Closure of The Sun mooted in response to further arrests

What now for The Sun? A week that began with fear of further arrests, talk of police search warrants and a desperate attempt by the paper's editor to rally the troops ended with the company chairman declining to speculate on whether it even had a future.

A paper that until so recently claimed the power to anoint election winners is wracked with uncertainty. Yesterday, Steve Rotheram the Labour MP for Liverpool Walton, claimed that The Sun's name appeared in the files of Glenn Mulcaire, the private detective whose phone hacking brought down the News of the World. Whereas News International has spent more than two years fiercely protecting The Sun brand from being tarnished by the hacking scandal, James Murdoch declined to fight its corner. Asked by Mr Rotheram whether the Britain's biggest-selling daily might close if evidence of hacking came out, he said: "I don't think we can rule out any corporate reaction to behaviour or wrongdoing."

Mr Murdoch also introduced the subject of The Sun's district reporter Jamie Pyatt, who was arrested on Friday, over illicit payments to police rather than hacking. Disquiet in the newsroom over Mr Pyatt's arrest prompted The Sun's editor Dominic Mohan to call the entire staff before him on Monday. News International's chief executive, Tom Mockridge, told journalists that if the company did not hand evidence to police, officers might enter the building with search warrants.

If staff were looking for reassurance from Mr Murdoch they did not find it. Emphasising the global scale of his job and the difficulty of recognising the significance of the hacking scandal, he talked of meetings in Hong Kong and dismissed News International as the smallest part of his portfolio. His comments did nothing to dispel rumours that News Corp is preparing to exit the British press.