witness. It is also said that the Prime Minister was obsessed with press coverage, went out to buy personally first editions of the Evening Standard, fear of the tabloid press. Was that true or not?
A. Well, like I say, there had been something of a myth developed that the tabloids had been highly influential in the 1992 election. Certainly prime ministers and Sir John Major was no different in this respect care a lot about what the media say about them and get very upset when there are inaccuracies reported. He got particularly upset when they would be of a personal nature. Indeed, I was involved in a situation where we went to litigation over some incorrect statements made in the New Statesman. So he did feel quite strongly that it was important that the press should be accurate and that if they made mistakes, that these things should be corrected.
Q. But you wouldn't go so far as to say an obsession; is that it?
A. Well, he was he took a keen interest.
Q. You touched on lobby briefings. Final sentence of your paragraph 31, page 05346, you refer to them as being seen as the dark arts. Many people in this room will fully understand why you say that and what you mean by that, but could I invite you to expand, please?
A. Certainly. There was a perception that somehow in lobby briefings something was going on which was giving information that was somehow not available elsewhere, and what I wanted to do is kind of move this to a situation where certainly we were giving that information and I was much more relaxed about attribution of that information to the Prime Minister's spokesman, and we were giving it to everybody because everybody was allowed in. I didn't want it televised and the reason I didn't want it televised was because I thought that in you televised a lobby briefing, then the Prime Minister's press secretary becomes a very public figure, and that meant that people would associate that person with the policies, rather than the elected politicians whose policies he or she was explaining. So I drew the line as saying: look, everyone can be there and report it but it shouldn't you're televised. And I still think that's true. So for me, the dark arts were when people were going and spinning stories to individual newspapers in different ways to accommodate the story to what they believed would go well with the readership of that particular story. What I felt, as a press secretary, was what you were trying to do was actually tell the one story to everyone at the same time and I thought that was a very important part of keeping the wrote process honest.
Q. The practice then of giving different versions of the same story, according to the taste or predilection of the listener spin in another form that was a practice then which existed, on your evidence, long before it became
A. I'm afraid yes. I mean, certain people would always feed their version of the story to newspapers and that's you know, that had been going on for many years.
Q. Yes.
A. What I tried to do by reinstating the importance of a lobby briefing to all journalists was to say: this is the version. This is what the government believes. This is why they're undertaking these sets of policies and these are the responses to your questions and that was the definitive guide across the whole of government.
Q. Okay, thank you. Paragraph 14 of your statement, please. You begin to identify the problem, paragraphs 14 to 17.
A. Mm-hm.
Q. In particular, newspapers and broadcasters leading the news agenda rather than following it. Paragraph 16: "Another risk in an overly close relationship between the media and politicians is the appearance and public perception of an undue influence, even if such an influence does not in fact exist." Well, that almost picks up a theme which we heard from Mr Rhodri Davies a few minutes ago. Are you able to assist with your personal knowledge, rather than a commentary on events, as to whether in your view that influence does or does not exist?
A. The influence between
Q. The undue influence exerted by media proprietors over politicians?
A. It's certainly the degree of relationships increased through time. There's no question about that. I would always be very clear with prime ministers that there were appropriate ways of managing those conversations, there were certain things that should happen, certain things that shouldn't, but in general, I would say the degree of closeness has increased over time. But I'm not aware of anything I cannot give you any specific examples of things where I think something happened that shouldn't have done.
Q. All you can speak to then is the appearance and public perception. You're not supplying us with hard evidence which you could draw to our attention of the perception maturing into fact; is that it?
A. That's right. LORD JUSTICE LEVESON But is it a reasonable perception, from your view?
A. Well, if you look at the incentive structures, we have a situation where newspapers can give support to political parties. Therefore obviously politicians have a strong incentive to explain to those newspapers their policies in a way that they hope will garner their support and therefore get them to support them in the election. That's the incentive structure, and therefore it's in the strong LORD JUSTICE LEVESON Or get their support for policies?
A. Exactly. So it's in their strong interests for politicians to talk to newspaper editors and proprietors to try and explain their policies, try and explain why that newspaper should support them. That's been going on and continues to go on and that's the structure we have. And as long as you have newspapers which are allowed to strongly support and come out very overtly in favour of political parties, that relationship is going to continue. Where I would like to see a change, perhaps, is if you look at if you contrast the newspapers, say, in the United States with the United Kingdom, you'll find in the United States newspapers in general tend to separate out opinion and news much more. So you'll get a page of opinion, which basically says, "We strongly support this politician or this set of policies", in a very kind of almost propaganda-ish way, and then you'll get the news columns, which tend to be pretty straight. I think if you looked at our newspapers, where they differ is that you'll find that you get all the opinion in the same way but in the news stories. If you took the same news story, the same set of facts and you looked at how that was handled by, say, the Mail and the Guardian, you would find they were written up in very, very different ways, and I think that's the difference. LORD JUSTICE LEVESON That actually raises a couple of questions, doesn't it? The first is the extent to which there is a sufficient distinction between fact and comment, which, of course, I think the code requires.
A. Mm. LORD JUSTICE LEVESON Secondly, the extent to which politicians feel they have to go to, as it were, try to persuade proprietors or editors that their line is the correct one, or best in the interests of the public, at the same time as proprietors and editors might have their own hobby horses or policies or campaigns which they're actually keen to get the government to take on board. That's where you get the risk of a mix. I'm sure Mr Jay is coming onto it, but it just all comes together in that, doesn't it?
A. Indeed. If I take your two points in turn, sir. The first one about the code and the business about trying to differentiate news and comment. I really do think that if there were anything that could be done to reinforce that because I think it would be fair to say that if you did any sort of analysis of the same set of facts reported by different newspapers, you'll see that it doesn't look like the same set of facts. So news and comment is much more mixed up than I think it should be. Your second point about persuading editors obviously in a democracy, for politicians to get their message across, it's really important that the media report what they're saying, that they're given a stage. On the broadcast stage, there are various rules about how that happens. In the newspapers, it's very different. So we've created a structure which very much incentivises politicians to try and persuade newspapers that they have the right set of policies and that is inevitably going to lead to them wanting very much to engage in that process, and it, I think, does result in difficulties of them getting too close. LORD JUSTICE LEVESON I don't know whether Mr Jay's going to come on to this, but it's twice you've now mentioned the obvious difference between broadcasting and print journalism and the inevitable consequence that there is a different way of approaching material. One can look at how people report statistics there are all sorts of subset examples of that. The reason for the broadcasting rules initially was because of bandwidth and all the rest, which I understand. I understand a little bit more than some reporters in the press suggest but there it is. But is that differentiation still tenable? Is it valuable? It might be thought that it is valuable, if, for example, in relation to the BBC, it's a publicly funded service, or is it something that ought to be looked at?
A. Well, I think inevitably if you're looking at regulation of the media, you have to look at all the different forms of media. You can't take some irrespective of the others because you'll drive you'll create incentives for one form rather than the other. If you just as we have with the current system. You know, it creates the incentives which mean that one of the ways in which newspapers can have a competitive advantage over broadcast media is by exploiting the fact that they are not subject to the same set of rules and regulations. So that's part of the competitive marketplace. So I think you do have to look at everything. The reason I used the example of BBC Online and Times Online is that they're there on your iPad beside each other, and I think one of the things we need to be clear about is: do the readers understand that they are subject to very different sets of regulation? And then comes the question of: if they understand it, are the regulations that were written some time ago really appropriate for the degree of technology and the way people are accessing their news now? I think one of the worries I have about moving towards very specific legislation is it will be probably specific to the technology we have now and I suspect that in five years' time the technology will be very different. So you have a very difficult task writing legislation for this, which is why I'm all for thinking about ways which are do not go down that route, which are principles-based and build around independence but also have a compulsory element to them. It's not easy to square all of those things, which is why we have such an eminent Inquiry. LORD JUSTICE LEVESON Don't start. MR JAY At paragraph 17, Lord O'Donnell, you refer to senior politicians developing personal and direct relationships with the media in opposition and those carrying through go on government and you presumably have direct experience, evidence, you could provide as to that?
A. Well, it's just that I think everybody knows this. When you're in opposition, an opposition politics, the key thing you have to do is get yourself into government, therefore you have a strong relationship with the media. You have much fewer resources. So you don't have big press offices and the like, so you do tend to develop much closer personal relationships with journalists. There tends to have been swapping of mobile phone numbers, all of those sorts of things. So one of the things I think that is right about, if you like, the theatre of coming into government, when that Prime Minister is clapped into Number 10 Downing Street, is to emphasise the difference between being in opposition and being in government. It's really important that when you come into government, we say, "Look, you are now " every single Secretary of State, subject to collective responsibility, is much more important in government than I would say in opposition. You have to be much more careful about what you say and when you say it, hence the whole panoply of saying, "Here are codes of conduct, here's the way in which press offices should operate." You should basically do your operations through your press spokesman and your press advisers, and basically change a lot of things. That's not to say that I don't think there could be something for opposition, and I think it would be worth exploring with the leader of the opposition whether he would think that there could be some way in which you could have a set of rules which they would be comfortable with in opposition, which would work for oppositions and which would allow that transition to be smoother.
Q. You also say in paragraph 17 that you try to discourage this sort of relationship in government, suggesting you might not always have succeeded. Is that right?
A. Well, I think the Prime Minister himself, current Prime Minister, has said that he felt his relationships had got too close, and I agree with him. LORD JUSTICE LEVESON It's not just the leader of the opposition, though, is it? Because then that will filter down to minority parties generally. Or would it? Or does it matter?
A. I think it's most important for the leader of the opposition but if you get into a situation where you know, we currently have a Coalition. I think you would want to put it to the leaders of all the parties: here's a set of rules that we think opposition parties should abide by and I think in terms of working with the leader of the opposition, in terms of some of the transparency rules which have been adopted by the opposition, I think there's an opportunity, a window of opportunity to get the opposition parties together and say to them: can there be a set of guidelines, code of conduct, something, which would cover these relationships which all could sign up to? MR JAY In paragraph 18, top of the 05343: "Undesirable behaviours are encouraged. For example, a special advisor feeding a story exclusively to a particular newspaper, knowing that it will appeal especially." Presumably you have personal knowledge of that, do you, Lord O'Donnell?
A. Well, it's something that you can observe, that there are closenesses between special advisers I mean, a lot of them have media/PR backgrounds. You can see particular stories appearing in a paper which have a particular slant to them I'm using my experience and judgment rather than actual evidence here which suggests to me that this has been a special adviser actually putting forward LORD JUSTICE LEVESON I'm not sure that's quite right. I think you're using actual evidence that is in your brain based upon your experience but you're being cautious about revealing that, but rather telling us the consequence of your consideration over many years.
A. Yes. LORD JUSTICE LEVESON Would that be fair?
A. That would be fair. MR JAY On a number of general points, do you have personal knowledge of government policy being modified, or, please, affected by fear of personal attack if a newspaper line is not pursued?
A. What, particular politicians saying that we shouldn't do this? I think there have always been examples of when it comes to actually assessing the merits of a policy, ministers will think about how well, how well will this go down? Will we get general support for it? What will be the media reaction to it? I mean, that's generally part of one of the factors that ministers will take into account. When it comes to the area of is there a set of policies where ministers are very nervous because they think the newspapers might personally attack them, I suspect it gets into the area that this Inquiry is talking about. I mean, when you have discussions about, let's say, policy issues like regulation of newspapers or, dare I say it, imposition of VAT on newspapers and magazines, then I think you'll get into the situation where they'd say well, they come back to me with the Sir Humphrey line, that it would be a very brave politician that would go down that route.
Q. Can I pick up that last point? You mentioned in your statement, in the context of current press regulation you describe it as a discredited form of self-regulation. In part, is that, in your view, because of a failure properly to address the manifestation of problems thrown up by the culture, practices and ethics of the press, or at the very least a section of the press?
A. Well, I think the recent experiences over phone hacking, the Milly Dowler and all the rest of it have clearly dented the public's trust. The fact that there was a PCC report on this which didn't come on up with anything, the fact that the PCC has disbanded itself I mean, I think all of these things have, I suspect, meant that people that think about these things have generally taken the view that the PCC is not didn't solve the problems, didn't foresee them, and indeed, I think in your evidence you heard somewhere the PCC didn't regard itself as a regulator. So in a sense, there was no regulator.
Q. Okay. May we move on now to the Ministerial Code, which you pick up at paragraph 20. You explain it was introduced in 1997 by Mr Blair. Its status as a matter of law is that it's an executive instrument; is that right?
A. Correct. I should stress I mean, one of the key moments was when Prime Minister John Major decided to publish questions of procedure for ministers. This was the first time there had been anything out there, and the Ministerial Code sort of grew out of questions of procedure for ministers, and now I think so this is a very important document and I know that ministers take it very seriously and obviously you will read always in the media about questions of: did minister A or B violate the Ministerial Code? So it is taken very seriously.
Q. This probably should be seen as a series of high-level principles rather than strict rules?
A. Absolutely. It is principles-based and that's what we try and do, because, like I say, given the changing nature of the circumstances, I think you have to go down a principles-based route.
Q. In paragraph 21, you explain that the aspects which you believe to be relevant to the conduct of relationships between the media and ministers are, first, accountability, collective responsibility, openness and the need to avoid any conflicts of interest. Well, you've touched on those concepts already. Do you feel you need to expand on any of them to the extent to which they're not largely self-evident?
A. No, I think all of them are very important. It's interesting, if you look back on these things things like conflicts of interest if you look back in history, there are amazing conflicts that were allowed to take place, but now we have a proper system of rules and I think it's important to emphasise how important this is. When a new minister comes in and sits down with their permanent secretary and goes through all of their financial dealings, their financial holdings, this is a very important part of not just getting the conflicts on the record but establishing the culture and framework within which ministers operate.
Q. We'll look at the July 2011 amendment in a moment but in the version of the code which we have in this bundle under tab 7 it's described as the May 2010 version, which does not contain the amendment which you advised on in July of last year.
A. That's right.
Q. Of course, we've all pre-read it, but the relevant sections in particular are section 7, which deals with ministers' private interests, on page 14 of the internal numbering.
A. Yeah.
Q. It's interesting that the drafters of the code, at 7.2, refer not merely to a conflict of interest but also to the perception of a conflict.
A. That's correct.
Q. And the issue of perception is taken up again in clause 7.7. There are various rules or principles which go outwith our Inquiry. Section 8 though is perhaps even more relevant to this Inquiry. 8.2 this is page 18: "In order to ensure the effective coordination of cabinet business, the policy, content and timing of all major announcements, speeches, press releases and new policy initiatives should, where possible, be cleared in draft with the Number 10 press and private officers 24 hours in advance." .14. Can I ask you to comment on that one, please: "Ministers may meet people in organisations and consider a wide range of views as part of the formulation of government policy. Departments will publish at least quarterly details of ministers' external meetings." So this covers, of course, a whole range of lobbying activity, self-evidently, which would be relevant to the formulation of government policy, but as your statement says, meetings with journalists would not have been thought to have been accommodated within this clause; is that correct?
A. That is correct. So that's why, in my advice to the Prime Minister in the letter which you have, I suggested some amendments to the code to add it will be in the new version, paragraph 8.15 all of their meetings well, meetings with specified editors, proprietors, all of that, and in that note, I've suggested precisely what the forms of transparency should be. That's correct. Just going back to what we said earlier, I think that the whole principle behind this was the point about perceptions is basically a message of: err on the side of caution in all of this.
Q. It might be said that a meeting with a journalist could be relevant to the formulation of government policy, or at least at the level of perception, but you might say: well, one would need hard evidence for that, and so interactions with journalists, as a matter of definition, are likely to be outside 8.14, if I have understood it?
A. That's right. If you look at my letter, this goes on it talks about the transparency with meetings with proprietors and editors. It doesn't go as far as to say meetings with individual journalists, because, in a sense, there will be conversations and meetings with individual journalists which are the basic lifeblood of politicians and the media interacting. If you see in the House of Commons, there are many media representatives there and ministers, they interact, they talk, they phone each other. So in a sense, I'm putting the bar at the editor and news proprietors above. You could say: everything has to be recorded. However, I think that would be disproportionate and I don't think it would work. LORD JUSTICE LEVESON There's another problem, too, isn't there, because there is also the prospect that actually politicians might be quite friendly with some journalists, or indeed, to take it away from journalism entirely, that you have a lifelong friend who's worked in a particular business or industry which then comes in for ministerial consideration and that has to be handled.
A. Indeed, and I think you can have a situation where and what I've suggested is where you have a situation where you have a lifelong friend who happens to work in industry X, what you should do is disclose that to your permanent secretary and you say you meet this person socially all the time. If it were to happen that a policy issue arose where industry X was absolutely crucial and it would have a big impact on that, then stronger degrees of transparency might be required and you might need to remind the minister that actually this person that they socialise with all the time, they have to be particular careful or they might want to amend their behaviour in some way during a particular period when that was a big issue. LORD JUSTICE LEVESON That may arise in connection with some aspects of recent events but has that always been the case? I mean, are we only thinking about this in the last few years or has this been something that has been knocking around in your mind for a long time?
A. A very, very long time. The truth is, all politicians come into politics having developed a social circle already. They have friends. It's a rather food thing, in my view, that politicians have got quite normal relationships and they have friends from different backgrounds, different maybe in industry, they may be trade unionists, they may be teachers, nurses. That's a good thing. LORD JUSTICE LEVESON I entirely agree, and nothing I have said should be taken as suggesting that in some way we have to change that, because it's difficult enough persuading able people to enter public life anyway. To put further restrictions on them would make it even more difficult, so I understand entirely that point. The question is defining the line.
A. Right, and I've taken the view that we should define the line at fairly senior proprietors and senior editors. I think they are different because of the ability of newspapers to very strongly support particular political parties. So I think there is something to be said for those things being noted in a transparent way, but they shouldn't be stopped. LORD JUSTICE LEVESON But you still then have to cope with the fact that a minister might have a very good friend who is in fact an editor that they've known for years and years and years.
A. Yes. LORD JUSTICE LEVESON It's quite difficult then to calibrate how you organise that, isn't it?
A. Well, I'd say if that's the case and the minister is a very good friend of a particular editor, I would fall back on transparency and say, "Look, in this case because that person has that particular job and because you have this particular job, I'm afraid you'll have to be more transparent than you would about other friends about when you meet", and you would remind them that because the nature of their specific jobs, they need to be quite careful what they talk about and what they don't. MR JAY The advice you gave, Lord O'Donnell, in July of last year is under your tab 2 and starts at our page 05294.
A. Mm-hm. Yeah.
Q. It was advice to the Prime Minister
A. Indeed.
Q. within a few days of the 13 July. LORD JUSTICE LEVESON Indeed, It was within two days of it. It was on 15 July. You set out your thinking there. In paragraph 4, page 05295, you're looking only at proprietors and senior editors and senior executives. You're not looking at all journalists. You explain that that would be disproportionate and we've heard your evidence on that. In paragraph 7, you're into the more difficult area. You call it the rather more complicated area of social and political meetings. The most difficult area is likely to be social meetings, particularly where there are long-standing personal friends involved.
A. Mm-hm.
Q. Is one aspect to it this and one perhaps might see the same phenomenon with the Freedom of Information Act that if you make if you overregulate and you drive people into clandestine interaction, so things are not recorded, you're in danger of creating an even greater vice. Is that part of your thinking or not?
A. Absolutely. I think if it is just social and that's all there is to it, well, then transparency, I think, is the answer. If you get down to the stage of saying: actually, this is something where we're going to monitor incredibly closely who said what had and we want a record of your social interactions, I think that gets into the ridiculous area, and obviously then you would get into the world of you just shunt things into the unregulated part. So if there's someone just imagine someone being at a social occasion kind of taking a note of who said what to whom, then nothing will you know, then you would push things into phone calls if they did want to say something they shouldn't. You can't regulate everything, you can't regulate past they may say something out of the hearing of somebody else. So I think we have to be proportionate about this.
Q. The public would perhaps be most interested in these social interactions because they will say: well, therein might lie the evidence which would demonstrate the inappropriate interaction. Would you agree with that?
A. And that's where I think it does make sense, with people like proprietors and chairs, that we are open and transparent about this. There's nothing to hide, you know. This is a person who I've been a friend with for a long time and I'm meeting them and I'm quite happy for the world to know about that. That's why I think transparency is the right solution.
Q. The amendment you recommended, which was going to be a new clause 8.15, which I believe has been accommodated into the latest version of the code, is at the bottom of 05296. Do you see that?
A. That's right, yeah.
Q. "The government will be open about its links with the media, all meetings with newspaper and other media proprietors, senior editors and senior executives will be published quarterly, regardless of the purpose of the meeting." In using the term "meeting", which perhaps suggests a degree of semi-formality, are you intending to include there a social interaction or not?
A. Yes. I think when there's lunches or get-togethers of that form, then I think the idea is they would be included, yes. Again, I think just that it goes back to the Ministerial Code, the question of not just reality but perceptions, and I think by publishing them all, we can be clear that hopefully we'll influence perceptions and show that ministers feel they have nothing to hide in these interactions. LORD JUSTICE LEVESON But don't you then have to go a bit further I'm only asking you at least to identify the headline. So if it's social, then you identify that, or if there is something specific discussed I've seen some of the record, "general business" or words of very, very great generality, which actually convey very little.
A. Mm-hm. LORD JUSTICE LEVESON I entirely endorse the view you can't start having detailed records that would go far too far but I would be grateful for your view on some clarity, because the risk otherwise is that you have legitimately half a dozen such meetings and they all say "general business", and then everybody says, "Hang on a minute. I wonder what's going on here." That's the problem.
A. The problem you'd have, in practical terms, of implementing that let's say somebody has a friend and they have a social relationship where they both happen to support the same football team and they both go to that team's home games together. Are you going to have someone sitting in a seat beside them LORD JUSTICE LEVESON Absolutely not. To some extent, we have to trust everybody.
A. Indeed. LORD JUSTICE LEVESON And all these rules are for the guidance of the wise and the obedience of the others, I suppose, as lots of rules in life are.
A. I absolutely agree with you, and so therefore I think the just transparency, saying, "You went to these social occasions why?", "To watch the football", would be a sensible way around it. LORD JUSTICE LEVESON No, it's actually not so much the social occasions because if you say I won't name a football club because that will always get me into trouble "attending XFC", then I think it's pretty obvious. But if you're having what might be described as a rather more formal meeting for a catch-up, where you might very well be discussing issues that ministers are entirely right to discuss with editors or proprietors, whether there has to be a little bit more detail associated with that not minutes, but just a little detail. I'm asking you, not telling you, not suggesting this is a conclusion. I'm trying to use your experience.
A. I'd probably be slightly stronger than you, in the sense of LORD JUSTICE LEVESON I might be very strong. I'm just (overspeaking).
A. Imagine there's a lunch and the lunch is to discuss a lot of political issues, trying to persuade a proprietor that you have a set of policies which deserve their political support. I'd expect in these circumstances a Prime Minister to take along his Chief of Staff, let's say, political appointee, and that there might then be a record made of that that was the nature of the conversation. If it was a conversation which was going to stray into a lot of detail about public policy, then you would expect there to be a private secretary and for the private secretary to keep a brief note, and then, in terms of what you put out there transparently, to try and without going into enormous detail just say there are certain things. Now, of course, as soon as you get into the world of a brief note, then you get the question: well, is such a brief note FOI-able or not? LORD JUSTICE LEVESON I understand the question, and you get into another problem as well, don't you, because then won't editors want fair treatment? And they will look at the notes they'll look at the disclosures of the last two months and say, "Hang on a minute, you saw the editor of the Sun six times in the last six and you've only seen me once or not at all. I want fair treatment." I'd be very interested to know how you would approach that sort of issue.
A. I suspect that it's no secret that certain editors get in to see prime ministers more often than others. That I think transparency in that area might be quite healthy, might create just those sorts of issues and it will generate some interesting questions, and I suspect prime ministers will be quite happy to defend why they spoke to some editors and not other editors. MR JAY Moving on to special advisers now, Lord O'Donnell, paragraph 22 of your statement, 05344. They're on the interface between government and politics.
A. Uh-huh.
Q. You say they provide political input to government business which would not be appropriate for the permanent civil servants, and of course they're coming up through the party system and they build up relationships with ministers often in opposition and then are carried forward as special advisers in government. That's the way it works, of course. You've identified in paragraph 22 a change to the code. We needn't turn it up, but paragraph 3.3 of the Ministerial Code May 2010 edition does make it clear they uphold their responsibility to the government as a whole, not just their appointing minister.
A. Indeed.
Q. How does that work in the context (i) a of the close relationship they might have with their minister, and secondly in the context of a coalition government?
A. Well, in a sense, it's particularly coalition that led us to include that sentence, because what you wanted was clearly, the special advisers are politically partial, that's precisely why they're put there, and they will be politically partial to different parties within a coalition government, and what you wanted was to be clear that when they were operating, they were operating interests of the coalition government, not of their political party. I suspect that this is important and it will become very strained as we move towards the end of this Parliament, when you might expect with a coalition that the political parties will start to think about differentiating their product ahead of a future General Election. But I think it's really important that it's there and that it's obeyed by special advisers.
Q. There's also a code of conduct specifically for special advisers, which is under tab 26 in the bundle you have.
A. Mm-hm.
Q. We have here the April 2009 amendment. Are you able to assist with the provenance of this document? Does it have the same status as the code as some sort of executive instrument? Perhaps slightly lesser normative force, really. It's not a code well, it is
A. It's a code. No, it's a code. It's the same as in a sense there's a Ministerial Code, there's a code of conduct for civil servants and a code of conduct for special advisers. So I regard them all as being the documents which all of those different groups should regard as the key document for them to decide precisely what they should do. It's their key guidance document.
Q. So this would be drafted by civil servants and improved by ministers?
A. By the Prime Minister. That's right.
Q. But not before Parliament?
A. No, it's an executive document. Although Parliament has access to it and could the public administration Select Committee might well want to comment on it.
Q. Paragraph 3 of the code of conduct identifies the sort of work a special adviser might do for his or her minister. Paragraph 4: "Temporary civil servants appointed under article 3 of the Civil Service Order in the Council." Although towards the end of paragraph 4, we see: "The responsibility for the management and conduct of special advisers, including discipline, rests with the minister who made the appointment." Which, of course, would be different with a civil servant for obvious reasons.
A. Absolutely, yes, and legally different post the passing of CRAG^name the Act.
Q. Contacts with the media, which is paragraph 10 and following: "Special advisers are able to represent ministers' views to the media with a degree of political commitment." 1: "All contacts with the news media should be authorised by the appointing minister and be conducted in accordance with the guidance on government communications." Is one looking for express authorisation in every instance of contact?
A. No.
Q. That wouldn't be feasible?
A. That would not be feasible, no, nor practical. It's just a general feeling that a minister would say, "I would like you to take charge of briefing on this specific area in conjunction with the press office."
Q. Section 12: "Special advisers must not take public part in political controversy So those are the general principles, and you pick them up in paragraph 23 of your statement.
A. Mm-hm.
Q. In particular, the fact the special advisers should only brief the media with appointed ministers' express authorisation. You say: "Where special advisers have had to resign in recent years, it's usually been because they became a bigger story than the minister they were appointed to serve." That's your own take on past events?
A. Well, you might want to discuss that with the witness you have this afternoon.
Q. Okay. That's fair enough. LORD JUSTICE LEVESON Do you intend to cover the time when we moved from civil servants acting as press officers to directors of communication? MR JAY Maybe we should. LORD JUSTICE LEVESON At some stage. It might be time to give a break to the shorthand writer, so we'll just take eight minutes. Thank you. (11.17 am) (A short break) (11.27 am) MR JAY At paragraph 25 of your statement, Lord O'Donnell, you deal with the appointment of Alastair Campbell as Director of Communications in 1997. An order in council granted him the power to instruct civil servants. You thought that the power was an inappropriate one for a special adviser to have. Did you give any advice at the time about this or not?
A. No, I was at that point in the Treasury, I think.
Q. Why did you, however, reach that conclusion?
A. I think it just blurred those lines between what special advisers does and what civil servants do, and I think, with hindsight, it didn't work as well as it should have done because I think it created the idea that the civil servants were obeying some rules by someone who was politically appointed, which meant that they also would be politically biased, and so it I don't think it was a good idea. I was very pleased when it was abandoned, and I did advise that it should be abandoned, and that's very good. I don't think it's an experiment we will try again, I hope.
Q. Do you have any personal knowledge, though, of instructions which were given to civil servants of a political nature pursuant to the powers that were had?
A. No. LORD JUSTICE LEVESON But a director
A. I think it was more a perception issue than anything else. LORD JUSTICE LEVESON A Director of Communications is still a post in being, isn't it?
A. Absolutely, but it's a Civil Service post. Well, sorry there are different posts. Let me clarify. There's someone overall who will look after all of the press officers and run both the Civil Service, generally someone based in the Cabinet Office, and there's a Prime Minister's official spokesman, currently Steve Field, who works in Number 10, a civil servant, and then there is a Prime Minister's special adviser on media matters, which is what Mr Coulson was, Mr Oliver is now. So there are those three posts. The point about the third one, the special adviser, is that they have no powers of ordering civil servants. The other two are civil servants. LORD JUSTICE LEVESON But who is the one I know the answer to the question, but who is the one that now does what you did when you were the Prime Minister's press secretary?
A. Steve Field. What I think it's fair to say what we've seen in the period since I was doing it in 1992 has been the growth of the importance of that special adviser in number 10. In the past, that wasn't such a big person. LORD JUSTICE LEVESON But obviously one only had to live through the years and see the significant role that Mr Campbell occupied and held. Has that role diminished post Mr Coulson, and if so, do you think that's a good idea? If not, do you think that's not a good idea?
A. No, I think what's tended to happen is in my day I would do overall all the government material as press secretary. If they wanted to do a lot more of the party style, they tended to use the party machines, the central office or Smith Square, and what happened over time is I think they've decided that they'd much rather have that in Number 10, and have that element of a special adviser role in Number 10 doing part of that job. Obviously they can't do the same as the people in the party political offices, and the special advisers' code explains that there is quite a strong distinction between those two, but they wanted to have that more political element inside Number 10. LORD JUSTICE LEVESON But does that create a risk?
A. I think it it certainly creates a risk, but it also solves a risk. The risk it solves is that if there isn't anyone there that kind of handles the issues of the day with a party political slant, that actually the civil servant gets dragged into it, and I think there have been occasions where there have been people have argued that's happened. So I think it's quite a good idea. You get rid of that risk by having someone in Number 10. Also, they don't become and I think it's particularly important now that that person's in Number 10 with a coalition, where they have someone alongside them from the Lib Dems so that they can manage this process, whereas if you'd outsourced it totally to the political parties, you would find that they would split very much more pushing their particular party rather than the Coalition government. LORD JUSTICE LEVESON And the risks?
A. The risks are that this person doesn't entirely accord with the special advisers' code and goes overboard into being a true party political, starts attacking the opposition and all the rest of it. LORD JUSTICE LEVESON Because actually doing it from Number 10 carries with it an authority.
A. Indeed it does, and in a sense it's quite important that that authority is there with the media, because the reason you want the Prime Minister's official spokesman and that special adviser role to carry the authority of the Prime Minister is that it's clear that, as it were, it trumps individual officers so that it's very clear that's the government view and that you co-ordinate it across government to come to that view. Sometimes when you're talking about this being out there with the political parties, they would tend to kind of have one faction or another, and it's not as obviously co-ordinated across the whole. LORD JUSTICE LEVESON I see. MR JAY May I move you through your statement, still on the theme of special advisers, to page 05352 under the rubric "General questions about special adviser conduct".
A. Uh-huh.
Q. At question 14, you make the point: a shift towards special advisers with the media or PR background, rather than a strong policy background, which is to be regretted in my opinion." It's probable self-evident, but what is the basis for your regret?
A. Well, when I look back on my times of those special advisers I think who had most impact, they were ones who they might have understood about handling the media but they also had a very strong understanding of the subject matter, and I think if you go across the board through all the political parties, I think some of the most successful special advisers were really on top of their subject matter. I look back on economists we had in Treasury who were special advisers who really understood the economics, and there were examples both during the Conservative period Bill Robinson would be, I imagine, a good example and in the Labour period, someone like Ed Balls, a trained economist as a special adviser. So I think it helps if your special adviser really understands the subject.
Q. In question 15, you explain: "Recent events have demonstrated the need to keep special advisers out of areas where ministers are operating in a quasi-judicial capacity." We may come to that in a moment. It's the last sentence, I think, in particular: "I think we do need to find better ways of policing the compliance of special advisers with their code, perhaps by making it clearer that the Prime Minister's Chief of Staff has a very important role to play in this area." Could you expand on that, please?
A. Certainly, and this is a recent thing. The amendment we made to the special advisers' code about them operating for the government as a whole I think is important. If you're a special adviser, it's actually quite a lonely job. You're working within a department for the particular minister that appointed you. To understand the nuances of where department A and department B have very different views and how that's been reconciled, and in order for you to explain the new reconciled policy and not get stuck in trying to explain actually what department A thinks rather than department B is quite a subtle role, and quite important that they get help and assistance in that process, and I think the Chief of Staff has a role to play and indeed does play this role, I think, in making sure and I think your witness this afternoon, Alastair Campbell, would get together special advisers to actually explain the overall government position. I think the point to stress about special advisers rather than civil servants is the absence of a standard management structure. They don't have a manager, as such. They don't have a set of objectives, annual appraisals, all those sorts of things. I've tried to push that, and I think current government is going to move some way in these directions, but I think we expect a lot of special advisers working within a specific department for a specific minister to actually understand and operate to working for the best interests for the whole of government.
Q. You were involved in the one aspect of the problems which arose in connection with ministers occupying a quasi-judicial role. Tab 31, Lord O'Donnell. After Dr Cable's
A. Yes.
Q. 21 December 2010. The shadow business secretary wrote to you, and the Financial Times have set out here the text of his letter, pointing out that Mr Hunt might not be able to bring an open mind to the issue either. You replied under tab 32.
A. Mm-hm.
Q. This is on the very day, 22 December. Particularly the last paragraph: "In advance of taking the decision to move ministerial responsibility yesterday, the Prime Minister specifically asked me whether there was any legal impediment to moving it to Mr Hunt. I took advice from lawyers and provided advice that there was no such impediment. I was, of course, aware of the former statements from Mr Hunt." Which you cite. "I am satisfied that those statements do not amount to a pre-judgment of the case in question. Indeed, the third quotation specifically states that Mr Hunt would not want to second guess what regulators might decide." So you acted on legal advice and the problem may lie more in giving these decisions to ministers in the first place, rather than the particular decision you made on this occasion.
A. (Nods head)
Q. Do you have a view about that?
A. Well, at the moment we have a system which gives these sorts of decision to ministers. So the issue for me was: which Secretary of State should get it? And the issue was clearly about media, so, surprise, surprise, you think first of all of the Secretary of State for Culture, Media and Sport. It's perfectly within their provenance, and so that seemed to me the right place to transfer the work. There were a number of ministers who'd made a number of comments. I think the legal question as it was put to me was: do those ministers' comments amount to a pre-judgment of the issue? And that's where the lawyers were clear that it didn't and therefore, that it seemed to me it was entirely appropriate to do it. There's obviously an entirely separate question thereafter about how it was done, but from the point of view of appointing a minister, that seemed to me I was told that this clearly did not amount to him having a close-minded view. LORD JUSTICE LEVESON Two points come out of that. First of all, it was quite clear that before the decision was made that Mr Hunt should do the job, his observation on the website, which has been reported much in the press of late that, like all good Conservatives, Hunt is a cheerleader for Rupert Murdoch's contribution to the health of British television was well-known and well reported?
A. Absolutely. LORD JUSTICE LEVESON The second point. Somebody has said I can't remember who, but somebody has said that actually all leading politicians, of whatever political persuasion, will have strong views one way or the other about Mr Murdoch and the risk then comes the question then arises how you get these decisions made, which actually leads into what Mr Jay was then asking you. Obviously you're getting the advice and you won't be surprised that I am perfectly content that you take legal advice and then act on it, but there are all sorts of ramifications which are outside the pure law here.
A. Indeed there are, and you could I mean, we could have the discussion but it might take us beyond the remit of your Inquiry as to whether it's appropriate that these sorts of decisions are dealt with in this way. But that's the way we do deal with them and if you want to take the view that I'm even being cautious about using the phrase "quasi-judicial" because I know there are some lawyers who argue about the use of that phrase, and some would argue that politicians are precisely because they have views, are the right people to take these sorts of decisions. But there is a debate to be had as to whether you would want to the say: "Actually, in these sorts of areas, we might want to do it in an entirely give it to a judge, for example." LORD JUSTICE LEVESON Oh, enough. The judges have more than enough to do. But I'm not sure that it seriously does take it outside the terms of reference in which I apprehend you had more than a little hand, because the terms of reference do require I'll just try and get hold of them
A. That's outside my memory's quite good on you're absolutely right. If you were to say, one of the lessons from these experiences is that actually you think we should amend this system and that it shouldn't be done in this way in the future, then I think that will be a very important finding one way of the other. LORD JUSTICE LEVESON Yes, it would be a very important finding but the question is whether I should go there. You have an experience of this sort of issue
A. Yes. LORD JUSTICE LEVESON that goes back many years.
A. Indeed. LORD JUSTICE LEVESON And people are entitled to say that judges have certain experiences but not those and therefore who I am I to say. That's why I need your help.
A. To be honest, I've thought about this a lot and in the end, I come down to the view that actually probably elected politicians are in quite a good place to take these decisions, as long as they're very, very clear about the basis on which they're doing it and the way they have to do it, and they have their lawyers alongside them throughout the whole process and they're very careful about it. I think on balance, I would stick with these being done by secretaries of state. LORD JUSTICE LEVESON The real question is: does the relevant Secretary of State have such a mindset, which is perfectly understandable he's entitled to his views like everybody else that he can't approach the question objectively and make a decision which is balanced, with all the factors in mind, rather than one that is I don't say prejudiced but pre-judged, because of the underlying background. It may be and I'm not doing a legal analysis that that's what is meant by "quasi-judicial".
A. It could be, but remember that if I mean, any decision made will be subject to a JR, and during the JR process I suspect that people that wanted to question the decision would be making precisely that argument, so it would be important, I think, when deciding that an individual Secretary of State was the right person to do it, that you'd take a view about whether such a JR would be successful or not. LORD JUSTICE LEVESON Yes, but one has to be rather careful here, because if you judge in terms of whether a judicial review will be successful, the risk is that you start to focus on the process rather than actually what's going on underneath the process, because it is frequently said that judges are very good at making their decisions proof of and ministers proof from judicial review. That's not necessarily an absolute guarantee that they haven't approached it slightly differently.
A. Absolutely, and all I think we can do from the Civil Service side is to actually ruthlessly emphasise the process, the importance of taking legal advice, the considerations that should be applied and shouldn't be applied, the need in the whole process to show absence of bias, and I think that's the crucial part. LORD JUSTICE LEVESON Or perception of bias.
A. Or perception of bias, indeed. LORD JUSTICE LEVESON Which is always more difficult.
A. Indeed. And there are legal rulings which make it clear that you have to manage this process and get the exact you know, that a respected outsider, as it were, would be happy with the decisions that were made. LORD JUSTICE LEVESON The corollary, is: well, if it's not going to be a minister, who is it going to be? It's always easy to pull out the file marked "judge", but judges aren't necessarily in the best position to make policy decisions.
A. No. LORD JUSTICE LEVESON Based upon a framework which they have to react around that decision, or you have to have some select group, which itself creates its own problems.
A. I totally agree with that. I would say this is an example of a policy decision, and if you think about it, ministers are making these sorts of policy decisions all the time and they're weighing up what in their view is in the public interest. What gives them the right to do that, I think, is the fact they've been elected to do precisely that. That's why, in the end, I come down to the view that it should be ministers that do these things, but subject to when we're in this sort of area, subject to very careful rules about process. I've observed other circumstances where we've kind of outsourced the view about assessing the public interest to others, and they're not always, to my mind, satisfactory. LORD JUSTICE LEVESON The Competition Commission?
A. What I had in mind was the panels of freedom of information tribunals, to be honest, trying to assess public interest versus safe space arguments for government. I think it's really hard for those panels to actually have the experience to understand the safe space part of it. MR JAY Lord O'Donnell, you also were involved in the aftermath of the Mr Coulson issue. Under tab 30, you'll see a letter you wrote on 22 July 2011 to the Shadow Secretary of State, Mr Lewis.
A. Mm-hm.
Q. You say this: "Neither the Deputy Prime Minister nor the royal household raised any concerns with me or officials either before or during Mr Coulson's period of employment as a special adviser. I have to admit to being somewhat surprised to be asked about Buckingham Palace when they have already clearly said on no occasion did any officials from Buckingham Palace raise concerns to Downing Street and indeed it is outrageous to suggest this. Neither were any concerns raised with my by the Prime Minister or any other special advisers about Mr Coulson's conduct in previous employment." On the issue of vetting it's on the next page, Lord O'Donnell you point out, if I can paraphrase it: he was cleared to SC level, which allowed him access to secret papers. This is one level below DC, higher than CT. Then you say: "DV is required only for individuals who require frequent access to the highest classification material. Only very small number of individuals are DV cleared, even within Number 10 and the Cabinet Office." Can I ask you a couple of questions about this. Were previous holders of Mr Coulson's post DV'd or not, to your knowledge?
A. It's a question of what you define as the post, but I think in general terms they well, I'm just trying to think who would have been the equivalent before. I guess Alastair Campbell probably would have gone through DV'ing. Quite often you get a situation where they might start off not being DV'd and then you will consider whether they're going to operate the job in a way in which it means that they do get involved in some of these issues, where they would need you can have access to top secret under SC clearance, which Mr Coulson had, but it's frequent access that would be the issue, and it just depends on how those individuals operate in their job. Sorry, I can't remember offhand precisely all of the past holders of that post, whether they had it or not, but I'm sure we can provide that information. LORD JUSTICE LEVESON Would that be done on a circumstances basis or
A. Yeah, in general it's LORD JUSTICE LEVESON routinely?
A. Some people operate in that job would say, "Look, what I really want to do is get involved in the economy" a whole set of issues which basically didn't go into the kinds of things that we would where regular top secret access was required, and they just wouldn't want to go there. It quite often turned out that they would start off with that view or, in this case, the Number 10 permanent secretary would have that view and then, as events changed, they would realise the first big terrorist event came along and then there would be a lot of papers which, by their nature, were all top secret, and then you would say, "Actually, this isn't working, we need to give access to this", or: "It would have been better if that person had access to these papers routinely, therefore we've decided And this is what happened with Mr Coulson: we decided in the light of the terrorist incident, the airline bomb plot, that actually it made for sense for him to be DV'd so we could give him regular access to these papers. Up to then, it hadn't been an issue because I don't think he'd been that interested in those aspects of work which would have required them to have top secret access. LORD JUSTICE LEVESON So a lot depends, do I gather from what you say, on what's happening at the time? So certainly under Mr Campbell's period in office, in the role that he occupied
A. Yes. LORD JUSTICE LEVESON there were matters which were likely to involve considerable access to top secret
A. Yes. When you're at war, clearly LORD JUSTICE LEVESON That's what I had in mind.
A. Absolutely. LORD JUSTICE LEVESON But in the light of the public interest in just this issue, and the inferences that have been argued, it might be worthwhile identifying if and when each of the comparative equivalent holders of that particular post received the higher level of vetting.
A. Yes. LORD JUSTICE LEVESON Only to demonstrate that there isn't a smoking gun here. If there is, then there is. I'll be happy to allow the Inquiry's offices to be used to demonstrate that there isn't, so at least that particular argument can be dealt with.
A. I'm very happy to give information on precisely when previous occupants of the office were DV'd and we can give you that detail. No problem about that. I think I should stress that the decision is DV'ing takes a while, so on day one, if you bring someone into the office, by their nature you have a problem about having them in the right vetting space straight away. So you do have to restrict them from various things. It was just felt that SC, given Mr Coulson's interests and the fact that he seemed to be very much domestically focused, that it would be we would be able to do that, but actually, when it became apparent during a real terrorist incident that this didn't work, we started the process of DV'ing. I think some people have different understandings of what DV'ing would reveal. It wouldn't have gone into enormous detail about phone hacking, for example. LORD JUSTICE LEVESON No. It's concerned with whether you're likely to be a risk.
A. Whether you're blackmailable, basically, yes, absolutely, and in terms of your financial position or your personal life. LORD JUSTICE LEVESON Yes. Do I gather from the next sentence in your letter that you'd taken the decision that actually the number of staff in Number 10 should be kept as low as possible or has that been a longstanding decision?
A. No, that's in general, you try not to have an explosion of how many people go through DV'ing. Like I say, SC level allows people access up to "secret" and occasional access to "top secret". If you're getting a vast number of people having regular access to "top secret", you do have to worry from a security point of view that there's just too many people seeing top secret documents. LORD JUSTICE LEVESON And the risk of leaks.
A. The risk of leaks, exactly. LORD JUSTICE LEVESON We have that even without secrecy.
A. Precisely. I'm sure you're aware of that. So as the person sort of in overall responsibility for this, I want top secret papers to be kept on a restricted circulation, please, so I want them to be just to the DV'd. When people say to me: "Do you know how many people there are DV'd?" I say, "Well, actually, we should look at that and keep it as tight as we need to." So these should be really on a need-to-know basis. So I think I do have a bias towards trying to keep the numbers low. MR JAY The other aspect of procedures you might be able to assist us about is the ascertainment of any possible conflicts of interest, and whether matters such as shareholdings are routinely asked for in disclosure forms or whatever. We're looking obviously now at May 2010.
A. And the answer is: yes, they are, and there's a form which has to be signed which should disclose shareholdings.
Q. Is this all shareholdings or any shareholdings which might be relevant?
A. Conflicts, basically, is what it asks about. LORD JUSTICE LEVESON Well, again, in the light of what we've heard, was such a sign formed by Mr Coulson?
A. A form signed, but it didn't disclose the shareholding and it should have done. LORD JUSTICE LEVESON He's said that it was an explanation, not an excuse. Well, the second half of your answer answers the next question I would otherwise have asked. MR JAY Last aspect of special advisers: did you give advice at any stage to Mr Brown about the activities of certain of his special advisers? In particular, Mr McBride, but not necessarily limited to him.
A. I did have a conversation with Gordon Brown when he was chancellor. I felt that what Damian McBride was getting into as press secretary was in the areas where it would be more appropriate for Damian McBride to be a special adviser than a civil servant and that status change was made, yes.
Q. So he mutated from being press secretary to special adviser, given the sort of things he was doing, to put it neutrally?
A. I think he was clearly someone who had the capacity to operate in the special adviser mode, and after discussion, we felt it was probably more appropriate that that's where he operated.
Q. Okay. At paragraph 27 and following, you deal with the position of civil servants.
A. Yes.
Q. In particular, the Phillis review. Can you explain to us the background to that review? Of course, it was in 2004.
A. Yes. I remember I was permanent secretary in the Treasury then. The background was very much in relation to your witness this afternoon, Alastair Campbell, and some worries about how the whole government communications machine was operating. There was an independent review led by Mr Phillis which came up with various recommendations, a number of which and principles which have been incorporated into the guidance for press officers.
Q. If you look under tab 24, you'll see the review itself. You're right to say you're not yet cabinet secretary in 2004.
A. No. I didn't really have anything to do with this. I was busy working on the economy then.
Q. Under section 4, page 6 on the internal numbering, we have the context and the evidence: a breakdown in trust, diminishing trust in the media. Then the background to the breakdown is on page 7. Do you see that?
A. Yes.
Q. "We were told that three major factors had contributed to the breakdown of the relationship between government, the media and the public. "1. The communications strategy adopt bit Labour administration on coming into power in 1997. "2. The reaction of the media and the press in particular to that. "3. The response of the Civil Service to the new demands that were placed on it. "Labour's past experience in handling the media, and its belief that government communications staff were not up to the mark saw a rise in the media handling role of politically appointed unelected special advisers. Their more aggressive approach and their increased use of selective briefing of media outlets, in which government information was seen to be used to political advantage, led to a reaction from the media that has produced a far more adversarial relationship with government." Is that close to the mark or not in your view?
A. Like I say, at the time I was operating in the Treasury and very much as permanent secretary there, but I think I have no reason to question what the Phillis review came up with. I think it may overstate the I think that was a trend that was happening anyway, but it was certainly more marked post the change of administration.
Q. It may be appearing to be placing all the blame, if that's the right way of putting it, on one individual, but subject to that qualification, would you agree with the general sentiment?
A. I think the general sentiment, yes, in that there was an issue, I think, with whether government communications, communicators there were certain areas where they were deemed not to be as effective as they might be, for example, in the areas of instant rebuttal. The whole point about 24/7 media was that it was becoming a process whereby you really had to have press officers that were staffed up and capable throughout the 24 hours, and I think prior to that, there had been a kind of feeling that you could manage this with rather less resources. So the resources allocated to media were increased quite substantially.
Q. In one sense, you may be best placed to deal with the third point, which is the response of the Civil Service to the new demands that were placed on it. Can you assist us with that?
A. Yes. From the Civil Service point of view, I think the question was it comes back to what I've said. There had been this massive growth in media outlets and the question was whether the press officers themselves were up to managing a situation where you had 24-hour news, you know, things happen instantly. When there was a terrorist event, you might get people using their mobile phones to put footage out straight away, and were we up to and capable of monitoring the media operation 24/7 and of responding in real time? And I think that was the issue, that we needed to get better at our response times and our ability to co-ordinate positions really quickly.
Q. Mr Phillis's report also deals with the role of special advisers again at page 10. Evidence of tensions between their respective roles. Well, that's something you've spoken to. The next paragraph: "Many of them concentrate their limited time on the political reporters in the lobby and on a handful of specialists. We have been told that this has created an inner circle of reporters who have good access but a disenfranchised majority who do not. This can leave reporters dealing with a sometimes poorly informed and demoralised press operation. The way some have operated has also led to a blurring of information and comment." Again, would you agree with that sentiment or not, from your own experience?
A. Well, I mean there was obviously an issue about journalists that were in the lobby and journalists that weren't. That was one issue. The ones that were in felt that they had better relationships. I think now with lobby notes being placed on the record, you get round that so it's all there for anyone to see. Also, there are various the Press Association, PA, for example, who put material out from the lobby. Where there is an issue, I think, is at times I think the focus has been too much on the national media and it hasn't given enough emphasis on the regional media. They are representative at the lobby but not in great numbers and I think it does tend to create this London-centric atmosphere. LORD JUSTICE LEVESON Interestingly enough, there's a comment in the box there which I'd not previously focused on but comes to mind in the light of one of your previous answers to do with the difference between special advisers and press officers, from Adam Boulton: "The present elision of political and Civil Service information is benefiting no one. In the short term, it gives the government more wiggle room because no one knows where they stand, but in the long run it has damaged the credibility of government statements, including denials of allegations against it." Do you have a comment on that?
A. This goes back to the point I made about I think it's really important that the Prime Minister's official spokesman is a civil servant and that's the clear government line. If there is a desire to get some political spin on that, then you can talk to the special adviser, but everyone knows that what the Prime Minister's official spokesman says is the government's position and there's no wriggle room, there shouldn't be any wiggle room, and I agree with what Adam Boulton's saying there, that actually it's in nobody's interests, this. You really need to know: this is the government's policy and here's what it is, and someone needs to be able to say that definitively and with absolute credibility. That's the importance of the Prime Minister's official spokesman.
Q. There weren't any other points on Mr Phillis. The report otherwise speaks for itself. The police and the media now. Paragraph 39 of your statement. LORD JUSTICE LEVESON Just before we go onto the police, while we're still talking about special advisers, I appreciate I'm dancing back, but I'm just focusing on the evidence you've given on the absence of a structure, a managerial structure of control, and the fact that the special adviser works to his or her minister without that sort of supervision, subject only to the relevant authority from the senior Civil Service, presumably the Permanent Secretary. Has that always worked?
A. No, I think it's it is, like I say, a weakness in the system in that I think various special advisers in Number 10 Alastair Campbell, Ed Llewellyn have tried to bring together the special advisers and create some sort of cohesion, but to my mind the problem is that there isn't a sort of managerial responsibility and the fact is special advisers are employed by the minister, so if there's an issue about a special adviser violating the code, it's not a matter for the Permanent Secretary; that's a matter for the minister. And it's the ministers that have to decide on whether they should stay or not. LORD JUSTICE LEVESON I understand. But I rather gather from something you said that the Permanent Secretary did have a role in relation to what special advisers could or should do.
A. The minister has responsibility for the special adviser. The minister, in saying, "Did my special adviser do the right thing here?" may well consult his permanent secretary, who would say, "Actually, the special advisers' code says the following, and it appears your special adviser either what he did was fine or wasn't fine", and will give advice to the minister. But it's very much the ministers who are responsible for this. Whereas if there was a civil servant who was accused of breaking the code, then it would be for the Permanent Secretary to sort out without reference to ministers. LORD JUSTICE LEVESON You will be aware that considerable attention has been focused recently upon the relationship between a special adviser to the Secretary of State for Culture, Media and Sport and a PR representative of News Corp.
A. Mm-hm. LORD JUSTICE LEVESON Without making any decisions because of course, you are not there to do that any more is there any assistance or light that you can shed on how the relationship should have worked, who should have got authority for what and how that should have happened?
A. Well, the I think it's clear in the special advisers' code that in terms of authorisation, ministers should authorise their special advisers as to what they do, for example, with the media. I would have expected the minister to be clear about what he thought his special adviser should be doing. Particularly, I think, the minister and permanent secretary will make clear what the nature of engagement should be in a if we're going to use the shorthand quasi-judicial procedure, absolutely. LORD JUSTICE LEVESON And would you expect that to be documented?
A. Not necessarily. I mean, these are fairly regular and routine things. They're slightly different in every particular case. If, for example, you're in DCLG and you're dealing with a planning issue, it's different. If you're dealing with a technical, economic or financial issue, again, it's different. So these areas have slightly different aspects to them, but in general, the principles of keeping all parties informed about process is perfectly reasonable, but not getting into substance. I think that's a general accepted principle. LORD JUSTICE LEVESON Do you have any other observations upon the not the detailed fact, which I don't think it would be fair to ask you to comment upon, but upon the principles in relation to this particular case?
A. I think the principles should be very clear, that it should be made absolutely clear to all concerned that the way they should operate is fairly, ie. talking about process is fine but you should make sure that the same information is passed on all parties in a case, so that I mean, this is not least to protect against a future judicial review, so fairness is absolutely crucial to what happened. And well, that should be at the heart of the whole process, that everyone should be clear that that's the way they should operate. MR JAY Police and the media now, paragraphs 39 and 40. You pinpoint, Lord O'Donnell, the need for a culture change for the police. Maybe the starting point is to identify in your terms the existing culture, at least from your own perception, your own evidence.
A. Well, I think you saw Bob Quick's evidence on this. The experience I have is that senior police officers take the view and I'm now talking about the Met that it's really important for them to have close relationships with the media, with journalists, so that on occasion they can talk to them about stories they would like them not to run because it wouldn't be in the public interest, or if they would like them to run because they would be in the public interest, in order to help them, say, catch someone or alert the public to a danger. And this process has led to a very close relationship I think Mr Quick's evidence gives examples of questions about hospitality and the culture I mean, it's so different from a Civil Service culture where we basically say to people: "Look, there's a press office, it's their job to deal with the media." I wouldn't expect senior civil servants to be having close relationships with the media. They might do a particular briefing on a specific subject. I would expect all of our hospitality to be for senior civil servants to be very explicit, very transparent, to be out there. I wouldn't expect there to be a lot of it. So it's a very different culture, I think. For us, you'll find that and you can look at all the records that have been disclosed there's very limited interaction with journalists in general amongst the senior Civil Service and what there is is out there transparently and I think that's the right way to do it and I think you should channel these things through your press offices. It's also apparent, having prepared for this, reading some of the books written by former Met commissioners and Mr Quick's evidence it comes through as a systematic element of people complaining that their senior colleagues were briefing against them in the media. Now, that would never happen I mean, that would be incredibly rare in the Civil Service, simply because those senior civil servants would never dream of it being appropriate, given the code of conduct, for them to be talking to journalists about those sorts of issues. So it does strike me as something quite widespread that really does need a fundamental look, and I would say that adopting the attitude that we do in the Civil Service, of basically saying, "Look, this is an issue you should just leave to your press office most of the time and not get involved in it yourself", would be a very good thing. My own experience was that again, very difficult to come up with hard evidence, but I certainly had my worries, which is why I raised some of them with Sir Paul Stephenson about the cash for honours issue. LORD JUSTICE LEVESON Just pushing that along a little bit further, does that mean that if you're going to involve your press office in more, you have to be a bit careful about the relationships developing between the very senior people in your press office and the press?
A. Absolutely, yes, but at least you they're the ones you should focus on, and it should be that when a line comes to the press office, it's a line that's agreed across the whole of the organisation. That's the virtue of having a press office, as opposed to individuals briefing. If you have a situation where the individuals are briefing against each other, you have the risk of there being different aspects of a story emerging in different ways. LORD JUSTICE LEVESON Oh yes, that's one aspect of it. The aspect I was particularly asking about was whether there was a risk of an unbalanced relationship with one media group as opposed to another in the person of the director of public affairs. There's no need to be coded about it, because one of the issues that I have been required to consider is whether News International became excessively involved, at a very high level, with senior police officers and indeed with the director of public affairs.
A. I think it is absolutely crucial that the person you have when you put this power in the press office then becomes someone who is seen as not being partial. They have to be seen as being able to deal with all the media across the board. It's absolutely right. It may well be that they have some media background but that, I don't think, should if anything, it should be an advantage, but you wouldn't want them to have any conflict of interest across a particular group, you know, one specific news outlet rather than another. LORD JUSTICE LEVESON Yes. MR JAY In relation to Mr Quick's evidence you'll have seen it, of course under paragraph 19 of his statement, which is
A. Which tab?
Q. Tab 19, actually.
A. Paragraph?
Q. Paragraph 19. This is MOD2, 01508.
A. Yes.
Q. There was a meeting which Mr Quick says you had with Sir Paul Stephenson in January 2007. Do you see that?
A. Mm.
Q. You raised a number of concerns regarding unauthorised disclosures. You had specifically expressed concern about Yates' relationship with the media in this regard. Can you remember anything specific that you said on that occasion, Lord O'Donnell?
A. No, it well, I raised this issue of there seemed to be certain information which was of a it related to a police investigation, a police interview, and some politicians. This frequently became public, and the question was: where was this information coming from? It didn't seem to be in the politician' interest for this information to have emerged, so I simply asked Sir Paul Stephenson: would he kindly look into the issue? Because I didn't believe the leaks were happening at my end. I mean, there may have been other leaks happening from my end, but on this specific issue, I wanted his view.
Q. So the concern you expressed about Assistant Commissioner or he was acting Assistant Commissioner then, I think Yates' relationship with the media, was, to put it bluntly, you suspected he might be the cause of the leaks rather than any wider concern about Mr Yates; is that correct?
A. Well, he was doing this investigation, so in a sense I wasn't necessarily saying that it was him. I was just saying it was an area that he was in charge of and could they could Paul Stephenson look into that area and see was there someone in that group who possibly was there. But it was quite apparent to me that a number of senior police officers had very strong links with the media, and they were very close and, in my view, I would say, too close. Their defence of this was that this was necessary, and this was true of a number of senior police officers. I happen to think it's not the right way to operate.
Q. Issues of regulation now. Paragraph 41 of your statement, our page 05347. You're giving us your views here from your experience but evidently not from, as I'm sure you would want to say, the prospective of a media lawyer, but nonetheless they are authoritative. You say in paragraph 42: "We have tried self-regulation and I think it's clear that it has not been satisfactory." We won't ask you to develop that. "Regulation should be independent and compulsory." Can I ask you, please, to explain what you mean by "independent" in particular?
A. Yes. I would say "independent" meaning there should be if you imagine a body being set up. The chair of that body that would have certain powers would be someone who's appointed in a fair and open competition and would not have any conflicts of interests. So in that sense they might have had a previous media background, but they would now not be employed by any media. They would if they had financial interests, they'd put them in blind trusts or they'd find a way not to be conflicted so that they would be, as it were, truly, clearly independent, not a current member of a newspaper or a broadcasting organisation. LORD JUSTICE LEVESON But you have to be a bit careful about that, haven't you, because one of the criticisms made of the present system is that although the chairpersons of the PCC have been independent, they've been appointed by a body which is anything but independent.
A. Exactly. So it's a necessary, I say, but not sufficient condition, so that's why I mentioned the point about fair and open competition, and I think you'd need to think very carefully about how that was handled. We have various ways using the Commissioners, for example, would be a good way of doing it, and getting together a panel that would have credibility and trust to put people of standing in there who would be have the courage, I think, to actually take on various newspapers, regulators, whoever it turned out to be, politicians, civil servants, when they felt that they needed to. So it would have to be quite a strong body. MR JAY Then you say: "It should be principles-based regulations LORD JUSTICE LEVESON Hang on, you've omitted the word "compulsory".
A. Well, I do feel very strongly the bit about compulsory, in the sense of, you know, if this is something for people to opt in and you have one or two that opt out, I just don't see how that works, I'm afraid. LORD JUSTICE LEVESON But how can one arrange that? I appreciate this is probably what you've asked me to do, so it's not terribly helpful, you might think, that I should throw it back at you. How can one arrange it in such a way that it is not in any sense seen to be government-led, government-controlled?
A. Absolutely. LORD JUSTICE LEVESON Either expressly or implicitly, so that it is seen to be independent in the true sense, not merely its appointment but its operation.
A. And I think for that there are various ways we've tried it in areas. For example, establishing a fairly long term of office for individuals who are appointed so that they're not thinking about being reappointed by someone, but actually, I suppose that's not so difficult here where you're trying to have an appointment system which isn't run by government. But I think we just have to think very hard about how you deliver true independence of mind and courage, and then basically establish the incentive structure such that if you're not part of this system, then you're really not to be regarded as serious or as having some of the kind of legitimacy that we give to various news outlets. I haven't myself worked out quite how you do that in detail, but I suspect that with the resources you've got, I expect you to come up with a great answer to this. LORD JUSTICE LEVESON I suppose I deserved that. Yes. MR JAY Principles-based regulation. Well, the Ministerial Code is based on that concept, designed to protect privacy and ensure accuracy and swift redress and correction. Then you say: with any corrections having the same prominence as the original error." Can I come back to the fact/comment dichotomy which is in clause 1 of the code? Indeed, it's a point this afternoon's witness is keen on. Would you expect the regulator to be able to properly differentiate between fact and comment and if comment is intruding into fact, to segregate the two? How do you see that issue panning out?
A. I may be being idealistic about this, but I would genuinely like to have a situation where you could have a newspaper and be absolutely clear that in its leader columns and its opinion pieces, it could portray its particular stance, its particular political stance, its view, but when it came to reporting a news story, it would, as it were there would be a strong belief that it I mean, in a sense, the code that civil servants operate to honesty, objectivity, integrity, impartiality if you could try and impose that as a kind of rule of thumb as to how you should write a news story, then wouldn't newspapers be better, more respected and more trusted? And then you'd give them plenty of scope to write their opinion pieces, you know, and express their political views in leader columns. That, I think, would be a very healthy situation to get to. LORD JUSTICE LEVESON Do you think that aspiration fundamentally changes the culture of the press in this country?
A. Yes. LORD JUSTICE LEVESON Well, there's a big ask.
A. Yes, indeed, but I think there are a number of journalists who actually would welcome it and I think it's a culture change that we may now be ready for. If not now, then when? MR JAY Paragraph 43, you've already dealt with, I think. Paragraph 44: "It might be worth considering whether the role of a regulator could be undertaken by the Information Commissioner." Can we understand clearly what you have in mind there, please?
A. I think I have this in the sense that there are lots of options out there. I wouldn't rule any out. The Information Commissioner looks at information across the board. It seems to me it solves one of the issues that they're set up they're independent, they're set up to look at broadcast media, newspapers, online you know, they can look at anything. So that's an advantage, I would say. The Information Commissioner is, at the moment, provided through a process by a minister, so you might want to think about how you might want to modify that. You know, it would you can't simply translate it across, but it's some of the points about the role of the Information Commissioner, the fact that they have this scope across all media I think is worth exploring. Nothing more than that. I think I put this forward in a somewhat tentative fashion.
Q. Because the Information Commissioner evidently has a privacy role
A. Yes.
Q. in the context of the DPA, antithetical role in relation to Freedom of Information Act, with the public interest always being weighed. Do you see an enhanced ICO it would have to be significantly enhanced to accommodate out this press regulatory function.
A. Absolutely. It would have to be a very significantly enhanced ICO. But, much as I have my disputes with them, I regard them as a very credible and independent body, and I have a lot of time for the Commissioner, who I think does a very good job.
Q. Were you involved at all with the aftermath of Operation Motorman, in particular the two "What price privacy?" reports in 2006?
A. Not enormously. I was aware of it. I mean, this was very much a Jack Straw issue, if I remember rightly. There were disturbing reports, and I know that there was a question of what should we do about them, and there were some discussions I think Richard Thomas went into discussions he had where I think there was a difference of view between the press on the one hand and Richard Thomas on the other, as Information Commissioner, as to precisely how strictly should there be a criminal sentence and all the rest of it? And in the end, a compromise was brokered.
Q. Weren't you instrumental in the broking of that compromise?
A. Instrumental? I wouldn't say I was, knowing that I didn't have any of the meetings with the different parties. I certainly felt that we needed to find a way of moving forward on this, because the alternative was nothing happening. So and people got stuck, so I suggested a process, which I didn't take part in myself, whereby different people talked to the MoJ and in the end, we got to a solution.
Q. Yes, but was the solution your idea?
A. I don't remember it being my idea, but I would have to check the records.
Q. I'm sure you weren't involved in the detail of the meetings which gave effect to the compromise and then Section 77 and 78 of the Criminal Justice and Immigration Act of 2008, but the philosophy behind it, namely put it into the statutory instrument which can then be enacted in due course, did that come from you?
A. Yes, well LORD JUSTICE LEVESON It's in a statute, but it's just not implemented. So at the moment it sits there with nobody doing anything about it.
A. Indeed. Absolutely, and I think the question was, I think, that was as far as ministers were prepared to go at the time. LORD JUSTICE LEVESON It's abundantly clear that that was the subject of lobbying from press interests.
A. Oh absolutely, yes. The press were very, very against that clause, and the question was: could you go any further? And in the end, I think it's quite clear and I'm sure you'll be talking to Jack Straw about this what ministers would accept was that compromise. MR JAY Because of the obvious political risks?
A. Indeed. Again, if you were, as an Inquiry, to suggest that that might be revisited LORD JUSTICE LEVESON I'll certainly be considering whether the implementation of those provisions should not now take place.
A. That would be a perfectly reasonable thing for you to consider. MR JAY Mr Brown, as prime minister, was involved in some the discussions with Mr Dacre and Mr Thomas, and in that context presumably you would be advising him, wouldn't you?
A. Yes, that's right.
Q. Although the greater detail would be within the province of Mr Straw, self-evidently?
A. Indeed.
Q. Context of regulation. Can we consider whether there might be further possible amendments to the Ministerial Code and try and look at it in this way: as you rightly say, transparency is the key but we need to find where the balance should lie, in particular in the context of the relevance of personal interaction and politicians having journalists as friends. It's clear that the Ministerial Code is interested in ministerial interactions and to some extent political interactions, but then, on the other end of the spectrum there are the personal social interactions which may or may not be relevant depending on how suspicious one might be. Do you feel there is a case for expanding transparency further to go right into the domain of the personal area?
A. I think my advice to the Prime Minister was very clearly in that area and lays out what I think we should do and it's in that letter which we've referred to already. I think we've covered that issue, didn't we, that I think that the social side does have to be there but subject to the detailed discussion we had earlier.
Q. So your final position, as it were, is set out in that advice of 15 July of last year, and nothing you've heard or seen since would cause you to suggest anything further?
A. Well, I would strongly recommend to my successors that in the light of whatever this Inquiry comes up with, that they should consider whether that requires any amendments to the Ministerial Code. So if, in your deliberations and the evidence you've heard, you think that actually the advice that I've suggested to the Prime Minister needs to be supplemented or changed in any way, then I'm that was my attempt, given the information I had at the time, to think of how to come to a sensible view, proportionate view, given the issues we discussed about how you handle the social side of things. If, in the light of all the evidence you've heard and that will give you access to a lot more information than I had in preparing that advice you decide that actually the line should be drawn in a slightly different way, I think that would be a perfectly reasonable thing to do and then I would like to think that my successors will take that into account in amending the Ministerial Code. LORD JUSTICE LEVESON You've walked yourself into some work there, Lord O'Donnell, because
A. Surely not. LORD JUSTICE LEVESON Well, because I readily recognise that your recommendations, when they were made, were based on the information which you had available. Of course, it seems to me that this area of the terms of reference can only be governed by guidance in reality.
A. Uh-huh. LORD JUSTICE LEVESON And therefore, although I will obviously take account of all the evidence I've heard and reach conclusions, I will not have the expertise that is available to you, from your experience, to calibrate how that could best be changed. So I appreciate that you gave it your best shot when you gave it but I can't believe that you're ignorant of the material that has come out in this Inquiry, and therefore if, in the fullness of the next month or so, you do have some further ideas, I would be very grateful to receive them. I hope that's not too impertinent.
A. This is certainly not impertinent. I fell for that one, didn't I? Yes, of course I will happily provide my thoughts, but I should stress, really I mean, in a sense, the issue of amending the Ministerial Code is for the Prime Minister and on the basis of advice from my successor. LORD JUSTICE LEVESON Don't get me wrong. Anything I do in this area will be in the form of a recommendation. Ultimately, everything that this Inquiry generates will be for the government to consider, I hope on the cross-party basis that set up the Inquiry in the first place.
A. Yes. LORD JUSTICE LEVESON Because if it ceases to be a cross-party effort, it becomes much, much less valuable. It's important that everybody feels that the process has been full, open, everybody can take a view and then everybody can decide what to do. I will have views but I would want them to be as informed as they can be.
A. I strongly support that. I think cross-party support is really crucial. MR JAY Some specific questions now. Could you go back kindly to your statement. Starting at page 05357, you deal with what happened after the Select Committee report in February 2010 and the call for a possible public inquiry. You state that the Prime Minister's principal private secretary, who then was Mr Heywood, informed you orally that the Prime Minister would be grateful for advice on the merits of establishing a judicial inquiry to explore the findings of that report, specifically those relating to phone hacking and blagging. You received, in that context, advice from the Treasury Solicitor, which is under tab 2, at our page 05324.
A. Mm-hm.
Q. Within the covering email, the Treasury Solicitor refers to the "not inconceivable risk of a successful JR", then says: "I think there is actually quite a significant risk that if an inquiry was limited to News International and the motivation was seen as political, the judge would require a lot of persuasion that the inquiry is being held for proper reasons." Is that a factor which you took into account or not?
A. No, I think the biggest factor for me was the question of the absence of evidence at the time and the various inquiries that had taken place. That was the overriding aspect in providing my advice, but I stress it was advice. It was for the Prime Minister to decide whether to hold an inquiry or not.
Q. The Treasury Solicitor's advice referred and you picked this up to CMS Select Committee's findings about a culture existing in the News of the World, et cetera. Wasn't that a factor which very strongly weighed in the balance?
A. It was a factor. That's absolutely right. But as you can see, we published the notes and there are various arguments in favour and various arguments against, and in the end, I came down on the line which I would still do now: on the basis of the evidence we had at that time, that wasn't the right point to do it. I, as is very well known to everybody here, very strongly took the view when more evidence emerged that it was absolutely right that we have this inquiry, and I'm delighted that it's happening. Sorry for all the work we've imposed, but I think you are going to provide an answer to a question that we've long struggled with.
Q. The advice you gave is on 19 March 2010, which was about two months before the General Election, which I suppose wasn't ideal timing on one version of events. We have it at 05530.
A. Yes.
Q. This is advice to the Prime Minister, isn't it?
A. This is advice going to Jeremy Heywood, who at the time was the Number 10 permanent secretary, who would then give it to the Prime Minister, that's right.
Q. It very much reflects the Treasury Solicitor's analysis. The summary at 05334, you see that?
A. Yes.
Q. "From the limited information available That was quite cautious, wasn't it? There was quite a lot of information in that report, wasn't there?
A. Well, I felt there were still a number of unanswered questions at that time. A number of people were saying that there was no evidence. If you look at I mean, the police had investigated the Crown Prosecution Service had decided that they weren't going to bring any charges, so it was against that background. Now, there were stories that there was more information out there, and there was I think there was still a question mark as to whether more would emerge, but at that time I felt that on the basis of what we knew then I would stick with that recommendation.
Q. You say: "It is doubtful whether this case would merit the holding of a public inquiry under the 2005 Act. Any decision to hold such an inquiry could be challenged by judicial review The answer is yes, in theory. particularly if the inquiry were extended to the media in general." So that at least was under contemplation, but the fear was that if we include the media in general, someone would say it's political, it's a motive ulterior to the 2005 Act, it's JR-able. Was that the thought process, do you think?
A. I think you've referred to the covering note that I had from the Treasury Solicitor, which explained that he thought his views about JR what I've said is actually not as strong as what was said there. I just said "not inconceivable" that such a challenge might succeed, which is quite a lot weaker than the legal advice that was put to me.
Q. But this was just advice, wasn't it? The Prime Minister would act appropriately. We know there wasn't a public inquiry, but Mr Brown, now in opposition on 7 September 2010, six days after the New York Times article page 05337 was now clearly of the view that there should be a public inquiry?
A. Yes.
Q. But of course, the political situation from his perspective has changed rather dramatically. Then you write back saying, well, it's not appropriate for you to
A. Well, a number of inquiries were then under way and I think a process which inexorably led to this Inquiry was already in train.
Q. Was there any sense, back in March 2010, that a manifestation of the sort of issue that paragraph 1(d) of the terms of reference of this Inquiry requires us to investigate, that it was simply too big a political hot potato, therefore let's not pick it up?
A. Well, I would say it's clearly a big potato, if you like, to use that phrase. The timing wasn't ideal. If you're going to do this, actually it would be good to have where stated, all-party agreement, and it would be much better to do that trying to broker such a thing in the weeks running up to a General Election was always going to be very difficult. So I think it's quite good that we have something set up now with all party agreement and hopefully, when we come to the recommendation stage, you can get all parties to agree to that. I think that will give us something secure and lasting in what is a very, very difficult task, I admit, you have been given. MR JAY You're right to emphasise the timing wasn't ideal on 19 March 2010. I'm sure that's entirely accurate. Those were all the points I have. LORD JUSTICE LEVESON All right. Can I just ask one thing, going back earlier in your evidence. You've rightly said I think, rightly that it is of very great importance to devise a system that works for the future, which has a dimension which is as yet unknown.
A. Mm. LORD JUSTICE LEVESON But do you believe that we will have to think about a system that is I and the Inquiry, but then more fully, the government that encompasses organisations beyond those traditionally understood to represent the media? You've identified the dichotomy between the BBC and television and the print media, which is for historical reasons of bandwidth, which have long since gone.
A. Mm-hm. LORD JUSTICE LEVESON The Inquiry is not encompassing the concept of regulation of the broadcasters. But there are many others, like Internet providers, others who are using the Internet in the same way that the press have used both print and online journalism, and I'd be grateful for any thoughts, first of all as to where the lines could be drawn as to how you devise a system that does encompass everybody who should be encompassed without straining too far in such a way as to attempt to regulate that which is probably incapable of regulation and one of the examples that have been bandied around the Inquiry, of course, has been Twitter, Facebook, personal communications of that sort which then can achieve very, very wide publicity in circumstances not only which are beneficial and the Arab Spring is the oft-cited example but also potentially damaging for example, providing the details of injunctions that have been held not to be in the public interest to divulge or alternatively to name, if I give another example, those who have been the victims of sexual attack, notwithstanding the anonymity provisions of the law. So there's that, and also there's the balance between as a separate question regulation on the one hand and police activity on the other. It's very well saying, "Well, that's a crime, therefore we shouldn't touch it", without having regard to the enormous pressures on the police and the inevitable decisions that have to be made between what the police should do and what they shouldn't. The best example, which we've heard a lot of and which I've already commented upon to the then Deputy Assistant Commissioner Peter Clarke, is a decision about: do we go further into phone hacking or look at the 70-odd terrorist threats that we are confronting? I think I used the phrase "it's a comparative no-brainer". Whether the information was all available there is another question. So those are two different questions, and on each of them I would grateful for your view, either now or again in due course, because actually they seem to me to be absolutely at the very centre of some of the more difficult problems that I have to confront.
A. And I will be happy to provide more input later on those questions because it strikes me that a lot of the information you're gathering at the moment will be relevant to that, and I don't think you've finished that process by any means yet. LORD JUSTICE LEVESON No, you're right.
A. I'm very happy to input into that. I think in terms of lines drawn, I've always thought that it might be possible to think about individual things like Facebook and Twitter in one sense, and covered by general laws as they are I mean, making the point that disclosing the names of victims of sexual assault, that's covered by existing law and that's people need to understand what the law is. LORD JUSTICE LEVESON And the consequence of breaching t and I believe that there's an investigation into that.
A. Yes, and I think that's a set of rules that should apply there. I think it would be very dangerous to get into the world where you're trying to apply certain rules towards newspapers that would drift into covering Twitter, for example. The interesting case seems to me blogs, where you now have a number of political journalists who are giving up working on a newspaper and going to run their own blogs, very successfully, with quite wide circulation. It raises the issue for me about whether you can do something which has a circulation or a readership number, where if you're in the mass market, as it were. LORD JUSTICE LEVESON The question I've sometimes asked people about that is whether if you're in the course of a business; in other words, if you're seeking to make money from the activity.
A. Yes. LORD JUSTICE LEVESON So, for example, if you're carrying advertising, which obviously will pay and might pay, depending on the number of people who enter the blog. Of course, that has potential extra-territorial issues.
A. Indeed. LORD JUSTICE LEVESON As Mr Staines was the very first to point out to me.
A. Indeed. LORD JUSTICE LEVESON Well, not the first but one of the most vocal to point out to me.
A. Yes, and none of these things are easy because once you set up a set of regulations for one sphere, then you create an enormous incentive for people to get into the sphere that isn't quite covered by that, so whatever rules you get, people will try and just move the other side of the line. So it's one reason why I've been hesitant to come forward with more details on solutions, is that it's not easy. LORD JUSTICE LEVESON I understand that, and I'm very happy for you to caveat whatever. All I'm seeking to do is to input into your experience so that whatever I come up with has the greatest possible degree of relevance and cannot immediately be shot down as the rather confused thoughts of a judge taken entirely out of his normal operating sphere.
A. I would be more than happy to get involved in that process in whatever way is appropriate. I'm just kind of nervous about precisely how that should happen. LORD JUSTICE LEVESON What will happen is this: this module as you know, we split it into four concerns effectively politicians and that's essentially what you've been dealing with, but in July, for a much briefer period of time, I shall be looking at the future, and I will be calling back some witnesses who have had ideas and some witnesses who have proffered ideas, so that they can be explored. It won't necessarily require further oral evidence, but I will be very willing to put into the public domain, as part of the record of the Inquiry, any submission that's in writing. So that's one mechanism. If there's something that you feel you'd like to elaborate upon, then I can assure you I will make time for you to be able to do it but I don't commit you to that. I'm conscious that to some extent you are entitled to say, "Actually, this was the job that I was party to giving you to do, so therefore I shouldn't have it back", and I understand that, but I'm sure you see why I would value your perspective.
A. I do, and I would be very happy to help. LORD JUSTICE LEVESON Thank you. Thank you very much indeed. 2 o'clock. (1.00 pm)

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Witnesses

Lord O’Donnell of Clapham

Government

Gave a statement at the hearing on 14 May 2012 (AM) ; and submitted 4 pieces of evidence

Gus O'Donnell, former senior civil servant and economist, who between 2005 and 2011 (under three Prime Ministers) served as Cabinet Secretary, the highest official in the British Civil Service. Gave evidence concerning Andy Coulson's role as press chief to Prime Minister David Cameron, and offered his opinion that Coulson should have declared his News Corporation shares.

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Morning Hearing on 14 May 2012

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