Of the many worrisome ties coming to light under the glare of the phone-hacking scandal, one of the most potentially explosive is the seemingly cozy relationship between British prime ministers and the Murdoch family. Tony Blair is godfather to one of Rupert Murdoch’s young daughters, as Murdoch's third wife revealed last year. Gordon Brown’s wife, Sarah, invited Rebekah Brooks—one of Murdoch’s closest lieutenants and who has been dubbed his “other daughter”—to a sleepover at Chequers, the prime minister’s country residence. And Murdoch visited Downing Street just two days after David Cameron, the current prime minister, took office—though not in the manner most people do. As Murdoch testified before Parliament last summer: “I was asked, 'Could I please come in through the back door.'”
And then there’s Brooks’s onetime horse—Raisa, a mare loaned to her after it was retired from Scotland Yard—who also worked for Cameron. Cameron has admitted that he rode the animal alongside Brooks’s husband, racehorse trainer Charlie Brooks—who was arrested along with his wife earlier this week, as the phone-hacking scandal continues to gather steam.
This questionable relationship between the Murdoch family and the occupants of 10 Downing Street is nothing new, as was confirmed this morning by a shocking cache of documents. The papers, released from the archives of Margaret Thatcher—the “Iron Lady” prime minister who dominated British politics from 1979 to 1990—testify to a controversial, and previously denied, 1981 meeting between Thatcher and Murdoch at Chequers just weeks before the mogul skirted Britain’s anti-monopoly laws to purchase his most venerable U.K. newspaper holdings, the Times and Sunday Times.
The documents, released by the Margaret Thatcher Archive Trust and first reported this morning by the BBC, include a note marked “commercial in confidence” from Thatcher’s press secretary, Bernard Ingham, detailing the meeting, which has long been denied by both Thatcher and Murdoch. “The main purpose of Mr. Murdoch’s meeting was to brief the prime minister on his bid for Times Newspapers,” the note reads, before going on to detail Murdoch’s plans for the acquisition, including reducing the workforce by a quarter and challenging the notorious print unions. “The prime minister thanked Mr. Murdoch for keeping her posted on his operations.”
The secret meeting is controversial because Murdoch needed a special exemption from the government in order to avoid having his bid referred to the Monopolies and Mergers Committee, as he already owned The Sun and News of the World newspapers. Though this issue is not addressed in the meeting, the argument Murdoch would later use to avoid facing the MMC—that the newspapers were unprofitable, and therefore eligible for an exemption—is hinted at in the note. “Mr. Murdoch freely admitted that some £50 million of the News Group’s resources could be at risk and that such an amount ‘could finish us’. He implied that he was willing to take losses for a limited, but unspecified, period,” Ingham writes. “Nonetheless, turning round a £13-17 million loss was a formidable underaking at a time of deep industrial recession.”
Critics have long challenged Murdoch’s arguments on the Times’s finances, arguing that the Sunday Times was already on its way to returning to financial health. But as the BBC notes, recently released minutes from a 1981 government meeting on the takeover show Thatcher highlighting the exemption, which ultimately allowed Murdoch to go through with his bid, creating what would become by far the United Kingdom’s largest newspaper group. The Times went on to become a stalwart supporter of Thatcher.
Ten days after the 1981 meeting at Chequers, Murdoch sent Thatcher a thank-you note, which is also included in the released documents. “My dear prime pinister,” Murdoch writes. “It was very kind indeed of you to let me interrupt your weekend at Chequers 10 days ago and I greatly enjoyed seeing you again. ‘The Times’ business is proceeding.”
There were echoes of the controversy this summer, as Murdoch pushed to avoid facing the Competition Commission in his bid to gain full control of the broadcaster BSkyB—a bid he had launched two months after his backdoor visit with Cameron. In late June, following negotiations with Murdoch’s News Corp., the U.K.'s culture secretary confirmed a proposal to approve the bid without a full referral to the commission. The BSkyB bid fell apart, however, in the wake of the phone-hacking scandal, which broke just days later when it was revealed that News of the World had targeted the cellphone of a murdered schoolgirl.