Bloomberg News

Gillard to Back Australia Probe After News Corp. Scandal

September 13, 2011

(Updates with Green Party leader’s comments in fourth paragraph.)

Sept. 13 (Bloomberg) -- Australia Prime Minister Julia Gillard’s government will hold an inquiry into the nation’s media following the phone hacking scandal surrounding the now closed News Corp. London tabloid the News of the World.

Communications Minister Stephen Conroy is working out the scope of the inquiry and details will be announced soon, Conroy’s spokesman Lyall Johnson said in a phone interview. It has not yet been determined whether it will be a parliamentary, independent or judicial probe, he said.

Demands for an investigation intensified after Gillard demanded and got a retraction and apology for the printing of a falsehood last month by the Australian, a newspaper owned by News Corp.’s local unit News Ltd. The Greens party, whose support Gillard’s Labor party needs to retain power, said it is working with her to determine the extent of an inquiry that should consider the role of an “independent umpire.”

"Information is the currency of democracy and we need a review to assess whether the media industry has been devalued," Greens Senator and party leader Bob Brown, said in comments e- mailed to Bloomberg News. "A robust inquiry which can promote media diversity and ensure the public’s recourse when wrong behavior occurs would serve Australia well.

The U.K. scandal means the local arm of Rupert Murdoch’s News Corp. has "hard questions" to answer, Gillard said July 20, without being specific. News Ltd. Chairman and Chief Executive Officer John Hartigan has said the Australian newspapers were free of the practices seen in Britain.

Hacking Allegations

Murdoch shut down the 168-year-old News of the World, owned by News Corp. since 1969, following allegations it hacked into the mobile phone of a 13-year-old murder victim and he has since pulled his $12.5 billion bid to gain full control of British Sky Broadcasting Group Plc.

News Ltd. owns 120 metropolitan, regional and rural newspapers, including The Australian and the Daily and Sunday Telegraph, and accounts for about 70 percent of the nation’s newspaper market.

A meeting of Labor lawmakers in Canberra today heard demands that Murdoch be forced to sell some of News Ltd.’s Australian newspapers, the Australian Financial Review said on it web site, citing party-room sources that weren’t identified.

Conroy said in July that Murdoch’s Daily Telegraph, the best-selling newspaper in Australia’s largest city of Sydney, is “running a campaign on regime change.”

Opposition Liberal-National leader Tony Abbott today said the government’s decision “looks like a naked attempt to intimidate the media.”

“There is no evidence of any significant new problems in the media in Australia,” Abbott told reporters in Canberra.

Bloomberg News parent Bloomberg LP competes with News Corp. in providing financial news and information.

--With assistance from Malcolm Scott in Sydney. Editors: Malcolm Scott, John Brinsley

To contact the reporters on this story: Gemma Daley in canberra at gdaley@bloomberg.net; Jacob Greber in Sydney at jgreber@bloomberg.net

To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net


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