Murdochs face questions in UK parliament

LONDON,  (Reuters) – News Corp Chief  Executive Rupert Murdoch and his son James face questions from  parliament today in a phone-hacking scandal that has rocked  Britain’s establishment right up to Prime Minister David  Cameron.

James Murdoch

With a second British police chief quitting yesterday over  the scandal, Cameron cut short a trade trip to Africa and was  due to return late today to attend an emergency debate the  following day in parliament, which is delaying its summer  recess. Before returning to Britain the prime minister, in  Lagos, Nigeria, will give a press conference at 1200 GMT.

The Murdochs’ appearance before parliament’s media select  committee was expected to attract a television audience of  millions keen to follow the latest twist in a saga that has  shaken Britons’ faith in their police, press and political  leaders.

“It seems as if there will be standing-room only, that’s not  surprising as it’s the first time Rupert Murdoch has been before  a select committee in his 40 years of building up a media  empire,” said Paul Farrelly, an opposition Labour committee  member.

Murdoch’s News International British arm had long maintained  that the practice of intercepting mobile phone voicemails to get  stories was the work of a sole “rogue reporter” on the News of  the World newspaper.

That defence crumbled in the face of a steady drip-feed of  claims by celebrities that they were targeted.

The floodgates opened two weeks ago when a lawyer for the  family of a murdered teenage schoolgirl claimed the paper had  hacked her phone when she was missing, deleting messages and  raising false hopes she could be still alive.

The ensuing outrage prompted News Corp to close the  168-year-old News of the World newspaper, drop a $12 billion  plan to take full control of pay TV operator BSkyB , and  saw the arrest of former News International Chief Executive  Rebekah Brooks, a Murdoch protégé.

Cameron has faced questions over his judgment in appointing  former News of the World editor Andy Coulson as his  communications chief, while London police chief Paul Stephenson  and anti-terrorism head John Yates stepped down within 24 hours  of each other over their links to a former deputy editor of the  newspaper.

     “NO CIRCUS”

The parliamentary committee has been pursuing the  phone-hacking allegations for more than four years, saying in a  report in 2010 that it was inconceivable that managers did not  know about the practice.

“We intend to be calm and forensic. There will be no circus,  no playing to the gallery because we really need to get to the  bottom of everything that has gone on,” said Farrelly, a former  journalist who once worked for Reuters.

“We want to know who knew what, and when, and how wide the  whole ambit of illegal activity, of which phone-hacking was only  one part, went, and how far any cover up went.”

David Cameron

In another twist to a story gripping the attention of many  Britons was news of the death of an ex-News of the World  journalist Sean Hoare. It was Hoare who told the New York Times  that phone hacking at the tabloid was far more extensive than  the paper had acknowledged at the time.

A former show business reporter also told the BBC he was  asked by Editor Andy Coulson, who went on to work for the prime  minister, to tap phones. Police said the death of Hoare was  being treated as “unexplained, but not thought to be  suspicious.”

News International chairman James Murdoch said earlier this  month that the News of the World “made statements to parliament  without being in full possession of the facts” and he is certain  to be questioned on that statement.

The Murdochs are due to appear at 2:30 pm (1330 GMT),  followed an hour later by a separate hearing for Brooks.

Brooks, a former News of the World editor, resigned as News  International chief executive on Friday and was arrested by  police on Sunday on suspicion of corruption and intercepting  communications before being released on bail.

Former Murdoch editor Bruce Guthrie, who worked for the  company in Melbourne, said Murdoch faced a fundamental decision  on the fate of the company he has built up into a global media  giant from an Australian newspaper business.

“What it boils down to it this, what is more important for  Rupert: the survival of the company or the survival of the  family’s control of the company,” he said.

“If he really is bent on saying I want this company  remaining in the control of my family, which would be James, I  reckon he has to take a bullet for James.”

News Corp shares climbed as much as 3.7 percent in Australia  after Bloomberg reported the firm was considering elevating  Chief Operating Officer Chase Carey to the position of CEO to  succeed Rupert Murdoch, who would remain chairman.

Yesterday Standard & Poor’s Rating Services had put all  ratings on News Corp on CreditWatch with negative implications  given the business and reputational risks associated with  widening legal probes in Britain and pressure for a FBI  investigation in the U.S.

        QUESTIONS FOR CAMERON

Prime Minister Cameron, who took office in May 2010, is  facing the worst crisis of his premiership as his decision to  hire former News of the World editor Andy Coulson as his  communications chief comes back to haunt him.

Coulson quit as News of the World editor in 2007 when the  paper’s royal reporter was jailed for phone hacking. Coulson  said he knew nothing of the practice but took responsibility.

Coulson quit as Cameron’s spokesman in January when the  long-running scandal came back to life. He was arrested earlier  this month and is also free on bail.
Cameron’s position has been made worse by a parting shot  from London police chief Stephenson, brought low by the force’s  decision to hire a former News of the World deputy editor now  implicated in the scandal as a media adviser.

Stephenson drew a subtle contrast between his decision to  step down and Cameron’s conduct.

Few expect the prime minister to quit but he appears  weakened as head of a deficit-cutting coalition and might find  his room for manoeuvre limited.

Stephenson and John Yates, the other senior officer to  resign, are both due before parliament’s home affairs committee  Tuesday lunchtime in what will be a prelude to the main event  with the Murdochs.

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