'Murky practices' revealed, says Nick Clegg

The phone-hacking scandal has uncovered "murky practices and dodgy relationships" at the heart of Britain's establishment, Deputy Prime Minister Nick Clegg said today.

Mr Clegg said that the judge-led inquiry into the hacking allegations provided a once-in-a-generation opportunity to clean up the media, politics and the police, by legislation if necessary. Politicians must be ready to accept Lord Justice Leveson's recommendations and act on them, he said.

The Deputy Prime Minister's comments came as Prime Minister David Cameron was under renewed pressure over his contacts with senior executives at News Corporation, after aides confirmed he had discussed the company's bid to take over BSkyB with them.

Downing Street said Mr Cameron could not rule out that BSkyB was mentioned during the Prime Minister's meetings with News Corp figures, including chairman Rupert Murdoch and former News International chief executive Rebekah Brooks, but insisted that none of his conversations were "inappropriate".

Culture Secretary Jeremy Hunt - who had responsibility for making the final decision on the bid, which has now been dropped - told MPs last night: "The discussions the Prime Minister had on the BSkyB deal were irrelevant.

"They were irrelevant because the person who had the responsibility... the person who was making this decision was myself."

At a Whitehall press conference today, Mr Clegg said: "I think that we now have a once-in-a-generation opportunity to really clean up the murky practices and dodgy relationships which have taken root at the very heart of the British establishment between the press, politicians and the police.

"That is what we now need to get on and do. That's what the independent judge-led inquiry will allow us to do. We must act on any recommendations from that inquiry quickly, if necessary through legislation as well."

Mr Clegg said the hacking scandal, and allegations that police officers were paid by the press for information, had "shaken" faith in the police and brought public opinion of politicians to an even lower level.

Mr Clegg said Liberal Democrats had been raising concerns about phone-hacking even before the general election, and he was the first person in Government to demand a judge-led inquiry into the allegations.

And the Liberal Democrat leader confirmed that he had raised questions at the time of the creation of the coalition about Mr Cameron's decision to bring former News of the World editor Andy Coulson into the heart of the Government as Downing Street director of communications.

He stressed that the decision to appoint Mr Coulson was the Prime Minister's alone.

Asked whether he had challenged Mr Coulson's appointment, Mr Clegg said: "Of course there were constant conversations - particularly in the early stages of the Government - about how the Government was going to be formed, who was going to be appointed, who was going to be employed and so on.

"I asked questions about some of the decisions about who was being brought into government who had been active in opposition."

He added: "It was (Mr Cameron's) decision and he has been very frank and candid about the fact that he takes responsibility for it. In the same way that I take responsibility for appointments in my team, he takes responsibility for appointments to his team."

Liberal Democrats have not been implicated in the recent furore over politicians' relations with the press, but Mr Clegg has struggled to capitalise on this in the polls.

Today he sought to establish a distinctive position for his party, saying: "I don't think anyone should be surprised that the Liberal Democrats and Conservatives come at this issue from completely different directions.

"We were the only party in opposition to call for an inquiry into the phone-hacking allegations, even before the election.

"Going back further than that, we were the only party to campaign for new pluralism rules in the media. The Liberal Democrats have had a particularly unique role in raising issues which were ignored by the other parties for years and years, most notably by the last Labour government.

"I was the first person in Government to say it had to be a judge-led inquiry. I was the first person in Government to say that Rupert Murdoch needed to reconsider his bid.

"I was the first person in Government to say we needed to cover not just the police and press but politicians as well.

"On each and every one of these counts, I pushed that case and thankfully we have now got the right kind of inquiry, which I think will go a long, long way to cleaning up what was a very, very unhealthy state of affairs."

He added: "I passionately believe in open, transparent balanced government where people are not in each other's pockets, and that is what I think we now have an opportunity to achieve over the next few months and years, and that is an opportunity I hope we will seize."

Shadow chancellor Ed Balls said Mr Cameron had made "a catastrophic error of judgment" by discussing the details of the BSkyB bid with News Corp executives at a time when it was being discussed by his Government.

Mr Balls said it was "fine" for ministers to meet newspaper editors and proprietors to discuss the state of the nation and their Government's policies.

But he told Sky News: "That is a completely different issue from Government ministers who have a power to influence commercial decisions talking directly to executives who stand to benefit from those commercial decisions.

"What happened yesterday was that the Prime Minister evaded and evaded all day and in the end Jeremy Hunt had to admit the Prime Minister had discussed the details of the BSkyB bid."

Mr Balls said the Prime Minister should make clear whether the BSkyB bid was discussed at a private lunch he had with Ms Brooks and News Corp deputy chief operating officer James Murdoch around Christmas.

"If that was what was being discussed on Christmas Day or Boxing Day in Oxfordshire, the Prime Minister should set this out clearly," said Mr Balls.

"It's fine to meet editors and it's fine to meet proprietors, though you have to be careful," he said. "But you shouldn't be discussing commercially sensitive issues with executives while decisions are being made.

"If the Prime Minister didn't do that, he should make it clear. And if he did do that, he has got some very serious questions to answer."

Yesterday, Business Secretary Vince Cable claimed he had been "vindicated" in adopting a tough stance on News Corp's bid to take over BSkyB.

He said: "Clearly my judgments were vindicated.

"I think more important last autumn, when the takeover bid could easily have gone through, I stopped it happening, I referred it to the regulators."

Mr Clegg said today that history had "borne out" Mr Cable's reservations, which he first aired unwittingly to undercover reporters.

The Deputy Prime Minister said: "I don't think this is a time for anyone to start seeking retrospectively to claim credit one way or the other.

"Vince made his reservations about the BSkyB deal spectacularly clear - if in unorthodox circumstances - and to that extent, yes, Vince's reservations on the nature of the deal have been borne out by events.

"But, frankly, the events that have taken place since Vince made those comments are quite different from anything Vince or I could have predicted at the time."

Mr Clegg called for a revamped press industry with a new regulatory body to replace the Press Complaints Commission (PCC).

"I want a media landscape which is free," said Mr Clegg, adding: "I don't want an out-of-control press to undermine the integrity of a free press."

But he claimed he did not want "politicians making up the rules and I don't want politicians to start predicting how the media should be configured in the future".

Mr Clegg went on: "The PCC can't carry on in its present form - it is judge and jury.

"You've got this ludicrous situation where the committee which is actually responsible for supervising the code of conduct by which editors should be judged is populated only by editors, chaired by the editor of the Daily Mail (Paul Dacre).

"We have got to have independent regulation - independent of Government (and) independent of the press - able to adjudicate and able to impose sanctions as well."

Speaking at an event in Birmingham organised by the Birmingham Mail newspaper, Labour leader Ed Miliband said the hacking scandal underlined the need for social responsibility.

He said: "One of the things that has struck me about the last couple of weeks is that we talk a lot in our society about the responsibilities of the powerless - people without power, people on benefits and others - and it's important they show responsibility.

"But the reason why people have been so shaken by recent events is they have shown such irresponsibility among the powerful in our society."

He added: "In order to restore trust - and this is why it's important we get the truth in all respects - we've got to make sure once and for all we ensure the kind of events we have seen don't happen again.

"We also have to... ask ourselves more widely what it says about us as a country.

"Why did these things happen? Why did it get to a stage where it was thought it was OK to listen to (and) delete the voicemail messages on Milly Dowler's phone?

"That requires us to look into our soul as a country and say 'What standards do we want set?'

"That is an issue for all of us."

Glenn Mulcaire, the private investigator jailed in the phone-hacking scandal, said today he will not speak out about his involvement in the phone hacking scandal until the police inquiry is completed.

He released a short statement through his solicitor after News International announced it had stopped paying his legal fees.

The statement said: "As I made clear yesterday, because of the ongoing police inquiry and the possibility of further criminal proceedings, I cannot speak further at present.

"I am advised that this will remain the position until after the conclusion of the police inquiry."