- Downing Street says Jeremy Hunt "acted properly" adjudicating takeover bid
- Hunt insists he acted impartially in assessing News Corp.'s plan to take control of BSkyB
- Hunt sent congratulatory text to Murdoch hours before he took oversight role
- The Leveson Inquiry is examining relations between British media and politicians
UK Culture Secretary Jeremy Hunt defended his conduct in the case of a bid by Rupert Murdoch's News Corp. to take over British satellite broadcaster BSkyB at a hearing Thursday.
Hunt, the Cabinet minister who oversees British broadcasting, has been under pressure over his contacts with News Corp. since apparent back channel communications were revealed between a senior aide and the company last month.
Prime Minister David Cameron, who appointed Hunt to adjudicate the bid, has also faced questions over his relations with News Corp. and the Murdoch family.
But Downing Street said Thursday Hunt had "acted properly" and had not breached the rules governing the way ministers are required to behave.
Hunt's special adviser, Adam Smith, resigned in April after the extent of his contacts with Murdoch representatives over the multi-billion dollar BSkyB bid were revealed, saying they went beyond what the minister had authorized.
News Corp., which owns 39% of BSkyB, eventually pulled out of the takeover attempt last summer amid a furor over allegations of phone hacking by the News of the World newspaper, owned by News Corp.'s British publishing arm, News International. The paper was closed down.
Hunt at times looked uncomfortable as he was grilled at the Leveson Inquiry in London over texts and e-mails dealing with the BSkyB takeover.
Among them were text messages from James Murdoch, son of Rupert Murdoch and a senior News Corp. executive, and the firm's chief lobbyist, Fred Michel, to Hunt and in particular to his adviser, Smith.
Some of the texts between Hunt and James Murdoch, presented as evidence to the independent judge-led inquiry, appeared to show a close relationship between the two.
Among them was a congratulatory message Hunt sent to Murdoch after it was announced that the European Commission would not intervene over the takeover bid. "Great and congrats on Brussels, just Ofcom to go," he wrote.
Hours later, Hunt, who heads the Department of Culture, Media and Sport, was asked to oversee the bid process.
Meanwhile, Michel -- who Hunt described as "pushy" -- sent 542 text messages to Smith, the inquiry heard. Of those, 35 were sent in two days at one important stage in the process. Michel also made about 140 phone calls to Smith.
"We didn't predict this barrage of contact from Mr. Michel," Hunt said.
Hunt said Michel's text message contact with him never led to any substantive discussions about the bid.
Hunt stressed that he was getting independent advice from Ofcom, the independent UK media regulator, and the Office of Fair Trading (OFT) in order to ensure due process was followed and persuade the public that it was fair.
He characterized his view on the bid before he was asked to oversee the process in December 2010 as "sympathetic," rather than "supportive," saying he did not act to advance it.
Once he was put in charge of the process, he was careful to take the required impartial approach and acted with "scrupulous fairness," Hunt insisted.
He was not a "cheerleader" for News Corp., Hunt said, arguing that he repeatedly angered James Murdoch by requiring more scrutiny of the bid by independent bodies.
After the phone hacking scandal broke, he asked Ofcom and the OFT to look again at whether News Corp. could be trusted to live up to its undertakings with regard to BSkyB, he said, because he was concerned there might be a broader problem of corporate governance.
Questioned over his judgment in responding to Michel's text messages, the minister said his interpretation was that in his quasi-judicial role a "courteous reply to a text message was fine."
He added, "But I think now I would probably not take the same view and would avoid text messages. But it was my assessment that it had no impact on process, the decisions I took. It was just me being courteous."
Hunt acknowledged that Michel deployed flattery "persistently and frequently," and said he was shocked when he discovered the level of contact between Michel and Smith. It appeared to have led to the use of "occasionally inappropriate" language on the part of his aide, he said.
He also defended the integrity of Smith, saying he was "very capable and decent," and added that he wished his aide had alerted his colleagues to the pressure he was under from News Corp.'s lobbyist.
But in the end, he had no choice but reluctantly to accept Smith's resignation, Hunt said.
Alan Rusbridger, editor of the Guardian newspaper, highlighted the different treatment by Hunt's department of News Corp. and those who opposed the takeover, in comments posted on Twitter Thursday.
"No chummy texts or spad (special adviser) for opponents of Sky. Were told to address all concerns to Treasury Solicitor," he tweeted.
"Thousands of texts, e-mails and phone calls" were exchanged between News Corp. and the Department of Culture, Media and Sport, Rusbridger said, while the newspaper got just one meeting with Hunt.
Questioned before the inquiry, Hunt said he was "a very passionate supporter of having a free and vibrant press," and that he felt the BSkyB bid would help modernize the UK media industry.
Hunt last month faced calls from opposition lawmakers to resign over his handling of the BSkyB bid, saying he had colluded with News Corp. and breached the ministerial code of conduct, which governs how ministers behave in office.
But Cameron said Hunt had his support and urged lawmakers to await the conclusion of the Leveson Inquiry before passing judgment.
Downing Street said in a statement Thursday: "Jeremy Hunt's evidence has shown that he acted properly while he was responsible for the BSkyB bid. He took independent advice at every turn, as well as a number of decisions which were against News Corporation's wishes."
However, there are "lessons to be learned" from the process, the statement added, and ministers have been sent guidance on how quasi-judicial decisions are taken.
The current phase of the Leveson Inquiry -- which was set up by the coalition government in response to the phone hacking scandal -- is examining the relationship between the press and politicians.