The media mogul backed Rebekah Brooks to continue as chief executive of News International despite claims that the News of the World hacked murdered schoolgirl Milly Dowler’s phone while she was editor.
Police also told Chancellor of the Exchequer George Osborne that his name and home phone number appeared on notes kept by private investigator Glenn Mulcaire and former News of the World reporter Clive Goodman, a spokesman for the Chancellor said. There was no suggestion his phone had been hacked, he added.
Meanwhile, political and commercial pressure mounted as more leading companies pulled advertising from the paper, and MPs including Labour leader Ed Miliband said Ms Brooks had to go.
Mr Murdoch issued a statement condemning the alleged interception of voicemail messages and payments to police officers by the News of the World.
The chairman and chief executive of News International’s parent company, News Corporation, said: “Recent allegations of phone hacking and making payments to police with respect to the News of the World are deplorable and unacceptable.
“I have made clear that our company must fully and proactively co-operate with the police in all investigations and that is exactly what News International has been doing and will continue to do under Rebekah Brooks’ leadership.
“We are committed to addressing these issues fully and have taken a number of important steps to prevent them from happening again.”
MPs used a three-hour emergency Commons debate on the latest revelations to condemn journalistic practices at the News of the World.
Labour MP Tom Watson even demanded the suspension of James Murdoch, Mr Murdoch’s son and the chairman of News International.
In the Commons he alleged that James Murdoch attempted to pervert the course of justice.
He said: “It is clear now that he personally, without board approval, authorised money to be paid by his company to silence people who had been hacked and to cover up criminal behaviour within his organisation.”
Meanwhile, more companies announced they were cancelling advertising due to appear in this weekend’s issue of the News of the World.
Halifax and the Co-operative Group, which each had two half-page adverts in last Sunday’s paper, joined Ford, Vauxhall, Mitsubishi, Butlins and Virgin Holidays in suspending their marketing.
Families of 7/7 bombing victims and the parents of murdered Soham schoolgirls Holly Wells and Jessica Chapman have been told by police they may have been targeted for phone hacking.
Mr Cameron told MPs at Prime Minister’s questions that he supported holding one or more inquiries into the scandal.
He said: “We are no longer talking here about politicians and celebrities, we are talking about murder victims, potentially terrorist victims, having their phones hacked into.
“It is absolutely disgusting, what has taken place, and I think everyone in this House and indeed this country will be revolted by what they have heard and what they have seen on their television screens.”
Mr Cameron said there were two “vital areas” that needed to be considered — why the original police inquiry into News of the World phone hacking failed to get to the bottom of what happened, as well as the behaviour, practices and ethics of journalists and media organisations.
Mr Cameron said he took “full responsibility” for his decision to employ former News of the World editor Andy Coulson as his most senior spin doctor — a position he quit in January.
The ex-Downing Street director of communications was drawn further into the row with claims that he had authorised payments to police when he edited the newspaper.
News International executives said they were “very close” to discovering who commissioned private investigator Glenn Mulcaire to allegedly hack Milly’s phone after she went missing in 2002.