Follow our liveblog below from yesterday (25 April) and today's (26 April) Leveson inquiry hearing, where Rupert Murdoch, chairman and chief executive of News Corporation is giving evidence.

13:14pm: Murdoch is asked if he is aware that the NUJ has been seeking to have a conscience clause inserted in contracts generally in the UK, which forbids papers from disciplining journalists who refuse to do something on ethical grounds.

Murdoch says he has never heard of it but tells Leveson he thinks it is a good idea.

The final point raised by NUJ relates to industrial relations law, and a provision known within the union as the "NISA clause" that says if an employer already recognises a union for collective bargaining, no other union can get involved. He says there is an embellishment that says if an employer has an agreement with a non-formal association that also prevents a union involving itself in negotiations.

Murdoch claims he has no knowledge of this clause and despite assertions to the contrary says NI was not responsible for it being implemented to the best of his knowledge and that he had never lobbied for it.

Leveson brings proceedings to a close by thanking Murdoch for his contributions and says exhibits will go on the website in due time.

13:13pm: Murdoch is asked if he feels the lack of NUJ representation means there is no independent place for journalists to go at NI with complaints.

Murdoch says there is an internal staff association which people can take complaints to.

The NUJ representative retorts that the association funded by NI and has not been certified as independent.

He asks Murdoch if he feels that if the NUJ were allowed to represent NI journalists this would be at least one step towards elimination of unethical practices.

Murdoch says no, he's sure some of those arrested had once been members of the NUJ yet this didn't stop them doing what they did.

The NUJ representative describes the union as a place journalists could turn to. He suggests one journalist who submitted evidence said that the absence of NUJ support meant there was nowhere to turn. Murdoch doesn't accept this.

13:10pm: The NUJ representative quotes from anonymous journalists saying there was enormous pressure at NotW.

He references one journalist who said she experienced almost constant bullying, and puts it to Murdoch that there was a culture of bullying at NotW.

Murdoch asks why she didn’t resign.

Leveson says it’s probably because she needed a job. He suggests it may be sensible for Murdoch to look at the evidence and comment if he wishes.

Murdoch asked if as far as he’s been aware there has been no internal NI investigation of bullying of staff.

Murdoch says he has never heard of such an investigation and that journalists "always struck him as a happy crowd".

Discussion turns to the relationship between NI and the NUJ.

The NUJ representative says its the case that no independent union is permitted to represent journalists on any NI UK title.

Murdoch responds saying he'd have no choice if a majority of journalists wanted to join the NUJ and it would be their democratic choice.

13:02pm: A representative of the NUJ outlines five areas he wishes to ask Murdoch about:
  1. Unethical treatment of journalists
  2. Allowing the NUJ to represent members and how this would offer protection against unethical behaviour in future
  3. Whether NI was involved in insertion of a particular provision in industrial relations legislation
  4. Whether a conscience clause would not be a sensible protection for journalists
  5. The role of the management standards committee and theabsence of protection for journalists at NI

Leveson accepts the first four as valid, but dismisses the fifth as not coming within scope of the inquiry.

Murdoch says he would welcome the chance to comment on the Management Standards Committee and says they did not disclose the sources of any journalists.

The NUJ's request is disputed by a lawyer for Murdoch who says they are not questions but statements. Leveson says if the NUJ representative doesn’t ask questions he will stop him.

First up Murdoch is asked if he is aware of unethical treatment of journalists by NI.

Murdoch says he does not know of any or believe there has been any. He says he has a very large staff who are free to join the NUJ when they wish.

12:58pm: Mr Kaplan, representing Associated Newspapers, asks about comments regarding Paul Dacre.

He suggests Murdoch has made a mistake in how he interpreted a statement of Dacre's.

Kaplan highlights an email between Michel and James Murdoch, where Michel says Dacre was clear the campaign was about commercial interests and fears about bundling.

Kaplan suggests it clearly refers to the campaign against BSkyB bid and not wider editorial interests.

Murdoch says he does not see the difference, that papers were campaigning against them and that is a commercial reason.

Referring to Sky, Murdoch says: "I nearly went broke and once mortgaged my own apartment, but got through it and gave great plurality to the British public."

"I do want to say that whatever happened at the NotW I have contributed to plurality of the press."

Murdoch refers to beating "the old craft unions who I’m sure Dacre remembers" and suggests Dacre would agree with him on this.

"We went through agonies. Without that there wouldn’t be such a good democratic press."

Kaplan stresses again the email solely concerned a campaign against the BSkyB bid.

12:55pm: Leveson asks Murdoch about the cost of maintaining ethical standards and failure to do so, and if he has any other comment on it.

Murdoch says that through ethical lapses discovered at NotW he has spent hundreds of millions across all of News Corp. The company has examined 300 million emails and 2 million in more detail.

Murdoch says: "This led to the arrest and terrible distress of a number of families of journalists who had been with me many many years and caused me a lot of pain, but we did it."

Murdoch says all those accused are still his staff until they are proven guilty.

Murdoch says he drew a very vague line about who deserves privacy and who doesn't yesterday, and wants to live in a transparent society.

Leveson asks Murdoch if he wants to say anything about people who have legitimate complaints about interception of their voicemails.

Murdoch: "It was totally wrong and I regret it, said it will be a blot on my reputation for the rest of my life."

12:51pm: Leveson goes back to what Murdoch considers unethical, but not civil or criminal wrong.

Leveson acknowledges problems at NotW might have been problems of enforcement, but says the police must be the very last rung of enforcement as they have other things to do.

He says there needs to be some mechanism for speedy resolution of complaints, which are short of claims in libel or in breach of a civil/criminal wrong.

Leveson wants there to be some mechanism to resolve them that will encompass as many as possible, including those who publish for profit online. He asks Murdoch if he has considered this.

Murdoch says he's not as aware as he should be of all the details of the PCC, but knows of a number of complaints and what their outcome has been.

He says he doesn’t think it’s enough to cover profit, as he can then leave out most of his newspapers online.

Leveson clarifies that he perhaps should have said those who do it for money.

Murdoch says he thinks everyone is doing it for money, including bloggers.

He highlights the example of the Huffington Post, which he described as starting as a political pamphlet and is now a very large organisation, but he doesn’t believe makes a profit yet is read by millions of people.

He also cites Mail Online as a similar example and claims it is unrecognisable as being related to Daily Mail.

Murdoch claims they just "steal content and post gossips". He says this comes right up to the barrier of what he views as fair use of other people’s material. He says there's no profit there despite tens of millions of readers.

12:49pm: Leveson says he agrees with Murdoch and says the whole issue requires very great care.

Leveson says he has to ensure one isn’t regulating what Evgeny Lebedev talks about as "work printed on dead trees", and that he has to encompass what is going out digitally.

12:45pm: Murdoch says the challenge of disruptive technologies "has to be met and turned into an opportunity. The trouble is we ask people to pay for it, but if it's good enough they will."

Murdoch says that advertising revenue on free sites is rising, but at the same time so are their costs. There are more ad opportunities every year than there are sites, so rates stay very low.

Murdoch says this should be treated as an opportunity. He uses the example of The Times: "We charge for The Times every day on the iPad, that can be seen in any corner of the world... Maybe there’s an opportunity there."

"There's some opportunities, they're not easy and we have a lot of people working at them to make attractive versions of our newspapers. For instance the Wall Street Journal, every single word is there every day and we add more photographs on the iPad.

"When it comes to regulation I just beg for some care, because it's a very complex situation ... a varied press guarantees democracy and we want democracy rather than autocracy."

12:41pm: Murdoch points out that local newspapers have suffered as they previously depended "very largely on classified ads that went to the internet" and that there's nothing that can be done about this.

Murdoch suggests that the BBC's local sites have taken readers away from local newspapers.

He thinks more local newspapers will cease to publish daily and this contributes to lack of diversity in the press. 

Murdoch: "The local media in this country have a great history of contribution to our democracy and I think it will be a very sad day if the major ones or all of them disappear. So I don’t know that they can be saved.  They could be saved from the BBC, but I don’t want to dwell."

12:35pm: As a result of action in 80s Murdoch says every newspaper has had a very good run, but this is coming to end because of disruptive technologies.

"We're spending a lot of money and succeeding in putting every word of our newspapers on modern tablets."

He says he's very confident in saying that in less than five years there will be billions of tablets in the world and maybe twice as many smartphones.

"Already some of our newspapers and other people present their news on a smartphone."

"I like and prefer the tactile experience of reading a newspaper or a book, so I think we’ll have both for quite a while. I’d be inclined to say 20 years, but 20 means very small circulations.

"The day will come when we say we can’t afford it and we'll be purely electronic."

On privacy, he says: "If you have a telephone or the number of my iPhone you could find out wherever I was anywhere in the world, any time of the day within 10ft."

Murdoch suggests the GPS chip in phones that makes this possible can also be used for industrial espionage.

"That can be stopped. It would take legislation and I would encourage it."

12:32pm: Murdoch is invited to share his ideas about future of press regulation.

Murdoch: "I would say that the laws you’ve seen enforced in the last few months are perfectly adequate. It’s been a failure of enforcement of the laws.

"You said at the beginning I had a great understanding of technology. I should have corrected you. I don't ... but the fact is the internet came along, slowly developed as a source of news and now is absolutely in our space.

"I think it's been responsible for a lot of loss of circulation.

"We're seeing everybody under extreme pressure. We saw this week the announcement of three papers ceasing to publish daily and going to weekly. There’s a reason for that, there’s a disruptive technology.

"Certain things can be done to control the major players, but it's just too wide. People can send their blogs from anywhere, you just can't regulate that.

"I think you have a danger of putting regulations in place which means there will be no press to regulate. I honestly believe that newspapers, with all their mistakes and qualities, are a huge benefit to society."

12:25pm: Murdoch says he has learned a lot about control and compliance. He says it takes place naturally in most of his newspapers, but it didn't at the NotW.

Jay puts it to Murdoch that only Crone and the editor acted as such controls at NotW.

Murdoch agrees, but adds there were people above them with similar responsibilities.

Jay asks Murdoch if as costs of implementing proper internal systems were not that great, does failure to do so show a cavalier attitude?

Murdoch says it does not, but admits he did make mistakes.

He says he should have changed the legal officer every five-to-ten years, rather than keeping same one for 20 years.

Murdoch describes the NotW as an aberration and says it was his fault.

12:24pm: Jay asks if the NotW situation was cavalier in regards to business risk.

Murdoch disagrees, but says again he was guilty of not paying enough attention to the NotW.

Jay tries to get Murdoch to separate personal responsibilities from systems failures.

He says if Murdoch did commit a personal failure, it would have been in not ensuring the systems were appropriate.

Murdoch disagrees and says there was a full time legal officer on NotW who was meant to check every story.

Murdoch says he is sorry the systems proved inadequate and that additional ones have now been put in place, involving "people of the highest calibre".

12:23pm: Murdoch says again that the business costs of establishing a framework for ethical and legal behaviour are minor compared to the costs of criminal action.

12:20pm: Back from break.

Jay asks Murdoch if he would agree that the magnitude of legal risk is linked to the magnitude of ethical misbehaviour within a company.

Murdoch says it may be, serious breaches of the law are certainly unethical, but he can think of things that he would call unethical and extremely serious which are not criminal. He adds he hopes he is not guilty of either.

Leveson intervenes to ask if he means by "not criminal" also not giving rise to civil actions. Murdoch agrees.

Jay says he wants Murdoch to view this as all being on a spectrum, with criminal wrong at themost serious end, but all part of a continuum.

Murdoch says he supposes that is a way of looking at it.

12:10pm: Leveson calls a break

12:04pm: Murdoch says he is now showing at the Sun you can still produce the best newspaper without engaging in bad practices.

Jay asks Murdoch if the decision to "clean out the Augean stables" was arguably an overreaction, because he realised the period before had demonstrated a cover up.

Murdoch says he wouldn't use emotional words like "cover up" and that the response went way beyond anything police asked them to do.

Murdoch: "I should have gone in and thrown all the lawyers out and met Goodman one on one and examined him myself and made up my mind, maybe rightly or wrongly if he had been telling the truth.

"If I had concluded he was telling the truth I would have torn the place apart and we wouldn't be here today. But that's hindsight which is a lot easier than foresight."

Jay asks Murdoch if he sees the link between ethical and legal misbehaviour.

Murdoch says he does. He gives the example of him hypothetically asking Prime Ministers for favours, which he says would have been unethical but not criminal, however this would still have been bad so he would not have done it.

12:01pm: Murdoch says the decision to close the NotW was taken very quickly, by his son, Brooks and himself

Murdoch: "Perhaps we relied too much on the conclusions of the police. you saw our response to Sienna Miller, we realised we had a major problem."

Murdoch says the Select Committee accused NI executives of collective amnesia. He says "our response was far too defensive and disrespectful of Parliament."

Murdoch discusses his appearance at the Select Committee last year.

He says he has lived up to his pledge to "clean up the mess" as he has spent hundreds of millions of dollars and NI have examined 300 million emails of which they chose 2 million and anything which was faintly suspicious was passed to the police.

Murdoch says that led to a dozen or so midnight arrests, and that this was because of his pledge, not because of the police.

Murdoch: "They did not ask us to go to that extent. That went way beyond what they asked us to do. I remain greatly distressed that people who had been with us 20-30 years and were great journalists, some friends of mine were arrested. I'm glad we did it, though I feel personally responsible."

11:48am: Jay says closing the NotW was a disaster in financial and reputational terms.

Murdoch says the closure didn’t stop excellent sales of the Sun and other newspapers. He says he thinks historically, the NotW is a "serious blot" on his personal reputation.

Jay asks Murdoch if reputation is a vital commercial asset which needs managing. Murdoch says it is what keeps the PR business going.

11:56am: Jay asks Murdoch why he closed the NotW rather than toughing it out.

Murdoch replies that when the Milly Dowler phone-hacking story broke, other newspapers took the chance to make it into national scandal, making people aware of it who had not followed the story previously.

Murdoch says he "could feel the blast coming in the window".

Murdoch says he "panicked" but is "hlad [he did] and sorry I didn't close it years before and put a Sunday Sun in."

11:54am: Jay puts questions to Murdoch given to him by another core participant.

First he asks if Murdoch has ever asked papers to pursue stories which promote his business interests.

Murdoch says he would suggest the to the editor of the Sun it might be good to mention what might be coming in the new Sunday edition. He sees this as self-promotion and remembers his training on the Daily Express where they would always promote what was coming in the next edition.

Murdoch says he never asks his journalists to promote his TV channels or films. He tells Jay to read New York Post critics attacking Fox's films.

Murdoch says he has never asked papers to attack commercial rivals or to make life uncomfortable for regulators.

11:52am: Jay now asks Murdoch about self-regulation and refers to evidence from Piers Morgan discussing his time as editor of NotW.

In the evidence Morgan says publicly that Murdoch supported the PCC and criticised Morgan, but in private Morgan's diaries it is suggested he met with Murdoch and Murdoch said sorry for the press criticism.

Murdoch denies saying this, and says he might have expressed confidence.

Murdoch denies making comments about a public statement being necessary and says he doesn't generally believe in a privacy law. Murdoch says privacy laws are proposed for the protection of the great and the good, not the mass of people who make up our democracy.

11:51am: Jay asks Murdoch if the ethical tone of a newspaper or newspaper group is set by the chairman, particularly if they have been there for decades.

Murdoch says he hopes he has had that effect for the most part.

He says he employs thousands of journalists around the world and has spent hundreds of millions in the UK, but has been through every possible check at his Australian papers. He wants to be absolutely certain this [scandal] was only here in London

"I think we'vere satisfied ourselves we have great, great journalists who do some amazing work."

11:45am: Jay goes on to ask Murdoch if he agrees maintaining high standards costs money.

Murdoch suggests the opposite, saying failure to maintain editorial standards can be immensely expensive, as he stands witness to today.

Jay asks about proper internal standards and puts it to Murdoch there is a commercial cost in implementing and maintaining them.

Murdoch says the cost of it is "peanuts" compared to what the hacking scandal has cost them, which he puts at hundreds of millions.

Murdoch says it is the "duty of the editor to take responsibility for every single word in his newspaper".

11:40am: Murdoch: "They [the press] love attacking me. I've developed a pretty thick skin and I'm under strict instructions by my lawyers not to say this, but I read Paul Dacre saying his editorial policy was driven by commercial processes and it's the most unethical thing I've read for a long time as I have great respect for his abilities."

11:37am: Murdoch now refers to a Daily Mail splash attacking Google for not deleting porn from its servers.

Murdoch says he agreed with the attack and felt it was fair, though very hard.

Murdoch says he thinks it is fair for a newspaper to debate issues in strong terms.

Leveson asks if the same applies to newspapers exposing other newspapers. Leveson adds that the press holds everyone to account, except themselves.

Murdoch says he doesn’t feel that, and he feels he is held to account by the British public every day. He repeats yesterday's comment about standing for election every day.

11:35am: Jay now refers to Murdoch's interview with Anne Diamond in 1980s about Elton John and Princess Diana

Jay says Diamond put it to Murdoch that his newspapers were "ruining peoples lives" and asked how he could sleep at night.

Diamond claims Murdoch brushed this question aside.

Murdoch says he tries to answer every question put to him.

Jay then refers a claim that Murdoch decided in collusion with editors to target Diamond.

Murdoch says this claim is completely wrong and he knew who made it. Murdoch describes the person who made the claim a "very strange bird".

11:32am: Leveson asks Murdoch about how the story was conducted and how it was put to the witness Murdoch referred to and the pixellating.

Leveson asks if they they put it to witness they could either publicly expose her or she could tell them the story and she’d be given money.

Leveson refers to the judgement and says he wants to make it very clear that he finds that approach somewhat disturbing and doesn't think Eady is being too strong in describing it as blackmail, and he would like to know if that is part of the culture of the press.

Murdoch apologises for not having read  Mr Justice Eady's judgement, but says its a common thing in life for people to say "I’ll scratch your back..."  Murdoch accepts Mr Justice Eady’s words but says again he has not read the judgement.

Leveson describes this as at the very core of what he is doing. He says without asking Murdoch to return he wants Murdoch to look at that judgement and let him know if what he thinks Mr Justice Eady referred to reveals a culture and practice that Murdoch thinks is A: accurate or B inappropritate.

Murdoch says he will be very happy to read it and submit a document.

Leveson says he would like his considered view.

Leveson says he gathers it was never brought to Murdoch’s attention and accepts that.

11:31am: Jay now asks about Max Mosley's letter to Murdoch from March 2011.

Murdoch says he did not read the correspondence and that it was sent by his assistant to someone else to handle.

Murdoch says he received an email yesterday from Mosley about it, which he passed to Tom Mockridge, his chief executive, to handle.

Jay says the point Mosley made referred to comments made by Justice Eady about blackmail being employed by NotW journalists.

11:30am: Murdoch says he tried to distinguish through appearance difference between the Sun and NotW, and that it is grossly unfair to the Sun to lump it in with NotW.

Jay says the inquiry is into the culture of the press and Major's comment was about Fleet Street, which he says he supposes is a reference to everyone.

Murdoch says Major had cause to be bitter about the press, so it would be natural he would make sweeping allegations against press, which mayhold an element of truth.

11:27am: Murdoch: "We have a great vibrant press here"

Murdoch says it's a fact of life there is great competition, but he doesn't think it leads to lying.

Jay presses Murdoch and asks him if he is saying Major’s comments only refer to other papers.

Murdoch says this is a little too broad and his papers did occasionally do it, but not exclusively. He refers to Piers Morgan's time as editor of the Mirror.

11:25am: Jay quotes from John Major's autobiography, in which Major says one part of negative coverage of his government was because of a price war on Fleet Street. Major says confidentiality was not respected and reputations were sacrificed "for a few days' hysterical splash".

Murdoch says Major was talking about other newspapers. He agrees with Jay that circulation was falling and still is which he wants to discuss later, but there was always great competition.

11:24am: Jay asks about "celebrity gossip, kiss and tell stories and salacious tittle-tattle" and how Murdoch was careful to exclude that.

Murdoch says NotW was "interested in celebrities just asthe public was, but had not been careful to exclude it".

Murdoch says much more effort went into covering weekend football.

Jay describes them as aspects of the brand that helped contribute to the financial success of paper, which Murdoch disagrees with.

Murdoch says there was coverage of celebrities, but rejects the suggestion there was gossip, which he takes to mean "unfounded stories".

11:22am: Jay refers Murdoch to his own witness statement and asks about a reference to the brand definition of NotW and how Murdoch would define it.

Murdoch says NotW is a "campaigning newspaper".

Murdoch: "When I first went there, [the paper was] more interested in covering courts all over country which were not covered in other nationals except the Telegraph, it went from being more court coverage to being more campaigning."

11:19am: Jay asks Murdoch why he said his priority was Rebekah Brooks rather than cleaning up his company.

Murdoch says he doesn’t think they should refer to Brooks until the inquiry has heard from her.

11:18am: Jay asks Murdoch why when he was in UK in July last year, he said his priority was Rebekah Brooks. Murdoch said he was confronted by press and that’s all he said. Murdoch says that if you have 30 journalists in front of you, "you are under duress".

Leveson: "We might return to that discussion later."

Murdoch is asked if he thinks the press acted inappropriately. He says he think it is "part of the game – to harass people". Murdoch adds there were "twenty or so" people outside his apartment this morning.

11:16am: Jay now refers to Tom Watson's new book, which Murdoch says he does not plan to read.

Jay says in the book Watson alleges Murdoch phoned Blair requesting he get Brown to get MPs to "back off" on their investigation.

Murdoch says he is certain it never happened and points out Brown also doesn’t remember the incident.

11:14am: Jay refers to JM's term "aggressive defence" when discussing the Guardian article.

Murdoch says he thinks Guardian does pretty well with regard to giving its audience what hit wants.

He says he doesn’t know if the phone hacking story would have entered public domain without the Guardian.

Murdoch says NI were investigating it internally, but when the Guardian story came out "I agree with my son that the statement we made in 2009 about Taylor allegations was far too defensive".

Murdoch says he does not think the story would have stayed concealed without Guardian work, but he is not sure how it would have come out. He suggests there's plenty of investigative journalists, or the police may have broken the story as "they have Mulcaires diaries which are major source of info on hacking."

11:12am: Murdoch says there was a committee set up under Myler and the corporate council/human relations to make inquires and there was Harbottle and Lewis and all of these seemed to confirm what the police had said.

Murdoch: "We relied on that too much as it turned out"

11:10am: The inquiry resumes.

Jay says the Met Police say they never said they were satisfied with the rogue reporter defence and that this was NI's defence. Murdoch says he understands this, but wasn’t aware until then.

11:00am: Leveson calls a break.

10:59am: Murdoch says he was never told there may have been a risk of many more cases.

He says "anyone who puts faith in confidentiality clauses is too naive to be true".

Murdoch says he was told of Taylor's confidentiality clause in his settlement, but didn’t think about the impact at time He says he is sorry he didn’t give it enough attention at time.

Jay puts it to Murdoch that JM said to him they needed to keep quiet to avoid massive reputational risk. Murdoch says he never said anything like that.

Murdoch says NI did not suspect rogue reporter defence was wearing thin, because the article in the Guardian, which was hostile and personalised, had been disowned by police within 24 hours. "We chose to take the word of police over the word of the Guardian."

Murdoch: "We rested on that until beginning of 2011 and the Sienna Miller case. We immediately realised there was a great danger and gave police the name of Ian Evans."

10:58am: Murdoch says a Guardian article of July 2009 was brought to his attention, but at same time police disowned it and said it was wrong.

Jay asks about JM saying there was conversation between him and RM about this and the Taylor settlement. Murdoch says in 2008 he did not know of the Taylor settlement and it surprised him, particularly the size of it.

Murdoch: "I didn't know if we had really hacked him, but the size seemed incredible and still does."

Murdoch says he asked JM why it was so large. James said he was given a choice of two boxes to tick, one of a relatively lower sum or one that was infinitely bigger. He ticked the lower one based on advice, as he was relatively inexperienced at the time. Crone and Myler gave the advice to JM.\

Leveson asks Murdoch to clarify his comments. Murdoch says James was told to tick the box which didn't have a risk of appeal.

10:57am: Murdoch says he thinks reporters do act on their own, they protect and don't disclose their sources.

Murdoch says he thinks the Times and Nightjack case is an example of a really rogue reporter, which didn’t reflect the newsroom at the paper.

Murdoch says he is guilty of not having paid enough attention to NotW throughout whole time he owned it.

He says he was more interested in the excitement of building new newspaper and the challenges of the Times and Sunday times.

Murdoch says this "was an ommission by me and all I can do is apologise to a lot of people including all the innocent people who lost their jobs as a result of that."

10:55am: Leveson says Murdoch has a particular interest in print media and has shown that interest is more than just a commercial one or intellectual one, "it is one which is within your being".

Leveson puts a question to Murdoch: ""Here was a newspaper that was in your family that you had built up to be the largest selling newspaper in UK, quite apart from commercial side, you would really want to know as you put it 'what the hell was going on' as printing was running through your veins.

"It's not just a matter of commercial interest, but at the very core at your being. Were you not really intensely concerned to know what was going on?"

Murdoch says has to admit some questions were closer to his heart than others, and admits here he "[has] to say he failed and is very sorry about it".

Leveson says he accepts Murdoch has made that clear not just to inquiry but in anumber of public appearances, but this doesn’t answer the question of whether he really did try to understand what was going on or "whether you felt 'I don’t need to understand what was going on'".

Murdoch: "I think when police said: 'We're satisfied this was a rogue reporter, we’re closing our file', I think Hinton did that."

10:47am: Murdoch says he relied on Hinton to ensure Myler followed his brief to find out what was going on.

Jay presses him as to why if it was such a serious matter which was capable of affecting wider interests, he did not view it as a matter which required his personal attention.

Murdoch: "In hindsight the buck stops with me, I have to agree with you."

Jay says in one sense the buck always stops with chairman of a holding company, but he was talking more directly.

He asks why Murdoch did not find out if Myler was discharging his brief.

Murdoch says he trusted Hinton and delegated responsibility to him. He says no there discussions between himself and Hinton at the time.

Jay: "This picture is consistent with a desire to cover up, not to expose."

10:45am: Jay asks if Murdoch made it clear to Hinton that Coulson had to resign when Clive Goodman and Glenn Mulcaire went to prison.

Murdoch says Coulson did the right thing in saying he knew nothing of this but had to go.

There was no conversation between Murdoch and Coulson, but Murdoch says he thinks there was a call between Murdoch and Hinton where Hinton said he thought Coulson was doing the honourable thing.

Murdoch says he thought it was a very serious matter that just one person had been found to have hacked phones and he was not aware of Coulson’s leaving package.

10:42am: Jay refers to events in January 2007, and quotes from Murdoch's statement where he says he recalls learning of Andy Coulson's resignation and the appointment of Colin Myler.

Jay asks if Murdoch was not directly involved in appointment.

Murdoch says Les Hinton sent him an emailing proposing it to which he agreed.

Murdoch says he knew Myler, he would not have been his choice, but Hinton felt there would not be personal allegiances there so he could rely on Myler to report back to Hinton.

Murdoch says Myler was not his choice because he could think of stronger people for the job.

Murdoch: "I'd hope Myler would do what he was commissioned to do and certainly during the remaining seven or eight months of Hinton's regime he did not report back to him, maybe he didn't find anything out but he certainly didn't report back."

10:40am: Jay says Murdoch used the term "cover up" and suggests there was more than one.

Jay asks where this culture of cover up emanates from.

Murdoch says he thinks it emanates from within NotW and that there were one or two very strong characters there.

He says the person he is thinking of was a drinking pal of a journalist and was a clever lawyer and forbade them from going to see this evidence.

This person forbade people from going to report to Rebekah Brooks or James Murdoch.

Murdoch says that is not to excuse it on NI's behalf, "I take it extremely seriously that that situation had arisen."

10:36am: At the time Murdoch says all he knew was police said it was a rogue reporter that was responsible for hacking and were closing file.

Jay accepts this may have been the case but says NI had the ability at time to ascertain whether this was true.

Murdoch says he thinks the senior executives were all misinformed and shielded from what was going on.

"I do blame two or three people from that who I shouldn't name as they may be arrested."

Murdoch says there's no question in his mind that certainly the editor and possibly other people were in charge of a cover up.

Murdoch says a new editor was appointed later to find out what was going on, but never reported back that there was more hacking.

Murdoch adds that Harbottle and Lewis were appointed and given a file and argued they were only given a very specific brief, but  he can’t understand why a law firm would "find stuff" and not ring the chief executive.

Leveson asks if NI will let them see what the second law firm found. Murdoch dodges the question.

10:35am: Leveson steps in to ask Murdoch about privilege and how NI waived privilege in relation to work done by their law firm, Harbottle and Lewis.

Leveson says waiving privilege allowed Harbottle and Lewis to assist the inquiry, but in regards to the second law firm NI have not waived privilege and so cannot aid inquiry. Murdoch says he was not aware of this

10:31am: Jay moves on to address thephone hacking scandal directly.

He asks if NI were cooperating with police over initial incident involving Goodman and Mulcaire.

Murdoch says NI appointed a special law firm to look into this and aid to cooperation with police.

Murdoch says after the arrest of Clive Goodman, police closed the file. He cannot believe they would have been unhappy with cooperation.

Jay disputes this and says the evidence they have received says NI were obstructive and their law firm only produced one document.

Murdoch says this allegation "shocks him deeply" and he first heard of this when Jay just put it to him.

10:29am: Murdoch: "I don't want to say anything against Michel, but may have been a little exaggeration there."

Murdoch admits he has not read all of 163 pages, but has "tasted" them.

Murdoch says he never assumed Hunt was on their side, but assumed he would be responsible and deal with the issue in a completely unbiased way. He thought Cable was an exception.

Jay asks if it was true the price would get higher the longer the bid went on.

Murdoch says no, though hedge funds may get greedier as that was "their way of negotiating".

Murdoch says without the hacking scandal News International would have secured BSkyB shares.

Murdoch says until the Milly Dowler story broke, phone hacking was not a massive issue to the public.

He adds that NI didn’t have any info as police had Glenn Mulcaire' diary under lock and key, and therefore NI have been limited in their own inquiries by that.

10:27am: Jay asks if Murdoch was aware NI had lobbyists targeting the government in favour of the BSkyB bid.

Murdoch says he only learnt much more recently of the extent of Michel’s lobbying and was not aware of the full extent at the time.

Murdoch knew of Michel’s existence a few months before the 163 pages of emails were disclosed.

He says he didn’t see anything wrong with Michel’s activities, but was surprised they had gone on so long and there were so many emails.

Murdoch says he was "surprised by the success of competitors lobbying and of course they would never have succeeded if it hadn't coincided with the hacking scandal".

Murdoch: "I don't think there was success [with NI lobbying]. We were made to make very big concessions, which I never understood the need for."

10:24am: Murdoch says he was more concerned by phone hacking in 2011 than the BSkyB bid and the length of time it was taking.

Murdoch says NI did want the remaining BSkyB shares as a good investment, but it wasn't "something we had to have".

Murdoch says he did get updates from JM on the bid, but probably not on a daily or weekly basis.

RM says he had delegated the situation to JM and had a lot on his plate. JM did not report that often, but they did talk.

10:22am: Murdoch doesn’t remember if he asked his son for an opinion on Hunt, and denies the suggestion he must have asked him.

Murdoch says he "never saw anything wrong with what we were doing" and that it was a "large transaction, but commonplace".

Jay asserts Murdoch must have been worried about politics.

Murdoch: "We saw all our competitors form a consortium very publicly and hire firms to lobby against it and try and stop it."

Jay asks if Murdoch was oblivious to whether Hunt would be on-side or off

Murdoch says there is no question of that, he just thought they would get a fairer go from anyone other than Cable.

Jay continues to press on what James Murdoch told Rupert.

Murdoch says he did not know know of relationship between Hunt and NI and denies knowing of the "cheerleader" aspect.

10:18am: Jay moves on to the BSkyB bid.

Jay says that in his witness statement Murdoch denies ever discussing thebid with Cameron, and asks him if he ever discussed it with Hunt.

Murdoch says he's not sure if he ever met him, and certainly had no discussions.

Jay asks about a visit by Hunt to New York in 2009, Murdoch doesn’t think he met him.

According to the parliamentary register, Hunt met with representatives of News Corp to discuss issues.

Murdoch doesn’t think he met Hunt and has never spoken to him by phone.

Jay asks if Rupert Murdoch (RM) has spoken to James Murdoch (JM) about Hunt.

Murdoch says he does not believe JM commented on it other than to inform him when Hunt took over responsibility from Cable.

Murdoch says he was shocked by what Cable said and the unethical way it was deleted from the Telegraph.

Jay asks if JM used the phrase "well we've got someone better now" or something similar.

Murdoch says no, but they "couldn't have had anyone worse".

10:15am: Murdoch says of Michael Gove that he wishes he was close to him.

He adds Gove had a "very distinguished career" at The Times and he "might have met him occasionally".

Murdoch says Gove have come to dinner with his wife once: "I like to get a few people around me of interest."

On Education: "We are passionate about it. I believe it's an absolute disgrace, the standard of public education here and in America.

"In the US nearly 30 per cent of children do not get through highschool, they drop out three years early and are committed to the underclass forever.

"I believe that there a lot of issues here in society and the way it's going, but from being in the first two or three or four recognised best education systems in the world, both the UK and US have droppd in to the mid 20s. It’s a crime against theyounger generation.

"We want to do something about that, [which is why I] keep hammering on about it."

10:11am: Jay follows up on Murdoch's comments yesterday that "anyone who wants to judge [his] thinking should read the Sun".

Murdoch says its "not parallel in every detail", but generally speaking regarding the issues the Sun fights for he will agree with most if not all.

Jay is keen to learn how editors work out what Murdoch thinks. Murdoch says they sit and talk to him and have conversations "pretty constantly".

Leveson asks if editors get to know him pretty well over time and Murdoch says they will, at least at the Sun.

Murdoch: "They [editors] might know my thinking but they don't have to agree with it, we have very vigorous discussions and sometimes I'll accept they were right and I was wrong."

Jay asks if the same applies to politicians. Murdoch says he sees very little of them as he is only in the UK about 10 per cent of the time, but thinks politicians do know his philosophy.

10:10pm: Murdoch: "I don't flinch from my responsibilities and I certainly do take part in the policy decisions of the Sun. I think that is my job."

10:08am: Jay follows up on his lines of questioning from yesterday about how Murdoch interacts with his papers.

Jay quotes a statement David Yelland, former editor of the Sun gave to the Evening Standard.

"All Murdoch editors, what they do is this: They go on a journey where they end up agreeing with everything Murdoch says. They don't admit it to themselves, but when you wake up in the morning and hear a piece on the radio, they ask themselves 'what would Murdoch think?'"

10:07am: Jay refers to a Guardian piece from 12 November 2009 about the letter from Brown to the soldier's mother and asks if Murdoch is sure a conversation did not take place.

Murdoch says he is not sure, but is certain he did not defend it and may have apologised for it.

10:04am: Jay asks Murdoch about Brown's response to a conversation Murdoch referred to yesterday in the aftermath of the Sun declaring "Labour has lost it" when the paper switched its support to the Conservatives.

Brown said the only conversation was about a letter he had written to the mother of a soldier killed in Afghanistan.

Murdoch says he does not recall that conversation, but says he did tell the editor that he thought the story was "very cruel" as Brown had taken the time to write to the mother personally.

Murdoch reaffirms his account of the other conversation that he recalled yesterday and notes Lord Mandelson accused NI of "doing a deal" with Cameron and in his own autobiography said he did this under order from Gordon Brown.

10:03am: Jay begins by clarifying yesterday's discussion about a meeting alleged to have taken place between Murdoch and Cameron and confirms there can't have been a meeting on 30 September 2009 as Murdoch was in New York.

10:00am: Leveson begins this morning by clarifying the process of publishing material in advance of hearings, says it should not be done by external parties. 

Leveson: "Everyone must understand that it is only the redacted statement or exhibit that can be referred to."

Leveson adds that material can only be used that has been made available on the website, core participants should not use their status to publish material before it is available to non-core participants.

Coverage of Rupert Murdoch's evidence will continue today from 10am this morning

14:49pm: Leveson calls a close to the day's session, to reconvene tomorrow.

14:47pm: Murdoch: "I don't know much about the SNP, I just find [Salmond] an attractive person."

Murdoch describes independence as "a nice idea".

14:44pm: Jay says it is a matter of public record that the Scottish Sun supported the SNP in 2011, but took a neutral stance on the issue of independence. Jay asks if Murdoch contributed to that decision.

Murdoch says he does not remember, but probably.

He says he supported Salmond’s party because "it's a little emotional, I'm attracted by the idea of Scottish independence but not convinced, so we should stay neutral on the independence question."

14:42pm: There is a pause while Murdoch is asked to examine a letter from Salmond from October 2007, in which Salmond describes Murdoch's views as insightful and interesting.

Jay reads from a letter from Salmond to Murdoch recommending he sees a play in New York.

14:39pm: Jay moves on to Alex Salmond and the Scottish National Party (SNP).

Murdoch is asked why the Scottish Sun changed its views on the party.

Jay highlights lack of contact between Salmond and Murdoch between 2000-2007, and compares this to the greater amount of contact from 2007 onwards.

Murdoch says that on 30 October 2007 he opened a large printing plant in Scotland and Salmond was invited to be present.

Jay highlights breakfast meeting on 4 April 2008 where claimed Murdoch discussed his family's Scottish roots.

Murdoch does not recall the meeting, but suggests it took place in New York.

Murdoch is asked about meetings in 2011, one reported to be about Scottish independence and one in December about News Corp's investments in Scotland.

Jay asks Murdoch to describe relationship with Salmond. Murdoch says "it’s warm today" and has continued to improve over the past five years.

Murdoch says he doesn’t know Salmond well, but describes him as "an amusing guy" and says he enjoys "talking and listening to him".

14:35pm: Jay asks Murdoch if he was advised in strategic terms when would be best to announce the bid.

Murdoch says he does not think they gave any thought to it, beyond waiting to talk to all directors when together

He says it was pure coincidence this happened to be a month after the general election.

14:32pm: Jay asks Murdoch about the role of his advisers. Jay says that as chairman he can't have his finger in every metaphorical pie.

Murdoch says he would call them senior executives not advisers.

Murdoch pauses when asked why the BSkyB bid was announced a month after election, before saying he does not know and would have to check his records.

14:31pm: Jay asks Murdoch if there was no link in his mind between supporting Cameron and the BSkyB bid.

Murdoch says there was none at all.

Jay follows by asking if Murdoch ever worried that if Brown won it might take the bid into "choppy waters".

Murdoch says it is something he never thought about.

14:29pm: Jay asks about Murdoch being asked to visit Downing Street via the back-door.

Murdoch says this is quite okay as it is a short cut to Cameron's apartment and means he isn’t photographed at the front door.

14:26pm: Jay asks Murdoch to return to the issue of the democratic process.

He asks if there is any validity in the perception that there is an implied trade-off between the support Murdoch gives to politicians through endorsements and a quid pro quo after they gain power.

Jay says that if that is right then the democratic process is distorted. He asks if Murdoch sees the perception of that.

Murdoch says the perception irritates him because it's a myth. "Just look at how we treat Mayor Bloomberg in New York, it drives him crazy but we still support him in every election.”

14:25pm: Murdoch: "We're very lucky in this country that we have 10 vibrant national newspapers to keep the national debate going."

Murdoch says he has no fealty to either the Conservatives or Labour party and doesn't get invited to dinner at 10 Downing Street.

Murdoch: "I enjoy meeting our leaders, some impress me more than others and I meet them around the world. I could tell you one or two who have particularly impressed me."

14:24pm: Jay asks about Cameron visiting Murdoch in Santorini while on his way to Turkey.

Murdoch: "I've explained that politicians go out of their way to impress the people in the press and I don't remember discussing any political things with Cameron at all. I think it's part of the democratic process, all politicians of all sides like to have their views known by editors in the hopes their views will be put across and they will impress people. That's the game."

14:19pm: Jay returns to the issue of the BSkyB bid, asking if Murdoch worked from the default position of assuming the Conservatives would be more favourable than Labour.

Murdoch says he did not, that he did not consider it an issue for government and didn’t think there were any legal issues at all. What worried him was his fear that the independent directors were trying to drive up the price.

Murdoch, referring to the BSkyB bid: "It’s a myth that I used the supposed political power of the Sun to get preferable treatment." Describes claims that he did so as lies, referring to articles in the Guardian and Independent.

14:14pm: Leveson intervenes to ask Murdoch to consider distinction between topics of commercial interest and those issues on which he had a view, which may be informed by his worldwide contacts made through his business interests.

Leveson says Murdoch’s view on regulation of TV may be of interest to policy makers, not because it would affect News Corp, but because it is a business that Murdoch has devoted his life to and has strong views on.

Murdoch says he has become "Long since become disillusioned" and that it is "a waste of time to speak to politicians about the BBC".

He then repeats his earlier claim that if he was motivated by business interests he would have supported the conservative party every time.

14:13pm: Murdoch describes the idea of slicing BBC licence fee and giving it to commercial competitors as crazy.

14:12pm: Jay asks Murdoch if he was consulted over Cameron's decision to appoint Coulson. Murdoch says no, he was just as surprised as everyone else.

14:10pm: Jay asks about a series of meetings between Cameron and Murdoch, asking Murdoch to confirm whether or not he remembered each one.

Murdoch says one of these meetings was impossible, as he was in the US on the date the Sun endorsed Cameron, when the pair were reported to have met for breakfast.

Murdoch says he did not discuss issues such as broadcasting regulation when he met to discuss policy with Cameron.

He tells Jay if commercial interests played a factor in endorsements he would have endorsed the Conservatives at every election.

14:05pm: Back from lunch.

The inquiry resumes with Murdoch giving his opinion on Cameron. Murdoch says he was extremely impressed when he first met him, particularly by the kindness he showed his children.

13:00pm: Leveson calls a break for lunch.

12:59pm: Jay asks Murdoch to go back to the "declaration of war" and puts it to Murdoch that Brown could have placed obstacles in the way when and if News Corp bid for the remaining BSkyB shares.

Murdoch says he never thought about that.

Murdoch says with hindsight he regrets ever agreeing to an initial public offering (IPO).

Jay asks again about whether he thought Brown could put obstacles in his way, which Murdoch denies again.

12:56pm: Jay asks Murdoch how Brown could "declare war" on his company.

Murdoch pauses for a long time before saying he doesn't know. Murdoch pauses again before suggesting Brown could have set up a commission or quango.

"He later, when the hacking scandal broke, made a totally outrageous statement that he had to know was wrong and he called us a criminal organisation, because he said we had hacked into his personal medical records, when he knew very well how the Sun had found out about his son, which was very sad."

"A father from the hospital in a similar position called us and told us and Rebekah Brooks immediately snatched it from the news list and said 'let me handle this'.

"Brooks called Mrs Brown and said 'we should be careful, how would you like it handled?'

"Several days later, we published the story and four or five days later Mr Brown wrote a personal letter of thanks to Brooks thanking her for her sensitivity."

12:50pm: Jay refers to a 6 June 2008 dinner between the Browns and Murdochs, six days before infamous pyjama party. He also mentions that on 15 June Murdoch was a guest at dinner with Brown and Bush, amongst many others, and that on 16 June, Brown attended the annual Murdoch summer party.

Jay asks if Murdoch was involved in any way with timing of decision to support Tory party in 2009. Murdoch says he was not. With regards to the 2010 election and whether he thought Brown would lose, Murdoch says it was a long way off.

In response to Jay questioning whether Brown "roared [at Murdoch] for twenty minutes", Murdoch stresses Brown never raised his voice but said: "Well, your company has declared war on my government and we have no alternative but to make war on your company."

12:47pm: Jay now asks about Murdoch staying at Chequers when Brown was Prime Minister. Murdoch only remembers one stay, when other guests were present including JK Rowling.

Murdoch says there were no discussions about a snap election with Brown, "I don't remember any and I'm sure he didn't ask me."

Murdoch: "If any politician wanted my opinion on major matters they only had to read editorials in the Sun."

12:43pm: Murdoch says he believed the matter of succession was settled when Blair left office in 2007.

Quoting from Blair's memoir "A Journey", Jay refers to Blair's belief that John Reid could have stood but Murdoch's papers had written them off.

Murdoch says he had met Reid and liked him, but didn’t know he was a possible contender.

Asked about his relationships with Brown, Murdoch says his personal relationship was always warm, both before and after Brown became Prime Minister.

Murdoch regrets that after the Sun attacked Brown this is no longer so true, but hopes it can be repaired.

Jay asks if Murdoch and Brown's common Presbytarian upbringing was a factor in this. Murdoch says it was.

12:42pm: Referring to the 2005 election, Jay asks Murdoch if he put a condition requiring a referendum on the latest EU treaty on his endorsement of Labour.

Murdoch says there was no such condition, but he and papers did strongly support a referendum.

12:40pm: Jay moves on to the topic of Iraq, asking Murdoch if all 175 of his papers backed the war.

Murdoch says the majority would have but some would have expressed no opinion, for example suburban freesheets.

Referring to three phone calls in early 2003 between Murdoch and Blair, Jay says Iraq must have been discussed.

Murdoch says he cannot recall what was discussed. Murdoch says this would not have been Blair calling for support as his papers were already strongly in favour of the war.

Jay refers to a book by Andrew Rawnsley, who that argued Blair and Murdoch were devising the best strategy to attack President Chirac of France.

Murdoch says he did not think Blair would talk to him about something like that. He admits the Sun attacked Chirac and France at the time, but claimed to have nothing to do with it himself.

12:34pm: Jay asks Murdoch about his attempt to launch cable channel in China.

Murdoch says there were extensive negotiations, and when the channel was finally launched it was a Mandarin channel in a Cantonese speaking area.

Jay puts it to Murdoch that this acted as a foothold from which he advanced his interests. Murdoch denies this.

Jay skips forward to 2001 and another entry from Campbell's diaries. Jay quotes Campbell’s reference to a meeting between Blair and Murdoch, in which Blair asked Murdoch if he was going to back Labour. Campbell quotes Murdoch as saying the Tories were "unelectable and that was that".

Murdoch: "I have no memory of that, I can’t help you sorry." Murdoch says he did not think the Tories were unelectable.

Murdoch becomes irate and accuses Jay of "putting words into [his] mouth". Jay denies this and says he is only referencing what Campbell wrote.

Murdoch says he cannot believe Blair would have been so direct as to ask him about backing outright, but they did meet occasionally and would debate issues. Murdoch refers to an afternoon at Chequers debating the Euro, a topic on which he and Blair disagreed.

Jay asks Murdoch about the Euro. Murdoch says it's "a great abdication of responsibility over a country's affairs" and he was concerned from an intellectual point of view.

12:32pm: Jay refers to evidence from Lord Patten (the last governor of Hong Kong) that claimed Murdoch, as owner of Harper Collins, halted publication of a book Patten was writing about Hong Kong as Murdoch was trying to expand in China.

Murdoch says this is only half right – he had no commercial interests in China but not for lack of trying.

Murdoch says he felt Patten was a bad governor and did step in to say not to publish the book. Murdoch says this "was one more mistake of mine, clearly wrong".

12:30pm: Jay moves forward to March 1998 and a news article in Italy referenced in a call by Blair to the then Italian Prime Minister, Romano Prodi, where allegedly a multi-billion pound bid for one of Silvio Berlusconi's companies was discussed.

Jay asks Murdoch if he had asked Blair to intervene. Murdoch says no, he had own channels that he could go through.

12:27pm: Jay resumes asking about a Blair piece written in the Times a month before the 1997 election and quotes Blair: "Let me state the position clearly, the essential elements of the trade union legislation of the 1980s will remain and the changes we do propose would leave British law the most restrictive on trade unions in the western world".

Jay asks if this was "music to Murdoch's ears", but Murdoch says he did not read it.

Jay says Murdoch and Blair dined the same evening and asks if the article was mentioned, Murdoch says it is possible.

12:26pm: The inquiry resumes.

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