Mr Coulson, acting editor of the paper when it published a story on the missing 13-year-old, said that he did not believe he knew that seven of the paper’s staff had travelled to the Midlands in a fruitless attempt to find her.
The court has heard that that attempt was prompted by Glenn Mulcaire’s hacking a voicemail message left on Milly’s phone by a recruitment agency (who turned out to have mis-dialled a number.)
Asked about his general knowledge of phone hacking around the time Milly disappeared in 2002, Mr Coulson told the Old Bailey: “I think I was aware of it in very vague terms. It was in the ether, if I can put it that way. It was something gossiped about.”
But he said he did not have any personal experience of hacking, telling his counsel Timothy Langdale QC: “I did not, no.”
In answer to Mr Langdale’s query as to whether he was “a party to or in agreement with phone hacking at the News of the World,” Mr Coulson replied firmly: “No, I was not.”
Asked: “Were you aware of any activity by the News of the World in relation to hacking of Milly Dowler’s voicemail?” Mr Coulson again replied: “No, I was not.”
Mr Coulson, deputy editor of the NoW between 2000 and 2003, said he was not aware that accessing voicemails was a crime.
Asked what he would have thought about hacking anyway, he told the court: “I would have thought it was intrusive and a breach of privacy – and I would have thought it was lazy journalism.”
In the run up to Sunday 14 April 2002, the NoW was trying to ascertain whether Milly was attending a job interview at a computer factory and sent five reporters and two photographers to Telford to check out the story.
Asked about the tasking, Mr Coulson, acting editing the paper that week while Rebekah Brooks was on holiday in Dubai, said: “No, I don’t think I did know that reporters had been sent to Telford.”
Asked why top NoW journalist Neville Thurlbeck had phoned him at 9.43pm on Friday 12 April, he said that he was probably ringing to discuss the first editions of Saturday’s papers.
Mr Langdale asked: “Did there come point where you learned from Neville Thurlbeck or anybody else that there was a possibility of Milly Dowler being interviewed for a job?”, to which he replied: “Yes.”
Asked when, Mr Coulson told the court: “I can’t place it precisely or approximately.”
But he said he thought the idea of Milly working at a factory was “ludicrous” because she was only 13 and her photograph had been all over the papers.
He had given no credence to the story.
The “mystery” voicemail left by the recruitment agency for Milly was the page 9 lead in the first edition of the News of the World on Sunday 14 April 2002, which Mr Coulson edited. Asked about it, he said: “I don’t remember reading this story, so I’m to a degree reconstructing.”
But he added he had probably played a role in downgrading the story – which the police had told the NoW was probably the work of a hoaxer – in later editions. Mr Coulson said: “I think what happened this week is that I went through the first edition of the paper and felt that the mix was wrong.”
He, Mrs Brooks and the paper’s managing editor, Stuart Kuttner, deny conspiring to hack voicemails. The case continues.