Fly half Charlie Hodgson admitted his wayward kicking played a big part in England's 18 17 defeat to France. Hodgson failed to convert three penalties and also missed a relatively easy drop goal attempt which would have given England a late win. "I'm very disappointed with the result and with my myself," Hodgson said. "It is very hard to take but it's something I will have to get through and come back stronger. My training's been good but it just didn't happen." Hodgson revealed that Olly Barkley had taken three penalties because they were "out of my range" but the centre could not convert his opportunities either, particularly the drop goal late on. "It wasn't a good strike," he added. "I felt as soon as it hit my boot it had missed. It's very disappointing, but I must recover." Andy Robinson said he would "keep working on the kicking" with his squad. However, the England coach added that he would take some positives from the defeat. "We went out to play and played some very good rugby and what have France done?" he said. "They won the game from kicking penalties from our 10m line. "It's very frustrating. The lads showed a lot of ambition in the first half, they went out to sustain it in the second but couldn't build on it. "We took the ball into contact, and you know when you do that it is a lottery whether the referee is going to give the penalty to your side or the other side. "We have lost a game we should have won. There is a fine line between winning and losing, and for the second week we've been on the wrong side of that line and it hurts." England went in at half time with a 17 6 lead but they failed to score in the second half and Dimitri Yachvili slotted over four penalties as France overhauled the deficit. England skipper Jason Robinson admitted his side failed to cope with France's improved second half display. "We controlled the game in the first half but we knew that they would come out and try everything after half time," he said. "We made a lot of mistakes in the second half and they punished us. They took their chances when they came. "It's very disappointing. Last week we lost by two points, now one point."


Eurosceptic party UKIP have suspended a candidate for allegedly suggesting the criminally insane should be killed. John Houston, 54, was due to stand in the East Kilbride seat in Lanarkshire at the next election. But he was suspended after his reported views, including the return of the British Empire, were sent to two Scottish newspapers. UKIP spokesman Mark Croucher said those who selected Mr Houston knew nothing of his views. The episode comes at a difficult time for UKIP, soon after the high profile departure of MEP Robert Kilroy Silk. Mr Houston is alleged to have said that the organs of the criminally insane should be "made available to law abiding members of the community" and proposed the legalisation of drugs and the sex trade. The document reportedly said: "We're looking for the resurrection of the British Empire. "The problems for the human race environmental and others can only be dealt with on a global scale, and that calls for a radical alliance of the English speaking nations, which they are uniquely able to do." Mr Croucher said the main issue would be that Mr Houston's reported views had been presented as UKIP policy, which they were not. He said they might have been submissions to a committee working on the party's manifesto, but would not have been matched to Mr Houston when he was standing to become a candidate. He told BBC News: "He appears to have said these things. We have suspended him as a member and as a candidate. "By all accounts none of this was mentioned at his selection meeting. "It is simply a distraction from the task in hand, the EU constitution, not individual idiocies." Mr Houston was quoted in the Herald newspaper saying: "I feel UKIP have over reacted and overshot the runway." Peter Nielson, who is UKIP Scotland chairman, said he had suspended Mr Houston on Friday night. "He will remain suspended while the matter is being investigated and then we will decide if and what further action will be taken." He said that any evidence would be looked into and Mr Houston may be interviewed by the party. He added: "I can't comment too much at the moment, I have one version from him but I haven't seen the papers yet."


India, which attends the G7 meeting of seven leading industrialised nations on Friday, is unlikely to be cowed by its newcomer status. In London on Thursday ahead of the meeting, India's finance minister, lashed out at the restrictive trade policies of the G7 nations. He objected to subsidies on agriculture that make it hard for developing nations like India to compete. He also called for reform of the United Nations, the World Bank and the IMF. Palaniappan Chidambaram, India's finance minister, argued that these organisations need to take into account the changing world order, given India and China's integration into the global economy. He said the issue is not globalisation but "the terms of engagement in globalisation." Mr Chidambaram is attending the G7 meeting as part of the G20 group of nations, which account for two thirds of the world's population. At a conference on developing enterprise hosted by UK finance minister Gordon Brown on Friday, he said that he was in favour of floating exchange rates because they help countries cope with economic shocks. "A flexible exchange rate is one more channel for absorbing both positive and negative shocks," he told the conference. India, along with China, Brazil, South Africa and Russia, has been invited to take part in the G7 meeting taking place in London on Friday and Saturday. China is expected to face renewed pressure to abandon its fixed exchange rate, which G7 nations, in particular the US, have blamed for a surge in cheap Chinese exports. "Some countries have tried to use fixed exchange rates. I do not wish to make any judgements," Mr Chidambaram said. Separately, the IMF warned on Thursday that India's budget deficit was too large and would hamper the country's economic growth, which it forecast to be around 6.5% in the year to March 2005. In the year to March 2004, the Indian economy grew by 8.5%.


Latin America's economy grew by 5.5% in 2004, its best performance since 1980, while exports registered their best performance in two decades. The United Nations' Economic Commission for Latin America and the Caribbean said the region grew by 5.5% this year. The Inter American Development Bank (IADB) said regional exports reached 445.1bn ( 227bn;331bn euros) in 2004. Doubts about the strength of the US recovery and overheating of the Chinese economy do however pose risks for 2005. Both organisations also warned that high oil prices raise the risk of either inflation or recession. Nevertheless, the Economic Commission for Latin America and the Caribbean (ECLAC) still forecasts growth of 4% for 2005. Strong recovery in some countries, such as Venezuela and Uruguay, boosted the overall performance of the region. ECLAC also said that the six largest Latin American economies (Argentina, Brazil, Chile, Colombia, Mexico and Venezuela) grew by more than 3% for only the second time in 20 years. Chinese and US economic strength helped boost exports, as did strong demand for agricultural and mining products. In fact, Latin American exports to China grew 34%, to 14bn. Higher oil prices also helped boost exports, as Mexico and Venezuela are important oil exporters. Regional blocs as well as free trade agreements with the US contributed to the region's strong performance, the IADB said.


The head of the "failing" Child Support Agency widely reported to have resigned three months ago is still at the helm of the troubled organisation. Doug Smith's departure was announced by Work Secretary Alan Johnson on 17 November as MPs grilled him over the agency's poor performance. His "resignation" was referred to by both Tory and Lib Dem leaders during that day's prime ministers questions. Officials now say he did not resign but will move on under civil service rules. Mr Smith's departure was reported widely at the time as his shouldering the blame for the failings of the Child Support Agency. In January the MPs who make up the Commons Work and Pensions Committee published a highly critical report into the "failing" agency noting the chief executive "has now left" and hoping "the new leadership will bring a fresh approach to what is a failing organisation". On that day's Today programme Mr Johnson was asked why Mr Smith had been allowed to resign rather than be sacked. He replied: "The chief executive decided it was time to move on, there is a new chief executive coming in." It now emerges that the widespread belief Mr Smith, made Commander of the Order of the Bath in the New Year honours, had left, was wrong. A Department for Work and Pensions spokeswoman confirmed Mr Smith was still in post and that he would continue in the job until a replacement was found. "No date was ever given for Doug Smith's departure," she said adding that the post had been advertised. Tory work and pensions spokesman David Willetts said families affected by CSA failings would wonder why Mr Smith was still in his job three months after his departure was announced. The CSA has been surrounded by controversy since its introduction in 1993 to assess and enforce child support payments by absent parents. The work and pensions committee launched their inquiry into the CSA's performance after it became clear that, despite the introduction of a simpler system of calculating maintenance payments for new cases in 2003, a backlog of claims was still building up. It is currently chasing outstanding payments of more than 720m, while a further 947m has been designated as "unrecoverable". The MPs found American IT giant EDS' 456m system was "nowhere near being fully functional and the number of dissatisfied, disenchanted and angry customers continues to escalate". In November, when he surprised MPs and the watching media by announcing Mr Smith's departure, Mr Johnson said: "I should tell you that Doug has decided that now is the time to stand aside and to allow a new chief executive to tackle the challenges ahead. "Doug has exceeded the four years that senior civil servants are now expected to remain in a particular post. "So Doug believes that we have reached the natural breakpoint at which he can hand over the reins." Lib Dem Sir Archy Kirkwood, who chairs the Commons work and pensions committee, said that when Mr Johnson had announced Mr Smith was going he got the "clear impression" the CSA chief was retiring though it had since emerged that was not the case, and he may be seeking new employment opportunities. He added his committee was "duty bound" to allow the work and pensions secretary to get new management into place in the CSA and it would be "premature" to say anything further on the issue at the moment. But committee member and Tory MP Nigel Waterson said he was "amazed" Mr Smith was still in his job. "When Mr Smith and the secretary of state came to give evidence, we were led to believe he was going shortly," he said. "Even if he was working out three months notice, he should have been clearing his desk by now." Asked on Thursday about Mr Smith's position Mr Johnson told BBC Radio 4's World at One he thought it was a "non story". He added that he had been absolutely open when he announced Mr Smith's departure to the select committee and how people chose to interpret it was a "different thing". "The major issue is have we got a new chief executive coming into this very important agency as quickly as possible and have we gone through the right selection process to make sure we've got the right people," he added.


The world's biggest carmaker General Motors (GM) is recalling nearly 200,000 vehicles in the US on safety grounds, according to federal regulators. The National Highway Traffic Safety Administration (NHTSA) said the largest recall involves 155,465 pickups, vans and sports utility vehicles (SUVs). This is because of possible malfunctions with the braking systems. The affected vehicles in the product recall are from the 2004 and 2005 model years, GM said. Those vehicles with potential faults are the Chevrolet Avalanche, Express, Kodiak, Silverade and Suburban; the GMC Savana, Sierra and Yukon. The NHTSA said a pressure accumulator in the braking system could crack during normal driving and fragments could injure people if the hood was open. This could allow hydraulic fluid to leak, which could make it harder to brake or steer and could cause a crash, it warned. GM is also recalling 19,924 Cadillac XLR coupes, SRX SUVs and Pontiac Grand Prix sedans from the 2004 model year. This is because the accelerator pedal may not work properly in extremely cold temperatures, requiring more braking. In addition, the car giant is calling back 17,815 Buick Raniers, Chevrolet Trailblazers, GMC Envoys and Isuzu Ascenders from the 2005 model years because the windshield is not properly fitted and could fall out in a crash. However, GM stressed that it did not know of any injuries related to the problems. News of the recall follows an announcement last month that GM expects earnings this year be lower than in 2004. The world's biggest car maker is grappling with losses in its European business, weak US sales and now a product recall. In January, GM said higher healthcare costs in North America, and lower profits at its financial services subsidiary would hurt its performance in 2005.


Venezuelan president Hugo Chavez has offered China wide ranging access to the country's oil reserves. The offer, made as part of a trade deal between the two countries, will allow China to operate oil fields in Venezuela and invest in new refineries. Venezuela has also offered to supply 120,000 barrels of fuel oil a month to China. Venezuela the world's fifth largest oil exporter sells about 60% of its output to the United States. Mr Chavez's administration, which has a strained relationship with the US, is trying to diversify sales to reduce its dependence on its largest export market. China's quick growing economy's need for oil has contributed to record high oil prices this year, along with political unrest in the Middle East and supply bottlenecks. Oil prices are finishing the year roughly 30% higher than they were in January 2004. In 2004, according to forecasts from the Ministry of Commerce, China's oil imports will be 110m tons, up 21% on the previous year. China has been a net importer of oil since the mid 1990's with more than a third of the oil and gas it consumes coming from abroad. A lack of sufficient domestic production and the need to lessen its dependence on imports from the Middle East has meant that China is looking to invest in other potential markets such as Latin America. Mr Chavez, who is visiting China, said his country would put its many of its oil facilities at the disposal of China. Chinese firms would be allowed to operate 15 mature oil fields in the east of Venezuela, which could produce more than one billion barrels, he confirmed. The two countries will also continue a joint venture agreement to produce stocks of the boiler fuel orimulsion. Mr Chavez has also invited Chinese firms to bid for gas exploration contracts which his government will offer next year in the western Gulf of Venezuela. The two countries also signed a number of other agreements covering other industries including mining.


A Labour peer has withdrawn proposals to give female members of the Royal Family the same rights as males. The legislation would have ended the right of male heirs with older sisters to succeed to the Crown. It would also have torn up ancient legislation banning heirs to the throne marrying Roman Catholics. But the government refused to back Lord Dubs' Succession to the Crown Bill, saying it was too complex and raised too many constitutional issues. The Lord Chancellor, Lord Falconer, agreed the 1701 Act of Settlement, which governs the succession, was discriminatory but added that "for all practical purposes its effects are limited". The changes proposed by Lord Dubs were a "complex and controversial undertaking raising major constitutional issues", he said. Lord Falconer said there were 22 members of the Royal Family in the line of succession after the Prince of Wales all of who were eligible to succeed and had been unaffected by the act. "It is not a simple matter that can be tinkered with lightly. While we wish to remove all forms of discrimination... this isn't the proper form," he added. He did not rule out change in the future but said if Lord Dubs' private member's bill was passed by peers, he would urge MPs to oppose it in the Commons. Lord Dubs agreed to withdraw his bill after its second reading in the House of Lords, but urged the government to think again at a later stage. "We cannot forever say we don't want to change things because it is too difficult," he told peers. During the debate, the Labour peer and former minister said: "The monarchy should symbolise the values of this country. "What we don't want is a situation where the values of the country have moved on and the monarchy is centuries behind the times. "We are surely all opposed to discrimination on the grounds of gender and we are surely also opposed to discrimination against Catholics." But opponents of the bill, including Tory Lord Campbell of Alloway and the Bishop of Winchester, the Rt Rev Michael Scott Joynt, said it would separate the state from both the Church of England and the Christian faith. Such a "secular" state would be markedly "less tolerant", Rt Rev Scott Joynt argued.


Parmalat, the Italian dairy company which went bust after an accounting scandal, hopes to be back on the Italian stock exchange in July. The firm gained protection from creditors in 2003 after revealing debts of 14bn euros ( 18.34bn; 9.6bn). This was eight times higher than it had previously stated. In a statement issued on Wednesday night, Parmalat Finanziaria detailed administrators' latest plans for re listing the shares of the group. As part of the re listing on the Italian stock exchange, creditors' debts are expected to be converted into shares through two new share issues amounting to more than 2bn euros. The company's creditors will be asked to vote on the plan later this year. The plan is likely to give creditors of Parmalat Finanziaria shares worth about 5.7% of the debts they are owed. This is lower than the 11.3% creditors previously hoped to receive. Creditors of Parmalat, the main operating company, are likely to see the percentage of debt they receive fall from 7.3% to 6.9%. Several former top Parmalat executives are under investigation for the fraud scandal. Lawmakers said on Wednesday night Enrico Bondi, the turnaround specialist appointed by the Italian government as Parmalat's chief executive, spoke positively about the company during a closed door hearing of the Chamber of Deputies industry commission. "Bondi supplied us with elements of positive results on the industrial positions and on the history of debt which will find a point of solution through the Parmalat group's quotation on the market in July," Italian news agency Apcom quoted several lawmakers as saying in a statement.


Former England captain Lawrence Dallaglio still harbours hopes of a place on the British and Irish Lions tour to New Zealand. Lions coach Sir Clive Woodward has made it clear he will pick his squad to tour next summer based on form shown in the Six Nations championship. But Dallaglio, who called time on England earlier this year, said: "I assure you I wouldn't let anyone down. "I know what it takes and what I have to offer," he told the Daily Telegraph. Dallaglio toured South Africa with the Lions in 1997 but was forced home early with a knee injury from the trip to Australia three years ago. The 32 year old also felt concentrating on club rugby could have prolonged his international shelf life. He said: "I'll be in good shape and fresh without another 10 Tests on the clock. "From what I witnessed at close quarters on Sunday in our Heineken Cup match against Leicester, I certainly didn't feel out of place alongside those players, many of whom will be on the trip. "If I'm fit and playing well, then I'm most certainly available. "If Clive feels he has no need to look outside the international crop, then fine. If he does, then he won't need to look too far, will he?"


The Liberian economy started to grow in 2004, but "sustained and deep reform efforts" are needed to ensure long term growth, the International Monetary Fund (IMF) has said. An IMF mission made the comments in a report published following 10 days of talks with the transition government. The IMF said that, according to data provided by the Liberians, the country's GDP rose by 2% in 2004, after a 31% decline in 2003. Liberia is recovering from a 14 year civil war that came to an end in 2003. The power sharing National Transition Government of Liberia will remain in place until elections on 11 October, the first presidential and parliamentary ballots since the conflict ended. The IMF said Liberia's economy started to grow last year thanks to a "continued strong recovery in rubber production, domestic manufacturing and local services including post conflict reconstruction". The IMF however remains cautious about what it sees as a lack of transparency in government actions. In particular, it pointed to mystery surrounding the sale of iron ore stockpiles and the alleged disappearance of some import and export permits. These matters are now being investigated by the Liberian authorities and the IMF has called for their findings to be made public. The IMF also said it was crucial that the Central Bank of Liberia be strengthened, the national budget be effectively managed and a sound economic basis built to allow the country's large external debt to be addressed. "The IMF team stands ready to assist the (Liberian) authorities in strengthening the areas mentioned," said the report. "The team agreed with the (Liberian) authorities that the period until elections and the inauguration of a new government will pose exceptional challenges to fiscal management, and expresses its willingness to provide...continued support."


Governments, aid agencies, insurers and travel firms are among those counting the cost of the massive earthquake and waves that hammered southern Asia. The worst hit areas are Sri Lanka, India, Indonesia and Thailand, with at least 23,000 people killed. Early estimates from the World Bank put the amount of aid needed at about 5bn ( 2.6bn), similar to the cash offered Central America after Hurricane Mitch. Mitch killed about 10,000 people and caused damage of about 10bn in 1998. World Bank spokesman Damien Milverton told the Wall Street Journal that he expected an aid package of financing and debt relief. Tourism is a vital part of the economies of the stricken countries, providing jobs for 19 million people in the south east Asian region, according to the World Travel and Tourism Council (WTTC). In the Maldives islands, in the Indian ocean, two thirds of all jobs depend on tourism. But the damage covers fishing, farming and businesses too, with hundreds of thousands of buildings and small boats destroyed by the waves. International agencies have pledged their support; most say it is impossible to gauge the extent of the damage yet. The International Monetary Fund (IMF) has promised rapid action to help the governments of the stricken countries cope. "The IMF stands ready to do its part to assist these nations with appropriate support in their time of need," said managing director Rodrigo Rato. Only Sri Lanka and Bangladesh currently receive IMF support, while Indonesia, the quake's epicentre, has recently graduated from IMF assistance. It is up to governments to decide if they want IMF help. Other agencies, such as the Asian Development Bank, have said that it is too early to comment on the amount of aid needed. There is no underestimating the size of the problem, however. The United Nations' emergency relief coordinator, Jan Egeland, said that "this may be the worst national disaster in recent history because it is affecting so many heavily populated coastal areas... so many vulnerable communities. "Many people will have had their livelihoods, their whole future destroyed in a few seconds." He warned that "the longer term effects many be as devastating as the tidal wave or the tsunami itself" because of the risks of epidemics from polluted drinking water. Insurers are also struggling to assess the cost of the damage, but several big players believe the final bill is likely to be less than the 27bn cost of the hurricanes that battered the US earlier this year. "The region that's affected is very big so we have to check country by country what the situation is", said Serge Troeber, deputy head of the natural disasters department at Swiss Re, the world's second biggest reinsurance firm. "I should assume, however, that the overall dimension of insured damages is below the storm damages of the US," he said. Munich Re, the world's biggest reinsurer, said: "This is primarily a human tragedy. It is too early for us to state what our financial burden will be." Allianz has said it sees no significant impact on its profitability. However, a low insurance bill may simply reflect the general poverty of much of the region, rather than the level of economic devastation for those who live there. The International Federation of the Red Cross and Red Crescent Societies told the Reuters news agency that it was seeking 6.5m for emergency aid. "The biggest health challenges we face is the spread of waterborne diseases, particularly malaria and diarrhoea," the aid agency was quoted as saying. The European Union has said it will deliver 3m euros ( 2.1m; 4.1m) of aid, according to the Wall Street Journal. The EU's Humanitarian Aid Commissioner, Louis Michel, was quoted as saying that it was key to bring aid "in those vital hours and days immediately after the disaster". Other countries also are reported to have pledged cash, while the US State Department said it was examining what aid was needed in the region. Getting companies and business up and running also may play a vital role in helping communities recover from the weekend's events. Many of the worst hit areas, such as Sri Lanka, Thailand's Phuket island and the Maldives, are popular tourist resorts that are key to local economies. December and January are two of the busiest months for the travel in southern Asia and the damage will be even more keenly felt as the industry was only just beginning to emerge from a post 9/11 slump. Growth has been rapid in southeast Asia, with the World Tourism Organisation figures showing a 45% increase in tourist revenues in the region during the first 10 months of 2004. In southern Asia that expansion is 23%. "India continues to post excellent results thanks to increased promotion and product development, but also to the upsurge in business travel driven by the rapid economic development of the country," the WTO said. "Arrivals to other destinations such as... Maldives and Sri Lanka also thrived." In Thailand, tourism accounts for about 6% of the country's annual gross domestic product, or about 8bn. In Singapore the figure is close to 5%. Tourism also brings in much needed foreign currency. In the short term, however, travel companies are cancelling flights and trips. That has hit shares across Asia and Europe, with investors saying that earnings and economic growth are likely to slow.


BMW has forecast sales growth of at least 10% in Asia this year after registering record sales there in 2004. The luxury carmaker saw strong sales of its three marques BMW, Mini and Rolls Royce in Asia last year after the launch of three new models. The company, which is vying with Mercedes Benz for the title of leading premium carmaker, is confident about its prospects for the region in 2005. It is launching a revamped version of its 3 Series saloon class next month. BMW sold nearly 95,000 cars in Asia last year, up 2.6% on 2003. BMW brand sales rose 2.3% to 80,600 while sales of Mini models rose 3.6% to 14,800. There was also a significant increase in sales of Rolls Royces on the continent. BMW sold more than 100 of the iconic models compared with just ten the previous year. The German carmaker is aiming to boost annual sales in Asia to 150,000 by 2008. "Here in Asia, we consider a double digit increase in retail on the order of 10 to 15% to be realistic on the basis of current features," said Helmut Panke, BMW's group chief executive. China remains the main area of concern for BMW after sales there fell 16% last year. However, BMW is hopeful of a much better year in 2005 as its direct investment in China begins to pay dividends. The company only began assembling luxury high powered sedans in China in 2003. 2004 was generally a good year for BMW, which saw revenues from its core car making operations rise 11%.


The value of the UK's housing stock reached the 3.3 trillion mark in 2004 triple the value 10 years earlier, a report indicates. Research from Halifax, the country's biggest mortgage lender, suggests the value of private housing stock is continuing to rise steadily. All regions saw at least a doubling in their assets during the past decade. But Northern Ireland led the way with a 262% rise, while Scotland saw the smallest increase of just 112%. The core retail price index rose by just 28% in the same period, underlining how effective an investment in housing has been for most people during the past decade. More than a third of the UK's private housing assets representing more than a trillion pounds in value are concentrated in London and the South East, the Halifax's figures indicate. Tim Crawford, Group Economist at Halifax, said: "The value of the private housing stock continues to grow and the family home remains, by a large margin, the most valuable asset of the majority of households in the UK." Halifax's own monthly figures on house sales issued on Thursday suggest the average price of a British property now stands at 163,748 after a 0.8% rise in January. Housing experts are split on prospects for the market, with some saying price growth will slow but not fall, while others predict a sharp drop in values.


UK businesses are set to prosper during the next few months but this could trigger more interest rate rises, according to a report. Optimism is at its highest since 1997 and business will reap the benefits of a continuing rise in public spending, say researchers at BDO Stoy Hayward. The Bank of England is expected to keep rates on hold this week but they could go up later in the year. Rates are likely to rise after the anticipated general election in May. The BDO optimism index a leading indicator of GDP growth two quarters ahead edged up in January to 102.5, from 102.2 in October. The rise is due, in part, to an increase in public spending and increased merger and acquisition activity. The only thing blighting business optimism this year will be uncertainties associated with the general election, BDO said. Its BDO's output index which predicts GDP movements a quarter in advance remained at 100.8 for January, implying GDP growth at 2.9% in the second quarter of 2005. However, the output index is being held back by recent interest rate rises, sterling's strength against the dollar and high oil prices, the group noted. Its inflation index, which has risen continuously over the last 8 months, climbed to 110.0 in January from 108.0 in October last year. "The UK is looking strong going into the general election, but businesses need to prepare themselves for a jolt ahead as the Bank of England reacts to growth and inflationary pressures," said Peter Hemington, partner at BDO Stoy Hayward. "Growth will probably slow by the end of 2005 and it is likely that we will see higher interest rates or a sharp drop in demand for products and services."


US interest rates are to rise for the fourth time in five months, in a widely anticipated move. The Federal Reserve has raised its key federal funds rate by a quarter percentage point to 2% in light of mounting evidence that the US economy is regaining steam. US companies created twice as many jobs as expected in October while exports hit record levels in September. Analysts said a clear cut victory for President Bush in last week's election paved the way for a rise. Another rise could be in store for December, some economists warned. The Fed's Open Market Committee which sets interest rate policy in the US voted unanimously in favour of a quarter point rise. The Fed has been gradually easing rates up since the summer, with quarter percentage point rises in June, August and September. The Central Bank has been acting to restrain inflationary pressures while being careful not to obstruct economic growth. The Fed did not rule out raising rates once again in December but noted that any future increases would take place at a "measured" pace. In a statement, the Fed said that long term inflation pressures remained "well contained" while the US economy appeared to be "growing at a moderate pace despite the rise in energy prices". Financial analysts broadly welcomed the Fed's move and shares traded largely flat. The Dow Jones Industrial average closed down 0.89 points, or 0.01%, at 10,385.48. Recent evidence has pointed to an upturn in the US economy. US firms created 337,000 jobs last month, twice the amount expected, while exports reached record levels in September. The economy grew 3.7% in the third quarter, slower than forecast, but an improvement on the 3.3% growth seen in the second quarter. Analysts claimed the Fed's assessment of future economic growth was a positive one but stressed that the jury was still out on the prospect of a further rise in December. "Let's wait until we see how growth and employment bear up under the fourth quarter's energy price drag before concluding that the Fed has more work to do in 2005," said Avery Shenfeld, senior economist at CIBC World Markets. "I think the Federal Reserve does not want to rock the boat and is using a gradual approach in raising the interest rate," said Sung Won Sohn, chief US economist for Wells Fargo Bank. "The economy is doing a bit better right now but there are still some concerns about geopolitics, employment and the price of oil," he added. The further rise in US rates is unlikely to have a direct bearing on UK monetary policy. The Bank of England (BoE) has kept interest rates on hold at 4.75% for the past three months, leading some commentators to argue that rates may have peaked. In a report published on Wednesday, the Bank said that with rates at their current level, inflation would rise to its 2% target within two years. However, BoE governor Mervyn King warned only last month that the era of consistently low inflation and low unemployment may be coming to an end.


The BBC's online search engine was used a record amount in 2004, helping with enquires both simple and strange. More than 277 million enquiries were made, asking for informaton of a wide range of subjects. The most requested search terms of 2004 included games, EastEnders, CBBC, John Peel, Harry Potter and Olympics. But there were many strange enquiries, including: what is a dog?, how do you say basketball? and what is the biggest collection of naval fluff? The search engine works by matching key words typed in to different web pages but many people still type in natural language questions. Here are some of the strangest queries of 2004 spelling and grammar errors left untouched and their possible solutions: How to fold a serviette like an elf's boot? How do I structure a French letter? What is better one long vacation each year or several short vacations throughout the year? What is so special about the Swiss? What are the contemporary issue in nurses? What is the number 4 in this number 40052308090? What is up? What is the name of James Martin's dog? Search engines are key to the way people use the internet. Companies such as Google have become of paramount importance as they dictate how people travel through websites while online.


Long jumper Chris Tomlinson has cut his schedule to ensure he is fully fit for the European Indoor Championships. The 23 year old has a minor injury and has pulled out of international meets in Madrid and Lievin this week as well as warm weather training in Lanzarote. "It's nothing serious," said his coach Peter Stanley. "He strained a muscle in his abdomen at the Birmingham meeting but is back in full training." Sprinter Mark Lewis Francis will also not compete in Madrid on Thursday. The Birmingham athlete, who clocked a season's best of 6.61 seconds over 60m in Birmingham last week, also prefers to focus his attentions on next month's European Indoor Championships. Lewis Francis, who was runner up to British team mate Jason Gardener at the Europeans three years ago, will continue his training at home. Meanwhile, Tomlinson is still searching for this first major medal and this season he has shown he could be in the sort of form to grab a spot on the podium in Madrid. The Middlesbrough athlete jumped a season's best of 7.95m at the Birmingham Grand Prix good enough to push world indoor champion Savante Stringfellow into second.


The Tories failed to hold onto power in 1974 after Liberals demanded Sir Edward Heath quit in return for co operation. Documents released after 30 years reveal the failed negotiations by the then prime minister following the dramatic February general election. Liberal leader Jeremy Thorpe appeared willing to form a coalition government. But it partly collapsed over the Conservative leader's own role, prompting the Queen to ask Harold Wilson to form a Labour government. The February 1974 general election surprised the nation when it created a hung parliament with no party in overall control. Sir Edward had gone to the country for a fresh mandate amid the spiralling economic crisis, a miners' strike and the subsequent three day week. Labour emerged with the most seats but its 301 MPs were 17 short of the number Mr Wilson needed to form a majority. Sir Edward, who had received more votes but had fewer MPs, believed he had the authority to remain at Number 10 providing the 14 Liberal MPs would support his government. He said the Liberals could keep out Labour in three ways: lend ad hoc support to his minority government, help draw up the government's programme, or have up to three Cabinet members in a coalition with the Conservatives. According to the documents released at the National Archives, the "friendly and easy" first meeting indicated that both Sir Edward and Mr Thorpe thought they had the makings of a deal. Mr Thorpe was in high spirits, having just led his party to a historic jump in support. He also argued for a grand coalition of all three main parties. But Sir Edward said that was impossible because the Labour left was set against it and the pair settled on trying for a Conservative Liberal pact. Hours later Sir Edward's hopes of a deal unravelled as Mr Thorpe's colleagues refused to support him. "Jeremy said he was encountering a rather embarrassing problem with his colleagues about the prime minister personally," reads a telephone memo for Mr Heath. "They feel they could not agree to serve as long as he is the prime minister. "Asked if this was his own view he said no it was not, I am very close to Ted and thought he was by far the most able man we had and he would be perfectly happy to serve it was only some of his colleagues who were being difficult." The following day, the stickling points had clearly become two fold: Mr Thorpe's colleagues wanted electoral reform and Sir Edward's resignation. Mr Thorpe told Sir Edward: "I am sorry this is obviously hell a nightmare on stilts for you. "Somehow I personally hope that we can work something out." Four hours later, Sir Edward called the Liberal leader back to Downing Street in a last attempt at a deal. The minutes of the meeting show how the chance of a coalition government quickly evaporated. "The PM said he was bound to tell Mr Thorpe that his colleagues had told him that they would not agree to serve under any other prime minister. Mr Thorpe was at liberty to verify this by talking to one or two of the prime minister's colleagues." Documents show that Sir Edward mulled over resigning and perhaps returning to coalition government in a Labour led coalition. But he already knew Mr Wilson would not form a coalition with either the Liberals or the Conservatives because of the opposition of the Labour left. Within hours of his final talks with Mr Thorpe, Sir Edward told the nation he was resigning and the Queen invited Mr Wilson to form a new minority government.


Germany's economy shrank 0.2% in the last three months of 2004, upsetting hopes of a sustained recovery. The figures confounded hopes of a 0.2% expansion in the fourth quarter in Europe's biggest economy. The Federal Statistics Office said growth for the whole of 2004 was 1.6%, after a year of contraction in 2003, down from an earlier estimate of 1.7%. It said growth in the third quarter had been zero, putting the economy at a standstill from July onward. Germany has been reliant on exports to get its economy back on track, as unemployment of more than five million and impending cuts to welfare mean German consumers have kept their money to themselves. Major companies including Volkswagen, DaimlerChrysler and Siemens have spent much of 2004 in tough talks with unions about trimming jobs and costs. According to the statistics office, Destatis, rising exports were outweighed in the fourth quarter by the continuing weakness of domestic demand. But the relentless rise in the value of the euro last year has also hit the competitiveness of German products overseas. The effect has been to depress prospects for the 12 nation eurozone as a whole, as well as Germany. Eurozone interest rates are at 2%, but senior officials at the rate setting European Central Bank are beginning to talk about the threat of inflation, prompting fears that interest rates may rise. The ECB's mandate is to fight rising prices by boosting interest rates and that could further threaten Germany's hopes of recovery.


The UK Independence Party could take legal action to unseat two London Assembly members who defected to Robert Kilroy Silk's Veritas Party. Damian Hockney, now Veritas deputy leader, and Peter Hulme Cross were elected in 2004 on the list system. The party argues the pair should give up their seats as they won them as UKIP representatives, not as individuals. Mr Hockney said the law was clear that those elected on a list who quit their party should keep their seats. UKIP chairman Petrina Holdsworth urged the men to step down from the GLA in a letter. She said: "The party has taken legal advice and it is clear that we could take legal proceedings against you which could result in the return of our seats and/or damages against you. "We would however like you to be given an opportunity to reflect on what you have done, to restore your own credibility with the electorate and return the seats to the party which won them fair and square at the last election." Mr Hockney said the law worked in exactly the same way for the GLA as it did for other electoral list systems. "The Greater London Act is clear that if someone resigns who was elected on a list, their party whip the seat belongs to them and not the party." He said Mr Hulme Cross and himself had no intention of resigning and added that they felt that it was UKIP who were not being true to the electorate. He accused the party of signing up to a deal with the Tories in Europe, rather than sticking to an independent stance. But the claim was denied by UKIP spokesman, who said: "Mr Hockney's accusations are like his sense of political morals empty." Veritas was formed by Mr Kilroy Silk earlier this month after he quit UKIP following an unsuccessful bid to take over as leader.


Computer games could enhance learning and have a legitimate place in the classroom, say researchers. Academics from the Institute of Education at London University found that "games literacy" was a key skill for youngsters. As well as being used in different areas of the curriculum, games are a legitimate area of study in their own right, researchers say. Pupils should also be able to create their own games, they say. "Like all games, computer and video games entertain while promoting social development, and playing and talking about games is an important part of young people's lives," said project manager Caroline Pelletier. "Games literacy is a way of investigating how games are means of expression and representation, just like writing or drawing," she said. The researchers conducted two studies into the impact of games on education, the first looking at how they can be used in different curriculum subjects to enhance learning. Researchers found that girls were often excluded from the male dominated world of game playing. "Without first hand experience of how much fun a game can be, they have little motivation to play and remain disengaged from an engrossing and sociable activity," said research fellow Diane Carr. The second project looked at how games can be integrated into media education and concluded that writing games should be a core part of studying them. Sixth form teacher Barney Oram already teaches computer games alongside the more traditional study of film, TV and popular music at the A level course he runs at Long Road Sixth Form College in Cambridge. For parents, the idea that computer games could be brought into the classroom environment, could cause controversy. Dr Andrew Burn, associate director of the Institute of Education's Centre for the Study of Children, Youth and Media moved to reassure anxious parents. "Games are a legitimate cultural form that deserve critical analysis in schools just as film, television and literature do," he said. "But we also want to argue that full understanding only comes when children have the tools to create their own games." The games industry welcomed the report, saying it showed how games had a positive impact on children. "At a time of hysterical and inaccurate reporting it is heartening to see the cultural, social and educational value of computer and video games being assessed intelligently," said Roger Bennett, director general of the Entertainment and Leisure Software Publishers Association. "This report is further evidence, if it were needed, about the excellence and imagination that thrives in gaming. They have much to offer to the education of our children and they have much to offer as a career." The three year research project, which is being presented at a seminar on Tuesday in London, was partly funded by the Department of Trade and Industry.


Fiat and General Motors (GM) have until midnight on 1 February to settle a disagreement over a potential takeover. The deadline marks the point at which Fiat will gain the right to sell its car division to GM, part of an alliance agreed in 2000. GM, whose own European operations are losing money, no longer wants to own the unprofitable Fiat unit. Reports of deadlocked talks sent Fiat shares down 1.2% on Tuesday, after Monday's 4% gain on hopes of a payoff. The US firm is thought to be offering about 2bn ( 1.06bn) to extricate itself from the arrangement. It has argued the deal was voided by Fiat's decision to sell off Fiat's finance arm and halve GM's stake via a capital raising effort. The 2000 deal resulted from a race between GM and DaimlerChrysler to ally with Fiat. The German firm wanted to buy Fiat outright. But Gianni Agnelli, the godfather of the group, wanted to keep control, and preferred GM's offer to buy a 20% stake and give Fiat the right to sell in the future, known as a "put option". Since then, however, Fiat cars have lost market share and the firm has piled up losses, while a plan to raise new money in 2003 cut GM's stake in half to 10%. For its part, GM's European units Opel and Saab have both had trouble, with Opel management threatening to cut 12,000 jobs. "The last thing they need is additional production capacity in Europe," said Patrick Juchemich, auto analyst at Sal Oppenheim Bank.


Greek sprinters Kostas Kenteris and Katerina Thanou are expected to find out on Wednesday if they will be banned for missing drugs tests this summer. The International Association of Athletics Federations (IAAF) council held a conference call on Tuesday and are set to announce their decision. Kenteris and Thanou could be suspended for up to two years. The duo withdrew from the Olympics after missing a test but claimed they had suffered a motorcycle crash. The Greek authorities have also brought criminal charges against the sprinters for avoiding a drugs test and faking an accident. Their former coach Christos Tzekos is also facing charges and all three are awaiting a trial date. However, the IAAF will determine the sprinters' future on the track after carefully considering all the evidence. The sport's ruling body is expected to direct the Greek federation in what action it should take against the sprinters. Kenteris and Thanou can appeal against any decision at the Court of Arbitration for Sport. The sprinters both sent written explanations to the IAAF, which have been taken into account. The IAAF sent an official warning to the sprinters and coach Tzekos after they were discovered training in Qatar rather than in Crete, where they had said they would be. But Kenteris and Thanou then went on to skip tests in Tel Aviv and Chicago, when they decided to fly back to Greece early. Just before the Olympics, the pair dramatically missed another test in Athens before withdrawing from the Games. Kenteris, 31, won gold in the 200m at the Sydney Olympics in 2000, where Thanou, 29, won silver in the 100m.


Japanese industrial output fell in October while unemployment rose, casting further doubt on the strength of the country's economic recovery. Production dropped 1.6% in October, reflecting a decline in exports, while unemployment levels edged up 0.1% to 4.7%, slightly higher than forecast. The economy has grown for six quarters but growth slowed dramatically in the last quarter amid weaker global demand. Japan's government remains optimistic due to strong domestic demand. Analysts had been forecasting a 0.1% rise in month on month industrial output. According to figures from the Ministry of Economy, Trade and Industry (METI), the decline was led by a fall in demand for electronic parts for mobile phones and digital televisions. Although inventories fell 0.7% month on month, they were 36% higher than a year ago. "It's a sign that the economy's adjustment phase is stronger than expected," said Takashi Yamanaka, an economist with UFJ Bank. Japan downgraded its overall economic assessment earlier this month for the first time in a year. Growth slowed to 0.3% in the quarter ending September 30, down from 6.3% in the first quarter of 2004. Experts believe the economy which stagnated for most of the 1990s may be entering a softer patch on the back of rising oil prices and the falling dollar. Japanese government officials played down the latest data, arguing that domestic consumer demand was still resilient. "The outlook for November is positive so I don't think one can say that conditions have worsened just because of the fall in October," said a METI official. Despite the rise in unemployment, jobless figures are still some way below historical highs of recent years. The comparatively weak economic date preyed on shares with the Nikkei down 1% in afternoon trade.


British Telecom has said it will double the broadband speeds of most of its home and business customers. The increased speeds will come at no extra charge and follows a similar move by internet service provider AOL. Many BT customers will now have download speeds of 2Mbps, although there are usage allowances of between one gigabyte and 30 gigabytes a month. The new speeds start to come into effect on 17 February for home customers and 1 April for businesses. "Britain is now broadband Britain," said Duncan Ingram, BT's managing director, broadband and internet services. He added: "Ninety percent of our customers will see real increases in speed. "These speed increases will give people the opportunity to do a lot more with their broadband connections," he said. Upload speeds the speed at which information is sent from a PC via broadband will remain at the same speed, said Mr Ingram. Despite the increases, BT will continue to have usage allowances for home customers. "The allowances are extremely generous," said Mr Ingram "For what we are seeing in the market place they are really not an issue." BT will begin enforcing the allowances in the summer. Customers who exceed the amounts will either be able to pay for a bigger allowance or see their download speeds reduced. BT now has a 36% share of the broadband market down from 39% which is becoming increasingly competitive. In the last few months, many rival ISPs have begun to offer 2Mbps services, including AOL, Plusnet and UK Online. But Britain continues to lag behind some countries especially Japan and South Korea which offer broadband speeds of up to 40Mbps. But Mr Ingram said it was important to "separate hype from reality". He said that a limited number of people with those connections consistently received speeds of 40Mbps. Customers will not see their connections double immediately on 17 February. Mr Ingram said there would be a roll out across the network in order to prevent any problems.


Chancellor Gordon Brown has visited Kenya's biggest shantytown as he opened a week long visit to Africa. Mr Brown's trip is designed to highlight how the UK wants to make Africa's problems a priority of its chairmanship of the G8 this year. He will see an HIV/Aids orphanage in Tanzania and a women's credit union in Mozambique before chairing a meeting of the Commission for Africa in Cape Town. At slums in Narobi on Wednesday, he said education needs had to be tackled. Speaking outside the Olympic Primary School, Mr Brown said: "It is simply not acceptable in the modern age for the rest of the world to stand by and have hundreds of millions of children not getting the chance at education." He pointed to international plans to invest 10bn for education in Africa over the next decade. The school is on the edge of Kibera, where 800,000 live often in huts made of mud, scrap metal and cardboard. Mr Brown's aides say he wants to find out more about the Kenyan Government's education policies, which included introducing free primary education in early 2003. The chancellor has already unveiled proposals for a G8 aid package which he has likened to the Marshall Plan used by the United States to rebuild Europe after World War Two. The trip follows claims of infighting between Mr Brown and Tony Blair detailed in a new book. Conservative leader Michael Howard is expected to seize on those reports at prime minister's questions at 1200 GMT on Wednesday.


A German firm whose main product is derived from the saliva of the vampire bat is looking to raise more than 70m euros ( 91m; 49m) on the stock market. The firm, Paion, said that it hoped to sell 5 million shares a third of the firm for 11 14 euros a share. Its main drug, desmoteplase, is based on a protein in the bat's saliva. The protein stops blood from clotting which helps the bat to drink from its victims, but could also be used to help stroke sufferers. The company's shares go on sale later this week, and are scheduled to start trading on the Frankfurt Stock Exchange on 10 February. If the final price is at the top of the range, the company could be valued at as much as 200m euros. The money raised will be spent largely on developing the company's other drugs, since desmoteplase has already been licensed to one manufacturer, Forest Laboratories.


A prospective candidate for the UK Independence Party (UKIP) has resigned after admitting a "brief attachment" to the British National Party(BNP). Nicholas Betts Green, who had been selected to fight the Suffolk Coastal seat, quit after reports in a newspaper that he attended a BNP meeting. The former teacher confirmed he had attended the meeting but said that was the only contact he had with the group. Mr Betts Green resigned after being questioned by the party's leadership. A UKIP spokesman said Mr Betts Green's resignation followed disclosures in the East Anglian Daily Times last month about his attendance at a BNP meeting. "He did once attend a BNP meeting. He did not like what he saw and heard and will take no further part of it," the spokesman added. A meeting of Suffolk Coastal UKIP members is due to be held next week to discuss a replacement. Mr Betts Green, of Woodbridge, Suffolk, has also resigned as UKIP's branch chairman.


Ulster scrum half Kieran Campbell is one of five uncapped players included in Ireland's RBS Six Nations squad. Campbell is joined by Ulster colleagues Roger Wilson and Ronan McCormack along with Connacht's Bernard Jackman and Munster's Shaun Payne. Gordon D'Arcy is back after injury while Munster flanker Alan Quinlan also returns to international consideration. "The squad is selected purely on form. A lot of players put their hands up," coach Eddie O'Sullivan told BBC Sport. "Kieran Campbell was just one of those players. He has been playing very well in the Heineken Cup and deserves his call up. "There is big competition in some departments and not so much in others. There were one or two players who were unfortunate just to miss out." Back row forwards David Wallace and Victor Costello are omitted, with O'Sullivan having Quinlan, Wilson, Simon Easterby, Anthony Foley, Denis Leamy and Johnny O'Connor vying for the three positions. With David Humphreys, Kevin Maggs, Simon Best and Tommy Bowe again included, it is Ulster's biggest representation in a training panel for quite some time. Munster and Leinster have 12 and 11 players in the squad respectively while Jackman is the sole Connacht representative. Four British based players are also included. Ulster forward Ronan McCormack said he was "totally shocked" to be included. "I'm really looking forward to it," said McCormack. "I played with guys like Brian O'Driscoll and Denis Hickie back in my school days in Leinster so I do know a few of them although not that well. "It will be great to work with them." S Best (Ulster), S Byrne (Leinster), R Corrigan (Leinster), L Cullen (Leinster), S Easterby (Llanelli), A Foley (Munster), J Hayes (Munster), M Horan (Munster), B Jackman (Connacht), D Leamy (Munster), E Miller (Leinster), R McCormack (Ulster), D O'Callaghan (Munster), P O'Connell (Munster), J O'Connor (Wasps), M O'Kelly (Leinster), F Sheahan (Munster), R Wilson (Ulster), A Quinlan (Munster). T Bowe (Ulster), K Campbell (Ulster), G D'Arcy (Ulster), G Dempsey (Leinster), G Duffy (Harlequins), G Easterby (Leinster), D Hickie (Leinster), A Horgan (Munster), S Horgan (Leinster), D Humphreys (Ulster), K Maggs (Ulster), G Murphy (Leicester), B O'Driscoll, (Leinster), R O'Gara (Munster), S Payne (Munster), P Stringer (Munster). K Gleeson (Leinster), T Howe (Ulster), J Kelly (Munster), N McMillan (Ulster).


Ireland captain Brian O'Driscoll has been ruled out of Saturday's RBS Six Nations clash against Scotland. O'Driscoll was originally named in the starting line up but has failed to recover from the hamstring injury he picked up in the win over Italy. His replacement will be named after training on Friday morning. Fellow centre Gordon D'Arcy is also struggling with a hamstring injury and he will undergo a fitness test on Friday to see if he can play. Kevin Maggs would be an obvious replacement at centre while Shane Horgan could also be moved from wing. Ulster wing Tommy Bowe could also be asked to travel with the squad to Scotland as a precautionary measure. The only other change to the Ireland side sees Wasps flanker Johnny O'Connor replacing Denis Leamy. O'Connor will be winning his third cap after making his debut in the victory over South Africa last November. : Murphy, Horgan, TBC, D'Arcy, Hickie, O'Gara, Stringer, Corrigan, Byrne, Hayes, O'Kelly, O'Connell, S Easterby, O'Connor, Foley. : Sheahan, Horan, O'Callaghan, Miller, G Easterby, Humphreys, Dempsey.


Middlesbrough boss Steve McClaren hopes that Stewart Downing did not seriously damage his hamstring during the 2 1 Uefa Cup win over Graz AK. The winger was carried off on a stretcher in the closing stages as Boro booked their place in the last 16. McClaren said: "Stewart has tweaked a hamstring, which is a blow for us. We will assess it in the morning. "But I'm delighted with the match result. They say in sport you can win ugly and we certainly did." McClaren was relieved to make it through after a tough encounter at The Riverside. "To be fair to Graz, they had a gameplan they knocked the ball forward, especially in the first half, and we struggled to deal with it. "In the second half we were better but it was frustrating because we got the goal but one slip and they were back in it." Boro face Sporting Lisbon for a place in the quarter finals after the Portuguese side saw off Feyenoord on Thursday. And McClaren added: "Sporting are technically very good Portuguese sides always are. "But the journey goes on for us and we will now go to their magnificent stadium after the first game here we'll look forward to it." Goalscorer Jimmy Floyd Hasselbaink added: "It wasn't a particularly beautiful match to watch but they made it difficult for us. "We didn't play well at all. But you need a little bit of luck and I think we got that when my shot went through the legs of their goalkeeper. "I would have liked to play in Holland that would have been a little bit special to me. "But so is going back to Portugal I'll be playing against some lads I played with at Boavista."


Tory leader Michael Howard has accused Tony Blair of performing U turns over rules on using force against burglars. The government has ruled out amending the present law, which allows "reasonable force" in self defence. Mr Howard branded the decision unacceptable, saying: "It is not householders who should be frightened, it's the burglars." Home Secretary Charles Clarke said ministers had kept to their pledge to review the law. Metropolitan Police Commissioner Sir John Stevens last month backed a Tory attempt to change the law so only householders using "grossly disproportionate" force could be prosecuted. The pressure prompted the prime minister to say the police and Crown Prosecution Service would be consulted as part of a review of the law. He told MPs: "If we get the right response from those people, we will, of course, support a change in the law." Instead, the government has decided no change is needed but there will be a publicity campaign so people are clear they are entitled to defend themselves. On Thursday, Mr Howard told BBC Radio 4's Today programme Mr Blair had initially refused the law change, then had come round to the idea and was now backtracking again. He said: "We've had three policy positions in three months and two U turns. "It's not surprising Gordon Brown told him: 'There's nothing you could say to me now that I could ever believe.'" Mr Howard said the "grossly disproportionate" test matched the hurdle ministers had introduced for civil cases where burglars where claimed compensation from householders. The issue entered the public spotlight when Norfolk farmer Tony Martin was jailed for shooting dead a 16 year old burglar in 1999 as he ran away from the farm. But the home secretary said Mr Howard was wrong to say the law was biased in favour of burglars. The barrister who had represented Mr Martin had said the rules were "weighted overwhelmingly" in favour of the householder, said Mr Clarke. He said: "The problem is there has not been enough understanding of it that was the point Sir John Stevens was making and the prime minister was making." The new guidance would help ensure clarity on the issue, added Mr Clarke. The director of public prosecutions, Ken Macdonald, says only 11 householders or occupiers of business premises have been prosecuted in the last 15 years. Those cases included a warehouse manager who had waited for a burglar, tied him up, beat him and set him alight, he said. Tory MP Patrick Mercer's private member's bill to change the law received a first reading in Parliament on Wednesday and goes to a full debate next month.


Chelsea's win at Fulham confirming their position at the Premiership summit proves that they now have everything in place to mount serious challenges on all fronts this season. They have got strength in depth, great players, an outstanding manager in Jose Mourinho and finances no other club in the world can match. All they need to add now is the big prizes which, as we all know, is the most difficult part of all. One thing is certain they have put themselves in a position to make that leap to success very impressively indeed. They beat a very tough Everton at Stamford Bridge, won at Newcastle in the Carling Cup, and then won 4 1 at Fulham, which was a great result given that they had been showing good form. As I said, winning the major honours is the hardest task of all, but in Mourinho they have a manager who will make it a whole lot easier to handle the anticipation and expectation that will come their way now. Mourinho has won the biggest club prize of all, the Champions League, and that track record and confidence transmits itself to top players. It is a priceless commodity. No one can be anything other than highly impressed by Mourinho. He is regarded as a touch arrogant by some people, and maybe he can appear that way, but he has the silverware to back up the talk. Mourinho doesn't simply talk a good game he's won some very big games such as the Champions League final with Porto. Some may criticise his talk, but the words are backed up with actions. I've also found him to be very realistic whenever I've heard him. He's spent a lot of money and it seems to be working, and we should remember lots of managers have spent money and it has not worked. The buys are now integrating, and in Arjen Robben he has the player who is giving them that extra dimension. In the early games he was slaughtered for defensive tactics, and yet he was winning games. You cannot win titles early on in the season, but you can certainly lose them and those points on the board were vital. I also thought the criticism was very harsh, because even though they were not scoring goals they were creating chances by the hatful. Now they are taking those chances, have the double threat of Robben and Damien Duff, and things are looking good. I just wonder if they lack a predator, particularly with Didier Drogba injured. He was starting to look the part before he was sidelined, but you have to feel if Chelsea had a Ruud van Nistelrooy they would be even more of a safe bet for the title. Chelsea also have all the tools to go far in the Champions League. I felt they would never have a better chance than last season, but they have swept all before them in Europe so far this season. It will now be very interesting to see how Mourinho prioritises things, but his life will be made easier by the size of Chelsea's squad. I have said I believed Chelsea would win the league this season, even when Arsenal were flying at the start, and I have seen nothing to make me change me mind. If anything, what I have seen has confirmed my early impressions. And Chelsea would have taken encouragement from Arsenal's rocky defensive display at Spurs, even though they ran out 5 4 winners. Mourinho had his say on that game, complaining: "Five four is a hockey score, not a football score. "In a three against three training match, if the score reaches 5 4 I send the players back to the dressing rooms as they are not defending properly. "So to get a result like that in a game of 11 against 11 is disgraceful." On a more serious note, it was a game that merely confirmed the importance of Sol Campbell to Arsenal. Much criticism has been aimed at Pascal Cygan, but I believe the problem lies with the absence of Campbell and its overall effect on Arsenal's defence. Confidence is a crucial factor in defending. When you start conceding goals, you suddenly get a chill in the bones every time the ball comes into the penalty area. You think "oh no" then find your worst fears confirmed. Arsenal need to reverse the process, with or without Campbell, and get some clean sheets on the board. But the return of Campbell is key. He solidifies the unit, has pace and is powerful in the air and on the deck. He is vastly experienced and has a calming influence on all around him. Campbell pulls it all together at the back and gets the defence playing as a unit. Chelsea have no such problems at present, which is why I would still place my money on them to edge out Arsenal as champions this season.


It is unlikely that future technological inventions are going to have the same kind of transformative impact that they did in the past. When history takes a look back at great inventions like the car and transistor, they were defining technologies which ultimately changed people's lives substantially. But, says Nick Donofrio, senior vice president of technology and manufacturing at IBM, it was not "the thing" itself that actually improved people's lives. It was all the social and cultural changes that the discovery or invention brought with it. The car brought about a crucial change to how people lived in cities, giving them the ability to move out into the suburbs, whilst having mobility and access. "When we talk about innovation and creating real value in the 21st Century, we have to think more like this, but faster," Mr Donofrio told the BBC News website, after giving the Royal Academy of Engineering 2004 Hinton Lecture. "The invention, discovery is likely not to have the same value as the transistor had or the automobile had. "The equivalent of those things will be invented or discovered, but by themselves, they are just not going to able to generate real business value or wealth as these things did." These are not altogether new ideas, and academics have been exploring how technologies impact wider society for years. But what it means for technology companies is that a new idea, method, or device, will have to have a different kind thinking behind it so that people see the value that innovative technology has for them. We are in a different phase now when it comes to technology, argues Mr Donofrio, Industry Week's 2003 Technology Leader of the Year. The hype and over promise is over and now technology leaders have to demonstrate that things work, make sense, make a difference and life gets better as a result. "In the dotcom era, there was something that was jumping up in your face every five minutes. "Somebody had a new thing that would awe you. You weren't quite sure that it did anything, you weren't quite sure if you needed it, you weren't quite sure if it had value for it, but it was cool." But change and innovation in technology that people will see affecting their daily lives, he says, will come about slowly, subtlety, and in ways that will no longer be "in your face". It will creep in pervasively. Nanotechnologies will play a key part in this kind of pervasive environment in all sorts of ways, through new superconducting materials, to coatings, power, and memory storage. "I am a very big believer in the evolution of this industry into a pervasive environment, in an incredible network infrastructure," says Mr Donofrio. Pervasive computing is where wireless computing rules, and where jewellery, clothes, and everyday objects become the interfaces instead of bulky wires, screens and keyboards. The net becomes a true network that is taken for granted and just there, like air. "People will not have to do anything to stay connected. People will know their lives are just better," says Mr Donofrio. "Trillions of devices will be connected to the net in ways people will not know." Natural interfaces will develop, devices will shape your persona, and our technologically underused voices could be telling our jewellery to sort out the finances. Ultimately, there will be, says Mr Donofrio, no value in being "computer illiterate". To some, it sounds like a technological world gone mad. To Mr Donofrio, it is a vision innovation that will happen. Behind this vision should be a rich robust network capability and "deep computing", says Mr Donofrio. Deep computing is the ability to perform lots of complex calculations on massive amounts of data, and integral to this concept is supercomputing. It has value, according to IBM, because it helps humans work out extremely complex problems to come up with valuable solutions, like how to refine millions of net search results, finding cures for diseases, or understanding of exactly how a gene or protein operates. But pervasive computing presumably means having technologies that are aware of diversity of contexts, commands, and requirements of a diverse world. As computing and technologies become part of the environment, part of furniture, walls, and clothing, physical space becomes a more important consideration. This is going to need a much broader range of skills and experience. "I am confident that the SET science, engineering and technology industry is going to be short on skills," he says. "If I am right about what innovation is, you need to be multidisciplinary and collaborative. "Women tend to have those traits a lot better than men." Eventually, women could win out in both life and physical sciences, he says. In the UK, a DTI funded resource centre for women has set a target to have 40% representation on SET industry boards. IBM, according to Mr Donofrio, has 30%. "Our goal is for our research team to become the preferred organisation for women in science and technology to begin their career." The whole issue of global diversity is as much a business matter as it is a moral and social concern to Mr Donofrio. "We believe in the whole issue of global diversity," he says. "Our customers are diverse, our clients are diverse. They expect us to look like them. "As more and more women or underrepresented minorities succeed into leadership positions, it becomes and imperative for us to constantly look like them."


Prince Charles and Camilla Parker Bowles are awaiting the nation's reaction after announcing they are to be married on 8 April. Mrs Parker Bowles will take the title HRH Duchess of Cornwall after a civil ceremony to be held at Windsor Castle. A Daily Telegraph poll of 1,313 people suggests two thirds of Britons support the couple's decision to marry. But only 40% think Mrs Parker Bowles should become Princess Consort as planned after Charles becomes king. Some 47% believe she should have no title, while 7% think she should become queen. The poll also found that the majority of Britons would prefer the monarchy to miss a generation, with the Queen handing the throne to her grandson Prince William, 22, on her death or abdication. On Thursday night, Prince Charles, 56, and Mrs Parker Bowles, 57, hosted a dinner at Windsor Castle, their first public appearance since announcing their engagement. Mrs Parker Bowles said the prince went down on one knee to propose and added: "I'm just coming down to earth." She displayed her diamond engagement ring a Royal Family heirloom to reporters. Charles said he and his wife to be were "absolutely delighted". Their marriage will end years of speculation on a relationship which dates back to 1970. The Queen and Duke of Edinburgh said the news had made them "very happy". Princes William and Harry said they are "very happy" and wish the couple "all the luck in the future". The wedding will be a civil ceremony followed by a service of prayer and dedication in St George's Chapel at which the Archbishop of Canterbury, Dr Rowan Williams, will preside. The marriage is likely to be a sensitive issue because Mrs Parker Bowles is divorced and her former husband is still alive. If he became king, Charles would be the supreme governor of the Church of England and some Anglicans remain opposed to the remarriage of divorcees. "His divorce from Diana and the disappointment the country felt over how Diana had been treated... opened up a sense of disillusionment with Prince Charles ," said Ros Coward, who wrote the authorised biography of Diana, princess of Wales. The Archbishop of Canterbury said: "I am pleased that Prince Charles and Mrs Camilla Parker Bowles have decided to take this important step." Tony Blair said he was "delighted" for the couple and offered his congratulations, as did Conservative leader Michael Howard and Liberal Democrat leader Charles Kennedy. Australia's Prime Minister John Howard also offered his congratulations, adding that their decision to marry was a "sensible and a good thing". Mrs Parker Bowles has joined the prince at numerous engagements in recent years mostly at evening events for The Prince's Trust. Clarence House staff were at pains to point out that she attended these events in a private capacity.


Shares in Australian budget airline Virgin Blue plunged 20% after it warned of a steep fall in full year profits. Virgin Blue said profits after tax for the year to March would be between 10% to 15% lower than the previous year. "Sluggish demand reported previously for November and now December 2004 continues," said Virgin Blue chief executive Brett Godfrey. Virgin Blue, which is 25% owned by Richard Branson, has been struggling to fend off pressure from rival Jetstar. It cut its full year passenger number forecast by "approximately 2.5%". Virgin Blue reported a 22% fall in first quarter profits in August 2004 due to tough competition. In November, first half profits were down due to slack demand and rising fuel costs. Virgin Blue was launched four years ago and now has roughly one third of Australia's domestic airline market. But the national carrier, Qantas, has fought back with its own budget airline, Jetstar, which took to the skies in May 2004. Sydney listed Virgin Blue's shares recovered slightly to close 12% down on Wednesday. Shares in its major shareholder, Patrick Corporation which owns 46% of Virgin Blue had dropped 31% by the close.


Six Chris Paterson penalties gave Scotland victory in a dour but clinical encounter against Italy at Murrayfield. Coach Matt Williams' side were outmuscled and outplayed in a tense first half but led 6 3 at the break. Paterson slotted four more second half penalties and Scotland were denied a try when wing Sean Lamont's touchdown was ruled out for a forward pass. A late Andrea Masi try was small consolation for Italy, chasing their first away win in the Six Nations. Scotland came out on top of the early exchanges and took a quick 3 0 lead through the boot of full back Paterson. But the more powerful Azzurri pack eventually rumbled into life. A series of drives into Scottish territory set up a penalty attempt, missed by full back Roland De Marigny, and a wayward drop goal effort from Luciano Orquera. Scotland defended the initial thrusts but on 20 minutes Italy, after coming up yards short of the line, equalised through a De Marigny penalty. Italy were offered another penalty when Scottish flanker Simon Taylor was offside but the left footed De Marigny pushed his kick wide. Scotland finally made the most of a rare foray into the Italian half and snatched three points from Paterson when an Italian forward handled the ball in a ruck. As the half wore on, both sides squandered promising spells of momentum with sloppy penalties, and the period fizzled out with Scotland numerically, if not psychologically, on top. Italy's De Marigny narrowly missed a chance to level the scores again shortly after the break but his long range kick shaved the right upright. And Scotland capitalised with a third Paterson penalty on 50 minutes. Williams' side seemed to have found a spark from somewhere and, after a couple of probing attacks, Paterson was able to slot another three points to widen the gap. With the pendulum of possession swinging towards Scotland, Lamont thought he had wriggled over in the left corner after 65 minutes but play was recalled for a marginal forward pass from Paterson. Another Paterson penalty on 70 minutes kept the pressure on the wilting visitors. But John Kirwan's men had the last laugh when Gordon Ross' attempted clearance was charged down and Masi pounced for the try, converted by De Marigny. : C Paterson; S Webster, A Craig, H Southwell, S Lamont; D Parks, C Cusiter; T Smith, G Bulloch (capt), G Kerr; S Grimes, S Murray; S Taylor, J Petrie, A Hogg. R Russell, B Douglas, N Hines, J Dunbar, M Blair, G Ross, B Hinshelwood. R de Marigny; Mirco Bergamasco, C Stoica, A Masi, L Nitoglia; L Orquera, A Troncon; A Lo Cicero, F Ongaro, M Castrogiovanni; S Dellape, M Bortolami (capt); A Persico, D Dal Maso, S Parisse. G Intoppa, S Perugini, CA del Fava, S Orlando, P Griffen, R Pedrazzi, KP Robertson.


The UK's biggest civil service union is to ballot its 290,000 members on strikes in protest at government plans to extend their pension age to 65. The Public and Commercial Services Union will co ordinate any action with up to six other public sector unions. Unions have already earmarked 23 March for a one day strike which could involve up to 1.4 million UK workers. The government says unions will be consulted before any changes are made to the pension system. PCS leader Mark Serwotka warned there could be further walkouts unless there was a government rethink. "For a government that lectures everyone on choice choice on public service, choice on this and choice on that isn't it ironic that they're saying to public sector workers there is no choice," he said. "If you want the pension you were promised when you started you must work for an extra five years that is working until people drop. "In the 20th century, it's completely unacceptable." BBC correspondent Stephen Cape said the combined unions represented "a formidable force" which could embarrass the government in the run up to the General Election. A stoppage involving civil servants, in particular, could seriously disrupt or close government departments, agencies and museums, he said. Opposition to raising the retirement age is "one thing all the unions are agreed on", our correspondent added. Unison's 800,000 workers, the Transport and General Workers' Union's 70,000 and Amicus' 20,000 are among those being balloted about a 23 March walkout. Deputy Prime Minister John Prescott held a private meeting with senior union figures on Thursday night. Our correspondent said that he understood no deal had been offered in that meeting but that there was room for further negotiations. There was "some possibility" of the strike action being avoided, he added.


The man making sure US computer networks are safe and secure has resigned after only a year in his post. Amit Yoran was director of the National Cyber Security Division within the US Department of Homeland Security created following the 9/11 attacks. The division was tasked with improving US defences against malicious hackers, viruses and other net based threats. Reports suggest he left because his division was not given enough clout within the larger organisation. Mr Yoran took up his post in September 2003 and his first task was to get the Cyber Security Division up and running. The organisation had a staff of about 60 people and a budget of about 80m ( 44.54m). The division was charged with thinking up and carrying out action to make US networks more impervious to attack and disruption by the viruses, worms and hack attacks that have become commonplace. In the last 12 months Mr Yoran oversaw the creation of a cyber alert system that sends out warnings about big hitting viruses and net attacks as they occur. The warnings also contained information about how firms and organisations could protect themselves against these attacks. The Cyber Security Division also audited US government networks to discover exactly what was sitting on which network. The next step was to be the creation of a scanning system to identify vulnerabilities that made federal networks and machines susceptible to attack by malicious hackers and virus writers. Mr Yoran's division was also doing work to identify the networks and machines that had been broken into by cyber criminals. Despite this success Mr Yoran left his post abruptly at the end of last week, reportedly only giving one day's notice to bosses at the Department of Homeland Security. "Amit Yoran has been a valuable contributor on cyber security issues over the past year, and we appreciate his efforts in starting the department's cybersecurity program," said a Department of Homeland Security spokeswoman. Some reports have suggested that Mr Yoran felt frustrated by the lack of prominence given to work to protect against net based threats in the wider homeland organisation. An attempt by US politicians to pass a law to promote Mr Yoran and raise the profile of his department's work is now mired in Congress.


Wales coach Mike Ruddock says England lock Danny Grewcock needs to review his actions after he kicked Dwayne Peel. Trouble flared at a ruck in the first half of Wales' 11 9 win in Cardiff as Grewcock came recklessly over the top with his boot, leaving Peel bloodied. Grewcock was sin binned with Wales captain Gareth Thomas for retaliation. "It's up to the citing commissioner," said Ruddock. "I'm not saying it's deliberate, but Grewcock did a similar thing for Bath against Leinster." Last June Grewcock was banned from rugby for two months for reckless use of a boot in a match against New Zealand. Six years earlier, also in New Zealand, Grewcock became only the second England player to be sent off in Tests. The player himself and his captain Jason Robinson have both said that the clash with Peel was accidental. "If the ball is at the back of the ruck and I feel I can step over and disrupt it then I will do that," said Grewcock. But Ruddock feels that the England man should be more careful. "The boy himself should look at his actions, it was a clumsy piece of footwork," he said. "He's a great player and I don't want to knock him, we won't be calling for the match commissioner to review the incident. "I'm not going to go too far with the lad. It could just be a clumsy action and Dwayne had just a minor cut. "The referee's interpretation was that Grewcock was attempting to step over the ruck." Ruddock also warned his RBS 6 Nations Championship rivals that his team can make massive improvements. "We created more opportunities and also squandered them by taking more contact and playing more individually," said the coach. "We've looked through things on the video debrief and there were definitely a lot of chances that we wasted." In the forthcoming games, Ruddock may use penalty hero Gavin Henson as his first choice kicker in place of Stephen Jones. "Our first aim was to get Gavin settled into the team, but it's something we'll talk about in selection this week," said Ruddock.


All four of England's Champions League representatives have reached the knockout stages for the first time. Arsenal and Chelsea are seeded as group winners, while runners up Manchester United and Liverpool are not. Rules stipulate that teams from the same country or group will be kept apart in the draw on 17 December. The favourites are Chelsea and Barcelona, and Real Madrid, the two Milan sides, Juventus and Bayern Munich are among the 16 still in the hat. Steven Gerrard's last gasp wonder strike secured qualification for against Olympiakos on Wednesday evening. AC Milan, Bayer Leverkusen, Internazionale, Juventus, Lyon. who had already qualified, fielded a second string side and went down 3 0 to Fenerbahce. AC Milan, Bayer Leverkusen, Internazionale, Juventus, Monaco. On Tuesday, finished top of their group with a 5 1 win over the Rosenborg after drawing four of their first five matches. Barcelona, Bayern Munich, Porto, Real Madrid, Werder Bremen , who had already qualified lost 2 1 to Porto as Jose Mourinho made an unhappy return to his former club. Barcelona, Bayern Munich, PSV Eindhoven, Real Madrid, Werder Bremen.


The UK's jobless total rose for the second month in a row in December, official figures show. The number of people out of work rose 32,000 to 1.41 million in the last three months of 2004, even as 90,000 more people were in employment. Average earnings rose by 4.3% in the year to December up from November's 4.2%, the Office for National Statistics (ONS) added. Meanwhile, the benefit claimant total fell 11,000 to 813,200 last month. Throughout 2004, the number of people in work increased by 296,000 to 28.52 million the highest figure since records began in 1971. The apparent discrepancy between rising unemployment and record numbers in work can be explained by an increase in the working population and a fall in those who are economically inactive. While the UK's jobless rate rose to 4.7% from 4.6% in the previous quarter, the rate still remains one of the lowest in the world, compared with 12.1% in Germany, 10.4% in Spain and 9.7% in France. But, despite more people being in work, the manufacturing sector continued to suffer, with 104,000 workers axed during the last quarter of 2004 pushing employment in the sector to a record low of 3.24 million by the end of last year. The figures prompted some analysts to forecast that the Bank of England will almost certainly raise rates this year. Marc Ostwald, a strategist at Monument Securities told Reuters that while no immediate market impact could be expected, "it is enough to underline that they (the BoE) will be more hawkish on rates".


Ronan O'Gara scored all Ireland's points as the home side claimed only their second ever win over South Africa on an emotional day at Lansdowne Road. O'Gara's first half try, poached after a quick tap penalty, helped the Irish to a 8 3 lead at half time. Three further O'Gara penalties extended Ireland's lead to 17 6 as the game entered the final quarter. Two Percy Montgomery penalties set up a frantic finish but Ireland held out to claim a famous victory. Ireland began strongly and were never led, but the match was tense and closely fought throughout. Aware of the threat posed by the South Africans, Ireland pressed hard from the outset, and played some impressive rugby while searching for a breakthrough. Early on, Denis Hickie thought he was in for a try after a delightful backline move but Shane Horgan's pass was adjudged to have gone forward by referee Paul Honiss. Ireland continued to press and they showed their intent by opting for a line out in the 19th minute when three straight forward points were on offer. Another South African infringement a minute later led to Ireland's first points O'Gara took a quick tap penalty and charged over the opposition line for an Irish try. The Springboks could feel hard done by as captain John Smit had his back to the play when O'Gara pounced after referee Honiss had told the skipper to warn his own players after consistent infringements. Stung by the score, the South Africans almost replied with a try of their own within 60 seconds with Geordan Murphy's ankle tap tackle denying a certain try for Percy Montgomery. However, the Springboks did win a penalty a minute later which Montgomery easily slotted to cut Ireland's lead to 5 3. Ireland got out of jail when the South Africans had a three to one overlap near the Irish line only to waste the chance. After the sustained Springboks pressure, the Irish produced an attack of their own in the 34th minute which culminated with O'Gara's clever drop goal to restore his side's lead to five points which remained the margin at half time. Sustained Irish pressure immediately after half time was rewarded by another O'Gara penalty. However, Montgomery responded quickly by slotting over a superb penalty from near the right touchline to cut Ireland's lead to five points again. Montgomery then burst through the Irish defence in the 48th minute and it took a superb Girvan Dempsey tackle to prevent a try. The South Africans suffered a double blow in the 52nd minute when Schalk Burger was sin binned for the second week in a row after killing the ball and O'Gara punished the transgression by notching another penalty. In the 61st minute, Hickie was left frustrated by a poor pass from Girvan Dempsey as a chance to seal the match was wasted. However, a late tackle on Brian O'Driscoll enabled O'Gara to notch another penalty in the 63rd minute which extended Ireland's lead to 17 6. However, two Montgomery penalties had Ireland's lead in peril again as the Springboks closed to within five points with seven minutes remaining. South Africa produced a huge effort in the closing minutes but Ireland held on to claim a deserved victory. G Dempsey; G Murphy, B O'Driscoll (capt), S Horgan, D Hickie; R O'Gara, P Stringer; R Corrigan, S Byrne, J Hayes, M O'Kelly, P O'Connell, S Easterby, J O'Connor, A Foley. F Sheahan, M Horan, D O'Callaghan, E Miller, G Easterby, D Humphreys, K Maggs. : P Montgomery; B Paulse, M Joubert, De Wet Barry, A Willemse, J van der Westhuyzen; F Du Preez; O Du Randt, J Smit (captain), E Andrews, B Botha, V Matfield, S Burger, AJ Venter, J van Niekerk. : H Shimange, CJ van der Linde, G Britz, D Rossouw, M Claassens, J de Villiers, G du Toit/J Fourie. Paul Honiss (New Zealand)


Argentina is set to close its 102.6bn ( 53.51bn) debt restructuring offer for bondholders later on Friday, with the government hopeful that most creditors will accept the deal. The estimated loss to bondholders is up to 70% of the original value of the bonds, yet the majority are expected to accept the government's offer. Argentina defaulted on its debt three years ago, the biggest sovereign default in modern history. Yesterday Argentina's economy minister, Roberto Lavagna, said that he estimated that the results of the restructuring would be ready around next Thursday (3 March). Argentina's President, Nestor Kirchner, said on Friday: "A year ago when we started the swap (negotiations), they told us we were crazy, that we were irrational." But he added that his government was close to achieving: "The best debt renegotiation in history." The country has been in default on the 102.6bn based on an original debt of 81.8bn plus interest for the past three years. If the offer does not go ahead, international lawsuits on behalf of aggrieved investors could follow but analysts are optimistic that it will go through, despite the tough terms for bondholders. About 70% to 80% of bondholders are expected to accept the terms of the offer. By 18 February, creditors holding 41bn or 40% of the total debt had accepted the offer. Sorting out its debt would enhance the country's credibility on international markets and enable it to attract more foreign investment. Of Argentina's bondholders, 38.4% reside in Argentina, 15.6% in Italy, 10.3% in Switzerland, 9.1% in the United States, 5.1% in Germany and 3.1% in Japan. Investors in the UK, Holland and Luxembourg have about 1% each and the remainder were not broken down by country. The deal is likely to be taken up most enthusiastically by domestic investors, who will benefit if Argentina's economy becomes more stable.


"Irreversible environmental damage" will be caused by government plans to build more than one million homes in south east England, MPs have warned. "Sustainable communities" were being promoted without a real understanding of what "sustainable" means, the Environmental Audit Committee said. It said issues like energy needs and transport were not properly addressed. Deputy Prime Minister John Prescott said the report was completed before new initiatives were announced. He said: "We are working across government, especially with our colleagues at Defra, to create cleaner, safer and greener communities, while protecting and enhancing the environment." The report said there was far too little attention paid to many environmental issues, including water, even though supplies in parts of the South East are already too low. Regulations designed to ensure energy efficient buildings are too lax, and builders routinely flout them anyway, it said. Financing for improving transport was around one twentieth of what would be required. The report was a stinging rebuke for the government and especially John Prescott's department, BBC environment correspondent Richard Black said. Chairman of the Environmental Audit Committee Peter Ainsworth MP, said: "The government's housing policy is an alarming example of disjointed thinking in an areas where joined up policy is crucial. "I accept the need to improve housing supply but, as things stand, the principal beneficiary of housing growth will be property developers, with the environment we all depend on being the principal loser." Points raised in the report included: No proposals to further increase housing supply should be taken forward without strong supporting evidence. The government should recognise shortcomings of the Treasury's Barker Review, which said 140,000 new homes a year were needed in Britain. The government should consider a "national spatial framework" for England such as those already in place in Scotland and Wales. The Office of the Deputy Prime Minister should maximise brown field development and housing densities. Measures to encourage improved energy efficiency for existing homes should be considered including reduced stamp duty for homes that achieve set standards and a clear timetable for achieving zero emissions homes. The government should make clear how it intends to measure its success at creating sustainable communities. Conservative local government spokeswoman Caroline Spelman said: "There is now growing evidence that John Prescott's buildings programme is environmentally unsustainable, leaving a concrete scar across the face of rural England."