The Liberal Democrats were threatened with unfavourable press coverage if they were not open to Rupert Murdoch's News Corporation's bid for BSkyB, Nick Clegg has told the Leveson Inquiry.
Testifying at the probe into media ethics, the Deputy Prime Minister said: "There was a lots of lobbying, counter-lobbying going on self-evidently - an endless sort of twists and turns.
"At one point it was brought to my attention by Norman Lamb, a friend and colleague of mine, a Liberal Democrat MP, that he had been told that it would be good for the Liberal Democrats to be open to the bid otherwise you would expect unfavourable treatment from the Murdoch press, and Norman was quite agitated about that.
"I have to say, since we hadn't received particularly favourable treatment in the first place I didn't think it was a hugely credible threat.
"It was part of so many rumours and counter-rumours and claims and counter-claims that I just said to him, 'look, we just must not be knocked off course from allowing this process to proceed in an independent, objective and quasi-judicial manner.
"Throughout all of this I was very conscious that if I had any role at all it was just to make sure that Vince Cable , as the relevant Secretary of State, was given the time and the space to discharge his quasi-judicial functions and was insulated from political influence one way or the other."
Mr Cable was stripped of his responsibilities for the media when secret recordings of him "declaring war" on News Corp emerged.
Mr Clegg told the inquiry that while he did not think it was a "hanging offence", he recognised that it made it "impossible for him to carry on responsibility for the decision".
Shortly afterwards, Prime Minister David Cameron handed Culture Secretary Jeremy Hunt the responsibility for overseeing News Corp's BSkyB bid, who has been criticised for his handling of the process.
Following Mr Hunt's evidence to the inquiry , Mr Cameron judged the Cabinet minister had acted "properly" and decided not to order an investigation into whether he had breached the ministerial code of conduct.
Mr Clegg said he believed Mr Hunt had given a "full, good and convincing account" to the inquiry of how he handled the bid to ensure he was insulated from any accusations of bias.
On the issue of politicians getting to close to the media, Mr Clegg said a free press was the "lifeblood" of a democratic society - but "remedies" are needed to safeguard against any "abuse of power".
However, the Lib Dem leader warned against "going down a slippery slope" of trying to distinguish between fact, opinion and comment.
"The more the press abides by its own code the better, but I would be very wary indeed as a liberal who believes passionately in the freedom of the press, of going down a slippery slope of trying to somehow intrude from outside in trying to distinguish between fact, opinion and comment - they blur constantly and I don't think you can legislate to unravel them," he said.
He told the inquiry: "To get the balance right mutual interest between politicians and the media will always exist, but mutual dependency and what I call political clientalism must be avoided.
"I think that it is right, inevitable, legitimate and to be expected that politicians will seek out the media... and it is quite right, legitimate and to be expected that the media will want to seek to persuade politicians of their points of view.
"I just think that that relationship should be laced with a healthy degree of scepticism about the motives of both sides within that relationship, and a certain sort of distance.
"That is clearly threatened or can be undermined when you get, as I say, a relationship in effect of clientalism, where party 'x' feels he owes it to press group 'y' because press group 'y' is supporting party 'x'.
"The press have an incredibly valuable asset in their possession which is their ability to promote politicians and political parties in a way which then leads to an increased number of votes, and that after all is the heart of what the democratic contest is all about."
Alex Salmond , leader of the Scottish National Party, follows Mr Clegg in the witness box before Lord Justice Leveson at the Royal Courts of Justice in London.
He has been under growing pressure about his links to Mr Murdoch, and has been accused of courting the media mogul in order to win The Sun's support for the SNP - although he insists he was interested in safeguarding Scottish jobs.
The inquiry could also seek to learn whether the SNP leader was among those who had their phone hacked. He has previously refused to confirm if police have said he was a victim.
The pair follow other major political figures who have already appeared before the probe this week, including former prime ministers Gordon Brown and Sir John Major, Chancellor George Osborne, Labour leader Ed Miliband and his deputy Harriet Harman.
Tomorrow is Mr Cameron's turn in the hot seat, who is likely to be questioned about his relationship with the media, News Corporation chief executive and chairman Rupert Murdoch, and his friendship with former News Of The World editor Rebekah Brooks.
The PM is also likely to be grilled over his decision to hand Culture Secretary Jeremy Hunt the responsibility for overseeing News Corp's BSkyB bid.
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