James Murdoch bombshell for Tories over BSkyB bid

David Cameron and Culture Secretary Jeremy Hunt were on the rack this afternoon after sensational evidence to the hacking inquiry from James Murdoch.

The Prime Minister was facing accusations that he acted inappropriately after Mr Murdoch confirmed for the first time that they discussed his company’s £8 billion bid to take full control of broadcaster BSkyB at a Christmas dinner party in the home of Rebekah Brooks.

Mr Murdoch said that a lobbyist working for him had contacts with Mr Hunt’s special adviser while Business Secretary Vince Cable was dealing with the bid.

The QC for the inquiry, Robert Jay, described Mr Hunt as “your cheerleader Mr Hunt”. Mr Murdoch replied: “I think that’s unfair.” The exchanges came in a dramatic day of evidence to the Leveson Inquiry by News Corp deputy Mr Murdoch.

Mr Hunt took over the bid after Mr Cable was sacked when he told undercover reporters he had “declared war on Mr Murdoch”. Mr Hunt later said he intended to give the deal the go-ahead but Rupert Murdoch abandoned it amid the public outcry over phone hacking.

Giving an extraordinary insight into the huge political clout wielded by the Murdoch empire, James Murdoch listed a string of meetings with the country’s most powerful figures, including a dozen meetings with Mr Cameron before he became prime minister, plus talks with Gordon Brown and George Osborne.

The most controversial meeting was when Mr Cameron was guest at the home of Ms Brooks, then the chief executive of News International, at her Oxfordshire home at Christmas 2010, two days after the Prime Minister stripped Lib-Dem minister Mr Cable of ministerial responsibility to decide on the BSkyB bid. Asked if they discussed the bid, Mr Murdoch said he spent a few moments with Mr Cameron pointing out the bid needed to follow the “correct and legal process”.

“I recall speaking briefly to the Prime Minister on one occasion about the proposal,” said Mr Murdoch in his witness statement. “This was on Dec 23, 2010, at a dinner hosted by Rebekah and Charlie Brooks and attended by a number of other people.”

Questioned later, he said: “I imagine I expressed the hope that things would be dealt with in way that was appropriate and judicial. It was a tiny side conversation, it was not a discussion.”

Labour were demanding that Mr Cameron come clean about exactly what he said. In Parliament last year the Prime Minister said: “I never had one inappropriate conversation” about the bid. Downing Street also said Mr Cameron had “not been involved in any of the discussions about BSkyB”.