Afternoon Hearing on 31 May 2012

Jeremy Hunt MP gave a statement at this hearing

Hearing Transcript

(2.00 pm) LORD JUSTICE LEVESON Mr Rhodri Davies, I understand there is some concern about the redaction of documents in relation to Mr Hunt's exhibits. Let me make it clear that in the light of what has happened in the past, I have agreed to publish all Mr Hunt's exhibits today. They've been released over some days, if not rather longer than that, and I would have hoped that if there were issues about redaction, that they would have been resolved by now. What is the problem? MR DAVIES Mr White will explain, sir. LORD JUSTICE LEVESON Very good. MR WHITE I'm sorry, it only came to our attention late. You're right that the documents were released about five days ago, but there's an enormous amount of material. What I spotted yesterday, I can just give you an example. There is an email at EX.L.74, which if I just hold it up, is redacted to that extent to remove commercially sensitive information. LORD JUSTICE LEVESON Hang on. EX.L.74? MR WHITE EX.L.74. You see the extent, it's on page 07334. And that is information that the department accepts is commercially confidential and ought to be redacted. When the same email appears at EX.L.92, 07348, it appears in entirely unredacted form. And once I spotted that, I realised that that unfortunately has happened on several occasions. Do you see the point? LORD JUSTICE LEVESON Yes, I see that it's redacted in one place and not in the other. Let me just see what's been redacted. (Pause). I don't really see that it matters, given that all this is now history, but there it is. MR WHITE I take that as an example just to show what's happened. It's not perhaps the most sensitive. There are others where the same thing has happened, where it's more obviously sensitive. There's an end date to a contract, for example, which is accepted is confidential. As soon as we saw that, we've put a team of people on to go through and check and we're making good progress on that as quickly as we can, but whether we'll have checked it all by the end of today, I simply don't know. LORD JUSTICE LEVESON I think we'll be going a bit faster than that, Mr White. The position is this, that Linklaters informed the Inquiry, I think this morning, and an email was dispatched in return saying, "Well, you'd better let us know what you're talking about", to which there has been, as I understand it, no response. I think this has to be done jointly and extremely urgently. Presumably it's only in relation to a few documents that we're talking about. You may be looking at them all, but most of this material will be entirely innocuous. MR WHITE The difficulty, sir, is as you've said, having been alerted to it, we are now turning the pages as quickly as possible, but it is important that material which is properly regarded as commercially sensitive shouldn't come out accidentally. That's our position. LORD JUSTICE LEVESON I understand that, but it's equally important that if I've given my assurance that documents will be published, that they should be published. So this is irresistible force and immovable object, Mr White. Have Linklaters communicated any of the detail to the Inquiry? MR WHITE I know that Ms Ellis has been in contact with the office and has been pushing this forward over lunchtime. I don't yet know whether an email has gone. LORD JUSTICE LEVESON What might be better is if somebody from Linklaters actually comes down to the Inquiry and works with Inquiry Team staff to make sure that the issues which concern you are considered this afternoon. I don't think there's any point in just working in Linklaters' offices and then sending us an email with three minutes to go when we want to press the button. MR WHITE We are doing it absolutely as quickly as we can. There are a lot of documents to go through. We can certainly explore someone coming down with LORD JUSTICE LEVESON It should be concurrent, not consecutive. That's what I'm saying, I think, Mr White. MR WHITE What Ms Ellis reminds me of course is Linklaters didn't act in relation to the transaction so they have to liaise with Allen Overy and the client about what is particularly sensitive. Sir, can we try and hold off pressing the button on publication until Linklaters have had the opportunity to come down and tell the Inquiry those documents LORD JUSTICE LEVESON Linklaters had better get into a taxi now and come down now. I am going to fulfil the commitment that I have given. I'm very happy to look at inspanidual documents and I'm very happy to consider inspanidual documents. I readily respect the commercial confidentiality of News Corp and I don't want to impact upon it, although one has to say that in relation to a bid which ceased to be effective almost a year ago and deals with material that is very, very historic, I'm not entirely convinced how up to date all of it will be and how commercially sensitive it will remain, given the bid is now finished. If it were going on, if it had potential impact on the market, I could understand all that. I'm not stopping you doing the exercise, but I am prepared to make sure that the Inquiry Team are ready to consider everything that Linklaters want to say. If they want to bring somebody from Hogan Lovells down, they can bring Hogan Lovells down. If they want to bring somebody who's involved from News International or News Corp, obviously News Corp, they can do that, but I'm afraid that to say "Well, we'll send you an email some time today" is not good enough. I'm conscious of the work that you've done, and I'm not in any sense minimising it, Mr White. I've said several times that I have a great respect for what Linklaters have done to work their socks off to help the Inquiry, but there have been difficulties about the publication of documents, which has caused embarrassment for which I am responsible, and I don't want to be responsible for any more. MR WHITE I fully accept that. We are working absolutely flat out. We thought rather than send intermittent emails we should try and go through I see your point about it being concurrent rather than consecutive. May we try and be practical, but I would simply ask that the button isn't pressed on publication until we've had the chance to put our concerns. LORD JUSTICE LEVESON Well, I hear what you say. I'll return to it at the end of Mr Hunt's evidence. MR WHITE Thank you, sir. MR JAY Mr Hunt, I think we were on page 07822, which is an email of 6 July 2011.
Q.Are you with me on that?
Q.You reached the point where there were now debates in Parliament on phone hacking. The second paragraph of the email at THE TOP "The basic line is that the Secretary of State and he alone has to make a quasi-judicial decision on the merger on media plurality grounds. Whilst we all agree that phone hacking is dreadful and the police should pursue their investigations vigorously, the Secretary of State has made his decision on media plurality grounds, not wider public interest. He has followed the legal process and been openly transparent in doing so, seeking publishing advice from independent regulators at every step of the way." So that was the official line as at that date; is that correct?
Q.At 07824, you'd apparently seen something in Private Eye which made some legal points about the strength enforceability of the articles and you wanted a legal view on that, is that fair?
Q.07826, we're now on to 10 July, things were hotting up politically, some might say. The SECOND EMAIL "To be aware I've just had a call from [someone at] Number 10 are very worried about the vote on Wednesday they think it's highly possible that Miliband will win. [This someone] said that he needs us to do more work on the legal position/fallback options, et ceter
A.Number 10 are most worried about the line that the fit and proper person evaluation is a matter for Ofcom. They are not convinced that this argument is sustainable." Isn't that an indication that by this point for political reasons the fit and proper person issue had, as it were, come to the surface rather than for any reasons of the substantive merits?
A.I think what we have here is that what happened was that Number 10 did start talking to DCMS after the Milly Dowler revelations occurred, because this was such a huge national issue, they needed to understand timescales, and they needed to have a sense of what was coming down the track with respect to the BSkyB bid, because they were certainly linked in the public mind, even if they weren't initially linked in my mind. And so we were having lots of discussions between the communications teams at Number 10 and communications teams at DCMS. These were not discussions with me, and they were not discussions about my decision. My actual decision to write to Ofcom was a decision that was primarily prompted by the closure of the News of the World because I thought that indicated that there could be a massive failure of corporate governance in News Corp, which made it potentially risky to accept the undertakings. So that was my perspective on the issue.
Q.Although the discussions were not with you, they were with your department, and presumably drawn to your attention; is that right, Mr Hunt?
A.Only in a casual way, as in, you know, Number 10 are getting worried about the fact that the phone hacking issue is getting big and they wanted to be sure that the public would understand that we couldn't link the two issues. I think that was essentially what their worry was. LORD JUSTICE LEVESON But you'd actually got further than that because you'd found a way in which it was arguable that the issues could be linked.
A.By this date, yes, because the News of the World had been closed in the middle of the previous week. But I'd had very clear advice as I say, it was the corporate governance issue, the fact that a newspaper had been closed down, that really made me re-evaluate the advice that I'd previously received on trust. MR JAY But wasn't it pressure from Number 10 which was drawn to your attention which caused you to look at the matter afresh, Mr Hunt?
A.No. I was already looking at the matter under my own steam, if I can put it that way.
Q.There's further pressure at 07827, where Number 10 apparently had been in touch and had spoken directly to JON ZEFF "They want a note for the Prime Minister this evening on current situation and our assessment of available options in relation to delay, fit and proper person and Wednesday's vote." So what they were HOPING FOR let's see if we can park this for the time being, let's see if we can consider this as a fit and proper person issue, and what are we going to do about Wednesday's vote? This is a clear political steer, isn't it?
A.I think there were lots of discussions going on between communications teams because this issue had exploded onto the national scene and Number 10 wanted to understand what we were doing and how to handle it in communications terms. It wasn't anything that was affecting my decision.
Q.Of course the decision remained yours pursuant to the same quasi-judicial obligation you'd been discussing; is that right?
Q.We can take the matter forward quite quickly because things soon come to a head. 07830, Mr Hunt. Still on the afternoon of 10 July. We can see the message at the bottom of the page, which I believe is coming through from Sir Jeremy Heywood. I deduced that from 07831. This is the message beginning "These are the broad fallbacks we briefly discussed."
A.My copy is redacted so I'm afraid I can't see who it's from.
Q.The Heywood note is referred to on the next page. That's all I'm saying, Mr Hunt. I may be incorrect about it. LORD JUSTICE LEVESON If the normal policy has been followed, the name will only have been redacted if it was somebody other than a member of the senior Civil Service. MR JAY That's correct, but the note would have been sent by email by someone junior, but it appears to be from Sir Jeremy Heywood, but that's at least one possible deduction. I understand there may be others. But at all events your response to it is recorded in the email above that, isn' T IT "Secretary of State has said he would like to see the note before it goes."
A.Yes. I'm sorry, which is the note we're talking about? I'm not familiar with this material, Mr Jay.
Q.I had deduced, but it may be incorrect, that the note that is being referred to is in fact the text of the email which starts halfway down page 07830 and is not a separate document. But it may be that that inference is incorrect. I'm not sure we could take it any further.
A.No, I'm sorry, I can't.
Q.Later that afternoon, there was a conference with counsel and others. Can you remember whether Number 10 was involved in that? Possibility that it was because of the email at the top of 07832, if you can look at that?
A.I don't think that would imply that, actually, because all conference calls that ministers have are set up by the Number 10 switchboard.
Q.I understand. LORD JUSTICE LEVESON I'm not sure you're talking about the right Jeremy. At the bottom of 7832, that's a letter to Daniel Beard, who is of counsel, isn't he? MR JAY It is. LORD JUSTICE LEVESON And it's obviously from a legal adviser to the Department of Culture, Media and Sport. And it's referring to Daniel, that's clearly MR BEARD "Jeremy was wondering if he could have a preliminary chat with you about this this afternoon at about 5 pm. I don't know if that would be possible but I'm copying Paul Oldfield, Jeremy's Principal Private Secretary in." That's clearly Mr Hunt. MR JAY Yes. LORD JUSTICE LEVESON Not necessarily Sir Jeremy Heywood. MR JAY But that's the top of 07831. LORD JUSTICE LEVESON I understand that point. That's a slightly different one. MR JAY Okay. LORD JUSTICE LEVESON Yes. MR JAY There was a conference with counsel where the issues we'd seen in earlier emails were discussed. We know it took place at about 5 pm, 07833. I think actually it was a conference by telephone, which you listened in on as well as Mr Smith; is that correct, on the top of page 07833?
A.I don't know if Mr Smith was listening. He may well have been. But I was on it.
Q.Soon thereafter, matters were overtaken by events because on 11 July News Corp withdrew the undertakings; is that right?
A.I'm not sure I would necessarily describe it that way, Mr Jay. We decided in that conference call that I would take the very significant step of writing to Ofcom and the OFT to ask them whether they still stood by their advice of around 10 days earlier, in which they said that they were satisfied with the undertakings and that they addressed plurality concerns and they were financially viable. We also asked Ofcom to look at the fit and proper person issue, which is an Ofcom issue, but the development that happened during that week was, I believe, that the Select Committee had written to Ofcom to ask them whether BSkyB was a fit and proper licence holder, and that was something which could have been relevant to the bid. Obviously you accept undertakings from someone that then loses their broadcasting licence, that would be pretty significant. And we had the issues that I've talked about earlier, my concern about a failure of corporate governance. If wrongdoing was so endemic in a company, then it does become potentially a question for management structure. So all those things had come together in less than a week, because I think the Milly Dowler story broke on Monday, 4 July, and the News of the World was closed later that week, and I thought it was appropriate to ask Ofcom and the OFT whether they still stood by the advice that they had given me. LORD JUSTICE LEVESON 7836, I think, says just that.
A.And that was made public pretty much first thing on the Monday morning, so the conference call was on the Sunday evening. That was made public on the Monday morning, and by Monday lunchtime the undertakings had been withdrawn. I don't know whether you can link those two events or not, but well, one can infer whatever one wishes. MR JAY And on the Wednesday, which was going to be 13 July, I believe, there was going to be a vote on the undertakings in any event in Parliament; is that correct?
A.I don't think it was so much a vote on the undertakings, it was a vote on the whole BSkyB bid.
Q.We can see the underlying concern in the emails, that the government might have lost that vote, can't we?
A.Yes. That was a political concern, which obviously was on Number 10's mind because it was a big motion.
Q.Two final emails in these files, Mr Hunt. Go forward to tab SS.B LORD JUSTICE LEVESON Just before you go on, it seems clear from 7839 that the timing is as Mr Hunt has identified it, because Mr Murdoch withdrawing the bid refers to the letters to Ofcom and the OFT asking for advice as to whether they should reconsider accepting undertakings.
A.Yes. MR JAY Thank you. LORD JUSTICE LEVESON All right. MR JAY SSB, page 08105. It's an email you send to your special adviser Sue Beeby on 20 July. Have you found that one?
Q.I wonder if you could explain this for us, please. You say: "You may need to correct any press/make a statement about my apparent admission that DC discussed BSkyB with Rebekah Brooks. I am pretty sure I said 'any discussions were irrelevant' but Labour have seized on it as 'the discussions were irrelevant'. I think the best thing to say is that I couldn't have been confirming that there were discussions because I have never discussed it with the PM and don't know. Hope it doesn't cause an issue." But what did you mean by "I think the best thing to say"?
A.Well, because I was proposing how we deal with the fact that the Labour Party at that time, I believed, were misinterpreting something that I had said. They were suggesting that David Cameron was in cahoots with Rebekah Brooks and this was having some kind of influence on the whole process, and my response to that consistently had been that it's irrelevant whether the Prime Minister was having any discussions with Rebekah Brooks because the Prime Minister wasn't taking the decision on the BSkyB merger, and I think in the Parliamentary statement, they had said what I said I don't know what I actually said, but they had used what I had said to try and confirm that there were such discussions between the Prime Minister and Rebekah Brooks about the bid. I didn't know whether there had been any discussions or not. All I was SAYING WAS if there had been any, it was irrelevant. And Labour WERE SAYING Ah, he's confirmed there were discussions, which I wasn't at all. So we were discussing how to deal with that situation that had come up.
Q.And then your special adviser emails you on 26 July on the next page, 08160, stating: "We have published the list of meetings you've had with media organisations today and I've gone through the lists to pick out the facts in case you get any hostile questions when you're doing media tomorrow morning. "Basically there is absolutely nothing surprising about your meetings at all (but that doesn't mean to say people haven't been trying to find something dodgy). Here are some rebuttals." And then there are really lines to take. But were those based on what you told your special adviser as matters of fact or were they just lines to take?
A.Well, they're a suggestion from Ms Beeby to myself, she's my press adviser, and she would have worked out those lines to take on the basis of fact.
Q.Okay. Can we go back, please, to the file of text messages, which is the tab at the end of this second supplementary bundle. We're going to look first of all at the post 22 December 2010 messages between you and Mr Michel and we can pick these up on page 08148, Mr Hunt. Are you with me?
Q.Which really start at the very end of the last page. On 20 January, the date of your second meeting with News Corp, do you see
A.Sorry, which date was that?
Q.20 January 2011, bottom of page 01847.
A.Sorry, I'd turned over the page.
Q.You have to turn over the page to see the time. It's at 20.53. Mr MICHEL SAYS "Great to see you today." Then there's a reference to your babies, so obviously we pass over that, it's been redacted. "Warm regards." And then you at a quarter to midnight TEXT HIM "Good to see u too. Hope u understand why we have to have the long process. Let's meet up when things are resolved." Is that not giving a somewhat positive message, Mr Hunt?
A.Not at all. I'm just saying to him we have a long process, hope you understand why that's necessary.
Q.Then he replies the following morning for him he's slightly late coming back to you, but NEVER MIND "We do and will do our very best to be constructive and helpful throughout. You were very impressive yesterday. And yes let's meet up when it's all done. Warmest regards, Fred." This is very pushy, isn't it, Mr Hunt?
A.Yes, it is, and it's also it's also a little bit cheeky, actually, because that was the day that I'd had the row with Mr Murdoch when he was pretty cross about the fact that I'd said that I was going to involve Ofcom and the OFT in advising me as to whether to accept the undertakings, so it was a very difficult meeting. I wonder whether he was trying to break the ice or something like that, but it was but I agree.
Q.For someone exercising a quasi-judicial function, you would have been concerned, would you not, by the tone of this pushy and frankly cheeky text message, would you agree?
A.Well, I would have been I just would have given a courteous reply and thought, you know, he's he knows he can't have any contact with me about the bid process and so I want to close down the conversation as quickly as possible.
Q.Closing down the conversation as quickly as possible might have entailed you sending a text message back along THESE LINES "Given the role I'm performing, any contact of this sort is inappropriate and might stop." Why didn't you do that?
A.I don't think that I didn't think that a courteous reply to a text message was inappropriate. I would have thought it was inappropriate to put anything of substance in a text message. I mentioned earlier, I do make a point of replying to text messages that people send me, so I was just trying to give a courteous brief reply, essentially try and close down the discussion.
Q.If he was being pushy and cheeky with you, you would know evidently that he would be trying the same with Mr Smith, wouldn't you, Mr Hunt?
A.Yes. I wouldn't get the I wouldn't know about the volume of communications that he was having with Mr Smith. I might have expected the tone to be similar, but what we've learnt about the 35 texts in two days, that kind of thing, I wouldn't have been able to surmise.
Q.But the tone continues, one might argue. On 3 March, which of course was the day you'd made your announcement to Parliament after the long night when the UILs and redactions were being sorted out, he comes back to you unprompted: "You were great at the Commons today. Hope all well. Warm regards." That's along similar lines, isn't it?
A.Yes. I think we can see that flattery is a weapon that Mr Michel tries to deploy quite frequently.
Q.And persistently, would you agree?
A.And persistently, yes.
Q.You do reply to it in only four words, though: "Merci large drink tonight!" And then he has another GO INSTANTLY "Me too! Taking wife out for dinner!" That's the end of that one but ten days later he's flattering YOU AGAIN "Very good on Marr. As always!"
A.Yes, and I think one is beginning to slightly discount his flattery by this stage, because one is getting used to it.
Q.Well, that's one possibility, but you don't quite rise to the bait, but you lapse into FRENCH AGAIN hopefully when consultation over we can have a coffee like the old days!" Are you happy with that message?
A.Perfectly. I had a friendly professional relationship with him. It was a relationship that had become a little bit warmer because of the coincidence of both our wives having children on pretty much the same night in the same maternity ward, and we'd said, as I think one would frankly, we'd said let's get the families together because we have children of the same age, and then of course it wasn't possible to do that because of the bid process, and so I was basically saying, well, you know, that's something that will have to wait.
Q.Some might say if the consultation is over and the bid is turned down, it would be a rather frosty cup of coffee, wouldn't it?
A.Well you could exactly say that, but I was just saying, "Look, I can't have any contact with you until the bid is over", and I think that was the proper thing to say.
Q.The final piece of pushiness. I deduce that he sees you at Wimbledon at quarter to 4 in the afternoon on 3 July, I recall the occasion, it was a Friday afternoon, and he starts TEXTING YOU "Come on Nadal!" And you text him back. This is pushiness par excellence, isn't it?
A.I think it's incredible ingenuity. I mean he was just looking for any opportunity he could to try and establish contact of some sort or another. You know, it was pushy. You know, I responded briefly, courteously, and in a friendly way as well. What I didn't deduce from this, and I think you alluded to in your earlier comments, was the effect of this kind of contact multiplied many, many times over to Adam Smith. And that was the crucial thing right at the beginning of the process that we didn't foresee, the fact that there was going to be such a volume of correspondence, and I think it's something that we have to reflect on in terms of the way that we handle bids in the future, because and maybe this is a line of questioning that you're going to come onto, but I just make the point now anyway. My feeling is that, you know, Adam Smith is the most decent, straight, honourable person that one could imagine, and even he was not able to maintain the impartiality that he needed to because of the volume of communication, and I think that was where things went wrong as far as his communication was concerned.
Q.We will come back to that. You did tell us, though, that in your view Mr Michel was looking for every opportunity he could to establish contact one way or another, but that was his job, wasn't it?
Q.And once the door pushed open, he was in, wasn't he?
A.Well, no, because none of his text messages led to any substantive discussions about the bid.
Q.Okay. The messages between you and Mr Smith start at 08149. Until the end of June, there are only about a dozen, indeed there are only 11 texts between 19 January and 4 March. Do you see that, Mr Hunt?
Q.We can skim read them, but the only one that is of slight interest is at nearly 11.30 on 4 March you thank him for his "utterly outstanding help". Do you see that?
Q.What specifically were you referring to there?
A.I'm afraid I can't remember what event happened that day.
Q.It was in fact the day before. 3 March was the announcement
A.Oh, right, sorry, yes. So it was the day after I'd made the announcement about the UILs and I sent him a text to thank him for his help and I also sent my other special adviser a text to thank her for her help.
Q.Thank you. Go to 30 June. So we pick up the flavour of these messages passing between you. He TEXTS YOU "Chap from Enders analysis just told BBC that this was the only logical outcome." Of course you'd just made the announcement to Parliament on the amended UILs. "And that Competition Commission wouldn't have done anything different. Nice third party endorsement." And YOU SAY "Nice!" Then on 5 July: "Vince was fine. Stuck completely to the line. Sue concerned we don't stick up for news so thinks sticking to need for police inquiry to finish is strongest line." Do you know what the reference particularly to "Vince was fine" is or was?
A.Well, I think these discussions were really about presentational issues. We wanted to make sure that Cabinet ministers spoke with a united voice in saying that it was a quasi-judicial that I had to take, it had to be taken on grounds of media plurality. Obviously given the history of what had happened before, I'm guessing that there may have been some concerns about what Dr Cable might say, which was why that reference was made.
Q.Right. Then he gives you some advice at 15.48, on 5 July: "You should be at the debate even if not leading it. Can't get hold of Home Office." So he's not afraid to tell you his opinion at any relevant point, is he?
Q.Then you try to find out what the Prime Minister is going to say but he finds out for you and tells you at the bottom of the page on 8 July: "PCC has failed. Needs reform. Must be independent of press and government. Inquiry will look at how to reform it." So this is an example of him, I suppose, being your eyes and ears and going to find out information for you, is it?
A.Yes. Eyes and ears? He was an aide to me, he was a very important aide, and this was a very big issue about the type of inquiry that we were going to have and he was finding out for me, you know, what Number 10 was going to say and what the Prime Minister had decided to say.
Q.Then on 11 July, 1800 hours, he gives you some not so much further advice but certainly an opinion of your appearance in Parliament THAT DAY "You did exactly what was needed, pulled back when they got political but were calm and considered otherwise. A view from journos seems to be you were dumped on by Number 10. Give me a call on broadband when you are free." So again he's not holding back from expressing a view and he's quite astute and exhibiting political nous here, isn't he?
A.Yes. I mean, to be honest, I think this is a fairly normal kind of interchange between any special adviser and any minister.
Q.Yes, I'm sure it is, Mr Hunt, but it's just so that we get the flavour of your interactions. On 13 July there's some material he draws to your attention about Mr Dacre's interaction with Mr Brown over the Criminal Justice and Immigration Bill. Do you see that?
Q.Something the Inquiry knows a lot about. And he's keen to draw to your attention, that's to say Mr Smith is, that there might be some evidence that Mr Dacre might have been influencing Mr Brown on that issue. Do you see that?
Q.And that was of political value to you at that point, wasn't it?
A.I think it was just in the context that we were having debates in Parliament in which we were being accused by the Labour Party of being influenced by the press and we were trying to find examples where it was suggested that Labour had been influenced by the press when they were in office.
Q.And then on 15 July he tells you this is the top of page 08151 do you SEE THAT "Rebekah Brooks has resigned." And YOU SAY "About bloody time!"
A.That was nothing personal against Mrs Brooks. It was just that I did think it was difficult to see how she would be able to lead an investigation into practices at News of the World during precisely the time when she was editor of News of the World.
Q.On 20 July at 13.13 hours he TEXTED YOU "If this keeps up it looks like you'll need the partisan speech!" Is it the case that you had as it were two versions of a speech you were going to give and he was advising you as to which one might be the one you should run with?
A.I'm not sure which speech he's referring to on this occasion, but very often in Parliament when you're giving a speech and you're trying to get the mood of the House, you basically respond to the way your opponents, your political opponents, speak. So if they give a partisan speech, then you give a more partisan speech back. So I may well have had that discussion about how partisan do we think Labour are going to be.
Q.The overall impression is of someone who exhibits political understanding and empathy and also has empathy to or with you. Is that a fair impression?
Q.And aside from all these text messages, one assumes that's not the only way you communicate, there are face-to-face meetings, there are discussions by mobile phone, et ceter
A.That's also right, isn't it?
Q.Okay. Can we move on through this bundle. 08153. We have some material on 3 July. These are messages between you and Mr Oliver at Number 10. He starts off texting you at 8.11 in the morning I said July. This is March, isn't it?
Q.So this is just after the press notice that the UILs were matters you were minded to accept?
Q. HE SAYS "Hi Jeremy. One thought which I'm sure you are onto. View emerges that Murdoch will pull a fast one on selling Sky News needs assurances that won't happen." Then you go BACK IMMEDIATELY "Thanks think our agreement will address those concerns and will feed out." You're absolutely right that the agreement did address those concerns, but as this indicates that there were at least concerns at Number 10 that a fast one might be pulled and you had already foreseen it. Is that fair?
A.I think that's I think it was more a presentational thing. Craig Oliver is head of communications at Number 10, so if he was contacting me, I think he's saying "view emerging", I think he's probably talking about a view in the press is emerging and so he was just alerting me to what the press were saying.
Q.Thank you. The next section, messages between you and your other special adviser, who of course is Sue Beeby. This is 08154. We start off on 22 December, so you've just acquired the bid. And you TEXT HER "Daily Tel running something on my mtg with James Murdoch at DCMS earlier in year. Cld u check they know I met all media owners, et ceter
A.Pretty sure Sky bid not discussed." That's likely to be a reference to the meeting on 28 June 2010; is that right?
Q.Then SHE SAYS "Do you know who is writing it?" The ANSWER IS "Really sorry deleted message. I'm sure we'll be fine, they hardly have credibility reporting this issue!" SHE SAYS "Exactly! Have spoken to the Guardian too who have run the story and know from an FOI [that's request] that the meeting wasn't minuted." We've seen that in the bundle we were looking at this morning.
A.Yes. I think I was just pointing out that the Telegraph was a commercial opponent of well, it was an opponent of the bid.
Q.Yes. Could you help us, please, with the next message, 17 February 2011, 14.17, Sue Beeby TO YOU "Hi. Had a think about Andy drink That of course is Andy Coulson, isn't it?
Q. and think it might be best to wait till News Corp process is over. He's so closely linked to them that if you were seen it wouldn't look great. I'm sure he would understand and it should only be a week or so." So it looks as if you were minded to or had arranged a drink with Mr Coulson and you were being advised that that wasn't a good idea; is that right?
A.Yes. I think what happened there was when Mr Coulson left Downing Street, I'd known him not socially particularly but I'd known him professionally and I'd respected his work and when he left I'd said probably in a text message, "Let's meet up for a drink", or something like that, and I think I'd left Sue to arrange the drink and she was basically saying, "It's better to wait until after the quasi-judicial process is over."
Q.Did it really need your special adviser to tell you that?
A.She had the job of arranging the drink and she probably thought about it and I think she was absolutely right, it was something that would be wiser to wait for doing.
Q.The last one on this page. 23 June 2011 at 11.13, Sue Beeby TEXTS YOU "Warning! Please don't take any calls from Vince over the next few days. Will explain all when we speak but he is trying to be very sneaky over News Corp." What was that about?
A.Well, I don't actually know whether that was true about Vince, but I think Sue Beeby had heard a rumour that Vince might be somehow planning to distance himself from my quasi-judicial decision and we didn't quite know, but she was worried that there might be something there and there was a presentational issue for the government and so she was trying to minimise it.
Q.I mean, in one sense he couldn't distance himself from the quasi-judicial decision because it was your decision and he had to remain distant from it, but are you saying that politically once you'd made it he would seek to place a distance between himself and your final decision?
A.Yes. I imagine that was what the rumour was that he might be thinking of doing. As I say, we have no evidence that that is what he was thinking of doing, but these are the kind of rumours that go around the Whitehall rumour mill pretty regularly.
Q.The next page are messages, we've seen some of them already, between you and Mr James Murdoch. 08155. We'd halted in the morning at 12.57 hours on 21 December, hadn't we, but on 3 March at 18.33, which of course is the day of the announcement on the UILs, he TEXTED YOU "Big few days. Well played. JRM." What did you make of that?
A.I thought it was something of an olive branch because my two previous contacts with Mr Murdoch had been very difficult. I'd had the row with him in the meeting of 20 January, when I had insisted on involving Ofcom in the assessment of the UILs, and then on 15 February I had written to him giving him 24 hours to back down on a whole series of things where he was in dispute with Ofcom and the OFT, so I think it was a sort of we'd made the announcement in Parliament and I saw it as a sort of olive branch, I suppose.
Q.It could be read in a slightly different way, that he's indicating approval for the state of affairs which had been reached and your participation in that process. Do you feel that that's a fair interpretation or not?
A.Well, he might have been indicating to me that he wasn't as angry about the state of affairs as I might have thought he would have been. I just saw it as a brief comment because it was a moment in the process, and as I say, we'd had these very, very difficult conversations leading up to that point.
Q.And you TEXTED BACK "Thanks think we got right solution!" Which I suppose speaks for itself, does it not?
A.Well, I was just saying what I'd been saying in the media and in Parliament all day. We, the government, had been working hard with Ofcom, the OFT and News Corporation to see whether we could find a version of the undertakings that address plurality concerns. I thought we had got the right solution. It wasn't the solution that Mr Murdoch wanted, but it was the right one.
Q.The next message looks as if you in fact were trying to complete the previous message but gave up on it and started again, or maybe you didn't, but is that the right deduction I've drawn?
A.I suspect that the next message was actually one that was sent prior to the first message.
Q.Yes. You pressed the send button too early because you didn't complete the message so you had another go. They should appear the other way around. But at 31 March in the morning, you congratulate Mr Murdoch on HIS PROMOTION although I am sure u will really miss Ofcom in New York!"
A.I was just I mean this is nothing to do with the bid. I'd heard on the Today programme that he had been promoted to a post in New York and he was going to be moving from London to New York, so I was just sending him a congratulations text.
Q.But Ofcom was heavily involved in the bid at this stage, wasn't it?
A.I was pulling his leg about the fact that being in New York he would be a long way away from his much-hated Ofcom, the same Ofcom that I'd insisted on involving in the whole undertakings greatly against his will.
Q.So it's slightly tongue in cheek?
A.I think that's a fair assessment of the message.
Q.And then he emails or texts you BACK INSTANTANEOUSLY "Thanks Jeremy sadly I fear they won't see the back of me that easily! Hopefully we can move our other business forward soon so we can catch up properly." So the reference to "moving our other business forward", that's still the BSkyB business, isn't it?
Q.Were you at all uncomfortable communicating with Mr James Murdoch in this way?
A.Well, I think, you know, as we look at the whole way quasi-judicial processes are run and as we look at the lessons that we learned from what happened between Adam Smith and Mr Michel, I think there are probably things we would learn, and my interpretation of my quasi-judicial role was that a courteous reply to a text message was fine. I think probably now I wouldn't take the same view, and I would just avoid all text messages, but that was my assessment, that it had absolutely no impact on the process. It was not material to the decisions I took, and it was just me being courteous.
Q.There are some limited communications next between you and Mr Llewellyn at Number 10, 08157. We're on 3 March. You offer a briefing at 7.21 to the Prime Minister or the DPM. Mr LLEWELLYN SAYS "Possibly yes." And then at 18.20 THAT EVENING "Am I officially allowed to talk to my boss now? :-) seriously think we r thru worst, broadcast fine although Mail and [Telegraph] will be horrible." And HE SAYS "Yes you are! Well done today. Give me a call tomorrow time we had a catch up." "Not a single PMQ on Murdoch I declare victory!" "Well done!" Are you possible indicating there a degree of favouritism towards Mr Murdoch or not?
A.No, not at all. The context of the first text to Mr Llewellyn was that the Prime Minister's office, which Mr Llewellyn runs, had made strenuous efforts from the moment that I was made responsible for the quasi-judicial process to avoid all one-on-one contact between me and the Prime Minister, so I would have obviously met him at Cabinet meetings but I didn't have any one-on-one meetings with him about any issue at all during the period of the bid because they were absolutely clear it was his decision. They even cancelled a dinner that was organised between the Prime Minister and his wife and me and my wife just because they wanted not to have any opportunity when people could have said that the Prime Minister had privately discussed the bid with me, and so I was just saying because 3 March, it wasn't the conclusion of the process, and in fact, I think looking back I suppose I didn't know quite how long the process was going to last. I was expecting it to finish more quickly than it did at that point, so I was sort of saying are we getting to the point where I'm allowed to talk to the Prime Minister? And then when it came to Prime Minister's Questions, the reason I made that comment was very simple. I thought that if there had been any questions about the probity of the process, any possible argument that the Labour Party could make that the process had not been fairly handled, it would be sure to be raised in Prime Minister's Questions by Ed Miliband, and because I had, of my own volition, sought independent advice from Ofcom and the OFT that I didn't have to do, I think the world knew then that the decision had been completely impartial, completely fair and completely unbiased, and the fact that the Labour Party chose not to raise it in Prime Minister's Questions I thought was significant evidence that we had persuaded the world that actually the process had been handled totally fairly, as it had been.
Q.Thank you. The next page there's only one text, 08158. This is between you and your private secretary, and relates to 21 January 2011, so we're back in time. The reference to "News uncomfortable", that's obviously News Corp uncomfortable, "but understand. They are working over weekend to get us final UIL on Monday. Adam suggests we take stock on Monday after receipt and make final decision with lawyers." Is that not an indication that Mr Smith knew that News was uncomfortable and that that message is being communicated back to you?
A.It's quite possible, yes. I don't know. It's I suppose it's an indication, though, that Mr Smith was communicating information that he was getting from News Corp to officials in the process. It wasn't just to me. He was just telling everyone. He was really acting as an official. He was just saying, "Look this is what they're saying", and that might be the case.
Q.But of course he wasn't an official, he was a special adviser, wasn't he? That's the difference.
A.Well, no. Special advisers are civil servants, and he was one of my officials as a special adviser and he had an official part in the process.
Q.The final document to look at, but it doesn't require any analysis, is 08160, which is messages passing between Mr Zeff and Mr Michel. You mentioned that before lunch, didn't you, and this is the evidence of those messages. There are probably about 30 of them on this page and the next page and they speak for themselves. I think that completes the picture of this bundle of text messages. Can we look now at KRM 18. May I ask you first of all whether you've had the chance to study this bundle, which contains 161 or 163 pages of emails passing between Mr Michel, primarily, and Mr Murdoch and his team?
A.More times than I would care to mention, Mr Jay.
Q.We're not going to look at all of them, Mr Hunt, for obvious reasons. We've studied them with care, and of course it is well understood that issues arise I don't put it any differently than that as to whether some, most or even all of these messages are a misrepresentation of an anterior text message or conversation that Mr Smith might have had with Mr Michel, so there's a question of fact, as it were, which would need to be resolved before we get any further. But can we just look at some of them and just see where we are on a number of points. This is the PROP file starting at page 01687. The first point, if you could get your bearings on this one, is two-thirds of the way down there's reference to you seeing Mr Richards or Ed Richards, pardon me, described here, today. We know from the documents we saw before lunch that indeed you did see Mr Richards today.
Q.But it's unlikely, given the time, that the minutes had been available. And he sets out, or rather Michel sets out what you apparently told Mr Richards. Would you agree that this is broadly speaking a correct summary of what you told Mr Richards?
A.Broadly speaking, but actually it's exactly the same as I told News Corp themselves I was going to do at the meeting I had with them on 6 January.
Q.Although this is sort of fresh evidence of a discussion which plainly hadn't taken place on 6 January but is an update really on the actual discussion you had that day, would you agree?
A.I suppose what I'm saying is I don't think there's much substance there that they didn't know, because we don't know what actually happened in the conversations, but I'm very persuaded by what Mr Smith said that quite a lot of these conversations might have been built on Mr Michel offering something and Mr Smith just acknowledging it, so Mr Michel might have said, you know, were those areas raised that were mentioned and Mr Smith may well have said yes.
Q.If you cast your eye three lines above "he saw Ed Richards today," you' LL SEE "He understands the cost of a CC referral and the potential damage for the bid. Asked me if we could mention it again in our document." First of all, is that a fair reflection of what your thinking was?
A.No. What News Corp had said to us at the meeting on 6 January was that a Competition Commission referral would be very expensive. In fact, they'd basically said that they would probably not go ahead with the deal, so they'd said that. So I could well imagine a situation where Mr Michel said, "Does Jeremy Hunt understand what was said?" and Adam Smith could well have said, "Yes". I don't think that Adam Smith asked for anything to be included in any document or anything like that, but that's obviously for Mr Smith to respond to.
Q.Although there's no reason why he wouldn't have said that, is there?
A.Well, you've asked him what he thought about this email and he says that he doesn't recognise the language.
Q.Yes, but we're trying to test whether the language chimes with other evidence, if you follow me, Mr Hunt. I mean, I think we understand the FIRST BIT "He understands the cost of a CC referral and the potential damage for the bid." That can simply be interpreted as he, that's you, understands the point that's been made on 6 January 2011 about the cost of a CC referral and the potential damage for the bid. In other words, you'd listened to what you were told and you understood it. So, as it were it doesn't take us very much further. But after THE COLON "Asked me if we could mention it again in our document." That's not implausible, is it?
A.I may well have said at the meeting on 6 January, because you remember the context, the meeting of 6 January we were giving the Ofcom report to News Corp, and then we said we would we told them we were minded to refer to the CC and then we invited them to make submissions back to us with their response to the Ofcom document, so I could well imagine that I said, "If you have any points, put them in your submissions that you send back to me."
Q.Three lines from THE BOTTOM "He made again a plea to try to find as many legal errors as we can in the Ofcom report and propose some strong and 'impactful' remedies." Is the adjective "impactful" one which would naturally fall from your lips, Mr Hunt?
Q.It's not a word you would tend to or like to use?
A.No. LORD JUSTICE LEVESON Is it a word? MR JAY It's a rather bad word, I think, but I have heard it used. Not one I would use, it's fair to say. What about the reference to a plea to "try to find as many legal errors as we can"? Had anybody said anything along those lines in your hearing?
A.No. I mean, Mr Smith says he doesn't recognise that language, and, you know, what we would have said to them is, "If you have any points, put it in your document, which is your response to the Ofcom report, which we will consider." I think they said to us, incidentally, that they believed there were some legal problems with the assumptions that Ofcom had made. Their hope at that stage was to avoid a CC referral by telling us that there were legal flaws in the Ofcom report, which would mean that I should ignore the Ofcom report and wave the bid through, and I rejected that advice.
Q.You're clear then that I suppose the most damaging line, if that's the way to put it, in this email is, "He made again a plea to try to find as many legal errors as we can"; you're clear that that does not emanate from you?
A.We know the conversation is with Mr Smith and Mr Smith says it doesn't emanate from him, so it certainly doesn't emanate from me.
Q.Thank you. 01692. This is an email timed at 8.59 in the morning on Sunday, 23 January 2011, and the previous evening there had been a 17-minute telephone conversation between Mr Michel and Mr Smith. Are you surprised that Mr Smith was working on your behalf so early on a Sunday morning?
A.I'm sorry for him, actually, because I think that he was getting this incredible volume of contact from News Corp and he's a very helpful, courteous person, so I would imagine it was the last thing that he wanted to do, to be dealing with this at the weekend, and I didn't have any idea about this until I saw these documents.
Q.I suppose it might be said that the greater the volume of contact, arguably the more extraordinary the contact, the more likely it is that he'd communicated the fact that there had been such an amount of contact with you. Are you sure that he didn't, Mr Hunt?
A.He didn't, and I was totally shocked when I discovered the level of that contact. I think it does explain why sometimes he slipped into inappropriate language.
Q.So are you saying that we shouldn't necessarily read all of this as exaggeration by Mr Michel; some of it might reflect inappropriate language by Mr Smith, is that it?
A.I don't think we should speculate on these are this is a conversation between two other people. We know there's an element of exaggeration. We know there are elements of truth in what is stated in these. But the extent to which there is truth and the extent to which there is exaggeration is, I think, a very difficult thing to do.
Q.Would you or did you use language like "very substantial UIL" or "strong UIL", that is to say privately to Mr Smith?
A.I think I would have said that this is a serious UIL. I mean, for BSkyB to be saying that they were going to take Sky News out of the whole deal, the only news organisation that they have, when I'm making a decision about news plurality, so this is a UIL which clearly needs to be seriously considered. But I put a lock on this process, which was that I was getting independent advice from Ofcom and the OFT, so I was going to wait until I heard from them before I made my decision.
Q.I'm sure the final decision had to await the final attention of legal and expert advice, but it's whether he's correctly reporting to Mr Michel the expression by you of a provisional view. Do you see that, Mr Hunt? Might you have said "strong UIL" for example?
A.I think if I'd said anything along those lines, it would be, "Looks on the surface like it might be a strong UIL but we're going to go through a process now and Ofcom and the OFT are going to look at it and then we'll hear their view and take a final decision."
Q.So "looks on the surface like a strong UIL" might have been interpreted by Mr Smith as "strong UIL", is that a possibility?
A.Well, I think we're sort of getting into a game of trying to predict how Chinese whispers happen when I don't know if I even said those words, so I don't think I can really predict on the basis of not even knowing I'm just giving you an indication of what I might have said at the time.
Q.We know what you wouldn't have said. You wouldn't have used the word "impactful" because that was LORD JUSTICE LEVESON Well, come on, Mr Jay. MR JAY Okay. What about "it's almost game over for the opposition", would you have used language like that?
A.No, absolutely not.
Q.You never use that turn of phrase?
A.Well, certainly not in the context of the BSkyB bid.
Q. LATER ON "He very specifically said that he was keen to get to the same outcome and wanted JRM to understand he needs to build some political cover on the process." Was that your private state of mind?
A.Not at all. How could referring these undertakings to Ofcom and the OFT possibly be political cover? Because I would have absolutely no idea what they were going to say. They were independent regulators. They could have come back to me and said, "Actually, these UILs do not satisfy our plurality concerns."
Q.Wasn't it your assessment though that one way or another and this may have been the advice you were getting that this would be resolved by UILs which would be negotiated and ultimately approved by the regulators?
A.Well, I didn't know whether it would be whether there would be a resolution. I didn't know whether the UILs were going to be knocked into a shape which satisfied the regulators and was commercially acceptable to News Corp. So what I knew was that if there was going to be a solution, it would have to be because there was a version of the deal that satisfied the plurality concerns of Ofcom and was commercially and financially viable as far as the OFT were concerned.
Q.And then towards the end IT SAYS "He said we would get there at the end and he shared our objectives." Is that something which you might have said privately to Mr Smith?
A.Not at all. I didn't share their objectives. My objective was to see whether a version of this bid could satisfy media plurality concerns, and if it could, I would approve the bid. If it couldn't, I would refer it to the Competition Commission.
Q.So your position is, on any view, what we see here does not reflect your opinion; is that right?
Q.Okay. 01704. Do you have THIS ONE "JH just said there was plenty of support for the remedy in the statement 'potential to mitigate problems' he can't say they are too brilliant otherwise people will call for them to be published." Now, in this case, as you know, there is a text message which immediately precedes this which is on very similar lines. Are you aware of that?
A.No, I don't know what the text message is, I'm afraid.
Q.Just bear with me while I produce the document. It's in Mr Michel's LORD JUSTICE LEVESON It's a text message from Mr Smith to Mr Michel. MR JAY Yes, on 25 January. This is one of the ones which were repeated verbatim. Yes. Text message at 8.03. The message from Mr Smith to MR MICHEL "There's plenty potential to mitigate problems. We can't say they're too brilliant otherwise people will call for them to be published. Will check on meeting." So this is passed on virtually verbatim. Do you think you might have told Mr Smith something along those lines?
A.No. Mr Smith, I think, said that this was a sort of this was an attempt to pacify Mr Michel. I think, as I see it, because I didn't know about these discussions between Mr Smith and Mr Michel, so I'm just inferring what I can from the documents that we've now seen, but it appears that News Corp were putting Mr Smith under pressure to say that these UILs were brilliant in the statement on 25 January and I wasn't prepared to say that because actually what we were doing was considering them but then we were going to wait and see what independent regulators said before we made a decision, and I think that Mr Smith was just trying to find a reason why we weren't prepared to change that language, and, you know, as he said, he probably didn't choose his words particularly carefully.
Q.In relation to this email, the possibility of exaggeration is ruled out of account because there's the antecedent text message, so there are two possibilities. Either Mr Smith for whatever reason has said something possibly out of a good motive, as you've ventured to suggest, or it reflects some things that you told Mr Smith which Mr Smith has passed on to Mr Michel. Why are we ruling out the second possibility, Mr Hunt?
A.Because I didn't tell Mr Smith that. I don't think I would have even had a conversation on this level of detail with Mr Smith.
Q.Okay. Move on then to 01707. 25 January. You see the LAST LINE "JH believes we are in a good place tonight." Immediately preceding LORD JUSTICE LEVESON We have to keep remembering that JH does not mean Mr Hunt. MR JAY The text message was, Mr Michel to MR SMITH "I think we're in a good place tonight, no?" And his REPLY IS "I agree. Coverage looks okay. Let's look again in the morning though." You see the last sentence of THE EMAIL "Let's see what the morning's coverage brings." That's a reflection of the text message. Did you express the view that at least as regards the coverage you were in a good place?
A.I can't remember if I expressed that view or not. But I would have wanted the coverage to be fair. You know, in particular, this is one of the differences I suppose between a quasi-judicial process and a judicial process. I'm still a Secretary of State, accountable to Parliament. I have to defend my decisions in the media and it was a particular challenge in terms of media coverage, which was to try and get the media to understand that I could only decide on grounds of media plurality and not on grounds of competition, and we actually did get there in the end with the media, and it took a lot of engagement to do that, but that was a very big problem that we had in the early days. LORD JUSTICE LEVESON This exchange reveals something rather interesting, doesn't it, because the text was Mr Michel saying to Mr Smith, "I think we're in a good place tonight", which might be read to mean "News Corp are in a good place tonight", Mr Smith says "I agree", then that's translated to Mr Murdoch as you or Mr Smith believing that "we", which could equally mean the joint combination of the two of you, are in a good place tonight.
A.(Nods head). LORD JUSTICE LEVESON One has to be a bit careful about translating from one to the other, hasn't one?
A.Mm. MR JAY I should have asked you, Mr Hunt, about an earlier email that day at 01705, sorry to go back IN TIME "Just had a chat with JH re statement before he went to Parliament, to get further reasons why not stronger support of the remedy. "He said he had no legal wriggle room in a statement to Parliament; that it's all exactly as he said yesterday and he only needs some space to prevent any accusation of deal-making at this stage." The text messages which were within half an hour of this email, Mr Smith to MR MICHEL "Other than what Jeremy and I have told you, we have no legal wriggle room in a statement to Parliament." Mr Michel then TEXTS BACK "Will do my best to get James on board." And then MR SMITH "It's all exactly as we said. We just need space." So apart from the words "to prevent any accusation of deal-making at this stage", which may be an elaboration, it may be an exaggeration, it may be an influence, the rest is vouched by the earlier text message. Do you see that?
Q.Do you think you might have used the term in this context "we just need space"?
Q.Why not?
A.Because I was running a process and my interest in this was that the process should be transparent and fair, and we would need to take as long as it took. I didn't want to send a signal to everyone involved in the process that they could drag their feet over this. I thought, you know, this was something we needed to conclude as briskly as we could. But, you know, consultations are extremely important parts of the process. To me may I offer an observation, Mr Jay, about a number of these things? I mean, to me, the way I interpret this exchange is that Mr Smith is trying to say things to get Mr Michel off his back, and he's basically saying you know, he used the phrase "no legal wriggle room". Quite an easy way to get someone off your back if they're pressuring you is to say, "I'm not allowed to by law". Sort of difficult to argue with. I don't know if that's what Mr Smith was doing, but that seems to me to be a reasonable interpretation. But what Mr Smith hasn't done, as far as I can tell, and I've looked as hard as I can through KRM 18 and his text messages, is ever go back and agitate for the thing that Fred Michel is putting him under pressure to achieve. So, you know, when Fred Michel complains about the role of Ofcom, Mr Smith doesn't come to me or to anyone else in DCMS and say, "We've got to rethink the role of Ofcom"; he just bats it back. When he at a later stage, I think it was in June, Mr Michel actually made a threat that News Corp would walk away from the deal. He said, "This is the bottom line", or something, "We're not going to give any more on these UILs", and Mr Smith doesn't even contact me to tell me that he's heard what you might consider to be quite a significant piece of news. He just sends a text straight back saying, "That's up to you and it won't affect Jeremy's thinking." I think that the picture that emerges to me is of someone trying very hard to keep a stakeholder on board with a process under huge pressure and occasionally lapsing into inappropriate language, but not someone who is giving them any substantive help in any way at all that is influencing the impartiality of the decision-making process.
Q.Just the terminology, though. "We just need space". Are you putting that into the category of inappropriate language or not?
A.Did that appear in the text?
A.It did. I think I would put that in the category of inappropriate language, yes, because I think you could interpret that as a suggestion that we're trying to do what you want to do. LORD JUSTICE LEVESON We'll just take another few minutes, Mr Hunt. Thank you very much. (3.26 pm) (A short break) (3.35 pm) LORD JUSTICE LEVESON Just one moment, Mr Jay. I'm told, Mr White, that my words at 2 o'clock meant that Linklaters, Allen Overy and News Corp all came over to the Royal Courts of Justice. I'm very grateful to them for the speed with which they responded to what I said. It appears that there may not be as much concern as originally thought. That's what I'm told. I hope you've received the same information. I am still very keen to ensure that I do fulfil the undertaking I gave to be able to publish today, and if there is anything that I can do to make that easier, let me know. I trust that you'll be able to provide appropriate assurances to Linklaters in the meantime. MR WHITE We know that the process is moving forward as quickly as it can. LORD JUSTICE LEVESON Thank you. We'll review it at the end of the day. MR JAY We were on the turn of phrase "we just need space", Mr Hunt. You say that's inappropriate. Why do you say that that doesn't represent your view?
A.Because my view wasn't about time apart from the fact that I just wanted to I wanted the thing to proceed at a brisk pace, but I think the phrase "we just need space" sort of has an implicit suggestion of wanting to get to the same destination and that wasn't my view.
Q.But didn't you want in one sense to arrive at the same ultimate destination, which was in one way or another a successful bid with appropriate UILs?
A.I would have been happy to approve the bid if we could have found a version of it that satisfied plurality concerns, yes. My default position is not that we should block bids. But I would not have approved it if we hadn't been able to find a way of satisfying those plurality concerns.
Q.In terms of Mr Smith trying to understand your own personal thinking on the issue, which after all was in part his role, wasn't it?
A.I don't think it was his role in this situation.
Q.But generally it was his role, wasn't it?
A.Well, he was important because he did understand my thinking, yes.
Q.But we know what your own personal thinking was from, for example, the memorandum of 19 November 2010 and the text messages around 21 December 2010. So Mr Smith wasn't going way off-piste, was he?
A.We knew what my thinking was up until the point when I took responsibility for the bid, but when I took responsibility for the bid, I didn't just set aside those views but I actually had a much higher order job to do, which was to make sure that our democracy was safe. It was a much, much more fundamental task.
Q.This goes back to the point, I suppose, that your mind had a series of Chinese walls in it by this point. You of course had got to discharge quasi-judicial functions according to the law, you were putting to one side of your mind your private views, but in terms of what Mr Smith was trying to do, he might find it difficult to differentiate between those two compartments of your mind, would you accept that?
A.No, because I don't think my mind had different compartments. I believed that I had a different job to do and it was an important job and it was about making a very fundamental decision that made sure that our democracy can function properly, and that was my absolute priority and I think Mr Smith knew that was my priority.
Q.I'm not sure you're telling us that you were successful, or could you logically erase from your mind all the thinking which you brought on this issue which we see culminating in the text message at 12.57, I think, on 21 December? It's impossible to wash one's mind clear of anterior thoughts, is it?
A.No. You know, from a policy point of view, the arguments I was making in my memo to the Prime Minister were what I believed, but I now had a much bigger job and a much bigger concern. I knew that I mustn't consider those policy considerations, but actually I didn't want to consider those policy considerations because media plurality, as this Inquiry has discussed many times, is so fundamentally important. The idea that no one person should have too much control over no one person or no one company should have too much control over the media we consume is fundamentally incredibly important.
Q.I think we agreed in the morning that at no stage did you sit down with Mr Smith and tell him expressly, "You have to be extremely careful here in your dealings with any third party, in particular News Corporation, because I, the Secretary of State, am now occupying a different role, a quasi-judicial function, and I must exclude from consideration any private view I might have told you previously"? That never happened, did it?
A.Well, it never happened if you're saying did we have a specific conversation with Adam Smith, but we had discussions that we were all part of in which the way a quasi-judicial process worked and the things that I could consider and the things that I couldn't consider were discussed in front of all of us. I actually believe Adam Smith knew that too. I think he understood that. I don't think that he was in his way of thinking he was really trying to deal with a difficult stakeholder. He wasn't in any way trying to give them advantage, and I don't believe that he did give them substantive advantage.
Q.You'll recall Mr Smith's witness statement where he said something rather different, namely that he did not understand his role to be any different from the role he would ordinarily undertake in relation to any other policy decisions. It's paragraph 51 of his witness statement.
A.I don't, I'm afraid, have his witness statement, but I can remember the concept.
Q.It's page 09042. What he told us in his statement and he CONFIRMED IT "As I had not received any specific instruction as to how I should deal with the contact I received from News Corp, I approached the matter in the same way as I did in other projects with which I'd been involved." In answer to my questions, he confirmed that that meant that he followed his usual practice in relation to policy issues and did not regard this function as possessing any special and unusual features. You follow that, Mr Hunt?
A.Yes, I do.
Q.Didn't you think that there was at least this risk, that although the legal advice which Mr Smith may well have heard related to you in terms of the quasi-judicial functions you were exercising, it wouldn't automatically be obvious to your special adviser, even acting as your alter ego, that he should follow exactly the same ground rules? Do you see that?
A.I think it would have been obvious, but I also think that we could have spelt it out, and looking back, you know, when something very sad has happened and someone very capable and decent has lost their job, you always ask yourself what you could have done better, and I wish we had spelt out to him that he needed to be very careful, to use appropriate language. I wish he had told us about the pressure that he was under and the barrage that he was getting and then we could have perhaps warned him at that stage as well, and the consequences were very unfortunate.
Q.We're in the somewhat unusual position then of a person of obvious intellectual ability and some political judgment, someone might say if you look at the text messages he sent to you, simply misunderstanding what all this was about, if paragraph 51 of his witness statement is correct. Do you accept that?
A.I believe what happened was that he did understand his responsibilities in the quasi-judicial process. I think he broadly understood the importance of being free from bias and being free from appearance of bias, but I just think that the barrage that he was subject to, the amount of contact that he had, ended up pushing him in certain situations into language that was inappropriate, and I think that's that is the core of the problem, and I think we do need to think hard about how we prevent that kind of thing happening in the future.
Q.Can I just understand saying something that was inappropriate or words to that effect. It might have been inappropriate in the sense that if he were communicating a private thought of someone, he shouldn't have communicated it at all, so it was inappropriate to share it, or it might have been inappropriate in the sense that it didn't in fact represent the private thought of someone, so in other words it misrepresented his master's voice, if I can put it in those terms. In which sense are you using that phrase?
A.I'm using the phrase in the sense of language that suggests that he shared News Corp's objectives in trying the get the bid through.
Q.I'm not sure that correctly groups with the question I put. The two possibilities are he shouldn't have expressed a private view at all, or he shouldn't have expressed the private view or a view in the way in which he did because in fact he misrepresented your private view. Do you see the difference?
A.Well, I'm not sure that he did ever misrepresent my private view. We don't know from Mr Michel's emails how much is fact and how much is fiction, so I don't know that he whether he misread certainly if some of the things he's alleged to have said were said, then he would have been misrepresenting my thoughts, but we don't know that he said them. In terms of actually passing on my thoughts, I don't think that when you actually look at the you know, what Mr Michel suggests are great big insights into my thinking, the evidence I've seen is that basically Mr Smith was just repeating stuff that News Corporation would have already known was my thinking from meetings that I'd had and official contacts.
Q.But there's quite a lot of material here which there are only two possibilities. Either it is your private thinking or it is a misrepresentation of your private thinking, because it's material which couldn't have been derived from any other source. Would you agree with that?
A.I'm happy to look at any of those and I can tell you which it is.
Q.But in terms of Mr Smith's instincts and from your knowledge of him, it was his job, insofar as he would be speaking for you, to represent your thinking. It would certainly not be his job to misrepresent it, would it?
A.It's certainly not his job to misrepresent my thinking, but I don't think a special adviser has many roles. They help you work out a difficult policy solution in an area where you have a conundrum that you're trying to resolve. Sometimes they go into a meeting where, as you say, they're speaking for me. I would say that the best example of that is probably internal meetings inside DCMS, where he would sit in a meeting about local television or broadband or one of our other policy areas and the civil servants would be trying to better understand what I meant when I'd had a meeting with them that might have been quite a brief meeting and Adam would explain it more. That would probably be a more typical time that he would be speaking for me in the terms that you suggest. But in this bid, his role was to act as an official point of contact for News Corp, to keep them informed about the process, to reassure them that the process was fair because of the circumstances that we'd had. That was what that's what we thought his job was.
Q.I think the real point you're making, Mr Hunt, is that he shouldn't have been expressing any private views at all, isn't it?
A.Any of my private views?
Q.Or indeed any of his either?
A.Well, I think that part of the reason why his conversations did lapse into inappropriate language and we don't know the extent to which he expressed private views because we just don't know what Mr Michel said but if that happened, I think part of the reason might be the volume of contact that he was subjected to. LORD JUSTICE LEVESON Could you tell me, Mr Smith had worked for you for some years, including the period when you were in opposition, and doubtless had been doing the same sort of role advising you as an opposition spokesman as he later took on advising you as a minister. Would that have brought him into contact with Mr Michel?
A.I think he may well have met Mr Michel in opposition. I met Mr Michel in opposition. His roles were different. I mean, he started working for me as a Parliamentary researcher, which is sort of the bottom of the tree in terms of jobs that people do working for MPs, and then when I joined the Shadow Cabinet, he became my chief of staff and he had a small team working for him and his primary responsibilities there would have been policy developments for the manifesto. And then when I moved into office, he then came as my special adviser, where his role changed again, but each time when he had as it were a promotion, he showed himself extremely able and capable LORD JUSTICE LEVESON No, that wasn't the point that I was seeking to ask about. It was rather different. If he had had a previous relationship, professional relationship, with Mr Michel where the rules of the game were perhaps somewhat different, I'm just wondering whether it wasn't rather more difficult for him to step out of the relationship that he had had with him prior to your taking responsibility for this bid and adjust for the differing nature of the relationship. It's a question, it's not a statement. I'm asking.
A.I think it's a very valid question because I think that one of the things that both he and I had to do in this quasi-judicial situation, this is I think a situation that you can get when any politician or politician's assistant is, as it were, having to do a job in a different way to the normal course of work, one of the differences between what I had to do and perhaps what you do, sir, is that I was adjudicating on a decision where I had pre-existing relationships with the inspaniduals concerned and an expectation that there would be relationships that would continue afterwards, so I had to set all those considerations aside, and I believe I did. But it may have been that one of the factors that made it easier for Mr Michel to suck Mr Smith into a situation where he was using some inappropriate language was partly because there was some pre-existing relationship, which would have been less likely with a civil servant, and that might be something that we want to reflect on in terms of doing things in the future. LORD JUSTICE LEVESON Well, I merely raise it for you to comment upon it. Thank you. MR JAY May we look at another email, this is the Swan Lake email. In fact, it's Black Swan, isn't it?
A.That's right. The mystery is resolved.
Q.01717. LORD JUSTICE LEVESON Yes, well, I'm pleased we've done that.
A.I just need to find the famous Swan Lake ah. MR JAY 01717.
A.Right, okay. Here we are.
Q.You'll remember the evidence about this. There were a number of calls or conversations between Mr Smith and Mr Michel that evening, I think five of them, but the records show that Mr Smith called you at 19.03 hours and spoke for 3 minutes, 23 seconds with you. And the email is timed 7.24 in the evening. Can you remember anything about that conversation out from Mr Smith to you?
A.I'm afraid I can't. I mean, he does call me quite regularly, so there would have been numerous conversations that happened at times when I wasn't in the office, so I'm afraid I can't remember the particular details.
Q.If I were to suggest to you it's likely to have been about the BSkyB bid, would you agree with that?
A.I it's certainly possible. I can't say it's likely because I just don't know what other issues we were, you know, doing a lot of other different things as well at the same time as the BSkyB bid which Adam would have been involved in.
Q.But it comes amidst a number of calls, I said there were five of them, that evening. The most sensible inference, Mr Hunt, is that the discussion was along similar lines as his other calls, namely what we see here, namely the bid. Do you follow that?
A.I'm sorry, I'm not sure I do, Mr Jay.
Q.Okay. If the evidence shows that Mr Michel and Mr Smith were speaking on a number of occasions about the bid, and before the last of those occasions, which was just after 8.00 in the evening, at 19.03 there's also a call to you, can't we reasonably draw the deduction that the subject matter of the call to you is going to be the same as the calls Mr Michel and Mr Smith were enjoying at about the same time?
A.I think we can deduce that it's possible, but I don't think we can deduce that that was the case. There could have been another reason that he called me. But I agree, it's entirely possible.
Q.And you can't think of any other subject matter which might have arisen at about this time, can you?
A.Not off the top of my head, but, you know, we would have had lots of other issues happening at the same time. As I say, I may have talked to him about the BSkyB bid. I'm not trying to say that I didn't. I just don't know.
Q.Can I ask you about the language which is put in inverted commas here about six LINES DOWN "We all know what Ofcom's intentions are and have been from the start on this." Did you say anything along those lines to Mr Smith?
A.No, and Mr Smith says that he didn't say anything along those lines to Mr Michel.
Q.So even privately that's not the sort of view, is it, that you would have expressed to Mr Smith?
A.No. And I would hardly, if I had had that view about Ofcom, which I certainly don't have and certainly didn't have, I would have hardly said to them, "I want you to take an independent look at the UILs". I see them as a highly professional independent regulator.
Q.Is it your evidence that what we read here is simply something you don't recognise?
A.What I
Q.The core messages anyway?
A.The thing that I recognise in this is the fact that News Corp had massive, massive suspicions about Ofcom, and it's just absolutely no surprise to me at all that they would I mean, as you know, we had the row with News Corp on 20 January, where they strongly objected to the idea that Ofcom should have any role in saying whether the UILs addressed plurality concerns, and so I imagine this isn't that long after that that there's still huge frustration that Ofcom that they thought that Ofcom were not going to address the issue fairly, but I'm just speculating because I obviously have no idea what was said in the conversation. I suppose what I'm saying is I could imagine Mr Michel downloading all his views about Ofcom and trying to interpret the sort of odd grunt from Mr Smith as being agreement with what he was saying.
Q.Okay, let's move on to another one, 01720, 11 February. We know from the chronology we went through before lunch that 11 February was indeed the date that you received the reports from Ofcom and OFT. Do you recall that, Mr Hunt?
Q.But this appears to be some sort of advance preview, if that isn't a tautology, of what those reports contain. Both will recommend that he refers to CC, and that's correct, it is what they both recommended, isn't it?
A.As I recall, they both said that they were broadly satisfied with the UILs but they had some major reservations and then they listed the major reservations.
Q.And if those reservations were not met, and we can see some of the reservations listed in the email, then there would be a reference to the CC.
A.That's correct, yes.
Q.Had you in fact been given advance notice orally of what the reports would contain?
A.I don't know if I had or not. It has to be said at this stage of the process this was a pretty open under the law, the negotiation was a negotiation between DCMS and News Corp, but because I'd insisted on inserting this double lock of Ofcom and the OFT into the process, they were involved in these negotiations, but there was no particular reason why there should be any secrecy about anyone's positions. It was a general discussion between News Corp, Ofcom, the OFT and DCMS, to see whether it was possible to put the UILs into a position where they satisfied plurality concerns.
Q.In this sort of situation, it's highly plausible, isn't it, that you would be given advance notice of reports, sort of a heads-up, in advance of receiving the formal documents; that's right, isn't it?
A.Not necessarily. I had a number of other things that I was doing as a Secretary of State at the time and I could just as easily imagine my private secretary bringing me in the actual letter and saying, "Here we've got the letter from Ofcom and the OFT", but I may have also been given a heads-up verbally as well, I don't know.
Q.This is consistent with if you had been given the heads-up verbally, and indeed it's sufficiently consistent with what we know the reports to contain to lead us to the conclusion that that's what happened in this case. Would you accept that?
A.Well, this of course could be one of those situations where we don't quite know what JH means. It could be that Mr Smith knew a heads-up of what those reports contained. I'm afraid I just don't know what it's referring to here.
Q.And then five lines down a point is made which has been made in PREVIOUS EMAILS "JH doesn't want this to go to the CC. He also said his officials don't want this to go further as JH believes it would kill the deal." So it's at least the second time the point has been made. Is it your evidence that it's therefore the second time an error has been made as to what your private thinking was?
A.It certainly wasn't my private thinking, but I think there's a substantive point about this email, Mr Jay, if I may point out, which is what I actually did, because this is on 11 February, so we had discussions going on about the UILs for two weeks or so, and there are clearly some issues of difference, things that News Corp are not prepared to concede, including the very substantive one of whether James Murdoch continued to be chairman of the spun-off Sky News. That was significant because there was concern about media plurality, so Ofcom and the OFT were saying that he should not be allowed to be chairman. And what I did when those issues bubbled to a head, I thought we have to resolve them one way or the other, and we were being given an indication in this email, I guess, that News Corp were very unhappy with those. I simply wrote to Mr Murdoch and I said, "You need to back down on every substantive point within 24 hours", so I think that indicates that I was not afraid of it going to the CC, because if I had wanted to avoid it going to the CC at all costs I would certainly not have written a letter to Mr Murdoch saying, "We're not even going to negotiate on this, I want you to back down on every single point within 24 hours."
Q.Unless your assessment was, I suppose, that you knew he would back down because he wanted the deal so much.
A.Well, I'm
Q.Was that it?
A.I don't think many people would assess a negotiation with the Murdochs as the likely outcome being that they would back down on every single point.
Q.We know from surrounding text messages which I've just refreshed my memory about that the letters from Ofcom and OFT didn't arrive that evening, and that Mr Smith was waiting in the building to receive them, so he had either received advance notice or you had received advance notice. I don't think there are any other possibilities. Do you see that?
A.If that's what it says, then that must be it.
Q.But you can't remember which it is; is that right?
A.I don't remember receiving advance notice of them.
Q.I think he stayed in the office until after 9 o'clock waiting and they didn't eventually arrive that evening. But there it is. Can we move forward to 01744. This is the 3.25 in the morning email, 3 March. It may be little turns on this because you'll remember seeing the emails in the file this morning which indicate that there was discussion within the department as to whether News Corp could be given advance notice, and your understanding was that they could, and maybe a bit ahead of the game Mr Smith is giving some form of advance notice to Mr Michel, isn't he?
A.I'm not sure it's particularly ahead of the game. My understanding is that you're allowed to let the companies know well before, but this is at 3.25 in the morning for an announcement that's going to be made at 7.30 the next morning, so it's not a great deal of notice.
Q.So you feel on this occasion Mr Smith is in fact obeying whatever instructions he was given; is that right?
Q.Can I ask you about 01756. 31 March. It's really the LAST POINT "He debriefed on his meeting with the media coalition. In A NUTSHELL they looked miserable, were making competition arguments and know they have lost the battle." Is that a fair assessment of where you were at following that meeting?
A.No. That meeting was that was an important meeting and we discussed some quite substantive points. We'd taken on board a lot of things that Slaughter May had said in the process, which actually found their way into the UILs in a very significant way. And so no, I think the meeting was an important meeting.
Q.I'm not saying it wasn't an important meeting, I'm just saying whether the email accurately captures the demeanour of those who attended it apart from the department's demeanour, in other words fairly crestfallen. Is that accurate or not?
A.I don't remember them being crestfallen or not, actually. I don't even I just have no memory of it at all.
Q.You can't assist us then as to whether that does represent the state of mind or at least the manifestation of the state of mind of those with whom you were speaking on that occasion; is that right?
A.I suppose I can assist you in the sense that that clearly wasn't my thought. I don't have any recollection of the emotional state of the people that I had that meeting with, so I think it's unlikely that I ever had much thought about that.
Q.On this occasion there are two possibilities. Either Mr Michel is exaggerating or fabricating or Mr Smith is going too far. Are we agreed about that?
A.Well, either it may be that Mr Smith made a flippant comment about the media coalition and maybe he noticed that they were looking miserable. Maybe they did look a bit miserable. And maybe he passed that on. Or maybe it's been invented by Mr Michel.
Q.Okay. 01778, 20 May.
A.Mr Michel did talk, I think, about saying things occasionally to boost the morale inside News Corp, so I guess this could be one of the comments that
Q.The boosting of morale, I think to be fair to him, related to the period when Dr Cable was in the saddle. My recollection is not is not that he was doing that after 22 December 2010, but if that last statement is wrong, I will doubtless be corrected.
A.I was pointing out that that is something that he has in the past thought was something that he might want to do in an email, but I'm speculating. I think it's the wrong track to go down because we just don't know.
Q.I think his position is that the morale was low for good reason under Dr Cable but much higher for a different reason under you, if you follow me. Okay. 01778. There is a text message which antedates this email. We're on 20 May. Mr Smith to MR MICHEL "It wasn't a speech", this relates to your remarks to journalists. "It was one remark to journalists and doesn't say anything different to what I've said to you. Will take as long as it takes and we need to get it right." Pausing there, that's something you might have said, are we agreed?
A.Yes. And that was my position.
Q.Mr Michel back to MR SMITH "You did tell me by 24 June." There is mention of that date in an email I think of 13 May. "I might need JRM to call JH. Let's discuss." And then Mr Smith to MR MICHEL "And that hasn't changed but we can't tell journalists that, can we?" So 24 June is the date which hasn't changed and which journalists cannot be told about. Is that sort of conversation one you believe you're likely to have had with Mr Smith?
A.I don't believe I did have that conversation with Mr Smith. I don't believe that was really the level of detail that I would have been involved in. I think the I didn't want not to have target dates when things would be completed by, because I thought otherwise the process could just drag on and on for years and years, so I wanted people to go about their analysis and negotiations briskly, but I also wanted it to take as long as it took. So I think what Mr Smith is saying is there's a target date, but it's not one we can say publicly because if we say it publicly and we miss it then we'll be putting ourselves under formal pressure to meet a date and that wouldn't be appropriate, so I think that's what he's saying.
Q.If that is what he's saying, he would have been reflecting your view; is that correct?
A.It would certainly be my view that we shouldn't publish a target date when we're hoping to complete all the negotiations by, yes, because it might take longer.
Q.And might you have as well had a conversation with Mr Smith along the lines that any target date was one which could not be shared with the press?
A.Well, it's self-evident. If all the parties in a negotiation are aiming to conclude the negotiation by a certain date and we say "Let's try and get it completed by this date", because we don't want it to go on forever and ever, but we would say we aren't going to publish this date because then it becomes an immovable deadline and actually the discussions may take longer. And so that was, you know, I don't know if I actually said it but it's I think self-evident.
Q.So if you did say it, you weren't saying anything which was at all remarkable. That's what it amounts to, is it?
Q.01781, 3 June. I don't think there's evidence of text messages before this email but there's evidence of phone calls which lasted for the last one at 13.23 hours lasted 19 minutes and 26 seconds. He refers to a "clear blame game going on regarding the delay between lawyers, the department and Ofcom". Now, if there were a blame game, that's something that would come to your attention; is that right?
A.Yes. I don't particularly remember a blame game going on. We're on 3 June now.
Q.3 June.
A.Yes, so the consultation finished on 21 March, so we've had a bit of March, the whole of April, the whole of May, so we had 40,000 responses, mind you, to plough through, so there was a lot of work to do. LORD JUSTICE LEVESON Were they 40,000 inspanidual responses or people signing petitions and that sort of thing?
A.I think there were a lot of responses that were exactly the same in that, organised on the Internet, but it was still you know, in terms of the number of different I think Avaaz was responsible for nearly 40,000 alone, but there were still several hundred and the several hundred that we had, some of them had very substantive points. We had to go through every single one of them to see and we did indeed find some substantive points, such as the importance of making sure that BSkyB continued to promote Sky News on its other channels, which was what they currently do, as a way of making sure that Sky News continued to get the support that it needed to continue as an independent entity, so quite important stuff came out of that consultation. Sorry, to get back to your point, I may well have been frustrated at how long it was taking. MR JAY And given the delay and given human nature it's possible that people were blaming one another perhaps unfairly, do you accept that?
A.It's possible. I don't think I particularly got into a sort of Spanish Inquisition about who's responsible for the delay. I suspect that that is something that was going on inside News Corp, from the tone of Mr Michel's email.
Q.I'm sure it didn't reach that level of pain, Mr Hunt, but it may be that you were getting quite impatient, which is what the email says. Is that possible?
A.It's possible, yes. I'd say it's actually probably quite likely that I was getting impatient at that stage because it had been going on for a long time.
Q.Indeed some of the evidence we were looking at before lunch in the emails indicates that overall people were getting concerned by the delay within the department without necessarily allocating blame for it. What about the third point, though, that "he" it's the same point always on the pronoun "he", who is the "he"? "He is politically very keen to get this done as quickly as possible and understands the potential impact this will have on the share price." In political terms that was your thinking, wasn't it?
A.No. I can't think of a political reason why I would want to get the deal done quickly. I mean, obviously I knew my advice that I shouldn't have political reasons for doing anything in a quasi-judicial process, but, you know, I think that because this was such a controversial deal, the politics were actually quite similar to the legal, which is that the only thing to do was to be scrupulously impartial and so getting something done more quickly than it should be done wouldn't have been appropriate.
Q.I'm not sure that that's the message from paragraph 3, that for all sorts of reasons the process had to follow its course, otherwise you faced risk of judicial review. Can we agree about that?
A.Yes. The process had to be legally robust, but the reason that it was taking so long was because of the involvement of Ofcom and the OFT and that wasn't required by statute, so we could have had a much, much shorter process if I had just decided to negotiate the UILs myself directly with Mr Murdoch, and I chose not to do that and that may indeed have been the reason why the deal failed in the end, because the whole thing took so long and by the time you know, by that time the phone hacking allegations had emerged in much greater number.
Q.That was a supervening event which you couldn't necessarily anticipate, but it's possible, though, to imagine two parallel processes. One, the deal must take as long as it takes to safeguard the department from the possibility of judicial review and therefore there's no choice but to go down this road and through all these legal hoops. At the same time you could be thinking to yourself and telling Mr SMITH PRIVATELY politically we want this to be done as quickly as possible, consistent with the first and primary objective, and we understand that the longer the delay the greater the impact on the share price. Those aren't two inconsistent propositions, are they?
A.With respect, I think they're both wrong. I can't see what my political motive would be. This is a deal that was incredibly unpopular with the whole of the rest of the media, so politically it was an incredibly unpopular thing. You talked about this as a hot potato in other hearings; it certainly was. So I don't see what the political motive would be to get it done quickly. In terms of due process, of course we wanted to have a legally robust process, but my concern was not that, because I don't think that we needed to involve Ofcom and the OFT to have a legally robust process. My concern was that the public should be reassured that this had been approached in an impartial way, and that meant involving the OFT and Ofcom in a very substantive way, a much more substantive way than was required by the enterprise act, and that did indeed mean that it needed to take as long as it took.
Q.But the reference to "politically", surely that harks back to the memorandum of 19 November 2010, that it chimed with you and your party's perception of what was in policy terms desirable for the United Kingdom and it chimed, at least in the first draft of the memorandum, with the political objectives of your party. That's the sense in which you were using the term here or rather that's the sense in which we read it here. Would you agree with that?
A.No. I certainly agree that I had those policy views in the memorandum of 19 November, but, as I said, the politics were complex to say they were complex is a big understatement. You had two Conservative-supporting newspaper groups bitterly and passionately against this deal and one Conservative-supporting newspaper group strongly in favour of this deal, so there wouldn't have been a political reason to want this deal to go ahead.
Q.It may turn on how you define "politically" and whether it's short term or long term or whether you limit it to what different print titles were saying at particular times, but certainly in political terms your party was generally sympathetic to deals of this sort and this particular deal. Can we agree about that?
A.No. I think in political terms, the politics are as I've described. If I may say, Mr Jay, I don't think Mr Smith even confirmed that he used the word "politically". I'd be very, very surprised if he did use the word "politically". It may well be that Mr Michel believed that we might have had a political motive, which we didn't have, and he was putting that into his email, but I'd be just very surprised indeed if Mr Smith used that, because it's not the sort of language Mr Smith would use and it's not true.
Q.The last point on this email is paragraph 12: "At the end he said that for him being able to obtain a full green light on everything from Ed Richards/Ofcom in the coming days was the easiest way to clear the process and make a swift decision without facing any credible legal challenge." That bit is accurate, isn't it?
A.I don't think there's any surprise well, when you say "he said", I don't know if I had had this conversation, but it may well be that Mr Smith had said to Mr Michel, "The Secretary of State is going to take into account what Ofcom say very seriously indeed" and that would have been something that I would have said on 20 January when I had that difficult exchange with Mr Murdoch.
Q.Okay. Move forward to 01792, 30 June: "Had a debrief with JH and his team tonight at 7pm before he left to his constituency. He is very happy with the way today went and especially with the absolutely idiotic debates led by Watson and Prescott." Is that the sort of characterisation of debate led by those inspaniduals which might reflect your viewpoint?
A.I can't remember what Mr Watson and Mr Prescott said in those debates so I can't remember if I thought it was idiotic or not.
Q.You might be able to tell us whether you're sure that's something you wouldn't have said, maybe you can't go quite that far, Mr Hunt. Can you assist us?
A.Well, as I recall, Mr Smith said that he didn't think the debates were idiotic either, so I don't think either of us recognise that language.
Q.So it completely grates in that sentence so we can put it all to one side, is that it?
A.It is conceivable that I did see those debates and did think they were idiotic. I think I might have remembered if I had, and I don't recall it. LORD JUSTICE LEVESON Let's assume you're entitled to think whatever you wish about your political opponents or indeed your political friends, but would you expect your special adviser to share that sort of comment?
A.That wasn't his role in this process, and it's possible that there were one or two thoughts during the process that I had about things in general, I don't say this in particular, that, you know, he may have passed on to Mr Michel. He may have said, for example, "Jeremy's very frustrated the process is taking so long." I can't find anything in here that if it was true is substantive in terms of giving News Corp an unfair advantage in terms of an insight into my thinking. LORD JUSTICE LEVESON Yes. It's not so much in relation to the bid that I ask the question, but more in relation to the relationship.
A.Yes. It does seem that there was such extensive contact that, you know, there could have been chat along those lines. MR JAY The last one we're going to look at, 01799, 7 July. We know it's preceded by an 11 minute 8 second conversation, Mr Smith/Mr Michel, within about half an hour of this email. What Mr Michel appears to be doing is referring to a meeting that you had with the Prime Minister that day. First of all, was there a meeting between you and the Prime Minister that day?
A.I did have a meeting with the Prime Minister to discuss inquiries. I'm afraid I can't recall whether it was that day. But I did have a meeting. We can certainly find that information out for the Inquiry if that would be helpful.
Q.At that stage was the policy thinking along THESE LINES one of the inquiries would be into the police, led by a judge; the other into media practices, not with a judge and led by DCMS. Is that broadly speaking right?
A.I think that we at that stage I'm just sort of looking at the date here I think there were lots and lots of options floating around at the time, and I don't think that I don't believe that we had concluded I seem to remember I'm sorry, I'm sort of trying to remember here, but the Prime Minister made a statement to Parliament, which I think was the day before, about having an inquiry, and we should perhaps cross-reference whether this was information that was in the Prime Minister's statement.
Q.Yes, we think it was 8 July, the statement.
A.Oh right, okay. It could well be, if it was the day before the Prime Minister's statement, that this was one of the options that was being discussed.
Q.Therefore an option which you communicated to Mr Smith, is that fair?
A.It's possible.
Q. LOWER DOWN "The closure of News of the World does not affect JH decision and if anything help [should say helps] the media plurality issue by weakening our voice." Is that a view that you might have expressed to Mr Smith?
A.Well, it's just wrong. I mean, the closure of the News of the World directly influenced my thinking because it made me have a very real concern about corporate governance issues at News Corp, which led me to write to Ofcom the following Monday to ask them if they stood by their earlier advice.
Q."The Cabinet spanisions reported in the press are much more to do with the hacking saga than the deal itself." Is that accurate or not?
A.Well, I think Mr Smith says he wouldn't have known about the Cabinet spanisions, and here Mr Michel is talking about them being reported in the press, and it may well be that the reports in the press made clear that it was about the hacking sag
A.I just I'm afraid I just don't know.
Q.But I think you would know what the Cabinet spanisions were or weren't, and I think the simple question is there are TWO QUESTIONS (a) were there Cabinet spanisions and if so were they to do more with the hacking saga than the deal itself?
A.I don't remember any particular Cabinet spanisions. There may have been discussions. I don't believe that it was discussed in Cabinet, although I may have got that wrong. We certainly wouldn't have discussed the deal at Cabinet because that was a quasi-judicial process. The Milly Dowler story broke on Monday the 4th and there would have been a Cabinet meeting the following Tuesday morning and I don't remember it being on the Cabinet agenda that morning. But the Prime Minister was obviously very aware of it and made a statement later on that week. I think it is fair to say that the concerns that were generally being expressed by people were about the phone hacking rather than about the BSkyB bid. I think that's where the public outrage was, and that's what, you know, people were thinking about.
Q.What about the LAST POINT "Feels that both BBC and Guardian have been extremely helpful in reporting accurately that he has no room in his decision." Did that represent a sentiment which either emanated from you or which you shared?
A.I think that we had made progress at that point and it had been a lot of hard work in trying to get everyone to understand the constraints under which the decision I was taking were taken and the fact that it could only be about media plurality and it wasn't a competition issue and I couldn't, you know, automatically include phone hacking in the considerations except on the narrow basis that we'd been advised. I think we were quite pleased that around that time, but I can't remember exactly when, that this had been reflected in the BBC and the Guardian.
Q.May I move away from KRM 18 now. I haven't taken you to each and every email there, we've done more than taste them, to use Mr Rupert Murdoch's terms, but we certainly haven't looked at all of them but the conclusions can be drawn one way or another from your evidence about it. Can I move forward to 24 April 2012. I think you had a drink with Mr Smith that evening; is that correct?
Q.And Mr Smith tells us at paragraph 262 of his statement that he said that if the pressure became so great that it would help if he resigned then he would not hesitate to do so. Did he say words to that effect?
Q.Did you reply along the lines that it would not come to that?
A.I may well have said something along those lines, yes.
Q.Then there was a meeting the following morning, according to Mr Smith, where presumably you met with, amongst others, the Permanent Secretary; is that correct?
Q.And what was the we've heard Mr Stephens' account. What view was taken at that meeting?
A.Well, I'd come in early that morning. There was there was obviously a big storm going on, and Adam Smith had again offered to resign if that became necessary, and it was still very much my hope that it wouldn't come to that, and discussions continued during the course of the morning and, you know, one of the challenges we had was that there was a huge volume of information, as you know, and we knew there was some exaggeration but we did also know that there were examples of text messages that Adam had sent where the language was inappropriate, and we didn't know as much as we know now about how much of KRM 18 appears to have had an element of exaggeration, but we knew there was some language that was inappropriate, and I think we came to the conclusion with very, very heavy hearts that we were going to have to accept his offer to resign.
Q.Did you say to him at about 9.30 in the morning, "Everyone here thinks you need to go"?
A.Yes. I wasn't particularly including myself in that description of "everyone", I was just talking about I mean, I think I personally found the whole thing incredibly difficult. This was someone I'd been working incredibly closely with for nearly six years, someone of whom I had the highest opinion, someone I felt responsible for and someone who is very decent and honourable, and it seemed terribly unfair but the pressure was such that it did seem that it was inevitable.
Q.Although the person responsible for his discipline, if I can use that term, was you, not the Civil Service, wasn't it?
A.Well, he reported to me, yes.
Q.So if something had gone wrong, I'm not saying that it follows that you were responsible for that, it's not for me to suggest that or put that question to you, but theoretically it fell within your responsibility, didn't it?
A.You know, I do have responsibility for what he does. I actually have responsibility for whatever everyone in my department does, but I have more direct responsibility for the people who are my direct reports.
Q.Mm. May I put to you this question, which I've obviously SEEN SOMEWHERE did you originally believe that Mr Smith had done nothing wrong and tell friends that you would resign yourself rather than let a junior official go, or words to that effect?
A.I did think about my own position, but I I had conducted the bid scrupulously fairly throughout every stage, and I believed it was possible to demonstrate that, and I decided that it wouldn't be appropriate for me to go, but it was with an incredibly heavy heart that I felt that we just didn't have any choice but to accept Adam's resignation.
Q.Do you feel, Mr Hunt, looking at this more widely, that you were given a task which, in the event, was too difficult, too toxic, given the views that you'd expressed publicly, given some of the views we've seen you were expressing privately right up to just before 1.00 in the afternoon of 20 December 2010, that simply these are decisions which should not be taken by politicians such as you?
A.Well, I think it's something that we should consider. I do believe that I conducted the bid totally fairly. I do believe that I was completely able to put aside my opinions of policy merits of the bid, put those on one side, and I was able to construct a process where there was a double lock that could reassure the public, because of the involvement of independent regulators, so I do feel in this case that the bid was conducted completely fairly. But I also feel that what we didn't predict was the pressure that Adam Smith was going to come under, and I do think that in terms of thinking about how one could do these things better in the future, I think the point that we discussed earlier about whether special advisers are more susceptible because they might have a pre-existing relationship with people who are involved, I think that's something that we need to think about. I think also the volume of communication was huge. It wasn't something that we knew about until all this evidence came out, and I think that might have meant that, you know, as I mentioned earlier, even someone as straight and brilliant and diligent as Adam found himself getting sucked into inappropriate language, and that might have been a factor. So I think there are lots of things one can learn. LORD JUSTICE LEVESON But your DOUBLE LOCK I will take every step with legal advice, with Ofcom's advice and with the OFT's advice, so to that extent it's triple, lawyers, Ofcom, OFT, and I will do exactly what they recommend, actually means that on one reading of it, you are dropping out of the decision because you're going to rely on what the experts say, yet you are the one that is going to take the flak for all the decision.
A.Well, I wasn't dropping out of the decision, because I always viewed it as my decision and I was going to take the advice that I got very seriously, but I tried to create a structure where I didn't have, if I can use a phrase that we've had earlier, any political wriggle room, so that my political discretion was zero, so that the public could see that the weight was being given to legal and independent regulator advice. But in the end I had to take responsibility, I had to make the choice whether I was going to accept the Ofcom and the OFT advice, and that was my role constitutionally, and yes, I would have to defend that, but I think perhaps it's easier to defend a decision that is necessarily going to be controversial one way or the other if you can point to a very strict process that you followed and you can demonstrate that you've been fair, which I believe we were. LORD JUSTICE LEVESON But if you've removed all political wriggle room, and you're going to follow the advice, if you say, "I'm retaining the decision because I might not choose to follow the advice", you are retaining your wriggle room.
A.I think there's if I could say, I think what I'm really saying there is that I was removing the political wriggle room. I didn't have any political discretion. The way I structured it was that when I made my decision on each occasion, I published the independent advice at the same time, so it would have been completely free to me to take a different view to the independent advice, one way or the other. But the way I constructed it meant that I would have to justify that publicly so there would have had to be a very good reason to do it, and providing I believed that I had a good reason, then I could make that case. LORD JUSTICE LEVESON But once you've done that, politics have walked straight back into it, haven't they?
A.I think it depends what the reason is. If you had a political reason, that would not be a good reason and therefore it wouldn't stand up and you wouldn't be able to do it, but you might have another reason. I don't know. As it happened, I never found a reason to disagree with that independent advice. But I think, just to address Mr Jay's earlier question, and following on from what you said, sir, you could ask, well, if you're giving so much weight to independent regulators at every stage and you're removing your discretion to a very large degree, if not entirely, why not just give the whole decision to independent regulators? That's what we do in competition law. It used to be in competition law that those decisions were made also by secretaries of state and we removed that and gave that to independent regulators. You've had different witnesses who have expressed different views on that. I do have some sympathy with that view, because even though the decision I took was totally impartial, I always felt there were going to be elements of the public that would never believe it was. LORD JUSTICE LEVESON But that's precisely the point. And ultimately, this is slap bang in the middle of the terms of reference, the concern is that it's not only the perception perhaps of the public, perhaps of those who've opposed whatever decision you actually make, there's also a slightly different problem, that in the context of your work you are dealing with these very self-same people across a wide range of issues, and as you yourself have said, you will have to continue dealing with them across a wide range of issues. Therefore the risk becomes that it's going to get in the way. I appreciate it's particularly poignant here because you were never going to have this problem. This was actually for another Secretary of State. But that only serves to underline how difficult it is where the subject matter is one which (a) involves the media and (b) involves extremely difficult and potentially controversial issues.
A.Well, I have a great deal of sympathy for that view. I still believe it's perfectly possible for politicians to set aside their views and take decisions in a quasi-judicial impartial way, but I do think that you have to try very hard, because you know that some of the decisions you make could have an impact on future relationships and you have to set all that consideration aside, so that's an additional thing that needs to happen. I think it can be done, but I agree with you entirely, it adds to the difficulty of the situation. MR JAY The structure you mentioned, which has two attributes, might I SUGGEST no legal wriggle room but creating political space, that would be my gloss upon it, is that not the structure which we see coming through the messages Mr Smith imparted to Mr Michel in some of the emails?
A.No. First of all, I don't think there was any political space. If you mean by political space was there any room for me to take a different decision to the regulators, yes there was, because in the end it was my decision, not their decision. But if you mean there was space for me to take a decision on party political grounds, there was none at all. It would have been completely transparent to the whole world that's what I was doing and the structure I set up made it, I would say, impossible to do that and deliberately so. So I don't believe that Mr Smith used the phrase "political space". I think that it was probably Mr Michel's gloss on why we were making News Corp go through a much more difficult process than statute required."
Q.But when he used the term "space", he didn't say "political space", he said "space". You remember the text message?
A.Mm. I mean he may just have meant time. I think one would have to ask him. You know, this was a thorough process that was taking time.
Q.The other aspect of this is the appearance of bias in the context of the quasi-judicial decision because we have Dr Cable who is removed from his responsibilities in this regard on 21 December because he's made remarks which create, he accepted, a perception of bias, although as it happens, on analysis, those remarks didn't relate directly to the decision he was being asked to make, they related more widely to his view of News International and the Murdoch press. You understand that. We then have Mr James Murdoch characterising that to you as acute bias, and then you acquiring the bid on the evening of 21 December having in fact expressed private views to the Prime Minister on 19 November and in other materials which do relate expressly to the bid. So we have a sort of irony here, don't we, and a request perhaps by others to you which with hindsight perhaps you might say ought not to have occurred. Do you accept that?
A.I don't accept it because I had views on the bid which were public, but I set them to one side, and I set up a process that meant that I had to set them to one side, and I think I've demonstrated that the process was totally impartial.
Q.But on that argument, apparent bias could never be established, could it?
A.Well, there are aspects of some of the language that Mr Smith uses in his texts which, taken in isolation, appear to demonstrate bias, but actually I think if you look at the process as a whole, including the decisions I took and the way that I took them, it's clear that there was no bias.
Q.But that would be the case even if you had said categorically, "I'm 100 per cent in favour of this bid in every respect". If you'd said that one minute before you acquired the bid, you could have put in place on your argument exactly the same process which gave you little or no legal wriggle room and on your argument there would be no possible means of challenging what you did. Do you see the logic of that?
A.Yes, but that wasn't what I said. What I had said was that I respected the fact that we had to follow due process, I'd said that we mustn't second-guess the regulators, and that was exactly what I did when I took responsibility for the bid.
Q.May we move finally to the more general questions you address at the end of your statement. Given the time, the extent to which we want to go into the detail of these is going to lead to Lord Justice Leveson to guide me. You have helpfully said in paragraph 73 that you've asked Ofcom to look specifically at the options for measuring media plurality and they are due to report to you in June 2012. Was this with a view really to assisting the Inquiry's thinking on one of the aspects of its terms of reference?
A.Yes. I think measuring media plurality is an incredibly complicated thing to do. Ofcom has clearly given some thought to that in the past, in other work they've done, and I thought it might be helpful to the Inquiry if they could see Ofcom's thinking about whether it is actually possible to measure someone's market share of news across different technology platforms. It's a complex process. So that was the reason why I asked them to give me a view on that. LORD JUSTICE LEVESON Speaking for myself, I'm sure it would be, but I'd be grateful if you could convey to Ofcom that the train isn't stopping and their deadline is not really extendable because obviously if I'm to consider it, I have to show it to people so that they can make representations on it. I'm sure you'll understand that.
A.I'll happily pass that message on. MR JAY The other general question goes to the future of press regulation. Obviously you're one of the two sponsoring ministers of this Inquiry, so you might be entitled to say, well, that's the Inquiry's problem, not yours, at least until the Inquiry reports, but are you able to assist the Inquiry's thinking as to where you stand at the moment on this critical question?
A.Well, I have been quite encouraged I mean, first of all, I think we can take it as a given that everyone is strongly in favour of freedom of expression and no one wants to undermine that, but I've also been encouraged by the degree of consensus around the need for an independent press regulator that is independent of course of politicians, because one of the main jobs of the press is to hold politicians to account, but needs a greater degree of independence from serving editors than the PCC currently has, so that in particular I think it needs to have a credible sanction making power and we need to solve what in loose parlance is called the Desmond problem, the fact that everyone has to be part of it, because obviously if someone can just walk away from it, then that undermines the ability of sanctions to have an effect. I think there's actual a surprising degree of consensus. How the mechanics will work on that is obviously something that you will be giving a great deal of thought to and we look forward to those thoughts. I think I would just make two other brief observations at the end of, I know, a long week for the Inquiry. I think the first is that a lot of the problems that concern the public are actually a matter of law. So phone hacking, payment of police, payment of witnesses, harassment. There are laws against all of these things. And to a certain extent, as the law takes its course because of the three police operations that are currently happening, there will be an element to which these problems are self-correcting, because practice will evolve and processes will be put in place. I think the question THEREFORE IS how did it happen? How did we create a situation where these kind of practices happen, because the vast majority of journalists are incredibly professional and do a fantastic job and, you know, are ashamed by some of the practices that have emerged. I think if there was a way that the successor body to the PCC could be a champion of press freedom and a champion of press standards as well as a complaints body when things have gone wrong, I think that would be a positive thing for the entire press industry, and that might perhaps mean in the future that we could avoid these problems happening. That would be my first point. My second point is that one of the real problems for the press, we all say how much we value an independent, vibrant press. You've said so in your introduction to this section, Mr Jay. But there is a very fundamental problem, which is that the business model of the press is slowly dying on its feet as the world becomes electronic and people consume their news on iPads and iPods and so on, and advertising, which is so important to the press model, is less easy to raise in those electronic media and it's less easy to get people to pay large sums of money for subscription. I think the opportunity of the work the Inquiry is doing is to try and find a new model for press regulation that works across different technology platforms, because I and I know that I'm sensing LORD JUSTICE LEVESON No, I entirely agree. I'm hoping you have at least an idea as to how that could be done.
A.Well, I think that if the if the press are willing to support a structure of independent self-regulation, which commands the confidence of the public and therefore does have the distance from serving editors as well as proper distance from politicians, if such a body could be set up, then I think the government could consider whether that could the regulatory structures and the rules could be made similar for products that go out online and on video on demand and the other types of things the press will be doing. I think we should see if we can simplify the structures the press operate under so that they're not dealing with massively different regulatory structures, depending on whether their output is being viewed on TV or on a mobile phone or in a newspaper. And I think in the end the newspaper industry is going to move into being a news industry, and we need to try and find a regulatory structure that matches that. LORD JUSTICE LEVESON Just one correction in what you're saying: in fact, payments to witnesses are not criminal. They're certainly contrary to the code, but the consideration to making it criminal following the trial of Rosemary West was that the code would be sufficient. Whether that's so is something which may have to be thought about, but it's not in fact presently criminal.
A.I stand corrected. LORD JUSTICE LEVESON All right. Is there anything else that you'd like to say about this aspect of the work? I appreciate that you're entitled to await my view, but obviously these are issues that you've thought about, and if you do have any views as to what such a structure might look like, then I'd be very interested to receive them, if not now then in writing. You've had a long day as well, so it may not be fair to ask you to elaborate at this stage, but if you have, I'd be grateful to receive them.
A.Thank you. LORD JUSTICE LEVESON Anything else? Right. Well, Mr Hunt, thank you very much.
A.Thank you. (Pause). LORD JUSTICE LEVESON Right. There are apparently eight pages that need redactions, spread across three bundles of documents. Everything else will be published now. We're now seeing whether we can publish the last three bundles with those redactions and how long it will take them. I'd be very keen to seek to persuade somebody to be able to do that tonight. MR WHITE Thank you. LORD JUSTICE LEVESON Thank you. Mr Jay, is that now Monday week? Thank you very much indeed. 10 o'clock on Monday week. (5.00 pm)


Gave statements at the hearings on 31 May 2012 (AM) and 31 May 2012 (PM) ; and submitted 25 pieces of evidence


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