James Murdoch accused of misleading parliament

"We would like to point out that James Murdoch's recollection of what he was told...was mistaken."

James Murdoch has been accused of misleading MPs by two former News of the World executives.

Colin Myler, who edited the paper until its closure two weeks ago, and Tom Crone, formerly the paper's top lawyer, issued a statement last night saying that Murdoch had been "mistaken" in his evidence.

The disagreement hinges on an email known as the "for Neville" email because its link to the paper's former chief reporter, Neville Thurlbeck, would have blown a hole in News International's defence that phone-hacking was just the work of one rogue reporter, Clive Goodman. The email is thought to be a key factor in News International's decision to pay a settlement of around £700,000 to Gordon Taylor, chief executive of the Professional Footballers Association, when he threatened to sue the paper.

At the select committee on Tuesday, Labour MP Tom Watson asked him about this.

Watson: "When you signed off the Taylor payment, did you see or were you made aware of the full Neville email, the transcript of the hacked voicemail messages?"

Murdoch: "No, I was not aware of that at the time."

He claimed that Myler and Crone hid the email from him. However, their statement contradicts this claim:

Just by way of clarification relating to Tuesday's Culture, Media Select Committee hearing, we would like to point out that James Murdoch's recollection of what he was told when agreeing to settle the Gordon Taylor litigation was mistaken.

In fact, we did inform him of the 'for Neville' email which had been produced to us by Gordon Taylor's lawyers.

So what happens now? John Whittingdale, the chairman of the select committee said that this email was "one of the most critical pieces of evidence in the whole inquiry", and said that MPs would be asking Murdoch to respond and clarify.

However, it is unlikely that this will get very far. Thus far, News Corporation has issued the following statement in response:

James Murdoch stands by his testimony to the select committee.

It is difficult to see circumstances in which this would be revoked, in the absence of concrete evidence that Murdoch saw the email. Wilfully misleading a select committee is not technically a crime as evidence is not given under oath, but it certainly would not look good.

Crone and Myler's intervention is deeply troubling. If their claim is true (and given the large payment to Taylor and his confidentiality agreement, it it certainly not outside the realm of possibility), then at best Murdoch has forgotten evidence of serious criminality at his company, and at worst he has deliberately misled MPs. It is not the first time that News International executives stand accused of doing so.

Parliament is now in recess, making it unlikely that the select committee will hold a special evidence session to clarify the issue, although such a course of action is not unprecedented. One thing we can be certain of is that this story is not disappearing.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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What is the EU customs union and will Brexit make us leave?

International trade secretary Liam Fox's job makes more sense if we leave the customs union. 

Brexiteers and Remoaners alike have spent the winter months talking of leaving the "customs union", and how this should be weighed up against the benefits of controlling immigration. But what does it actually mean, and how is it different from the EU single market?

Imagine a medieval town, with a busy marketplace where traders are buying and selling wares. Now imagine that the town is also protected by a city wall, with guards ready to slap charges on any outside traders who want to come in. That's how the customs union works.  

In essence, a customs union is an agreement between countries not to impose tariffs on imports from within the club, and at the same time impose common tariffs on goods coming in from outsiders. In other words, the countries decide to trade collectively with each other, and bargain collectively with everyone else. 

The EU isn't the only customs union, or even the first in Europe. In the 19th century, German-speaking states organised the Zollverein, or German Customs Union, which in turn paved the way for the unification of Germany. Other customs unions today include the Eurasian Economic Union of central Asian states and Russia. The EU also has a customs union with Turkey.

What is special about the EU customs union is the level of co-operation, with member states sharing commercial policies, and the size. So how would leaving it affect the UK post-Brexit?

The EU customs union in practice

The EU, acting on behalf of the UK and other member states, has negotiated trade deals with countries around the world which take years to complete. The EU is still mired in talks to try to pull off the controversial Transatlantic Trade and Investment Partnership (TTIP) with the US, and a similar EU-Japan trade deal. These two deals alone would cover a third of all EU trade.

The point of these deals is to make it easier for the EU's exporters to sell abroad, keep imports relatively cheap and at the same time protect the member states' own businesses and consumers as much as possible. 

The rules of the customs union require member states to let the EU negotiate on their behalf, rather than trying to cut their own deals. In theory, if the UK walks away from the customs union, we walk away from all these trade deals, but we also get a chance to strike our own. 

What are the UK's options?

The UK could perhaps come to an agreement with the EU where it continues to remain inside the customs union. But some analysts believe that door has already shut. 

One of Theresa May’s first acts as Prime Minister was to appoint Liam Fox, the Brexiteer, as the secretary of state for international trade. Why would she appoint him, so the logic goes, if there were no international trade deals to talk about? And Fox can only do this if the UK is outside the customs union. 

(Conversely, former Lib Dem leader Nick Clegg argues May will realise the customs union is too valuable and Fox will be gone within two years).

Fox has himself said the UK should leave the customs union but later seemed to backtrack, saying it is "important to have continuity in trade".

If the UK does leave the customs union, it will have the freedom to negotiate, but will it fare better or worse than the EU bloc?

On the one hand, the UK, as a single voice, can make speedy decisions, whereas the EU has a lengthy consultative process (the Belgian region of Wallonia recently blocked the entire EU-Canada trade deal). Incoming US President Donald Trump has already said he will try to come to a deal quickly

On the other, the UK economy is far smaller, and trade negotiators may discover they have far less leverage acting alone. 

Unintended consequences

There is also the question of the UK’s membership of the World Trade Organisation, which is currently governed by its membership of the customs union. According to the Institute for Government: “Many countries will want to be clear about the UK’s membership of the WTO before they open negotiations.”

And then there is the question of policing trade outside of the customs union. For example, if it was significantly cheaper to import goods from China into Ireland, a customs union member, than Northern Ireland, a smuggling network might emerge.

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.