Opposition Labour lawmaker Tom Watson made the claims in parliament as the government said it was giving the green light for Murdoch’s News Corp to take full control of British satellite pay-TV group BSkyB.

Critics have said allegations that the News of the World, part of Murdoch’s News Corp, hacked the phones of showbusiness stars, politicians and the royal family, made Murdoch unfit to extend his media empire in Britain.

“I now believe the evidence exists that show journalists currently employed on The Times and The Sunday Times were involved in phone hacking, and that damaging revelations were printed in The Sun from information possibly collected by illegal hacking,” Watson said.

News Corp’s News International, the publisher of the newspapers, rejected the claims.

“We do not believe Tom Watson has any evidence to support these allegations. It is not a coincidence that he has made such cowardly and unsubstantiated claims under the cloak of parliamentary privilege,” a News International spokeswoman said. “If he has any evidence, we urge him to provide it to us and we will take immediate action if proven,” she added.

Watson asked culture minister Jeremy Hunt in parliament whether he would change his mind on the BSkyB bid if police showed him evidence to back the claims.

But Hunt said this was not yet a matter that could affect his decision not to refer the bid to competition regulators.

“As to whether I can ask (media regulator) Ofcom to look at those issues, my understanding is that legally I am not able to do that at this stage,” Hunt said.

The issue of phone hacking dates back to 2005/6 when the News of the World’s royal reporter and a private detective were arrested and later jailed for snooping on the voice-mail messages of royal aides.

A continuing row over the scandal cost the job of Andy Coulson, Prime Minister David Cameron’s communications chief, earlier this year. Coulson was News of the World editor at the time of the scandal, but denies knowledge of wrongdoing at the newspaper.