Leveson latest: Hunt aide Smith can't remember saying it was 'game over' for Murdoch bid opponents
Jeremy Hunt's former special adviser told a News Corporation lobbyist that the media giant's BSkyB takeover bid would go ahead once plans to spin off Sky News were accepted, the Leveson Inquiry heard today.
But Adam Smith said he did not remember telling Fred Michel it would be "game over" for opponents of the buyout after the proposal to make the news channel a separately listed company was announced.
At the time other media groups criticised News Corp's intention to buy the 61% share of BSkyB it did not already own, alleging it would concentrate too much power in Rupert Murdoch's hands.
Mr Michel, News Corp's former director of public affairs in Europe, sent an email to fellow executives on January 23 last year based on a conversation with Mr Smith.
He wrote: "His (Mr Hunt's) view is that once he announces publicly he has a strong UIL (undertaking in lieu, namely the Sky News spin-off plans), it's almost game over for the opposition."
Mr Smith, who quit as Mr Hunt's special adviser last month after admitting he got too close to Mr Michel, said much of the lobbyist's email was factually accurate but disputed its tone.
He told the inquiry: "I think that that's a sort of colourful explanation of the process.
"If you have an undertaking in lieu that Ofcom (the broadcasting regulator) and the OFT (Office of Fair Trading) say satisfied the plurality concerns that Ofcom had identified, then the whole point of that is that then there are no plurality concerns. So the deal would go ahead.
"I don't remember saying 'game over for the opposition', but I can imagine we had a conversation along those lines about the process and talking around what happens."
Mr Michel's email said Mr Hunt was "keen to get to the same outcome" as News Corp.
But Mr Smith disputed this: "I wouldn't have said that ... They didn't have the same outcome. Mr Hunt's aim was to follow the process, whereas I'm sure Mr Murdoch's aim was to acquire the remaining shares."
Robert Jay QC, counsel to the Leveson Inquiry, suggested: "The wider objective was the same outcome, namely the securing of the bid for News Corp, because he thought in policy terms that was desirable."
But Mr Smith insisted: "That wasn't his objective. Now his objective is to carry out his legal and statutory duties."
The inquiry was yesterday shown a memo Mr Hunt sent Prime Minister David Cameron arguing the case for News Corp to take over BSkyB, just weeks before he was given quasi-judicial oversight of the bid.
The note, dated November 19 2010, warned that Business Secretary Vince Cable's decision to refer the bid to regulator Ofcom could leave the Government "on the wrong side of media policy".
Mr Smith said the Culture Secretary and his department knew he was in contact with Mr Michel, who "bombarded" him with information about News Corp's BSkyB takeover bid.
"I would have thought on the odd occasion that I did mention to Mr Hunt one of the issues that I thought was worthy of his attention, I would I think almost certainly have said, 'Fred's told me X, Y or Z'," he said.
"They generally knew I was in touch. On some certain issues they certainly knew. But I don't think they knew the volume or extent."
The inquiry heard yesterday that Mr Michel exchanged 191 telephone calls, 158 emails and 799 texts with Mr Hunt's team between June 2010, when News Corp announced its bid, and July last year, when it abandoned the plan amid outrage over the News of the World phone-hacking scandal.
Of these, more than 90% were exchanged with Mr Smith, who himself sent 257 text messages to the News Corp lobbyist between November 2010 and July last year.
Mr Smith said today 95% of his contact with Mr Michel was via his mobile phone, with only a "handful" of calls made using his office landline.
Has PM Cameron any regrets? ... none to mention
Prime Minister David Cameron has defended giving Jeremy Hunt responsibility for the decision on News Corporation's takeover of BSkyB.
Mr Hunt sent a memo to the Prime Minister arguing the case for the bid just weeks before being given the role but Mr Cameron insisted he acted "impartially" once he was responsible for the decision.
Mr Cameron said: "I don't regret giving the job to Jeremy Hunt, it was the right thing to do in the circumstances, which were not of my making."
Mr Hunt was given the role after Business Secretary Vince Cable was stripped of the responsibility over comments made to undercover reporters.
The Prime Minster told ITV's This Morning: "The crucial point, the really crucial point, is did Jeremy Hunt carry out his role properly with respect to BSkyB and I believe that he did."
Documents submitted to the Leveson Inquiry revealed that Mr Hunt sent a memo to the Prime Minister warning that Mr Cable's decision to refer the bid to regulator Ofcom could leave the Government "on the wrong side of media policy".
In the November 2010 memo, Mr Hunt, who will appear before the inquiry next week, warned that News Corp's James Murdoch was "pretty furious" over the Ofcom referral for the company's offer to buy the 61% share of the satellite broadcaster which it did not already own.
Mr Cameron said shifting responsibility for the decision to Mr Hunt was the "simplest, easiest, simplest path".
He said Mr Hunt's comments in public over BSkyB had been "more effusive" than the memo sent to him.
"The key thing was it wasn't what he had said in the past, it was how he was going to do the job."
Mr Cameron added: "He did act impartially because he took independent advice at every stage and he followed the independent advice at every stage."
He said then-Cabinet secretary Lord O'Donnell had been consulted over the role and taken legal advice - but had not been shown the memo.
"He didn't know about that email but he was in possession of what Jeremy Hunt had said publicly which was more effusive, more powerful."
No date has been set for the Prime Minister's appearance at the inquiry, but he said he was "looking forward to giving evidence", as was Mr Hunt, so "all of this will be out in the open".
Mr Cameron said: "Some people are saying there was some great conspiracy between me and Rupert Murdoch to do some big deal to back them in return for support.
"Rupert Murdoch has said that's not true, James Murdoch has said that's not true, I have said that's not true. There was no great conspiracy.
"As I have said, I think the whole relationship between politicians on the one hand and the press on the other got too close.
"There are lessons to learn, we are already learning those with far more transparency about contacts between press and politicians.
"No government has done that before, but I'm pleased my government is doing it."