Cameron orders judicial inquiry into phone hacking scandal

London: Prime Minister David Cameron on Friday promised a full investigation into the phone hacking and the police bribery that led to the collapse of the News of the World tabloid, saying that British politicians had for too long looked the other way at illegal practices.

Declaring that self-regulation of the press had failed, Cameron said a new body independent of the government and the news industry was needed to regulate newspapers in place of the Press Complaints Commission.

"The truth is, we've all been in this together," Cameron said, blaming both the press and politicians.

Cameron also said if he were in charge, he would have accepted the resignation of his friend Rebekah Brooks, a former editor of the tabloid, as chief executive of News International, the British unit of Rupert Murdoch's News Corp.

Cameron also refused to apologize for hiring former News of the World editor Andy Coulson as his spokesman. Coulson resigned in January, but British media were reporting that he was to be questioned by police Friday about the hacking.

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Opposition Labour Party leader Ed Miliband had called for Cameron to apologize for "the appalling error of judgment he made in hiring Andy Coulson" and reiterated that Brooks should resign.

But there are many more questions swirling around the shocking announcement by James Murdoch, Rupert Murdoch's son and heir apparent, on Thursday that the muckraking 168-year-old tabloid would disappear after this weekend's edition.

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The paper's life is ending amid an expanding police investigation of phone hacking and alleged bribery of police officers, and just at the moment when Rupert Murdoch is seeking government clearance to bid for full control of BSkyB, a prize far more valuable than his British stable of newspapers.

Several News of the World journalists have already been arrested and quizzed over the allegations, but Coulson would be by far the most senior. Two employees of the tabloid were sent to prison in 2007 after being convicted of hacking into royal telephones.

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The News of the World's defences against simmering questions about its activities collapsed this week after it was reported that it had hacked the mobile phone of 13-year-old murder victim Milly Dowler in 2002 while her family and police were desperately searching for her.

News of the World operatives reportedly deleted some messages from the phone's voicemail, giving the girl's parents false hope that she was still alive.

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That report provoked a level of public outrage far above any reaction to intrusion into the lives of celebrities which the paper had previously acknowledged and for which it paid compensation. Several major companies pulled their advertising from the paper, fearing they would be tainted by association with it.

Chris Bryant, a member of parliament who is suing the newspaper claiming his phone was hacked, said Brooks should resign because she was editing the paper at the time.

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"This strategy of chucking first journalists, then executives and now a whole newspaper overboard isn't going to protect the person at the helm of the ship," Bryant said.

News International, the British unit of Murdoch's News Corp., has not said whether it will move quickly to put another paper into the Sunday market which had been dominated for decades by News of the World.

Shares in BSkyB, which have fallen all week because of doubts whether the takeover will go ahead, were marginally higher in early trading in London Friday.

Shares in News Corp. rose 1.6 per cent on the Nasdaq index in New York after Thursday's announcement.

The British government on June 30 already gave its qualified approval allowing News Corp. to purchase the 61 per cent of British Sky Broadcasting that it doesn't already own, on the condition it spins off Sky News as a separate company.

News Corp. made an initial offer of 700 pence per share to buy the 61 per cent of the shares it doesn't already hold, valuing BSkyB at 12.3 billion pounds ($19.8 billion). Analysts believe News Corp. may have to go as high as 900 pence per share to persuade shareholders to sell out.

They see the BSkyB deal approval being delayed until at least September, as Culture Minister Jeremy Hunt is not expected to give his final go-ahead before the U.K. Parliament goes into recess on July 18.

Despite the public outcry, many analysts think Britain will still sanction the takeover, since officials have already said that threats to competition will be resolved with Sky News' spin-off.