Bloomberg News

Blair Denies Murdoch Deals as Protester Disturbs Ethics Probe

May 28, 2012

Former British Prime Minister Tony Blair arrives at the Royal Courts of Justice to give evidence to the Leveson Inquiry, in London, on May 28, 2012. Photographer: Dan Kitwood/Getty Images

Former British Prime Minister Tony Blair arrives at the Royal Courts of Justice to give evidence to the Leveson Inquiry, in London, on May 28, 2012. Photographer: Dan Kitwood/Getty Images

Tony Blair, the U.K. prime minister for a decade until 2007, told an ethics inquiry he never made “implied deals” on press regulation with News Corp. Chairman Rupert Murdoch in exchange for support from his newspapers.

Blair, testifying at the London probe triggered by the phone-hacking scandal at News Corp.’s News of the World tabloid, said it was “perfectly possible” he’d reassured Murdoch in 1994 about the Labour Party’s plan to pull back on calling for press regulation. There was no “quid pro quo,” he said.

“If we’d come into power and done a huge thing about who owned what in the media, it would have been a huge distraction for the Labour Party,” Blair, 59, said yesterday about a meeting he had with Murdoch before he became prime minister in 1997.

The inquiry, set up by Prime Minister David Cameron last year, is hearing from members of the former ruling Labour Party as well as his own Conservatives about their ties to Murdoch. Blair said his personal contacts with Murdoch evolved from a “working relationship” to becoming a godfather to one of the media mogul’s children after he left office.

“Being godfather to Murdoch’s child is a line he shouldn’t have crossed,” said Steven Fielding, a professor of politics at Nottingham University. “It reinforces this idea that there’s a kind of transnational elite that’s just in it for themselves.”

The hearing was briefly interrupted by a man who entered the courtroom from a secure corridor between Leveson and Blair and shouted that Blair was a war criminal because of the invasion of Iraq. The man struggled with security officers before being dragged out of the room.

Phone-Hacking Scandal

The probe, led by Judge Brian Leveson, expanded beyond phone hacking to include the U.K. media’s relationship with celebrities, the police and politicians. The phone-hacking scandal led New York-based News Corp. to shut the News of the World newspaper last year and abandon its bid for the pay- television company British Sky Broadcasting Group Plc. (BSY)

Blair said he sought to manage his media ties to avoid a “major confrontation” that would be needed to challenge the power of the press.

Murdoch was one of Blair’s few supporters when he decided to go to war in Iraq and the men spoke about it on the phone three times in the days before the invasion, his ex-press chief, Alastair Campbell told the inquiry earlier this month. Blair felt he had to deal with a “right-wing” Murdoch to get his message to the public, Campbell said.

“The relationships moved from being sensible to crucial in a way that’s not healthy,” Blair said, referring to the press’s overall relationship with government. He said the problem extended beyond Murdoch’s media empire.

Another Arrest

As Blair testified, the Metropolitan Police in London widened their phone-hacking probe with the arrest of a 42-year- old woman accused of money laundering. More than 50 people have been detained in parallel probes that also include bribery and computer hacking by News Corp. journalists.

Blair said he was friends with Rebekah Brooks, the former chief executive officer of News Corp. (NWSA:US)’s U.K. unit, News International, who was arrested last year in the hacking probe and charged earlier this month with trying to cover it up. He said he contacted her when she resigned to offer his support.

Blair said his decision to change the Labour Party’s handling of union disputes wasn’t influenced by Murdoch’s support, and that continuing to promise to repeal Conservative laws on this issue would have been “foolish.”

“I understand why these conspiracy theories arise, but it’s not as if my position on unions and so on was a matter of great surprise,” Blair said. Unions “have power and they should be subject to some kind of legal framework.”

Godfather

Blair said his relationship with Murdoch became “a lot easier and better” when he was no longer prime minister, and that he wouldn’t have agreed to be the godfather to one of Murdoch’s children while he was in office.

“It’s not the closeness that’s the problem,” Blair said of his media ties. “It’s the imbalance, because you know that at a certain point” if you are pursuing “a course you believe in and they don’t believe in it, or they don’t believe in you, then you are going to be in a big fight.”

Blair’s wife Cherie sued News Corp.’s U.K. unit in February, joining dozens of other public figures who say they have police evidence showing the News of the World intercepted their mobile-phone voice mail. Campbell and former Deputy Prime Minister John Prescott also sued.

Blair courted Murdoch immediately after he became leader of the Labour Party. In 1995, after Blair traveled to Australia to address News Corp. executives, Murdoch joked that “I suspect we will end up making love like two porcupines -- very carefully.”

‘Charm Offensive’

Blair said the trip was part of a “charm offensive” to woo Murdoch.

“I wouldn’t have gone halfway around the world if I hadn’t had a very deliberate and very strategic objective to go and try and persuade them,” Blair said.

Murdoch’s Sun tabloid, the best-selling daily title in Britain, switched from the Conservatives to endorse Blair in the 1997 election, and Murdoch was an early visitor to Blair after his victory. It switched back to the Conservatives in 2009, after Blair had left office.

“The Sun, partly because it is prepared to shift, makes it all the more important,” Blair told the inquiry.

Blair also complained about attacks made on him, his family and associates “day in, day out,” by the Daily Mail newspaper and said the result of falling out with any large media company is “relentless and unremitting” news coverage.

Independent Watchdog

Murdoch testified at the inquiry last month. He said he never asked Blair or any other prime minister for a favor while they were in office.

Leveson, who must issue a report on press regulation, said a future media watchdog would need to be “independent of the state, independent of Parliament, but also independent of the press.” A new system would need to help people who can’t afford to sue newspapers for privacy violations, he said.

The 49-year-old man who interrupted the inquiry was arrested for disturbing the peace and later released without charge from a London police station, a spokesman for the Metropolitan Police said yesterday. Leveson called for a probe of the security breach.

Bloomberg LP, the parent of Bloomberg News, competes with News Corp. units in providing financial news and information.

To contact the reporters on this story: Erik Larson in London at elarson4@bloomberg.net; Robert Hutton in London at rhutton1@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net


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