Home Office minister Baroness Browning has resisted calls for an immediate independent inquiry into phone hacking following claims murdered teenager Milly Dowler's phone was targeted.
Responding to an urgent question in the House of Lords she said the allegation that a private investigator working for the News of the World hacked into the schoolgirl's phone after she went missing was a "truly shocking matter".
She said she was not saying there would not be an independent inquiry.
But she told peers: "A police investigation into allegations of phone hacking is currently under way. It's important that the investigation is allowed to proceed and the conclusions made public."
She added: "The government believes it most appropriate to consider the outcomes of the police investigations and the various inquiries before deciding whether any further steps are necessary."
Lady Browning was responding to ex-journalist and former Conservative Cabinet minister Lord Fowler, who said it was "one of the biggest scandals affecting the press in living memory".
Earlier Prime Minister David Cameron made clear he would not intervene in the bid by the News of the World's parent company, Rupert Murdoch's News Corporation, to take a majority stake in BSkyB.
Ex-Labour deputy prime minister Lord Prescott, who believes he was a victim of hacking, said it was the "latest and most obscene action of this company, Murdoch press" and called on ministers to consult media regulator Ofcom before coming to a decision on the BSkyB takeover.