But, on one of his most difficult days as head of the press's self- regulatory body, he maintained he and the commission had no evidence to show Prince Charles or his friends had done the same.
He added Sir Robert Fellowes, the Queen's private secretary, who originally assured him the Princess had not been involved in leaking information, had always 'acted most honourably' in dealings with the commission.
Lord McGregor said he had discovered that the Princess's friends had contact with the press over the book by Andrew Morton, Diana: Her True Story. Sir Robert subsequently apologised for misleading the commission.
Last night royal correspondents close to the couple and other observers said Lord McGregor and Sir Robert were nave to believe the Princess's denials of involvement in the book. Lord Rees- Mogg, newspaper columnist and former editor of the Times, said: 'That was merely a reply that they should have expected and men of the world, which they seem not to be, would have known that there was a very great danger that if you put that question, you get an untruthful answer.'
Disagreements between Lord McGregor and ministers emerged during the day after publication of the PCC chairman's letter to Sir David Calcutt, detailing his distress at news of the Princess's role. Lord McGregor stuck doggedly to his assertion, in that letter, that he had alerted the Government to the Princess's manipulations. But Kenneth Baker, the former Cabinet minister, and Gus O'Donnell, the Prime Minister's press secretary, rejected the statement that he had spoken to them at length.
The PCC chairman also said he had warned of the manipulation in oral evidence to Sir David's inquiry into the press shortly after becoming aware of it during the summer, long before his letter to Sir David, dated 11 December.
Further damaging revelations about the royal private lives emerged in Australia with the publication in New Idea, a Rupert Murdoch-owned women's magazine, of the transcript of an intimate telephone conversation said to be between the Prince of Wales and his close friend Camilla Parker Bowles in 1989. The call, said to have taken place late at night, features a long exchange of highly explicit endearments.
Andrew Neil, editor of the Sunday Times, said editors met last night to discuss the story. They decided not to publish the full transcript, having been influenced by the threat to press freedom posed by Calcutt. He added: 'I think that . . shows the kind of climate that is developing in Britain. In the 1930s people like you and me then knew about the abdication crisis. Plain folk didn't. That's what we're coming to in Britain.'
No prisoners taken, page 2
Media, page 15
Letters, page 20