that是甚麼意思？有何作用？可否刪去？

The sentence in direct speech
He says, "the facts of the case may be as they have been reported by the court," but he says, "there is a strong political element to the story."

The sentence in reported speech
He says (that) the facts of the case may be as they have been reported by the court, but (he says) that there is a strong political element to the story.

Structure: 1st main clause, but (coordination conj.) + 2nd main clause

"that" is a conjunction introducing a noun clause which functions as the object of the verb "says". As "he says" is already omitted in the second main clause, "that" cannot be omitted to avoid ambiguity. Without "that", "but there is a strong ..." will become a part of the first noun clause.