However, partly as a result of the departure of Coulson, morale in Number 10 slumps badly in early 2011. It is the first sustained period of reversal the team has experienced in government, and they are yet to develop resilience. Cameron is under fire from all sides: the economy is not improving, a series of U-turns in January and February, on the sale of forests and cuts in housing benefit, damage confidence in him.17 Suddenly Cameron, and Osborne too, appear at sea and struggling.
Cameron now compounds any errors over Coulson by not distancing himself from Murdoch and the tentacles of the News International empire. He continues to see Rebekah Brooks and her husband Charlie, an old school friend. In May, the Sun asks for his support to reopen the search for lost child Madeleine McCann, which he readily agrees to out of sympathy. But it prompts questions about whether he was ‘pressured’ into giving favours to News International.18 Was it demanding payback for its support at the 2010 general election? Cameron keeps trying to turn the spotlight onto the government’s domestic achievements, but the probing doesn’t go away. A fresh inquiry into the hacking scandal set up in January keeps the issue in the public eye, and Labour MPs Chris Bryant and Tom Watson are gaining traction with their questioning about whether Murdoch’s support was being traded for commercial advantage. In the summer, always a highly charged time at Westminster, Culture Secretary Hunt announces in the House of Commons on 30 June that the government is ready to give the green light to Murdoch’s bid for BSkyB, giving him enormous power over broadcasting.19
However, on 5 July, Murdoch’s hopes of extending his empire are shattered. The Guardian reports that the News of the World had hacked the phone of murdered teenager Milly Dowler, while she was still officially missing. Ed Miliband seizes the moment, ushering in his most vibrant and effective period as leader. He tackles Brooks head on, suggesting she consider her position in the company, and takes aim at News International. Dominoes start falling. On 7 July 2011, News International chairman James Murdoch announces the closure of the News of the World. On 8 July, Coulson is taken into custody on suspicion of conspiring to hack phones and corruption. On 13 July, News Corp withdraws its bid for BSkyB.20 On the same day, Cameron announces that Lord Leveson will head an inquiry into the media. On 15 July, Rebekah Brooks resigns as CEO of News International. Two days later, she too is taken into police custody before being bailed. On 19 July, Rupert and James Murdoch, father and son, as well as Rebekah Brooks, are humbled before the Commons Culture, Media and Sport Select Committee. The nation revels in a rare moment of Schadenfreude at the expense of the Murdoch family.
Following a week of fast-moving developments, Cameron cuts short a visit to South Africa to make an emergency statement on the crisis in the House of Commons on 20 July. He comes the closest yet to making an apology. ‘Of course I regret, and I am extremely sorry about, the furore it has caused,’ he tells MPs. ‘If it turns out that Andy Coulson knew about hacking at the News of the World, he will not only have lied to me, but he will have lied to the police, a select committee and the Press Complaints Commission, and of course perjured himself in a court of law … if it turns out that I have been lied to, that would be the moment for a profound apology.’21 In a test of stamina, he answers 138 questions from MPs after the statement. It is a bruising experience, but he survives.22
When announcing the inquiry a week earlier, Cameron says that the aim is ‘to bring this ugly chapter to a close and ensure that nothing like it can ever happen again’.23 It is a naive hope. The Lib Dems and the Conservatives are not in agreement. Cameron’s team want to stop the inquiry investigating the role of politicians; the Lib Dems do not, and win. Cameron initially resisted setting up any inquiry at all. He had visibly reeled when Craig Oliver told him on 7 July that the News of the World was closing. He goes up to the flat and talks about how to respond with Osborne, Llewellyn, senior aide Oliver Dowden and with Craig Oliver. Heywood has been arguing forcefully that an independent inquiry establishing the facts would be in the prime minister’s own interests. Cameron’s political staff agree, believing it is the only way to draw the sting from Ed Miliband’s ferocious attack. Gove vehemently disagrees. He subsequently briefs the press against Heywood for advocating the inquiry, which to Gove, as a former journalist, is anathema. Cameron knows that an inquiry will be a minefield, but he heeds Heywood’s advice: he has to do something to stop the firestorm gathering around him. ‘Camp Cameron was hanging by a thread,’ recalls a senior figure in Number 10. ‘He had to find a way of getting through this and calming everything down.’ He is under the greatest pressure in his premiership to date by a distance.
Discussions follow over who should chair the inquiry. O’Donnell is one of many to advise against appointing a judge, on the grounds that their investigations go on forever (Saville’s twelve years on Bloody Sunday are still fresh in everyone’s mind). Nevertheless, they land on Lord Justice Leveson because he has gravitas, and is known to be seeking one of the top positions in the judiciary, and is thus unlikely to want to spread out the inquiry too long. The Lib Dems are strongly supportive of the inquiry, and want it conducted in as public a manner as possible. The decision is taken that the inquiry will be televised, adding extra layers of strain on Cameron and Number 10.
Problem over? Those who hoped Coulson’s departure, and announcing the inquiry, would calm the storm are in for a rude shock. Cameron’s woes are only just beginning. Miliband’s tail is up – he knows he has Cameron on the run. Any honeymoon Cameron may have enjoyed with the media is over, as they probe consistently and relentlessly. One of his team offers this interpretation of what is happening: the ‘Telegraph and Mail think Cameron got into bed with News International before the general election, that he fell in love with Rebekah Brooks who persuaded him to appoint Coulson, an act of naivety and folly that led to the setting up of Leveson, which is going to stuff the British press. For that reason, they are giving us hell.’ Their questions rain down on Number 10. Did Hunt break the ministerial code in dealing directly with News Corp over the BSkyB bid? Was Cameron foolish bringing Coulson into Downing Street? What due diligence did he undertake? Had he allowed the Murdoch empire undue influence over him? When his judgement and integrity are called into question, it galls him, and makes him miserable. He has only himself to blame. It is his worst episode in Downing Street.
Cameron projects his anger onto Miliband who he thinks is posturing cynically. His distress reaches new levels when, on 30 April 2012, the Labour leader forces him to the House to answer ‘an urgent question’ about whether Hunt breached the ministerial code in his handling of News Corp’s bid for BSkyB. Speaker John Bercow’s support of Miliband’s action infuriates Cameron: he regards Bercow as biased and currying favour with Labour. Nerves are very frayed. Llewellyn insists the close team avoid any hostile briefing of the press. Heywood’s critics believe he pushed Cameron towards an inquiry, not because it is in the PM’s interests, but because it suits the Civil Service to rein in News International. In truth, Heywood advocated an inquiry because he judged it to be the best way for Cameron to respond to allegations of impropriety.
Cameron’s personal discomfort grows the next month. He endures acute personal humiliation when personal texts he sent Brooks are released, which he sometimes signed off ‘LOL’, mistakenly believing it stood for ‘lots of love’ (rather than ‘laugh out loud’). They are universally and rightly condemned as embarrassing and inappropriate, above all because they are between a prime minister and a senior figure in a highly partisan media outlet. Some of Cameron’s aides became frustrated earlier by his unwillingness to criticise Brooks personally and say publicly that she should stand down. They wonder whether he has learnt the lesson from his misplaced loyalty to Coulson. Cameron is in a terrible place, skewered in a complex web of loyalties and sense of duty. Charlie Brooks is close not only