No 10: Jeremy Hunt will not face ministerial code inquiry
David Cameron has decided not to order an inquiry into whether Jeremy Hunt broke the ministerial code after he was grilled at the Leveson Inquiry.
Mr Cameron believes the culture secretary acted properly when he was responsible for Rupert Murdoch's BSkyB takeover bid, Downing Street said.
No 10 added the prime minister would not refer the case to Sir Alex Allen, his adviser on the ministerial code.
Mr Hunt admitted he considered resigning over the BSkyB controversy.
Deputy Labour leader Harriet Harman called the decision not to refer Mr Hunt's case "disgraceful".
Mr Hunt faced more than six hours of questioning on every aspect of his conduct during the bid process.
He was also challenged about text messages between himself and News Corp lobbyist Fred Michel, who he described as "pushy" and "cheeky", and his special adviser Adam Smith, who was forced to quit over his alleged closeness to the Murdoch empire.
The inquiry also heard Mr Hunt congratulated James Murdoch on the progress of News Corp's bid - just hours before he was given the power to decide on it.
Mr Hunt admitted he was sympathetic towards News Corp's takeover bid for BSkyB, but said he acted impartially once he was given responsibility for it.
He told the inquiry: "I did think about my own position, but I had conducted the bid scrupulously, and I believed it was possible to demonstrate that, and I decided it wouldn't be appropriate for me to go."
Labour has accused Mr Hunt of misleading Parliament and said he broke the ministerial code, which states that ministers are responsible for the conduct of their special advisers - both reasons, they say, why he should be sacked.
Ms Harman told BBC News: "I think it's frankly deplorable that he should keep in his cabinet someone who has broken the ministerial code, who has misled Parliament, and of course David Cameron should never have given the decision to Jeremy Hunt in the first place.
"He was clearly already biased and I think that not only saying that he's going to stay in the cabinet, but he's not even going to refer him to the independent investigator on ministerial interests for breach of the ministerial code is, frankly, disgraceful."
The current phase of the Leveson inquiry into media ethics is examining the relationship between the press and politicians.
'Screw up' fear
The decision to ask Mr Hunt to oversee the BSkyB bid came in December 2010 after Business Secretary Vince Cable was stripped of responsibilities after telling undercover journalists he had "declared war" on News Corp chief Rupert Murdoch.
The culture secretary told the inquiry he would not have sent the text to Mr Murdoch, which said "Great and congrats on Brussels. Just [regulator] Ofcom to go", had he known he would be given responsibility for the bid later the same day.
The "great and congrats" message was one of a number Mr Hunt exchanged with Mr Murdoch on the afternoon of 21 December 2010 after the executive had tried to contact him by phone.
Mr Hunt also sent a text to Chancellor George Osborne expressing fears the government would "screw up" over its handling of the BSkyB bid as a result of Mr Cable's comments.
He also admitted he had a mobile phone conversation with James Murdoch on 16 November 2010 to hear what was "on his mind at that time" and considered that "appropriate" behaviour.
But referring to a memo on the bid that he sent to Prime Minister David Cameron that month, Mr Hunt said that "apart from informing the prime minister of my views I wasn't actually doing anything about it".
"It was widely known that I was broadly sympathetic towards the bid," he added.
He also admitted he had a mobile phone conversation with James Murdoch on 16 November 2010 to hear what was "on his mind at that time" and considered that "appropriate" behaviour, despite legal advice not to have external discussions about the bid.