LA UNE DES JOURNAUX.info

? Tear gas fired during Athens protests
? Party leader refuses to support austerity measures
? Venizelos: Greece must decide whether to remain in the euro
? No disembursement without implementation
? Another MP resigns
? Live-blogging now: Nick Fletcher

5.45pm: Now Fitch has waded in again to the Greek debate.

The ratings agency, which said last month the country would struggle to make its March bond repayments, has said it must secure an agreement about its bailout or face a disorderly default.

Now this may all be stating the obvious but it's chilling nonetheless. According to Bloomberg, Fitch said such a default could cause panic in the Greek banking system and cause contagion elsewhere, with Portugal and Ireland mentioned. Capital.gr reports:

"They must get this deal agreed really within the next few days to enable them sufficient time to do the paperwork and have the new bailout money disbursed before that bond is due," Tony Stringer, a managing director at Fitch, said in a conference in Singapore today. "If they don't manage to achieve that, then it could be in the realms of a disorderly default."

5.26pm: In a move which will surprise absolutely no one who's been following the long drawn out Greek drama, the proposed cabinet reshuffle has reportedly been delayed until Monday.

That means it will happen after Sunday's vote on the austerity measures (sorry for stating the obvious, there.)*

Meanwhile European markets have closed and it's not a pretty sight. Germany's Dax is down 1.41%, France's Cac is 1.51% lower and Italy is off 1.76%. The FTSE 100 finished 43.08 points lower at 5852.39, a 0.73% decline.

Athens fell more than 5% before recovering some of its losses to end 3% lower.

Meanwhile on Wall Street the Dow Jones Industrial Average is down 120 points at the moment, or nearly 1%.

* An update: talk now is the bailout vote itself might now not take place until Monday. Why am I not surprised?

4.44pm: We seem to be up to four resignations at the moment.

These are deputy foreign minister Mariliza Xenogiannakopoulou and three members of LAOS. According to Greek newspaper Etathimerini:

Transport Minister Makis Voridis, Deputy Merchant Marine Minister Adonis Georgiadis and Deputy Agriculture Minister Asterios Rondoulis tendered their resignation after LAOS leader Giorgos Karatzaferis said that he would not support the loan agreement following lengthy negotiations this week.

Apparently a cabinet meeting is due shortly which will be covered here (in Greek).

4.00pm: And the resignations apparently keep on coming. Greek TV is reporting deputy foreign minister Mariliza Xenogiannakopoulou is stepping down, while AP says two ministers have resigned. No more details on either, and at the moment it's not clear which two ministers AP is referring to.

There is growing talk that prime minster Lucas Papademos will announce a cabinet reshuffle...

3.49pm: Back with the US, it appears American consumers turned less optimistic about the economy in the early part of this month.

A Thomson Reuters/University of Michigan index of consumer sentiment fell from 75 in January to 72.5, less than the 74.5 level economists had been expecting. Annalisa Piazza of Newedge Strategy said:

This is quite disappointing, given the reassuring picture described by the last bureau of labour statistics employment report and the upswing in other survey indicators. We expect an upward correction in the coming months, with further signs of improvement in the US economy.

It has disappointed the market for sure, and the Dow Jones Industrial Average has slipped further, down 126 points or almost 1%.

3.19pm: Here's some video of the demonstrations in Athens against the austerity measures, showing police using teargas against protestors.

It also includes George Karatzaferis of the Laos party saying he cannot vote in favour of the proposed cutbacks.

2.57pm: Reports are coming in that another Greek minister has resigned over the austerity measures.

Deputy farm minister Asterios Rodoulis is said to have quit, following in the footsteps of Pavlos Stasinos, a Pasok (socialist) MP. Yesterday, a Pasok deputy labour minister and a New Democracy deputy both quit, saying they could not accept the demands being made on the Greek people.

Meanwhile my colleague Larry Elliott has written a piece arguing that the Germans want the Greeks out of the euro. He says:

With one important caveat, this would be a good outcome for Angela Merkel. If Greece decided to quit the euro of its own volition, she could say she had done all she could to keep the single currency intact but, in the end, the Greeks themselves had decided it was time to go.

The caveat is, of course, that a Greek departure would be orderly rather than disruptive.

2.41pm: The uncertainty in Greece - to put it mildly - is causing ructions well away from Hellenic shores.

Wall Street has just opened and in keeping with other global markets, it is falling sharply. The impetus for all this was news that George Karatzaferis of the Laos party, part of the Greek coalition, had refused to support the austerity programme the country has to agree in return for a second aid package worth ?130bn.

It is still possible that Sunday's vote will endorse the cuts, but the move by Karatzaferis has caused more confusion in an already confusing situation. And markets are not liking it one bit. Germany's Dax is now down 1.65%, France's Cac is off 1.16% and the FTSE 100 has fallen 0.7%.

As for the US, the Dow Jones Industrial Average is down around 101 points or 0.7% in the first few minutes of trading. The fall comes despite news of a US trade deficit that widened from $47.1bn in November to $48.8bn in December, much in line with expectations.

With investors seeking havens for their money and finding few around, one area of appeal was UK government gilts, which have jumped more than a point. Ten year yields have dipped by 8 basis points to 2.143%.

2.08pm: It appears inevitable that Greek prime minister Lucas Papademos will be forced to shake up his cabinet very soon.

The Greek government spokesman has just told Helena Smith in Athens that since the national LAOS party [the government's junior coalition partner] won't be giving its vote to the loan agreement in parliament (see 12.19pm), it is "only logical" that there will be a cabinet reshuffle.

Spokesman Pandelis Kapsis said:

It is only logical that since he [Laos leader Georgios Karatzaferis'] won't be [endorsing the latest round of austerity measures in exchange for aid], his ministers won't be staying in the government.

Another well-placed official said Karatzaferis' decision not to back the measures when they are put to vote on Sunday would create "a serious problem" although he did not think it would stop the package being passed.

And with that, I'm handing this blog over to my colleague Nick Fletcher. Thanks all.

1.54pm: Greece's largest police union has threatened to issue arrest warrants for officials from the country's European Union and International Monetary Fund lenders for demanding deeply unpopular austerity measures.

That's according to Reuters, which says it has obtained a letter from the Federation of Greek Police. In it, the police accuse Troika officials of:

...blackmail, covertly abolishing or eroding democracy and national sovereignty.

Since you are continuing this destructive policy, we warn you that you cannot make us fight against our brothers.

One target of the warrants would be the IMF's top official for Greece, Poul Thomsen.

Reuters explains:

The threat is largely symbolic since legal experts say a judge must first authorize such warrants, but it shows the depth of anger against foreign lenders who have demanded drastic wage and pension cuts in exchange for funds to keep Greece afloat.

1.30pm: Here's a lunchtime round-up of the main events so far:

? One of Greece's coalition leaders has refused to support the austerity programme that Greece must accept in return for a second aid package. George Karatzaferis of the Laos party said that the plan was the wrong way to take Greece. The move throws the situation in Athens into fresh confusion ? just a day after the country's prime minister claimed that he had an agreement.

? Greek workers are taking part in a 48-hour strike in protest at the bailout plans. Transport systems, schools and offices have all been affected. In Athens, demonstrators convened on Syntagma Square and chanted for MPs to resign. Clashes broke out, teargas was deployed, and petrol bombs were thrown at police.

? Overnight, finance minister Evangelos Venizelos warned that Greece must either comply with the demands of its lenders, or quit the eurozone. He spoke out after the eurogroup of finance ministers ruled that Greece has not yet met its obligations, and must find ?325m of additional budget cuts.

? Several MPs have spoken out against the austerity measures. One independent member pledged to vote against the plan, a second quit the government, and a third claimed that the latest budget cuts would ensure Greece's bankruptcy.

And on another note this lunchtime, several hundred Belgian firefighters have broken through police lines in Brussels and hosed down the prime minister's office in protest at the government's tougher retirement plans ? part of its own austerity plans.

Remarkable scenes -- for once, it wasn't the protesters who got a drenching.

1.19pm: An update on that Greek cabinet meeting -- it's now been postponed until tomorrow. The situation is looking increasingly confused.....

12.51pm: The Greek cabinet is now planning to meet at 5pm Athens time (3pm GMT) to discuss the next step. That''s two hours later than planned -- following George Karatzaferis's decision to refuse to support the budget plans.

12.46pm: This second picture from Athens shows a petrol bomb exploding near riot police.

We don't yet know whether there were any injuries.

12.42pm: We have more pictures from today's protests in Athens.

This image shows demonstrators who have been detained by riot police.

12.38pm: An independent MP named Milena Apostalaki (formerly of Pasok) has announced that she will not vote for the austerity measures when they come before the Greek parliament (probably on Sunday).

Apostalaki's move comes amid mounting speculation that MPs will be ordered to vote in favour of the package.

That, Helena Smith says, will be very unpopular -- many MPs want to vote against the deepy unpopular package.

12.26pm: The euro has fallen sharply since Karatzaferis began his press conference -- losing almost a cent against the US dollar to $1.3204.

Shares are also in retreat, with the FTSE 100 down 44 points at 5851. The German Dax has suffered a heavier fall, down almost 1.7%.

12.19pm: Bombshell -- George Karatzaferis has declared that he cannot vote in favour of the austerity measures that international lenders insist Greece must accept.

Karatzaferis explained that he believes the road being proposed by the troika is 'not right'.

He also explained that he still supports Lucas's Papademos interim government, but wants the Greek prime minister to consider a reshuffle.

Karatzaferis's Laos party controls 16 seats in 300 seat parliament, so Papademos would still have a majority if Laos walked out of the coalition (which does not appear to have happened).

However, his power extends beyond simple parliamentary maths, as the EU has demanded that all parties need to sign the bill before financial aid is released.

12.10pm: Karatzaferis ? whose far-right party is the smallest part of the coalition ? goes on to claim that the Paol Thomsen, the International Monetary Fund's mission chief to Greece, should be declared "persona non grata".

That'll go down well with the international lenders, points out the Financial Times's Christopher Adams:

Karatzaferis really going out of his way to build bridges with creditors

? Christopher Adams (@ChrisAdamsMKTS) February 10, 2012

Karatzaferis. also called for "the restoration of democratic processes in Europe", and appeared to claim that Greece could cope without the "German boot".
.

12.06pm: While protests continue on the streets of Greece, the leader of the Laos party has begun his eagerly awaited press conference.

Looking very glum, George Karatzaferis tells the assembled media in Athens that Greece's dignity has been stolen, adding that he "will not put up with the country being ridiculed".

We have Germany deciding on behalf of Europe

More to come (via Helena, who's watching the press conference now).

11.47am: Riot police in Syntagma Square have clashed with demonstrators in the last few minutes.

Helena Smith reports that tear gas has been deployed, as "running battles" break out between protesters and the police on the steets of Athens.

Reuters reports that youths have been "throwing stones and petrol bombs".

Here's a picture from the streets, via Twitter.

?????? ? ????????? ???? ???????????? #10fgr#Syntagma twitter.com/giannisg_/stat?

? giannis g. (@giannisg_) February 10, 2012

The kind of scenes we have seen at previous demonstrations, unfortunately:

Hooded persons breaking/hurling marble at riot police, tear gas, an MP resigns. Just another day in Athens. P.S. Most of us are at work

? Living in Greece (@livingingreece) February 10, 2012

11.25am: LAOS leader George Karatzaferis is due to give a press conference in a few minutes in Athens ? and it could be significant.

UPDATE: It's been delayed until noon GMT / 2pm local time

Laos political aides say that Karatzaferis wants to "speak to the people" through the press*. They say he is furious that he was not consulted about the final deal which Evangelos Venizelos presented in Brussels last night.

Could he, as the rumour mill suggests (10.41am), quit the coalition?

* - it's a two-way process, so keep those comments coming....

11.20am: Word is also spreading on the streets that a government ministry has been occupied by protesters (as we flagged up at 10.41am). Helena Smith reports that demonstrators are being encouraged to head over there.

As kizbot points out in the comments below:

'????????' or 'occupation' of a building is a common form of protest here.. especially in schools and universities. I wouldn't take it as a major sign of revolution.

11.11am: At Syntagma Square, our correspondent Helena Smith finds more people than ever before are saying that Greece should leave the eurozone.

That view conflicts with polls that have shown the vast majority of Greeks wanting to hang onto their euros, and not revert to the drachma.

But Despoina Koutoulouglou argued that it would be better to leave the single currency:

Under these terms why would we want to stay?

They are turning us into a sort of India with slave wages.

Koutoulouglou described herself as a member of the "500 euro generation" - a term used to describe young people who only receive low wages and are unable to leave their parents' home.

11.07am: Police bearing riot shields and protective helmets are now lined up outside the Greek parliament.

The protests still appear peaceful at this stage.

10.41am: Rumours are sweeping Greece that Laos, the far-right junior party in Lucas Papademos's coalition government, might quit the administration.

George Karatzaferis, the Laos leader, is reportedly meeting with Papademos now. A press conference is scheduled for 1.30pm local time (11.30am GMT), local media report (just checking this out now).

There are also reports that workers have occupied an office of the ministry of finance:

???? ?????????: ???????? ??? ????????? ??????????? ??? ?????????? ??? ?????????? twitter.com/naftemporiki/s?

? naftemporiki (@naftemporiki) February 10, 2012

10.36am: The front page of the mass-selling Ta Nea sums up the mood, Helena Smith reports from Athens.

It declares:

"Citizens speak: We have turned fifty years back."

"A cold war [has erupted] with our lenders."

Helena confirms that another MP, Pavlos Stasinos, has indeed resigned from the socialist Pasok party in "disgust" over the agreement. Throughout the morning MPs have been ringing into radio shows to have their voices heard -- the vast majority being far too afraid to be seen in public .

Many said they would vote with their "conscience" come Sunday when the controversial loan agreement is put before the Greek parliament for endorsement. The effects of the accord, they argued, would be as bad as bankruptcy itself.

"If we vote these measures through we are setting in motion the bankruptcy of our country," said Odyyseus Boudouris, a parliamentarian with the socialist Pasok party. "The dilemma we are faced with is awful and wrong. But bankruptcy won't just be bad for Greece, it will be bad for our partners in the EU."

10.14am: Maria Verivaki has got in touch to report that there is disruption in the city of Hania, on Crete:

main roads closed in hania centre of town due to marches, approx 800m stretch; my cabbie husband simply avoids this road

Another reader in Greece, James Wilkins, says he would be happier if "this charade" was over, and Greece had defaulted:

It will mean many horrible years for the Greeks, but at least the world will have to find another country to scapegoat.

The Greeks will survive, they always do, but other eurozone countries, including Germany, and Britain and America too, will struggle. I look forward to the time when Greece has forgotten this experiment with borrowed capital ( from which other countries benefited) and goes back to being what it once was - a poor little country on the south of Europe where people, despite the poverty, enjoy life.

9.58am: Greek media are reporting another resignation over the austerity plan -- Pavlos Stasinos, a Pasok (socialist) MP. That would be the third since Greece's leaders agreed to the draft agreement. Yesterday, a Pasok deputy labour minister and a New Democracy deputy both quit, saying they could not accept the demands being made on the Greek people.

9.46am: Helena Smith, our correspondent in Athens, says the mood among protestors is far from mild.

"They are crooks and thieves," the crowds have been screaming outside the 300-seat House. "Our politicians should live on a minimum wage to see what it's like" railed Iphighenia Kontou, a laid-off shop assistant. "What have these measures achieved? None of them have worked and they want more? "

"We want justice," screamed a group of hospital workers. "They are tearing down our state," said Giorgos Klonizakis, a doctor. "People can't get basic healthcare any more. They want us to pay off our country's debts at the expense of everything else. Why hasn't one person gone to prison yet for all the corruption, all the wrongdoing that got us here in the first place?"

"For a long time we accepted these measures because we understand that Greece needs change," said a mechanic requesting anonymity. "But they've got us nowhere and it's now the third year! The middle class is being torn apart. To ask for more when there is no more to cut is foolish and dangerous."

Helena adds that the unions appear to have achieved a good turn out -- what's not clear yet is whether today's march (like so many before) will descend into violence. She adds:

Riot police armed with stun guns and teargas cannisters are out in force -- lined up in armour like medieval soldiers in the narrow streets beneath Syntagma square around the finance ministry. Most are young - much younger than many of the protestors out there.

9.25am: Update on the strikes -- people are gathering in Syntagma square, the area in the centre of Athens outside its parliament.

Some are carrying loudspeakers, and Reuters reports that slogans are being chanted across the square -- including:

No to layoffs! No to salary cuts! No to pension cuts! Do not bow your heads! Resist!

Teachers, hospital staff and bank employees are all joining in the strike, although we don't get have details of how many people are taking part in the industrial action.

There were marches on the streets of Athens on Tuesday during another general strike -- turnout wasn't as high as at some previous demos, partly due to heavy rain in the city. Today's marches will be closely watched to show the level of public anger.

9.04am: We recently created a Flickr page called "Greece - life in an economic crisis", where readers can upload their own pictures from the country (hat-tip Laura Oliver). It's still open ? Greek readers might wish to upload their images.

8.59am: If you're in Greece today -- we'd be very grateful to hear how the strike is affecting you. Are you taking part? Do you support the action?

Let us know in the comment below, or via email (graeme.wearden@guardian.co.uk) or Twitter (@graemewearden).

Many thanks again if you helped out with this on Tuesday.

8.51am: The Greek transport system has been disrupted this morning as the 48-hour strike called by the country's two biggest unions gets under way.

Some railway, ferry and public transport schedules are suspended, as this picture shows.

Unions are planning to hold protests several cities, including Athens, around midday local time (10am GMT).

8.41am: Germany will vote in 17 days on whether Greece should receive its second bailout.

Klaus Ernst, the co-leader of the opposition Left party, has just told reporters that Angela Merkel briefed the leaders of the five parties in the lower parliamentary chamber about the Greek situation. According to Ernst:

We will probably have a special meeting of the Bundestag on February 27 to make decisions.

Another hurdle for the Greek bailout package to clear.

As I understand it (but I am very happy to be corrected) every eurozone parliament must give its approval to the ?130bn package -- in the same way that they approved the changes to the eurozone bailout fund last autumn (although Slovakia initially opposed it). The French government gave its approval last September (when the bailout was a mere ?109bn).

The immediate deadline, though, is next Wednesday ? when the eurogroup of finance ministers meets again.

That gives the Greek government just five days to meet the new demands, which Elizabeth Afseth of Investec says will be challenging:

Specifying another ?325m in savings will not be easy and getting the party leaders to sign up for it may be even trickier with an election looming.

Although as regular commentator RobertSchuman points out below, the ?325m does not represent an increase on the original target of ?3.3bn of budget savings. The eurogroup is demanding deeper cuts than contained in the plan that Greece politicians agreed to on Thursday.

8.14am: Most of Europe's stock markets have opened lower this morning. The FTSE 100 index dropped 30 points to 5864, a drop of around 0.5%.

That's partly due to disappointment over Greece, but shares have also been dented by disappointing trade data from China suggesting the global economy is slowing.

Greek bonds have dropped in value this morning, as economist Shaun Richards points out on Twitter:

The response to the new austerity is for the one-year bond yield in Greece to rise back above 500%. Some rescue! #gfc2 #euro #eurochat

? Shaun Richards (@notayesmansecon) February 10, 2012

8.09am: Evangelos Venizelos has said that Greece must decide whether it wants to remain in the eurozone.

The Greek finance minister told journalists that the Eurogroup have left Greece with a clear choice -- accept more austerity measures that its international lenders demand, or leave the euro.

Speaking after the talks broke up, Venizelos said:

From today until the next meeting of the eurogroup, our country, our homeland, our society has to think and make a definitive, strategic decision.

If we see the salvation and future of the country in the euro area, in Europe, we have to do whatever we have to do to get the program approved.

Venizelos also criticised politicians who have criticise the austerity measures forced on Greece :

Nobody can keep pretending to be the good guy....The era of easy choices and demagoguery is over.

Greek ekathimerini.com , Friday February 10, 2012 (02:09)

7.49am: Jean-Claude Juncker, the prime minister of Luxembourg who chairs the Eurogroup*, was adamant last night that Greece had not done enough ? yet ? to receive a second rescue package.

Juncker said that the ?325m shortfall must be addressed within days. The Greek parliament must also approve the wide-ranging reform plan, and the various leaders of its political parties must also pledge to enforce the plan.

Juncker told a press conference in Brussels his position was clear:

In short, no disbursement without implementation.

Neat, but not quite as catchy as 'No taxation without representation'. In this case, of course, there is no shortage of taxation:

The ?325m black hole in the Greek budget plan was caused by the heads of its coalition parties rejecting pension reductions. If the missing funds can't be obtained there, prime minister Lucas Papademos will have to reach agreement on alternative spending cuts or tax rises.

* - the group of 17 finance ministers from eurozone countries

7.42am: My colleague Ian Traynor reported earlier this morning that the Troika of Greece's lenders voiced exasperation with Greek "delaying tactics".

Ian writes:

Despite announcements earlier that the coalition government in Athens had yielded to savage new terms from the eurozone to qualify for the bailout, the eurozone finance ministers were unimpressed. The emphasis was on first getting Greece to deliver its side of the bargain.

"On the condition that the Greek parliament takes decisions on the prior actions over the coming days, then next week we can finalise decision on the overall package," said Olli Rehn, the European commissioner for monetary affairs.

"It's up to the Greek government by concrete actions through legislation and other actions to convince its European partners that the second [bailout] programme can be made to work."

7.35am: Good morning. Greece's hopes of receiving its second rescue package received a setback overnight, as its eurozone partners warned that Athens has not met the terms of the ?130bn bailout.

Meeting in Brussels last night, European finance ministers studied the plan presented by the Athens government yesterday and concluded that it was incomplete.

The European central bank, the European commission, and the International Monetary Fund are now demanding ?325m in further cuts to this year's budget before it will approve the rescue package.

The news comes as Greek workers begin a nationwide two-day strike in protest at the austerity measures that coalition leaders reluctantly signed up for this week. Unions have warned that the country now faces a "social uprising".

ConservativeHome editor says health secretary has failed to win public support for health and social care bill

David Cameron has been urged to replace Andrew Lansley and drop large chunks of the health bill by the Conservative party's most widely read and influential website.

Tim Montgomerie, the editor of ConservativeHome, said in a post published on Friday that Lansley, the health secretary, had failed to win public support for the legislation and that, if the Tories did not back down, every problem with the NHS over the next three years would be blamed on the bill.

The ConservativeHome intervention is particularly damaging to Cameron because Montgomerie says he was encouraged to speak out by three Conservative cabinet minsters who believe that pressing ahead with the bill would be folly.

"One was insistent the bill must be dropped. Another said Andrew Lansley must be replaced. Another likened the NHS reforms to the poll tax," says Montgomerie in his article.

"The consensus is that the prime minister needs an external shock to wake him to the scale of the problem."

ConservativeHome is not officially linked to the Conservative party. But it is read by thousands of activists, whose views it broadly represents, and, although it does criticise government policy, it is generally supportive and not given to gratuitous attacks on the party leadership.

On Friday Montgomerie told the Today programme why he had decided to publish his article. "I wrote this blog this morning because I think the feeling is David Cameron isn't listening enough to internal party feeling and this is why I have gone public," he said.

As the Guardian reported on Thursday, Cameron and Nick Clegg have decided to press ahead with the bill, which is still in the House of Lords, even though it has become a political liability. This week the Times quoted a Downing Street source saying Lansley should be "taken out and shot" because he was handling the issue so badly.

But Montgomerie argues that if the bill does become law, it will lead to the coalition being blamed for everything that goes wrong with the NHS between now and the election.

"The NHS has always gobbled up resources and creaked. The creaking was severe when spending was increasing by 3% or 4% in real terms every year," he writes.

"What do you think it's going to be like when spending is increasing by 0.1% year after year after year in this longest ever period of UK-wide austerity? The creaking could have been blamed on the empty Treasury and Labour's over-borrowing. Not now. It will now be unfairly blamed on the bill and a bill that is not only mangled and bureaucratic, but also unnecessary."

Montgomerie says Cameron faces a choice. "Path one involves removing all contentious components of the bill," he writes. A gutted bill could then be passed with cross-party agreement. "It would be humiliating to forge such a cross-party deal but the humiliation would subside over a few weeks.

"Path two involves pressing on. It's the path that, despite his rhetoric, Ed Miliband prays the coalition will tread. Pressing on avoids the immediate political pain but leaves the chronic electoral problem in place. By 'succeeding' in enacting a contentious bill every inevitable problem that arises in the NHS in the years ahead will be blamed on it. That's a heavy price to pay for a bill that is neither transformational nor necessary."

Montgomerie, who says that Cameron's "greatest political achievement" as leader of the opposition was to stop the Conservatives being seen as an anti-NHS party, says Lansley should go. "He hasn't been able to communicate these reforms in a streetwise way," Montgomerie says.

Echoing a point repeatedly made by Stephen Dorrell, the former Conservative health secretary who now chairs the Commons health select committee, Montgomerie says that implementing structural NHS reform is perilous at a time when the NHS already has to find savings of £20bn.

Reacting to the ConservativeHome editorial, shadow health secretary Andy Burnham said: "We already know that the Prime Minister isn't listening to doctors and nurses. But it's a shock to find out that even senior members of his own Cabinet have to take to a Conservative website to get through to him about the damage he is doing to the NHS.

"It couldn't be clearer: this is an out-of-touch Prime Minister who is putting his political pride before the best interests of the NHS," he said.

"David Cameron promised to protect the NHS but every day he digs in behind his Bill, he damages it further."

The ConservativeHome broadside was published after it was revealed that Lib Dem activists want to call a vote on scrapping the bill at the Lib Dem spring conference next month.

The Lib Dem leadership managed to keep a second health rebellion off the agenda of the autumn conference, but will face intense grassroots pressure if it tries to prevent debate again. An emergency motion can be kept off the floor of the conference if it is not deemed an emergency by the federal conference committee, or it is not selected for debate in a ballot of delegates.

In an effort to keep up the pressure on the coalition, Labour has agreed to hold an opposition day debate later this month demanding publication of the bill's risk register, a confidential government document setting out all the risks associated with the legislation.

Critics believe the risk register, which Lansley has repeatedly refused to publish, contains damning warnings about rising costs and confusion. Concern has been heightened after it emerged on Wednesday that a risk assessment by the London NHS warned some organisations could fail financially and care, including maternity and children's services and public health, could suffer. Such is the anger about the register that nine Liberal Democrats are already among 50 MPs who have signed an early day motion also calling for it to be published ? and Labour believes more Lib Dems will support its move.

To put further pressure on the coalition, Andy Burnham, the shadow health secretary, will urge Labour MPs to visit hospitals and surgeries during next week's half-term break, so they can recount their stories from the NHS frontline in the debate on 22 February. "The defining question in this debate now is, by pressing on and not listening, to what extent are they putting patient safety and quality of services at risk, and that's why the risk register becomes absolutely central to this," said Burnham.

Lansley faced fresh embarrassment on Friday when a report by the right-of-centre thinktank Reform said the government's entire reform of public services was being undermined by the Department of Health's management of NHS changes.

Further 175 hurt in security compound blasts but opposition blames attacks on security forces aiming to disrupt protests

The worsening violence in Syria spread to the country's largest city, Aleppo, on Friday with two blasts outside security compounds that left 28 people dead.

The explosions outside military intelligence and police compounds, which Syrian state media blamed on "terrorists", wounded 175 people, the worst bloodshed Aleppo has seen since the uprising against Bashar al-Assad began last year. The northern city and economic hub has been largely quiet, but protests had been planned for Friday. Anti-Assad activists accused the regime of setting off the blasts to discredit the opposition and disrupt demonstrations.

Government forces, meanwhile, continued their siege of rebel-held districts in Homs and other opposition areas, going house to house arresting people in the Insha'at district and keeping up an artillery and tank barrage on Baba Amr.

The intensified campaign began with the failure of the UN security council to agree on a common position last weekend, when Russia and China vetoed a resolution backing an Arab League peace plan and calling on Assad to step down. Moscow and Beijing stuck to their positions on Friday, dashing any residual hopes of a diplomatic breakthrough in the security council. Russia's deputy foreign minister, Sergey Ryabkov, accused the west of fuelling the crisis by arming the rebel Free Syrian Army.

"Western states inciting Syrian opposition to uncompromising actions, as well as those sending arms to them, giving them advice and direction, are participating in the process of fomenting the crisis," Ryabkov said, according to the Itar-Tass news agency.

Western governments have denied supplying arms to the Free Syrian Army, which officials on on Friday referred to as a ragtag force of local militias and army deserters.

"The Free Syrian Army is less cohesive that the name suggests. In a number of neighbourhoods, it is a combination of local residents and defecting soldiers," a senior European diplomat said, on condition of anonymity.

While there have been reports of Gulf states providing arms to the Free Syria Army, observers said there were no sign of modern or sophisticated weapons in the rebels' hands and that the Free Syria Army was having trouble smuggling arms across the Turkish and Jordanian borders.

Western capitals have stressed that the diplomatic initiative in the wake of the UN security council debacle will be left to Arab states and Turkey. Foreign ministers from the Gulf Cooperation Council are due to meet on Saturday in Riyadh, Saudi Arabia, and the Arab League is due to convene in Cairo on Sunday, to draft a new strategy to raise pressure on Damascus without Russian or Chinese help. That strategy is expected to include the creation of a "friends of Syria" group excluding Moscow and Beijing, to impose new sanctions and to rally support for the Arab League peace plan in the UN general assembly.

Turkey and some Arab states have been pressing for urgent action to help pockets of Syrian civilians caught in the conflict with little access to food, water or medical supplies. However, the US and European states have been resolutely opposed to the creation of a "safe zone" or "humanitarian corridors" because they would require significant military force to enforce them.

"All this talk of humanitarian corridors and no-fly zones ? once you start to go through with it and unless you follow it through,  you do more harm than good," the European diplomat said. "A humanitarian corridor has to be legal and properly protected. Otherwise you expose humanitarian aid workers to danger for example. You can't do this unless you are ready to go the whole hog."

Russian and Chinese resistance in the security council means it is impossible for the time being for the international criminal court to start investigating the Assad regime for crimes against humanity. However, the UN high commissioner for human rights, Navi Pillay, is due to address the general assembly on Monday to press the case for indictments.

"We believe, and we've said it and we'll keep repeating it, that the case of Syria belongs in the international criminal court. This would give a very, very strong message to those running the show," Rupert Colville, Pillay's spokesman, said.

British officials said the UK government had been providing training and materials for independent human rights groups to record suspected atrocities, to provide admissible evidence for future trials at the international criminal court or elsewhere.

"The UK has funded and is continuing to fund work aim at collecting evidence of crimes and preserve that evidence so that it can be use at a later date," the official said. "Even though these people may be out of reach of justice today, there may a time when are they are not."

Communities minister defends right of councils to hold prayer sessions after landmark ruling against practice

A high court ruling that councils have no statutory rights to hold prayers at meetings has been strongly criticised by the communities secretary, Eric Pickles.

He said the judgment was "surprising and disappointing" and he believed that under the Localism Act councils ought to be allowed to say prayers.

Local authorities across the country will have to review their practice of holding prayers during formal meetings after the National Secular Society argued successfully against it.

Pickles said: "While welcoming and respecting fellow British citizens who belong to other faiths, we are a Christian country, with an established church governed by the Queen.

"Christianity plays an important part in the culture, heritage and fabric of our nation. Public authorities ? be it parliament or a parish council ? should have the right to say prayers before meetings if they wish. The right to worship is a fundamental and hard-fought British liberty.

"The Localism Act now gives councils a general power of competence ? which allows them to undertake any general action that an individual could do unless it is specifically prohibited by law. Logically, this includes prayers before meetings."

Mr Justice Ouseley ruled in a landmark judgment that Bideford council in Devon had no statutory powers to hold prayers during council meetings. As many as half of UK local councils are believed to hold prayer sessions as part of their formal proceedings. In Bideford's case, the prayers were minuted.

The complaint against the practice was made by a councillor, Clive Bone, who was supported by the National Secular Society. The Christian Institute gave financial support to Bideford town council.

Ouseley said: "A local authority has no powers under section 111 of the Local Government Act 1972 to hold prayers as part of a formal local authority meeting or to summon councillors to such a meeting at which prayers are on the agenda.

"The saying of prayers in a local authority chamber before a formal meeting of such a body is lawful provided councillors are not formally summoned to attend."

Keith Porteous Wood, chief executive of the National Secular Society, welcomed the ruling. "We are delighted that the court has decided to make a ringingly secular decision, which will make the saying of prayers of whatever religion unlawful in local councils. This will mean no one will be disadvantaged or feel uncomfortable in performing their duties as a councillor in meetings."

Bone, the Bideford councillor who launched the action, said he was "delighted" when the Guardian broke the news of the judgment to him.

He said he was horrified when he became a councillor in 2007 to find prayers were being said. "It was outdated, antiquated and a turnoff," he said. He twice championed motions trying to get the practice halted but they were defeated.

Bone argued that the saying of prayers was bad for local democracy. "It sends out a signal that local governments are for particular types of people and not for everyone," he said.

The Christian Institute said: "The practice of saying prayers at Bideford town council meetings is understood to date back to the days of Queen Elizabeth I.

"The council has recently twice voted in support of continuing with the prayers. Individual councillors were free to not take part in the prayers if they wished, and the register of attendance was not taken until after the prayers had finished.

"Nevertheless, a court case was brought by the National Secular Society and a secularist former councillor, Mr Clive Bone, against Bideford town council."

The Christian Institute's spokesman, Simon Calvert, said: "We welcome the finding that the saying of prayers isn't discriminatory, or a breach of equality laws, or human rights laws. But it is extraordinary to rule that councils have no lawful authority to choose, if they so wish, to start their formal meetings with prayers. That is simply wrong.

"The logic of the ruling is that councils would also be going beyond the law if they took a vote and decided to start each formal council meeting with the national anthem."

Tony Inch, a councillor who supported the prayers, said the ruling was a "big shock and a shame". He added: "We seem to be going from one crisis to another. It has implications for councils up and down the country. Where is it going to end? It's eroding the whole basis of Christian life in this country."

The bishop of Exeter, the Right Rev Michael Langrish, said he would encourage councils in his diocese, including Bideford, to continue to say prayers before the statutory business of the meeting began.

He said it was a great pity that "a tiny minority are seeking to ban the majority" of people who were for the saying of prayers.

Speaking on the BBC, he said: "I've got no doubt the agenda of the National Secular Society is inch by inch to drive religion out of the public sphere.

"If they get their way it will have enormous implications for prayers in parliament, Remembrance Day, the jubilee celebrations, even the singing of the national anthem."

"The wider issue has got to be resisted. It strikes right at the heart of our understanding of ourself as a society. No one is compelled to participate in these activities. There is complete freedom. That freedom has to be respected."

The Bideford town clerk Heather Blackburn also expressed "surprise and disappointment" with the ruling.

But she noted that the court "has confirmed that prayers may be said in the council chamber immediately preceding formal business".

Blackburn said: "We are very pleased that the court has decided in favour of Bideford that we had not discriminated against Mr Bone nor infringed his human rights and that the practices adopted by the council did not infringe equality legislation.

"We will be speaking to our legal team to consider our options, including whether to appeal."

Emails released under Freedom of Information Act show Sir Gus O'Donnell was 'content' with Ed Lester's arrangement

A controversial deal that allowed the chief executive of the Student Loans Company (SLC) to be paid without tax being deducted at source was approved by Britain's most senior civil servant, according to emails released under the Freedom of Information Act.

Correspondence between Whitehall officials show that Sir Gus O'Donnell, the then cabinet secretary, initially called for "urgent clarification" on the deal for Ed Lester. The following day, it was reported in another email that O'Donnell was content with the arrangement.

The disclosures, in documents obtained by the investigative website Exaro, will raise concerns that other senior public servants have also had favourable tax deals waved through. One email dating back to 20 December 2010 shows that Chris Andrew, the company secretary of the SLC, wrote that "Gus O'Donnell has asked for urgent clarification prior to this being put to the CST [Danny Alexander, the chief secretary to the Treasury].

"Gus has asked us to set out why we are not proposing to put Ed Lester on the SLC payroll," it continued.

In an email written the next day, it appeared that O'Donnell's questions had been answered. Andrew wrote: "I have spoken with the Cabinet Office this morning who have confirmed that Gus O'Donnell is now content and that this is being sent to the CST this morning."

The arrangement with Lester, entered into in 2010, was first revealed in an HM Revenue and Customs (HMRC) letter obtained under the Freedom of Information Act.

It showed how the chief executive of SLC was able to save about £26,000 a year in tax by working as a consultant rather than an employee.

O'Donnell, who became a member of the House of Lords last month, was cabinet secretary and head of the UK's civil service until he retired in December.

The emails reporting his concerns were raised just days before ministers approved the contract. Whitehall documents show that Alexander and David Willetts, the universities minister, agreed Lester's contract.

They also suggest that Alexander was informed of the plan to keep Lester off the payroll. He has insisted he was unaware of the tax consequences of the deal.

Alexander has ordered an urgent Whitehall-wide review of the issue. He announced to parliament that the SLC would deduct tax and national insurance from Lester's pay at source in future, after being challenged by MPs in an emergency debate.

The debate was triggered when John Bercow, the speaker of the House of Commons, gave permission for an urgent question on the issue from Nick Brown, the Labour MP and former government chief whip.

The Cabinet Office declined last week to answer questions about O'Donnell's role in approving Lester's contract. A spokesman said: "We shall be working with the Treasury following the chief secretary's announcement of a review into the issue, and as such shall not be getting into the 'ins and outs' of this until that has concluded."

The SLC said Lester's tax arrangements were a matter for him and HMRC, adding that he had declined to comment.

O'Donnell did not return a telephone call from the Guardian.

? Association of British Insurers attacks bonus levels
? Annual bonuses for top executives down 48% on 2010
? Profits fall 3% to £5.9bn
? Bob Diamond's bonus could be £900,000
? Return on equity down to 6.6% for 2011
? BarCap revenue and profits down

Barclays was on a collision course with its shareholders despite the bank's insistence that it had cut the bonus pool for its investment bankers at Barclays Capital.

Robert Talbut, chairman of the investment committee at the Association of British Insurers (ABI), said on Friday: "Whilst overall bonus levels at Barclays have been reduced, for Barclays Capital, this reduction is only in line with the fall in profit before tax.

"This appears to be very close to business as usual. It is not the signal of the change required in order to improve the investment case."

The ABI, whose members control a fifth of the UK's stock market, had been urging Barclays to show restraint ahead of this bonus season and had written to all banks to make this point.

Barclays announced on Friday that it was capping cash bonuses at £65,000 as it reported a 3% fall in profits to £5.9bn.

Bob Diamond, the chief executive, admitted the returns to shareholders were "unacceptable" and targets set only last year may be missed.

Providing more detail about bonuses than usual, the bank said that the value of bonus per group employee was down 21% year on year to £15,200, while the average value of bonus per employee at Barclays Capital, its investment banking arm, was down 30% to £64,000 ? just below the value of the cap. Last year the average bonus was £91,000.

The bank said annual bonuses for executives and its eight highest-paid employees were down 48%. Diamond received a bonus in shares of £1.8m in 2010 so, if he is in line with the average, this indicates that his bonus would be about £900,000.

Diamond again stressed the bank's commitment to "citizenship" and repeatedly refused to disclose whether he had been offered a bonus, what the size of the bonus might be and whether he intended to take any payout.

Unions were also unimpressed with Barclays' bonus announcements. The TUC general secretary, Brendan Barber ? who is calling for taxes on bonuses ? said that the payouts show that "City bonuses have nothing to do with rewards for success".

"Barclays were kept afloat by a taxpayer guarantee and multibillion cash injection from the Bank of England. Today's anti-austerity pay largesse adds insult to subsidy," Barber added.

While the bank stressed that in 2011 bonuses were down 26% across the group and down 35% at BarCap compared with 2010, the proportion of revenue used to pay BarCap's 24,000 employees actually rose to 47% from 43% a year ago. Revenue inside the BarCap operation ? which Diamond used to run until being elevated to chief executive a year ago ? was down 22% and profits in that operation down 32%.

"Very weak Barcap revenues do most of the damage today," said Ian Gordon, banks analyst at Investec. But shares were up strongly by Friday lunchtime, rising more than 3% to 240p.

The bonus pool in BarCap was down 32% to £1.5bn ? but the World Development Movement reckoned this would pay for school meals for two years for the "23 million primary-age children who attend school hungry across Africa". About 20% of the profits generated by the bank ? £1.3bn ? were generated in Africa. Christine Haigh, campaigner at the World Development Movement, said: "Big bonuses encourage bankers to take big risks, not only with financial stability through their debt-based investment, but also with people's lives."

As a percentage of BarCap's profits, the bonus pool was 35% versus 36% a year ago. The total bonus pool for the bank's 141,000 employees was down 25% to £2.1bn.

The bailed-out banks Royal Bank of Scotland and Lloyds Banking Group ? where both bosses are not taking their bonuses ? are subjected to a £2,000 cap on cash bonuses.

Diamond admitted that its return on equity was just 6.6% in 2011 ? down from 8.8% the year before and well below the target of 13% set a year ago.

Diamond said: "We are not satisfied with the return on equity we delivered in 2011 and are committed to delivering steady improvement moving forwards." He refused to drop the target, however, instead refusing to say when it might be met. "13% remains absolutely the right target and its very achievable, but we may not achieve it in 2013 given the impact of the external environment," he said.

He was also unable to say whether net lending to small businesses was up or down on the year, but stressed that the overall lending to businesses under the Project Merlin deal with the government was up 3%, compared with the wider market, which was down 5%.

"We really got on our horses to get businesses going," Diamond said. He expressed concern about the lack of confidence among businesses, which he said were holding high cash balances that they were refusing to spend.

He said the mood towards the banking industry was "not a positive" but said, of the move to cut bonuses, that "we need to balance remaining competitive with being responsive to the public mood."

He is yet to set out how the bank intends to respond to the recommendations to erect a ringfence around its high street bank from BarCap. But, he said: "Barclays' universal banking model continues to be a competitive strength."

The bank is paying a 3p dividend in the fourth quarter to shareholders, who had been lobbying the bank to reduce pay, taking the total for the year to 6p.

Usdaw wants chains to follow Sainsbury's and Waterstones and end long-term unpaid labour for young unemployed

Unions have called on Britain's biggest high street chains to withdraw from government programmes that make the unemployed work for up to six months unpaid or face losing their benefits.

The call comes as Sainsbury's, one of the UK's largest retailers, confirmed to the Guardian that it has stopped branch managers from taking on jobseekers under the work experience scheme.

The move follows that of Waterstones book chain, which last week announced it had pulled out of the scheme because it did not want to "encourage work for no pay".

Under the work experience scheme, hundreds of thousands of largely young jobseekers will work in charities and private businesses for 30 hours a week, for eight weeks, without pay, and can have their benefits removed if they withdraw. The government has also introduced a plethora of other schemes, such as mandatory work activity, sector-based work academies, and the community action programme, which can force jobseekers to take unpaid work for up to six months as a condition of their benefits.

The schemes are in operation at more than a dozen well-known chains, such as Boots, Tesco, Asda, Primark, Argos, TK Maxx, Poundland and the Arcadia group of stores run by billionaire Sir Philip Green, which includes Top Shop and Burton.

Shopworkers union Usdaw, which represents more than 400,000 workers in high street retail outlets, said it was currently in discussion with a number of major companies about their involvement.

John Hannett, Usdaw general secretary, said: "Usdaw is not opposed to schemes that genuinely aim to give young people appropriate work experience or help long-term unemployed people get back into work, but schemes should be voluntary, participants should receive the rate for the job, and there needs to be transparent checks and balances in place.

"We are in discussions with the participating companies we have agreements with to re-examine their continuing involvement in the [?] various schemes."

Hannett added: "The unemployment crisis is never going to be solved by forcing people to work for nothing. What the country needs is a proper strategy for jobs and growth."

The TUC called for companies to pull out and warned that the government-mandated schemes were encouraging more unpaid work rather than creating actual jobs.

TUC general secretary Brendan Barber said: "While unemployed people may benefit from short periods of work experience, forcing them to work effectively for free for up to six months is not the way to solve the UK's jobs crisis.

"Not only are the high street names involved [?] in danger of exploiting participants, the scheme also poses a very real threat to the jobs and pay of existing workers. It is also far from clear whether the placements actually involve any genuine degree of training or work experience that will be of any use to the unemployed taking part.

"The danger is that [this] is simply encouraging employers to continue using unpaid labour when what they should be doing is recruiting unemployed people into properly paid jobs."

Solicitors from Public Interest Lawyers in Birmingham this week issued letters to the heads of 15 companies to make them aware of legal proceedings they have lodged in the high court challenging the legality of such schemes.

Their client, geology graduate Cait Reilly, is currently arguing in the high court that she was made to work unpaid in Poundland, contrary to the forced labour provisions in the Human Rights Act.

Phil Shiner from Public Interest Lawyers said he welcomed the withdrawal of major high street chains from "exploitative" programmes.

"Some major companies are now waking up and turning their backs on compulsory unpaid labour schemes. We have written to a number of major retailers involved in work-for-your-benefit schemes and asked them whether they intend to continue in light of what the Guardian has reported and we have brought to the attention of the courts.

"Whilst our legal actions are against the Department of Work and Pensions, these household brands bear their own moral and social responsibility to ensure that they have nothing to do with these exploitative and ill-judged programmes."

Sainsbury's, which has more than 1,000 stores in the UK, says it only now participates in the work trial programme, in which people work a maximum of 16 hours a week for four weeks in an actual job vacancy, and can pull out at any point without sanction.

Sainsbury's stressed that the work trials were "entirely voluntary" and, unlike work experience schemes, "candidates did not lose their benefits if they didn't participate".

The supermarket added that it had taken on 4,300 employees through the scheme.

Defending its continued participation in schemes that have elements of compulsion, Tesco said: "We take our responsibility as Britain's biggest private sector employer seriously and are playing our part to help tackle unemployment in these challenging times."

Tesco said that over the last four months around 1,400 people had worked for free for a month as part of work experience in its stores, and since the scheme began 300 jobseekers had gained a job with the company.

President's retreat designed to appease religious groups upset by rule that would require them to cover birth control for women

In response to a wave of opposition from the the conservative right and the Catholic church, President Barack Obama announced a compromise in the dispute over whether to require full contraception insurance coverage for female employees at religiously affiliated institutions.

The issue has grown into a dangerous one for Obama, threatening to alienate Catholics in an election year and providing an opening for conservatives who are accusing him of an offensive against religious freedom.

The Catholic church argues it is morally wrong to ask it to provide female employees with health insurance that includes payment for contraception.

In his remarks at the White House on Friday, the president criticised a "cynical desire on the part of some to make this into a political football".

"No woman's health should depend on who she is or where she works or how much money she makes," Obama said. But "the principle of religious liberty" is also at stake. "As a citizen and as a Christian, I cherish this right."

The White House proposed a compromise that will allow religious organisations to opt out of providing coverage that would include birth control for women. But insurers will be required to offer complete coverage free of charge to any women who work at such institutions.

In a continuation of the current law, female employees at churches themselves will have no guarantee of any contraception coverage.

Conservatives and religious organisations warned earlier in the day that the compromise did not go far enough.

The White House compromise also risks alienating Democratic women who regard payment for contraception as an important right.

In an election expected to be dominated by the economy, the move has brought social issues back to the forefront.

Republican presidential candidates are accusing Barack Obama of launching a war on religion, a line of attack that is resonating round the country.

At the biggest conservative conference of the year, the Conservative Political Action Conference, meeting in Washington and attracting about 10,000 activists, speaker after speaker has denounced the Obama adminstration over the issue.

Rick Santorum, one of four presidential candidates who won three victories this week in Colorado, Minnesota and Missouri, raised the issue in his his speech on Friday.

"Obama is now telling the Catholic church they are going to have to pay for things that are against their basic tenets," Santorum, a Catholic, told C-Pac.

Mike Huckabee, a presidential candidate in 2008 and a man still popular with the conservative grassroots, told the conference on Friday morning that while the economy should rightly be an election issue, so too should the sanctity of life. Huckabee, a Baptist pastor, spoke words he said he never thought he would hear himself speak: "We are all Catholics now."

He saracastically thanked Obama for uniting conservatives.

Bishop William Lori, head of a committee on religious freedom, wrote on the US Conference of Catholic Bishops blog: "The church must have the freedom to refuse to cooperate in any way in making these 'services' available. If we provide the means for another to act against the moral law, we ourselves become morally culpable as well."

Mohamed Nasheed, ousted in suspected military-backed coup, calls for elections as diplomats arrive to try to broker deal

Thousands of people have taken to the streets in the capital of the Maldives in a major show of support for the former president Mohammed Nasheed, who was ousted in what appears to have been a military-backed coup earlier this week.

On Thursday Nasheed was confined to his family home in Malé, facing detention after a court issued an arrest warrant against him. However, the political fortunes of the democracy activist and environmental campaigner appeared to be improving when thousands ignored a heavy presence of security forces to cheer him as he attended Friday prayers at the main mosque.

Though the police played a key role in forcing the 44-year-old out and in subsequent violence directed at his supporters, they did not intervene on Friday.

Nasheed called on his successor, the former vice-president Mohamed Waheed Hussain Manik, to resign and told reporters: "I am not asking to be reinstated. I am asking for fresh elections within the next two months. Dr Waheed has to resign.

"There has to be judicial reform and reform of the criminal justice system in this country. Status quo cannot be maintained. [The] international community needs to do more, they have to see the situation in Maldives, the real picture."

Nasheed, who won the Maldives' first democratic elections in 2008 with 54% of the vote, says he was forced to resign by a group of soldiers who threatened violence. The new government denies coercion. Presidential polls are due in 2013.

Almost all the Maldives' 350,000 inhabitants are Sunni Muslim and crowds began gathering at the 17th-century Hukuru Miskiiy mosque when the word spread that Nasheed would be present. Many chanted "Long live Nasheed, he is our president".

Hundreds then followed the ousted leader, surrounded by members of his Maldivian Democratic party (MDP), when he walked back to his family home nearby. "He is our president. We refuse to accept a military dictatorship," said 25-year-old Ismail as he marched. A second man said that supporters would not be cowed: "[Nasheed] will remain our president."

Malé appeared calm on Friday, if tense. Scores were injured in violence earlier this week, several seriously. International diplomats are arriving in the Maldives to broker a deal between the MDP and the new government ? which includes many individuals close to former president Mamoon Abdul Gayoom, whose 30-year rule was ended by the 2008 elections.

Nasheed loyalists accuse Gayoom or elements loyal to him of engineering the crisis which led to their leader's resignation last week. Oscar Fernandez-Taranco, the UN assistant secretary general for political affairs, met Manik at the start of a three-day visit to urge both sides to negotiate and avoid violence. Manik has denied that his predecessor was forced out of office and has described his own appointment as constitutional.

Diplomats from India, Britain, the US and EU are in Malé, or are expected this weekend. A Commonwealth delegation also was meeting all the political parties.

"We told the president that at this time, it is very important to ensure the police and military operate on an entirely constitutional level to cool the temperatures. The fragility of the democratic transition here was clearly demonstrated by recent events," Akbar Khan, the delegation head, told Reuters.

Delhi, which has changed its position repeatedly in recent days after strongly backing the new government earlier this week, is understood to have asked Manik to make sure his predecessor was not arrested.

Though the clashes earlier in the week were concentrated on Malé itself, violence occurred on Addu, the southern-most island in the archipelago. Nasheed told reporters on Friday: "Police and military are ransacking ... dragging people out from their homes. If [they are] MDP, they are spraying them with pepper [spray], beating them and arresting them. We are losing a country as we speak."

Much of the economy of the Maldives, a former British protectorate, depends on the luxury tourist trade. This appeared unaffected on Friday with flights operating as usual. Most visitors to the island bypass the capital and are taken directly by aeroplane or speed boat to island resorts. Nasheed, who has won a series of international awards for his efforts to increase awareness on global warming, said that if no new elections were scheduled his supporters would take to the streets.

Ihjaz Ali, Kabir Ahmed and Razwan Javed were first to be convicted of stirring up hatred on grounds of sexual orientation

Three men have been jailed after becoming the first to be convicted of stirring up hatred on the grounds of sexual orientation for handing out a leaflet calling for gay people to be executed.

Ihjaz Ali, Kabir Ahmed and Razwan Javed gave out the pamphlet, entitled The Death Penalty?, which showed an image of a mannequin hanging from a noose and quoted Islamic texts that said capital punishment was the only way to rid society of homosexuality.

Ali was jailed for two years and Ahmed and Javed for 15 months each.

Following a trial at Derby crown court last month, they were convicted by a jury of distributing threatening written material intending to stir up hatred on the grounds of sexual orientation ? the first prosecution of its kind since legislation came into force in March 2010.

Two other men, Mehboob Hussain and Umar Javed, who were also charged with the same offence, were found not guilty.

Terminally ill man convicted of killing two soldiers outside army base in Northern Ireland likely to die in prison

A republican convicted of killing two soldiers in Northern Ireland hours before their deployment to Afghanistan in 2009 has been told he must serve a minimum of 25 years in prison for the double murder.

The length of the sentence means Brian Shivers, who is terminally ill, is likely to die in jail.

The 46-year-old from Magherafelt, Londonderry, was convicted last month of killing sappers Mark Quinsey, 23, and Patrick Azimkar, 21, outside Massereene barracks in Antrim town. The pair were shot dead as they collected pizzas on the eve of their leaving Northern Ireland for a tour of Afghanistan. The Real IRA claimed responsibility for the murders.

During the trial, Shivers's lawyer said his client suffered from cystic fibrosis and had only a few years left to live.

At Belfast crown court on Friday, Mr Justice Anthony Hart told Shivers he would have to spend at least 25 years in prison before he could be considered for release.

Quinsey, from Birmingham, and Azimkar, from London, were both serving with 38 Engineer Regiment. Two pizza delivery men were also badly wounded in the shooting outside the army base.

After receiving his sentence Shivers gave a thumbs up sign to his supporters in the public gallery. Shivers's DNA was found on two matches in the back of a burnt-out getaway car. The judge said there was an extremely strong inference that the defendant was connected to the vehicle.

His co-accused, Colin Duffy, a 44-year-old republican veteran from Lurgan was earlier acquitted of murdering the two soldiers.

Judge rules that conduct of multimillionare financier on Siberian trip exposed Peter Mandelson to conflict of interest claims

It was a week-long libel case which offered an intimate, if brief, glimpse into the lives of the politically powerful and super-rich: impulse trips to Russia in a pair of private jets, birch-leaf beatings in a communal sauna, and an impromptu game of ice hockey, with staff members roped in to make up the numbers.

It was resolved by multimillionare financier Nat Rothschild failing to win damages over the Daily Mail's claims he was a "puppet master". The paper said Rothschild took Lord Mandelson on a trip to Moscow and Siberia to impress a key business contact, exposing Mandelson, the then-EU trade commissioner, to allegations of a conflict of interest.

Sitting at the high court in London, Mr Justice Tugendhat agreed on Friday that some elements were incorrect in the Mail article from May 2010, which recounted how Mandelson had flown in Rothschild's private jet from Switzerland to Moscow, and then on to Siberia as a guest of Oleg Deripaska, the billionaire Russian industrialist.

Notably, the paper withdrew the claim that Rothschild facilitated Mandelson's attendance at a dinner at a Moscow restaurant which sealed a £500m deal involving aluminium plants owned by Deripaska. Mandelson had responsibility at the time for EU metals tariffs. In fact Mandelson did not attend the dinner and the deal had already been sealed.

However, this was where the good news ended for Rothschild, 40, whose closeness to both Mandelson and Deripaska first underwent public scrutiny in 2008 when the trio were together on a yacht off Corfu alongside the then-shadow chancellor, George Osborne. That gathering caused a bitter spat over whether or not Osborne tried to solicit Conservative party funds from Russia's richest man.

Rothschild insisted that Mandelson undertook the entire Russian trip in January 2005 purely for leisure, including a one-night stopover at Abakan in Siberia, where temperatures were somewhere around -30C and the itinerary included a "fascinating" tour of one of Deripaska's aluminium smelting plants. "As far as I was concerned this was a trip made with a group of friends, not an official business trip," Rothschild said in evidence.

But the judge said Rothschild should have known that Mandelson travelling from Moscow to Siberia on Deripaska's private jet and staying at the tycoon's chalet would give "at the very least reasonable grounds" for confusion.

The Daily Mail argued that Rothschild's conduct was "inappropriate in a number of respects", Tugendhat said in his ruling. "I accept that submission. In my judgment, that conduct foreseeably brought Lord Mandelson's public office and personal integrity into disrepute and exposed him to accusations of conflict of interest, and it gave rise to the reasonable grounds to suspect that Lord Mandelson had engaged in improper discussions with Mr Deripaska about aluminium." But there was no suggestion that Mandelson had such discussions.

Rothschild's "different and developing" accounts of the Siberia trip were confusing, Tugendhat said, adding that on this subject Rothschild had not been entirely candid.

Neither Mandelson nor Deripaska was involved in the libel case and Tugendhat said none of his ruling should be construed as a criticism of them.

Rothschild said he would appeal, arguing that claims about Mandelson attending a dinner which ultimately led to the loss of 300 British jobs was "utterly false". "The truth is, as the Daily Mail has now accepted, that I had nothing whatsoever to do with this deal and that it had in any event been completed before Lord Mandelson and I even arrived in Moscow.

"Lord Mandelson's trip to Russia was entirely recreational ? as the court has accepted ? and Lord Mandelson had obtained clearance for the trip from his office before undertaking it.

"I am disappointed with today's ruling, although I do not regret bringing the action."

The court heard how Mandelson joined Rothschild and others in flying to Moscow from the World Economic Forum gathering in Davos, Switzerland, on an apparent whim, to the extent that he did not even have a Russian visa. In Moscow, Mandelson dined in the same restaurant where the deal was discussed between Deripaska's Rusal corporation and Alcoa, the US aluminium giant, but was sitting separately with a Russian government minister.

That same evening the party flew on Deripaska's Gulfstream jet to Siberia. There, Rothschild said in evidence, they toured the smelting plant, played five-a-side football and had a floodlit game of ice hockey alongside "some of the locals who worked for Mr Deripaska". The group enjoyed "the most delightful banya", a traditional sauna, where a young man beat them with birch leaves, a treatment supposedly good for the circulation. Entertainments at Deripaska's chalet included Russian billiards and a Cossack band.

Rothschild said: "I think that Deripaska's desire to develop a relationship with Mandelson was because Mandelson was an interesting and highly intelligent and, you know, fantastic guy. That's the way I look at it."

This notion seemed "quite unrealistic", Tugendhat ruled.

Argentinian foreign minister to submit formal complaint about Britain's 'militarisation' of seas around disputed islands

Argentina's foreign minister is due to arrive at the United Nations to officially protest about Britain's "militarisation" of the seas around the disputed Falkland Islands.

Hector Timerman is expected to make a formal complaint to the presidents of the security council and general assembly at the UN's headquarters in New York on Friday.

It comes after the Argentinian president, Cristina Fernández de Kirchner, hit out at the UK's decision to send the Duke of Cambridge and one of its most modern navy warships to the South Atlantic.

In a speech on Wednesday to an audience including Falklands war veterans, Fernández said the move posed a risk to international security, before announcing an official complaint would be made.

Addressing politicians on Thursday, Fernández said: "In a few hours our chancellor leaves for New York to make a presentation to the United Nations about the militarisation and the introduction of nuclear arms in the zone."

A statement from Argentina's foreign ministry added: "In accordance with the instructions received from the president of the Argentinian Republic, Cristina Fernández de Kirchner, the chancellor (foreign minister) Hector Timerman will meet with Ambassador Kodjo Menan, president of the United Nations security council, to present the Argentinian complaint against the militarisation that the United Kingdom is carrying out from the Falkland Islands in the South Atlantic.

"Furthermore the chancellor will personally inform the president of the general assembly of the United Nations, Ambassador Nassir Abdulaziz al-Nasser, and the body's secretary general, Ban Ki-moon, of the violation by the United Kingdom of around 40 United Nations resolutions which call for dialogue between the said country and Argentina to peacefully resolve the conflict initiated in 1833 with the military invasion of the Falkland Islands."

Timerman will also meet with the president of the UN decolonisation committee, the ministry said.

The Argentinian complaint comes amid growing tensions between London and Buenos Aires in the runup to the 30th anniversary of the Falklands war, in which Argentinian forces invaded the archipelago in a row over its sovereignty.

In December, the British prime minister, David Cameron, accused Buenos Aires of "colonialism" after the Mercosur grouping of countries, which includes Argentina, Uruguay, Brazil and Paraguay, announced it would ban ships sailing under the Falkland Islands flag from docking at their ports.

Last week, Prince William began a six-week posting in the Falklands region in his role as an RAF search-and-rescue pilot, while the government has also revealed it is to send one of its newest destroyers, HMS Dauntless, to the South Atlantic.

The Type 45 destroyer is due to set sail for the region on her maiden mission in the coming months to replace the frigate HMS Montrose.

Fernández said it was difficult to see how "the sending of an immense and modern destroyer accompanied by the royal heir who we would have liked to see in civilian clothes and not in military uniform" was not a show of military strength by the UK.

It has also been reported the Royal Navy is sending a nuclear submarine to the region to protect the islands from possible Argentinian military action. This has not been confirmed by the Ministry of Defence.

Britain has held the Falkland Islands, known as Las Malvinas in Argentina, since 1833.

Controversial plans to build a US-style mega farm pose serious health risks to those living and working nearby, campaigners say

Controversial plans to build a US-style mega pig-farm in South Derbyshire close to a prison and residential housing pose serious health risks to those living and working there and could breach their legal rights to protection of their private and family life, the local council is being warned.

In the light of fresh legal advice, the organic farmers' group, the Soil Association and Friends of the Earth have joined forces with local group Foston Community Forum and Pig Business, film-makers and campaigners, to urge Derbyshire county council to refuse planning permission for the proposed development at Foston.

Their challenge ? the first against the scheme under the Human Rights Act ? is set out in a joint letter to the county council, stating that "planning authorities ? have an obligation under the Human Rights Act 1998 to consider the effects of their decision on the human rights of affected third parties. The right to private and family life prevents not just physical incursions into the home or residence, but also interference from things such as noise, smell, emissions."

It goes on to say that the prison staff cannot avoid working close to the proposed development unless they resign from the jobs. The inmates of Foston Hall prison are not living in the area by choice, and clearly do not have the option of moving away if the development goes ahead. They will not be able to escape the risk to their health posed by the development, and the letter warns that allowing the pig factory to go ahead could also breach the inmates' right to be protected from inhumane treatment.

Midland Pig Producers (MPP) has applied for permission to build the farm ? which could house up to 25,000 animals ? on a greenfield site west of the historic village of Foston and adjoining a women's closed prison which houses up to 290 prisoners. If approved, it would become the third largest factory farm in the UK, sending more than 1,000 pigs to slaughter every week.

The legal letter also cites new research which shows that intensive pig factories of this kind can adversely affect the health of nearby residents. This has been confirmed by the government's Health Protection Agency (HPA), which says that those living within 150 metres of intensive pig farms "could be exposed to mutli-drug resistant organisms". The proposed development will be built within 150m of HMP Foston Hall - as well as within 75m of the nearest properties being planned for workers at the development site.

In November last year the project was dealt a major blow when Derbyshire district council refused to back it. The final decision ? already delayed ? will be taken at county council level although no date has yet been set for a meeting.

After an application for a mega-dairy in Lincolnshire by Nocton Dairies, which was later shelved, Foston has become the focus of a fierce fight over opposing visions for British farming. The Soil Association's concerns have been mainly about disease, antibiotic resistance and animal welfare in large pig herds.

But at an early stage the Foston battle took an unprecented twist involving libel law, when the Soil Assocation received a threatening letter from solicitors Carter-Ruck - acting for MPP ? saying its objection was defamatory and should be withdrawn.

Peter Melchett, policy director of the Soil Association, said: "The objections to the pig factory at Foston are mounting all the time, because of the growing weight of new scientific evidence of real risks to the health of local people, and to the staff and inmates of the prison right next door to the proposed site. Now it seems that the legal rights of local people may also be infringed by the proposed development."

Victoria Martindale, representative of the Foston community forum, said: "As a medical professional I am concerned about the health risks that this proposal will bring to local residents. Those living in the closest vicinity to the proposed site include the most susceptible and at risk groups such as children, the elderly and individuals already with known respiratory and other diseases. It is not fair to expect the residents of Foston to go about their everyday lives while being forced to continuously breathe in air that will put their and their families' health at risk."

A Derbyshire county council spokesperson said: "We have had thousands of views during the consultation and have had to look at and consider them. Following this, we have sent out for additional information from some agencies and are awaiting that. When this comes in we shall have to consider this and ensure we have all the information we need before compiling the report for the committee to consider."

MPP was contacted by the Guardian but has not issued a response to the letter.