AIDE to British Culture Secretary Jeremy Hunt resigns over 'absolutely illegal' advice emails to News Corporation executives, as cabinet minister prepares to make statement to Parliament.
Adam Smith quit today saying that he acted "without authorisation" from Mr Hunt.
The Culture Secretary continues to fight for his political life amid claims he secretly backed the media company's bid to take over satellite broadcaster BSkyB.
Speaking to reporters as he left his London home this morning, he insisted he had acted with "total integrity" in his conduct of the process of deciding whether to approve the multi-billion pound deal.
He added that he was going to be making a "very, very determined" effort to prove this was the case.
"I made my position very clear, I am going to be making a very, very determined effort to show that I behaved with total integrity and conducted this process scrupulously fairly," he said.
His defence came a day after a series of disclosures on by far the most dramatic day so far of the Leveson Inquiry.
It was disclosed that the Cabinet Minister’s key political adviser appeared to give apparently confidential information on a regular basis over several months to a lobbyist working for James Murdoch.
At the time, Mr Hunt was acting in a “quasi-judicial” role charged with ruling on whether News Corporation could take over BSkyB, the satellite broadcaster.
In public, the Culture Secretary insisted he was acting in an independent and impartial manner, but the release of the emails has led to allegations that he was privately colluding with the Murdoch family.
The emails were published on Tuesday as James Murdoch gave evidence at the inquiry. It came before his father, Rupert Murdoch was due to give evidence to the inquiry today.
Lord Fowler said Mr Hunt should explain his position straight away to MPs, not wait for his Leveson appearance.
The former Cabinet minister and Conservative Party chairman, who chaired the House of Lords communications committee and was opposed to the BSkyB takeover, said he thought "probably Jeremy Hunt followed the rules".
"But the trouble is the closeness to Murdoch before he took on the quasi-judicial role," he told BBC Radio 4's Today programme.
"We have got to wait for Jeremy Hunt to make his statement, wait for the questioning of it."
He added that it was clear that the disclosures showed that "once again we should take ministers out of the media decision (making) process."
The Prime Minister — who now faces the spectre of renewed accusations of Tory sleaze — is expected to come under intense pressure to explain whether there was any conflict between his relationship with Mr Murdoch and the behaviour of Mr Hunt’s department.
On Tuesday night, Downing Street was forced to issue a statement saying that David Cameron had “full confidence” in the Culture Secretary. Mr Hunt strongly denied wrongdoing and warned against a “knee-jerk reaction” to the revelations.
Ed Miliband, the Labour leader, demanded his resignation. “Jeremy Hunt should have been standing up for the interests of the British people,” he said. “In fact, it now turns out he was standing up for the interests of the Murdochs.
“He cannot stay in his post. And if he refuses to resign, the Prime Minister must show some leadership and fire him.”
Lord Prescott, the former deputy prime minister, told Sky News Mr Hunt should come to the Commons to explain his actions.
He said: "I can't understand why Mr Hunt - instead of applying to Leveson, why doesn't he come before the House of Commons and explain there is no truth in these allegations?"
"If he is so clear that he has done his job properly and impartially, come and tell the House of Commons. Why ask Lord Justice Leveson as to whether he would allow him to appear before?
"It means delay, delay, delay."
News Corporation released more than 170 pages of “evidence”, consisting of internal emails and text messages, detailing the company’s extraordinary efforts to lobby the Government.
The emails largely contain messages sent by Frederic Michel, the head of public affairs, to James Murdoch and other senior executives at News Corp detailing his discussions with the Government.
The company also released emails and text messages between Mr Michel and Adam Smith, Mr Hunt’s main special adviser.
News Corp said in a statement on Wednesday that it was “required by law to produce these documents".
In one message, Mr Michel detailed what the Culture Secretary would say to Parliament the next day on the BSkyB takeover, noting that it was “absolutely illegal” for him to obtain the information.
Another email, dating from January last year, reported Mr Hunt’s belief that it would be “game over” for opponents of the BSkyB takeover once plans to spin off Sky News into a separately listed company were announced. On Sunday, Jan 23 2011, he sent another email to James Murdoch, relating “a very constructive conversation with JH” which mentions a “plan” that would help create “game over for the opposition”.
Two days later, Mr Hunt said he was minded to refer the BSkyB takeover to the Competition Commission but delayed doing so while he considered proposed concessions from News Corp. Later that day Mr Michel emailed Mr Murdoch to say: “JH believes we are in a good place tonight.”
In total, there were at least 38 separate contacts between Mr Hunt’s office and News Corporation about the proposed deals. Some of the emails suggest that Mr Hunt’s adviser gave News Corporation’s lobbyist suggestions on dealing with the media regulator.
Although Mr Michel’s emails typically referred directly to him having spoken to “JH”, the lobbyist told the inquiry that this was shorthand for contacts with the Culture Secretary’s office — usually Adam Smith.
However, Mr Michel also said in one email that Mr Hunt had told him to liaise with his special adviser. Mr Hunt had previously told Mr Murdoch he backed his bid but had received “very strong legal advice” that it would be improper for him to meet the media tycoon.
News Corporation abandoned the £8 billion bid in the summer of last year after the phone hacking furore at the News of the World.
The email exchanges dominated proceedings at the inquiry. Lord Fowler said the PR man appeared to have been "over-egging the pudding, to put it mildly".
Mr Murdoch insisted that the reference to the “absolutely illegal” advice being offered by Mr Michel was “a joke”. Whitehall lawyers and the parliamentary authorities are now expected to analyse whether the information transmitted to News Corporation was legal and ethical.
In a statement on Tuesday night, Mr Hunt said: “Now is not a time for knee jerk reactions. We’ve heard one side of the story today but some of the evidence reported meetings and conversations that simply didn’t happen.
“Rather than jump on a political bandwagon, we need to hear what Lord Justice Leveson thinks after he’s heard all the evidence.”
He added: “I would like to resolve this issue as soon as possible which is why I have today written to Lord Justice Leveson asking if my appearance can be brought forward.
“I am very confident that when I present my evidence the public will see that I conducted this process with scrupulous fairness.”