From Nick Cohen I learn that Labour has shafted the libel reform bill.

The results of the cross-party consensus were not as liberal as I and my friends in the free speech movement wanted. But politics is compromise. The parties agreed on legislation that would have stopped London being “a town called sue” – the global capital of libel tourism – and would have made the British a little bit freer to speak and write. That was good enough for me.

But it went wrong.

Earlier this month and at the last minute, Labour peers in the House of Lords, led by David Puttnam and Charles Falconer, a barrister who has rarely exerted himself to defend our freedoms, spatchcocked proposals from a Leveson inquiry, which did not even consider libel reform, into the libel reform bill. They knew Cameron would drop the bill rather than accept their wholesale rewrites. It’s not just that he did not want to implement all of Leveson. Labour, Conservatives and the Liberal Democrats had a deal on libel reform and Labour had broken it.

No matter. Labour carried on. It wanted judges to award punitive damages if a writer or publisher had “not first sought advice from a recognised independent regulatory board before publication”.

In other words, writers must submit their work to a quango of censors or face enormous fines. This is pre-publication censorship, the favoured tool of dictators the world over. John Milton argued against it in Areopagitica, the first great defence of free speech in the English language. By the end of last week, Labour was scrambling to abandon its position. I doubt shame at breaking with the best values of the English radical tradition forced it to retreat. Someone must have told Falconer and Puttnam that the European Court of Human Rights had specifically ruled against prior restraint in 2011 and what the peers were proposing was, on the face of it, unlawful.

Are you kidding? Punitive damages unless writers and publishers got permssion from a regulatory board first? Are they out of their minds?

However, Labour is still insisting on a clause that says a newspaper outside its quango will face punitive damages in court “even if it had been successful” in fighting and winning a case. This strikes many legal authorities as a breach of Article 10 of the Human Rights Act that protects free speech and Article 6 that protects a fair trial. The detail, horrendous though it is, matters less to me than Labour’s willingness to destroy libel reform. Be in no doubt that it exists. Lord Falconer and Harriet Harman’s “people” told me they would rather see reform die than back down.

If it dies, the bill’s proposed ban on corporations, following the example of McDonald’s, suing individual activists will die with it. If it dies, the proposed limits on the libel tourism racket that have allowed Russian, Ukrainian and Saudi billionaires, Icelandic bankers and African dictators to punish their critics in London will die with it. If it dies, the new public interest defence for contested speech, which is essential for bloggers and small publishers as well as investigative journalists, will die with it. If it dies, the planned defence of “honest opinion” that would have allowed the Simon Singhs of the future to criticise alternative health quacks without risking a £500,000 bill will die with it.

It’s horrifying.