Lance Price: Mogul's hidden hand keeps its grip on power

Murdoch was one of only three men - the others were Gordon Brown and John Prescott - whose views Blair took into account

Three days after David Cameron became Prime Minister, Rupert Murdoch was spotted leaving by the side exit of Downing Street.

The visit was unannounced and No 10 declined to give details of what had been discussed. The regime may have changed but the mystery of how Murdoch exercised influence continued.

After working for Tony Blair in the late 90s, I wrote that Murdoch was effectively the 24th member of the Cabinet. Indeed, he was one of only three men – the others were Gordon Brown and John Prescott – whose views Blair took into account on all major decisions.

A few months ago David Cameron said he didn't "particularly notice the presence of a 24th person round the cabinet table". Murdoch won't worry unduly about that. News International exercises its clout without the tedious necessity of sitting around the table listening to other people's views.

The revelation that Gordon Brown embarked on the disastrous course of abolishing his own, much-vaunted 10p tax rate purely to impress Murdoch and his editors is truly startling. He took a hugely expensive gamble with the tax system, not because the press had been calling for it – that would be bad enough – but because Brown thought they'd be impressed and welcome him into office as a radical, reforming prime minister.

Cameron and George Osborne were careful observers of New Labour's relationship with the media. They wanted the upside, the positive headlines and frequent mastery of the political agenda, without the accompanying accusations of spin and dishonesty. To a large extent they have succeeded, so far.

Had it not been for the misjudgement of taking into Downing Street Andy Coulson, a man tainted by association at the very least with the worst scandal to hit the media for many years, Cameron could claim that his press operation was uncontroversial. Most journalists give it credit for playing things pretty straight.

There is no Alastair Campbell or Damian McBride in No 10 today. In part that's because the Prime Minister and his Chancellor are so good at communications themselves.

Even if they weren't, coalition government wouldn't allow for such a highly partisan communications chief. The Liberal Democrats ought to be a bulwark against the bullying of the Murdoch Empire.

Nick Clegg owes News International nothing. Indeed, the company's papers spent decades actively and deliberately marginalising his party and ridiculing its leaders.

Had The Daily Telegraph not used subterfuge to tempt Vince Cable into voicing his hostility to Murdoch, that bulwark would be stronger still. The Liberal Democrats are still learning about the realities of power. One is that proprietors and editors never use the front door when they really mean business.

The encounters that help them further their commercial interests are never minuted. The nods and winks that trade favourable coverage for influence over decision-making are always deniable. The evidence is usually circumstantial, insufficient to convict but enough to raise suspicions.

Cameron was foolish to get caught enjoying Christmas hospitality at the home of Rebekah Brooks, News International's chief executive, so soon after Cable's humiliation. He won't make that mistake again even if she is one of his constituents.

Jeremy Hunt, the Culture Secretary, who inherited from Cable the decision on whether News Corporation should be allowed to buy the 61 per cent of shares in BSkyB it does not own, has given Murdoch his main prize at very little cost.

The formation of the Coalition should have been a serious setback to News International. It's harder to do secret deals with two parties than it is with one. And yet, less than a year after Rupert Murdoch made his clandestine visit to Downing Street, his influence continues to grow.

By hiving off Sky News from BSkyB, he is repeating a trick he has done before, extending his reach in return for "guarantees" of editorial independence. He did the same 30 years ago when he bought The Times and The Sunday Times. The guarantees proved virtually worthless.

With the Conservatives very much in the lead, the Coalition is content to allow Murdoch to combine control of over a third of the newspapers bought daily in the UK and the country's wealthiest broadcaster.

If Gordon Brown was willing to tailor his economic policy to impress the Murdoch of old, what might a future prime minister do to get the backing of an empire whose borders have been extended once again?

The fully updated paperback version of 'Where Power Lies – Prime Ministers v The Media', by Lance Price, is published tomorrow