Irish Parties Agree On Coalition Govt Deal

9:07pm UK, Sunday March 06, 2011

Kat Higgins, Sky News Online

The leaders of Ireland's two largest parties have agreed on a deal for a coalition government and have promised to demand a renegotiation of the EU/IMF bailout.

Enda Kenny (L) And Eamon Gilmore struck a deal early on Sunday morning

The centre-right Fine Gael won the General Election in February but without enough seats to gain an overall majority.

Leader Enda Kenny said on Sunday that he had struck a partnership deal with Eamon Gilmore's centre-left Labour party after six days of talks.

The leaders then put the details of the agreement to their parties at separate gatherings in Dublin and were given the green light to go ahead with the deal.

The new government will hit the ground running as it battles to pull the country back from the economic brink, Mr Kenny vowed.

"We are looking forward to the formation of the Government on Wednesday which will give stable and strong governance to Ireland and its people," he said.

Labour leader Mr Gilmore said there was no time for any honeymoon.

"There's an urgency to deal with the economic problems and we're acutely aware of that," he said.

Mr Kenny has vowed to hit the ground running

"We are not planning on taking any honeymoon. It will be straight into it."

A key pledge of the new government is to rebuild the country's reputation abroad and one of Mr Kenny's first engagements as new Taoiseach will be the extraordinary European Council meeting in Brussels on Friday.

Ministers have promised to seek better repayment terms for last December's 85bn euro EU/IMF rescue package

Brendan Howlin, Labour's chief negotiator in the coalition talks, said a renegotiation of the bailout was in everybody's interests.

"We have to repair broken bridges across our European partners, to build up an understanding of our position," he said.

"It's in everybody's interests, not only the national interest of Ireland, but in Europe's interest and in the interest of maintaining the euro, that we have a path that is sustainable out of the economic hole that we find ourselves in now."

Fine Gael's Michael Noonan, a former party leader, is widely tipped to be the new finance minister.

Appointments will be formally announced on Wednesday.

Osborne: Stopping Cuts Would Spark 'Panic'

8:52pm UK, Sunday March 06, 2011

Adam Arnold, Sky News Online

Firms would go bust, jobs would be lost and the financial markets would panic if the Government stopped its deficit reduction plans, the Chancellor has warned.

Speaking to Sky News, George Osborne defended his economic strategy ahead of the budget later this month and said there was no plan B.

He said changing course was not an option after the Government's strategy had brought stability to the UK and enabled it to keep interest rates low.

The coalition has been criticised by Labour for its spending cuts in public services, saying they are too fast and too deep.

But Mr Osborne said if he abandoned his plan "there would be panic the following day".

"Markets would crash, the credit rating would be downgraded, interest rates would rocket for families and businesses."

He added that "investment would be cancelled, business would go bust, jobs would be lost."

He has also hinted that a planned 1p rise in fuel duty due next month might not go ahead amid fears that petrol may soar to £2 a litre due to Middle East unrest.

If you take £100bn out of the economy over the next four years, you risk derailing the economy.

Former chancellor Alistair Darling

Mr Osborne admitted that all families were being squeezed by the high price of food and petrol.

He said: "I hear what people are saying to me and am aware of the challenge. Fuel prices have clearly gone up considerably recently."

Amid the fragile economy, Mr Osborne is planning enterprise zones that encourage businesses to be set up in different areas by offering them particular tax relief.

Mr Osborne said in his next budget he wants "to unleash the forces of enterprise and aspiration".

He said the budget package would include a series of measures to boost growth.

The former chancellor Alistair Darling told Sky News it makes sense to put off the fuel duty rise but he believed Mr Osborne could have done it in the last budget in the summer.

He also criticised the Government's spending cuts, saying: "If you take £100bn out of the economy over the next four years, you risk derailing the economy."

Cameron To Fight 'Enemies Of Enterprise'

Ruth Barnett, political reporter

David Cameron has vowed to fight the "enemies of enterprise" in an effort to drag the UK economy out of the doldrums.

The Prime Minister told the Conservatives' spring forum he wants to make it easier for people to start their own business and will get rid of some of the rules and regulations that stand in the way.

He blamed Labour for suppressing enterprise since 1997, joking that even his baby daughter Florence knew that "tax and regulation" was holding the country back.

"Someone joked to me the other day that the biggest growth industry in Britain this past decade has been the people writing the rules," Mr Cameron said.

"But actually it's no joke.

"Every regulator, every official, every bureaucrat in government has got to understand that we cannot afford to keep loading costs onto business because frankly they cannot take it any more.

The enterprise culture is alive and well. Now we just need an enterprise government to go with it.

David Cameron

"And if I have to pull these people into my office to argue this out myself and get them off the backs of business then believe me, I'll do it."

Among his proposals is a plan to encourage government departments to award more contracts to small and medium-sized firms.

"There is no shortage of enterprise in this country," he told delegates in Cardiff.

"I see it in the ideas and energy of all the entrepreneurs I meet - British people selling curries to India and fashion to France.

"The enterprise culture is alive and well. Now, we just need an enterprise government to go with it," he added.

Mr Cameron added that he would also be watching the banks "like a hawk" to make sure they fulfilled lending commitments to small businesses.

His coalition has come under pressure to demonstrate it does have a plan for encouraging growth and creating jobs.

I suspect the Tory rank and file care more passionately about the threat to their party from AV than some senior politicians.

Sky's political correspondent Jon Craig

At the end of last year, the economy shrank by 0.6%, raising fears the economic recovery had stalled.

Labour has accused the Government of implementing spending cuts that are too fast and too deep.

But Mr Cameron also defended these, saying not to cut would be "cowardly".

He also used the speech to call again for Libya's Colonel Gaddafi to step down, saying the Conservatives would continue to "intensify pressure" on his regime.

Chancellor George Osborne has also insisted he has implemented the right policies for the UK economy and has no plans to change course.

He told Sky News he had a "credible" policy that has been endorsed by "almost every international organisation you can think of".

"What we’ve bought for ourselves, with the very large mess in the public finances I’ve inherited, is breathing space, stability - the things that Ireland and Greece don’t enjoy," he said.

Libya: 'Eight SAS Soldiers Freed By Rebels'

8:52pm UK, Sunday March 06, 2011

Mike Bradbury, Sky News Online

Eight SAS soldiers who had been detained by Libyan rebels near Benghazi have left the country aboard HMS Cumberland, according to Sky News sources.

According to reports the group had been taken to Benghazi after being apprehended near the city.

A British diplomat who was with the unit was said to have been involved in negotiations for their release.

The Foreign Secretary William Hague has confirmed that a British diplomatic team who had been detained by Libyan rebels had been freed and had left the country.

"The team went to Libya to initiate contacts with the opposition," said Mr Hague.

He added "They experienced difficulties which have now been satisfactorily resolved."

The Foreign Secretary said other diplomats would be sent to Libya to "strengthen dialogue" with rebel leaders.

The rebels had earlier been reported as saying the soldiers were being well treated and the issue would soon be resolved.

Conversation between ambassador and rebel leader

Defence Secretary Liam Fox earlier confirmed that a "small diplomatic team" had been in Benghazi to talk to Libyan rebels.

Mr Fox declined to comment on reports the SAS unit guarding the team had been detained.

"We are in touch with them but it would be inappropriate for me to comment further on that" he told the Andrew Marr show.

According to the Sky sources the eight SAS members were among a group of around 22 soldiers and one diplomat believed to have been dropped by helicopter in an area south of the Benghazi.

Sir Menzies Campbell On Libyan Developments

Audio of a telephone conversation between the UK's ambassador to Libya, Richard Northern, and a senior rebel leader was later leaked.

In it Mr Northern suggested the SAS team had been detained due to a "misunderstanding".

The rebel leader responded: "They made a big mistake, coming with a helicopter in an open area."

Mr Northern said: "I didn't know how they were coming."

The SAS's intervention allegedly angered Libyan opposition figures who ordered the armed and plain-clothes soldiers to be locked up on a military base.

Google map highlighting the city of Benghazi

Opponents of Libyan leader Muammar Gaddafi's feared he could use any evidence of western military interference to rally patriotic support for his regime.

The Geneva-based Human Rights Solidarity group says the soldiers were caught when they were at a location 6 miles (10km) from Benghazi's airport at Benina.

:: Libyan warplanes are reported to have launched airstrikes on rebels advancing on Colonel Muammar Gaddafi's stronghold of Sirte 350 miles (560km) west of Benghazi.

Saudi Arabia imposes ban on all protests

Saudi officials are aware of protests - sometimes focused at their country - building across the region

All protests and marches are to be banned in Saudi Arabia, the interior ministry has announced on state TV.

Its statement said security forces would use all measures to prevent any attempt to disrupt public order.

The announcement follows a series of protests by the kingdom's Shia minority in the oil-producing eastern province.

Last month, King Abdullah unveiled a series of benefits in an apparent bid to protect the kingdom from the revolts spreading throughout many Arab states.

"Regulations in the kingdom forbid categorically all sorts of demonstrations, marches and sit-ins, as they contradict Islamic Sharia law and the values and traditions of Saudi society," the Saudi interior ministry statement said.

It added that police were "authorised by law to take all measures needed against those who try to break the law".

The protests in the Eastern Province - where much of the country's crude oil is sourced - have been demanding the release of prisoners who demonstrators say have been held without trial.

The announcement of the crackdown on protests follows the return, last week, of King Abdullah to the capital after an absence of several months due to illness.

He unveiled an additional $37bn (£22.7bn) in benefits for citizens, including a 15% pay rise for state employees, as well as extra funds for housing, studying abroad and social security.

China security tight after new protest calls

Police in Beijing shut the underground and mobile phone networks, and helicopters were deployed

China has mounted a huge security operation in the capital in response to renewed online calls for protests.

Anonymous postings had urged people to stroll silently in areas of major cities, as a way of calling for change.

The BBC's Damian Grammaticas in Beijing says crowds of shoppers were out but it was not clear if any were protesters.

The massive police deployments are being seen as a sign of the Communist Party's nervousness at the civil unrest and revolutions across the Arab world.

The security blanket thrown over the parts of Beijing on Sunday afternoon was extraordinary, our correspondent says.

This was the third week of calls for protests and the anonymous posts urged people to take a walk through Xidan, a busy shopping area.

At Xidan and another shopping area, Wangfujing, there were hundreds of uniformed police; men posted every few yards. Reporters were banned from filming or interviewing anyone.

Data signals on mobile phones were blocked and everywhere were huge numbers of plain clothes security men; wearing ear pieces, watching everything, our correspondent reports.

Grammaticas in China

Despite the booming economic growth there are millions who feel shut out, angry at official corruption, at inequalities that are rising, at land grabs.

That's why the government is so concerned about the possibilities for unrest.

He says uniformed police politely checked his identity documents - in contrast to the previous weekend when the BBC team was taken away violently by plain clothes officers.

In Zhongguancun near Peking University, police also closed down the subway and mobile phone networks, and police helicopters were reported hovering overhead.

Online messages said there may have been a planned gathering of students there.

'The wrong idea'

Meanwhile, in a more hardline interpretation of current reporting rules, officials said that foreign reporters must seek government permission to conduct interviews in Beijing.

At a news conference, Li Honghai, vice-director of Beijing's Foreign Affairs Office, said reporters must apply for government permission before carrying out any news gathering in the city centre.

Beijing officials at the briefing denounced the protest calls as an attempt to undermine China's stability.

"All clear-minded people will know that these people have chosen the wrong place and have the wrong idea.

"The things they want to see take place have not and cannot occur in Beijing," said city government spokeswoman Wang Hui.

China's government is aware there are many possible reasons for popular discontent.

In his speech at the opening of the annual National People's Congress on Saturday, Premier Wen Jiabao said there were still fundamental issues the government must solve, which he said the masses felt strongly about.

Among the issues he listed were inflation, exorbitant house prices, land appropriations and house demolitions by the government and rampant corruption.

"We must make improving the people's lives a pivot linking reform, development and stability... and make sure people are content with their lives and jobs, society is tranquil and orderly and the country enjoys long-term peace and stability," Mr Wen said.

He made no mention of the unrest in the Middle East.

Japan Foreign Minister Seiji Maehara resigns

Mr Maehara has been seen as a potential successor to the prime minister

Maehara has resigned after being criticised for accepting a political donation from a foreign national.

Japanese law bans the practise, if done intentionally, and the opposition had called on him to quit.

The move is seen as a blow to Prime Minister Naoto Kan, who has been struggling to get budget bills through parliament and keep onto his own job.

Mr Maehara had been seen as a potential successor to Mr Kan.

On Friday, he admitted taking a 50,000 yen ($610) political donation from a South Korean national resident in Japan.

PM under pressure

The sum is small but Japanese law bars politicians from accepting money from outsiders to prevent foreign powers having influence on domestic politics.

The opposition said Mr Maehara's position was untenable.

"I apologise to the Japanese people for stepping down after only six months and provoking distrust over a problem with my political funding, although I have sought to pursue a clean style of politics," Mr Maehara said announcing his decision to step down.

Even before the scandal, Mr Kan was battling to stave off opposition calls for an early general election, says the BBC's Roland Buerk in Tokyo.

He wants to implement tax reform to cover the costs of Japan's rapidly ageing society and rein in its massive public debt.

But deadlock in parliament means Mr Kan is struggling to pass bills to implement the trillion- dollar budget for the new financial year which begins next month.

The foreign minister had called for closer ties with the US and had been critical of China's military build-up.