Cameron "regrets" hiring scandal-hit tabloid editor
LONDON (Reuters) - Prime Minister David Cameron, defending his integrity to parliament in emergency session on Wednesday, said he regretted hiring a journalist at the heart of a scandal that has rocked Britain's press, police and politics.
But in hours of stormy questioning he seemed to rally his Conservative party behind him and stopped short of bowing to demands that he apologize outright for what the Labour leader called a "catastrophic error of judgment" in appointing as his spokesman a former editor of Rupert Murdoch's News of the World.
Only if Andy Coulson, who has since resigned, should turn out to have lied about not knowing of illegal practices at his newspaper would the prime minister offer a "profound apology."
Analysts said Cameron emerged from the debate looking stronger than when he was forced to fly home early from Africa to face lawmakers who had delayed their summer recess by a day. But he left some lingering questions unanswered, notably about his role in Murdoch's takeover bid for TV network BSkyB.
Beleaguered but hardly under serious threat of being ousted by his party allies after less than 15 months in power, Cameron defended his actions and those of his staff in dealings with Murdoch's News Corp global media empire and with two senior police chiefs who resigned this week over the affair.
"He seems to have gained a bit of breathing space over the course of this debate," said Andrew Russell, senior politics lecturer at Manchester University. "He looked more self assured today than he has been for a little while."
A day after Murdoch apologized to a British parliamentary committee, but denied personal responsibility for the phone hacking scandal at the News of the World, he sent a message to his staff that his company was taking steps to ensure that "serious problems never happen again."
"Those who have betrayed our trust must be held accountable under the law," he said in an e-mail.
Some investors speculate the scandal may hasten a handover of power in the company from the Murdoch family in a way that may streamline global operations.
Saudi Prince Alwaleed bin Talal, who says his Kingdom Holding is the second biggest shareholder in News Corp and controls 7 percent of the votes, said on Wednesday he still saw the company as a valuable and long term investment.
"I continue to see News Corp as a valuable and long term investment and remain both supportive of and confident in the leadership of Rupert and James Murdoch," he said in a statement.
After his toughest two weeks in office, Cameron spoke with feeling to parliament about the Coulson saga. "You live and you learn -- and believe you me, I have learnt," he said.
"It was my decision ... Of course I regret and I am extremely sorry about the furor it has caused. With 20:20 hindsight ... I would not have offered him the job."
He said of Coulson, who is under suspicion of conspiring to intercept calls and bribe police: "I have an old-fashioned view about innocent until proven guilty. But if it turns out I have been lied to, that would be a moment for a profound apology.
"And, in that event, I can tell you I will not fall short."
Labour's Ed Miliband, whose muted first year as opposition leader has been fired up by attacking Cameron on the scandal, has not gone so far as to demand Cameron's resignation.
But he asked during the debate: "Why doesn't he do more than give a half-apology and provide the full apology now for hiring Mr Coulson and bringing him into the heart of Downing Street?"
Opposition members of parliament questioned the credibility of Cameron's defense that Coulson had assured him when being hired in 2007 that, as editor of the News of the World, he knew nothing of the hacking of voicemails which led to the paper's royal correspondent and an investigator being jailed.
Coulson left Cameron's office in January just before police reopened an investigation in which Coulson and his predecessor as editor, Rebekah Brooks, have been arrested and bailed.
Cameron repeatedly deflected questions on what he may have discussed with News Corp about its $12-billion bid to buy out other shareholders in BSkyB, insisting he had "no inappropriate" conversations and played no role in a government decision to let the bid proceed in the face of protests it would give Murdoch too great a share of media ownership in Britain.
Last week, as scandal engulfed News International, Cameron joined Labour in calling for News Corp to drop it. It did.
Cameron's Media Minister Jeremy Hunt, who would have made the final decision, later told parliament: "The discussions the prime minister had on the BSkyB deal were irrelevant."
"They were irrelevant because the person who was making this decision was myself," Hunt said.
His comments were immediately seized on by Labour.
"What we need to know is what were the nature of those conversations, when did they happen and how did they influence the decision-making process," Labour's media spokesman Ivan Lewis told BBC TV.
While he has derided suggestions from some on the left that backing the BSkyB bid might have been a payback for Murdoch's papers switching from supporting Labour to promoting Cameron at the 2010 election, Cameron told parliament it may make sense to "further remove politicians" from decisions about media mergers.
Cameron tried during the debate to move the political agenda away from the scandal, saying voters wanted him to concentrate on handling an economic crisis and other pressing matters.
He gave details of a judicial inquiry he has ordered into the scandal and wider issues it has raised over relationships among Britain's media, police and political establishment.
The scandal exploded into the public consciousness on July 4, when the family of a schoolgirl abducted and murdered in 2002 said police had told them they believed someone from the paper had hacked in to the teenager's voicemail, misleading detectives looking for her and giving her parents false hope.
Police say 60 officers are probing the hacking of messages of possibly 4,000 people, not just the rich, famous or powerful, but crime victims and families of soldiers killed in action.
Many of the leads come from the notes of Glenn Mulcaire, the investigator jailed with the News of the World reporter in 2007.
An ethics board which Murdoch set up this week said it had now ended continuing payments for legal costs to Mulcaire -- payments questioned by the parliamentary committee on Tuesday.
News Corp said it had authorized law firm Harbottle and Lewis, which advised in 2007 that emails uncovered by News International during an internal review did not show any criminal behavior, could answer questions from the police and lawmakers about their role.
On Tuesday, Britain's former Director of Public Prosecutions Lord Macdonald, brought in earlier this year by News International to re-examine evidence, told lawmakers he immediately concluded that the emails discovered during an internal review should be passed to the police.
He said the News Corp board were "stunned and shocked" when he told them and added: "If the police had seen that file in 2007, Operation Elveden (the inquiry into claims journalists bribed police officers) would have been opened in 2007."
(Additional reporting by Tim Castle, Kate Holton, Mohammed Abbas, Paul Hoskins, Peter Griffiths, Olesya Dmitracova, Georgina Prodhan and Stephen Mangan; Writing by Alastair Macdonald)
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