News Corporation lobbyist Fred Michel today insisted he had the “impression” that Jeremy Hunt was aware of details being passed on to him about the BSkyB bid.
Michel said he believed some of the “feedback” he was given by special adviser Adam Smith had been “discussed” with his boss Mr Hunt, the Culture Secretary.
The comments came as Mr Michel gave evidence to the Leveson inquiry over News Corp‘s attempt to acquire the whole of BSkyB.
Smith, who quit after admitting his contacts with Mr Michel were too close, is due to appear as a witness later.
The lobbyist said he had the “sort of impression that some of the feedback I was being given had been discussed with the Secretary of State before I was given it”.
Although he was not given legal advice on the nature of “quasi judicial” ministerial decisions, Mr Michel said he knew he was not meant to have “direct discussions” with the Culture Secretary about the controversial issue.
He said he regarded the extent of contacts with Hunt’s special adviser Adam Smith and other officials as “uncharted territory”.
“I think we had discussions on the fact that it was very important that the decision rested with the Secretary of State, that it was not appropriate to have direct discussions with the Secretary of State unless they were formal and minuted,” he said.
“I was never of the opinion that it was inappropriate to at least try to put the arguments to or make representations to these officers.”
‘I don’t think anything inappropriate ever took place’
Michel made 191 telephone calls and sent 158 emails and 799 texts to Hunt’s team between June 2010, when News Corp announced its BSkyB takeover bid, and July 2011, when it abandoned the plan amid outrage over the News of the World phone-hacking scandal.
Of these, more than 90% were exchanged with Mr Smith, the inquiry was told. Smith sent 257 text messages to Mr Michel between November 2010 and July 2011.
The News Corp lobbyist said he quoted the views of “JH” in a series of emails to his bosses, including James Murdoch, but was referring to Hunt’s team rather than the Culture Secretary himself.
He said: “I think it was a short-hand I decided to use, both because I was having a lot of conversations from the beginning of January (2011) with the office of the Secretary of State, but also because I was probably trying to be as quick and generic as I could be when I was writing them.”
Michel agreed that Hunt’s “quasi-judicial” role meant that there should also be no inappropriate contact with the Culture Secretary’s civil servants or special advisers.
But he insisted: “I don’t think anything inappropriate ever took place.”
The lobbyist said he sought to promote News Corp’s bid with officials in the Department for Business, Innovation and Skills and the Department for Culture, Media and Sport, as well as with Labour and Lib Dem politicians.
“This was something I did across both departments and political parties as well, including the opposition,” he said.
Smith was ‘always very diligent in his work’
Michel told the inquiry he could not say whether Hunt or Smith supported News Corp’s takeover of BSkyB.
Referring to the special adviser, he said: “Adam has always been a very warm, professional, available adviser, and always very diligent in his work with me.
“The only interactions I have had with him were always professional and reliable.”
Robert Jay QC, counsel to the inquiry, asked him: “Is it your evidence that Hunt was keeping an open mind, he was impartial, and would decide the bid on its merits at the appropriate time?” Michel replied: “Yes.”
The lobbyist played down a suggestion that he “spun” or “bigged up” the information Smith gave him in order to reassure Murdoch about the progress of the bid.
But he admitted he may have tried to “keep morale up” at News Corp during the period until decision-making power on the takeover was stripped from Business Secretary Vince Cable and given to Hunt.
“I think my emails, as they were internal emails, were an accurate account of the conversations I have had,” he said.
“Whether there was any exaggeration or spin, it depends. I would say perhaps during the period of when we were dealing with BIS (the Department for Business, Innovation and Skills), the morale was quite low because we had not much success on representation of this.
“Maybe I was trying to keep the morale up internally.”
‘I do not think I need to puff myself up’
Michel tried to organise a meeting between James Murdoch and Mr Hunt in November 2010 – before he was handed responsibility for the bid.
Smith responded that the permanent secretary advised that they should not meet personally.
In an email to Murdoch, Michel said: “My advice would be not to meet him today as it would be counterproductive for everyone but you could have a chat with him on his mobile, which is completely fine and I will liaise with his team privately as well.”
Michel told the inquiry that he was not certain if the conversation took place, but it would have been a “quick call to the mobile to refer to the fact that they could not meet, apologise to each other and that is it”.
The month before, Michel emailed Smith with a briefing memo for Hunt on the BSkyB issues. The special adviser’s answer stated: “Jeremy’s response to this – ‘persuasive’.”
In the run-up to Christmas 2010 – around the time Hunt took responsibility for the bid from Mr Cable – Michel sent the Culture Secretary a text saying: “Have a great Christmas with the baby.”
The two men had children who were almost exactly the same age.
Hunt replied: “Thanks Fred. All contact with me now needs to be through official channels until decision made.”
Jay challenged Michel over whether he had been exaggerating his contacts with Hunt and his aides “to boost morale (at News Corp) or frankly to puff yourself up?”.
He cited an example from September 2010, when questions were raised internally about reports that Cable was intending to refer the bid for further scrutiny.
Hunt had sent the lobbyist a test message saying: “Don’t know anything.”
But Mr Michel told colleagues in an email: “Jeremy Hunt is not aware and thinks it is not credible at all.”
Michel denied today that he had been exaggerating. “I do not think I need to puff myself up,” he said.