Rupert Murdoch began giving evidence on Wednesday to confront charges that he used his clout to curry favour with a succession of British leaders, electrifying a media inquiry that has become increasingly damaging for the government.

An appearance by Rupert's son James in a highly charged session on Tuesday revealed how a government minister had sought to help Murdoch's News Corp in an ultimately abortive takeover bid, a damaging admission for a government already seen as too close to the Murdochs.

The 81-year-old media mogul appeared under oath at the Victorian gothic courtroom, watched by his son Lachlan and wife Wendi Deng.

Some are expecting Murdoch to come out fighting, having been on the back foot for almost a year over a newspaper phone hacking scandal.

He's the master of the barbed quote, the one-liner, Neil Chenoweth, a veteran Australian investigative journalist who has written two books on Murdoch, told Reuters. He just lets it drop, and his delivery makes it absolutely lethal.

The revelation that a government minister had sought to help the Murdoch in his business dealings go to the heart of the issue in Britain, that Murdoch wields too much influence and that this resulted in a company culture that rode roughshod over rules and regulations.

The minister, media secretary Jeremy Hunt, briefed News Corp on the thinking of regulators and leaked confidential information, while at the same time acting for the government in deciding whether to approve the $12 billion deal.

The pressure on Hunt dominated the local news agenda on Wednesday, with newspaper front pages declaring that the Murdochs had declared revenge on the government. The front page of the left-leaning Guardian described Hunt as the Minister for Murdoch.

News Corp said it had been required by law to produce the email documents that revealed the contact with Hunt.


Prime Minister David Cameron appointed judge Brian Leveson to examine Britain's press standards after journalists at Murdoch's News of the World tabloid admitted widespread hacking into phones to generate exclusives.

Cameron is himself already under pressure after a series of mishaps by his government. To compound his problems, economic data released on Wednesday morning showed that Britain had slipped back into recession.

The revelations last July convulsed Murdoch's media empire, exposed the close ties between the upper echelons of Britain's establishment and provoked a wave of public anger. Politicians who had previously courted the media owner lined up to condemn his involvement in Britain.

U.S.-based News Corp, owner of Fox Television and the Wall Street Journal, eventually pulled its bid to buy the 61 percent of satellite broadcaster BSkyB that it did not already own after intense political and public pressure.

Murdoch is likely to face questions over how the phone hacking came about, but he will also face detailed questioning about his relationship with politicians.

He was the first newspaper boss to visit Cameron after he took office in 2010 - entering via the back door - and politicians from all parties have lived in fear for decades of his press and what they might reveal about their personal lives.

Labour politician Chris Bryant, who accepted damages from Murdoch's British newspaper group after the paper admitted hacking his phone, told Reuters the media mogul had dominated the political landscape for decades.

You have only got to watch Rupert Murdoch's staff with him to see how his air of casual violence intimidates people, he said. His presence in the British political scene has similarly intimidated people by offering favour to some and fear to all.

Murdoch's influence over prime ministers goes back decades. Papers released this year showed that he held a secret meeting with then-Prime Minister Margaret Thatcher in 1981 to secure his acquisition of The Times of London.

Tony Blair was godfather to one of Murdoch's daughters, Gordon Brown was a personal friend of the Australian-born businessman, and Cameron employed as his personal spokesman a former Murdoch editor who was himself implicated in the hacking scandal.

During a parliamentary hearing last year, memorable for the actions of a protester who hit Murdoch in the face with a foam pie, Murdoch sat alongside James and spoke often in monosyllables but on occasion hit the table with his fist in frustration at the line of questioning.

He will have to face potentially another day and a half of questioning starting on Wednesday from prosecutor Robert Jay, who in the five months of the inquiry so far has shown little deference for the status of those he interrogates.

(Editing by Will Waterman and Guy Faulconbridge)