Berlusconi 'obliged' to stay in politics

FORMER Italian prime minister Silvio Berlusconi said he felt "obliged" to stay in politics to reform the justice system, the day after he was found guilty of tax fraud and sentenced to a year in prison.

"There are going to be consequences," he told TG5, one of the television stations he owns, after branding Friday's verdict an "intolerable" political ruling.

"I feel obliged to stay in the (political) field to reform the planet justice," he said.

The 76-year-old three-time premier had announced on on Wednesday that he would not run in the next election due in the spring but did not say he was withdrawing completely from political life.

"I will not be presenting my candidacy but I will remain at the side of younger people who can play and score goals," he said.

Two days later he was sentenced to four years in prison for tax fraud, a term reduced to one year thanks to an amnesty, and banned from holding public office for five years.

Berlusconi's reaction was defiant.

"This is an incredible and intolerable political sentence. This is no doubt a political verdict, as political as all trials fabricated against me," he said.

The sentence will not come into effect until appeals have been heard by two higher courts. By that time the statute of limitations will probably have kicked in.

His lawyers have said they will file an appeal next month.
 

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EU lawmakers cancel Iran visit in row

A VISIT to Iran by five Euro MPs has been called off after Tehran refused to let them meet with a jailed activist lawyer and a filmmaker, just a day after the two were awarded a prestigious European human rights prize.

"The five MEPs were about to leave for Tehran when delegation chair (Tarja) Cronberg received a phone call from the Iranian ambassador to the EU, saying they would not be allowed to meet with the two Sakharov Prize winners," jailed lawyer Nasrin Sotoudeh and filmmaker Jafar Panahi, a European Parliament source said.

Sotoudeh, 47, who is serving an 11-year jail sentence for conspiring against state security, and Panahi, 52, who is under house arrest and has been banned from making films for 20 years, were awarded the 2012 Sakharov Prize on Friday.

"The Islamic Republic of Iran categorically rejected any pre-conditions. Therefore this visit has been cancelled," the Young Journalists Club, an affiliate of the state broadcaster, reported on its website.

The ISNA news agency quoted Hossein Sheikholeslam, international affairs adviser to the speaker of parliament, as saying Iran had "rejected a pre-condition set by the European parliamentary delegation to meet with two prisoners".

"If the delegation agrees to visit Iran under the initially agreed conditions and agenda, then there is no objection to the visit... But we cannot accept the current pre-condition."

Iran has cracked down on both since its disputed June 2009 presidential election.

Sotoudeh is a leading human rights campaigner known for her work as a lawyer representing opposition activists, while Panahi has been acclaimed at international festivals for his gritty, socially critical movies.

The human rights and democracy prize "is a message of solidarity and recognition to a woman and a man who have not been bowed by fear and intimidation and who have decided to put the fate of their country before their own," Parliament President Martin Schulz said on Friday.

Schulz had also warned the visit would be cancelled if the delegation was unable to meet Sotoudeh and Panahi.

The rights award comes on the heels of tough new European Union sanctions against Iran aimed at forcing a breakthrough in talks between global powers and Tehran on its disputed nuclear program.

After a biting oil embargo took effect in July, EU foreign ministers last week tightened the economic noose by targeting dealings with Iran's banks, shipping and gas imports.

The last visit by a European parliamentary delegation to Iran was in 2007.

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Russian opposition leaders detained

RUSSIAN opposition leaders have been detained while protesting what they say is the torture of a fellow activist.

Investigators earlier this week said that Leonid Razvozzhayev had turned himself in and confessed to plotting riots. But days later the activist disavowed his confession and filed a complaint over what he said was his abduction from Ukraine.

Rights activists who visited him in jail say he had been tortured into confessing.

Police detained Alexei Navalny, Sergei Udaltsov and Ilya Yashin as they were standing outside the Russian former intelligence and former KGB headquarters, protesting "torture and repression."

The three men were among hundreds of people gathered in central Moscow to protest an increasingly relentless crackdown on the opposition in Russia.

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Iraq Eid attacks kill 16

ATTACKS mostly targeting Shi'ite Muslims during the Eid al-Adha holiday, including bombings of a marketplace and a minibus carrying pilgrims, killed at least 16 people in Iraq on Saturday.

The shootings and explosions, which also left more than 40 people wounded, were the latest in a spate of violence in the past week that has broken a relative calm in Iraq, even though authorities had announced a series of moves to boost security during the four-day Eid break.

UN special envoy Martin Kobler condemned Saturday's violence as "atrocious", adding in a statement: "The targeting of worshippers is an appalling crime."

In the east Baghdad district of Maamal, a bomb exploded in a neighbourhood market as women were shopping for groceries alongside their children at around 9am (4pm AEDT).

At least five people were killed, including three children and a woman, security and medical officials said. They added that 13 others were wounded.

Just north of Baghdad in the town of Taji, a magnetic "sticky bomb" attached to a minibus ferrying Shi'ite pilgrims killed at least five people and wounded 12 others, a security official and medics said.

The doctors warned that the toll could rise.

Officials said some Iranian pilgrims were among the dead and wounded, but it was unclear how many. Differing tolls and details of casualties are common in the chaotic aftermath of attacks in Iraq.

A Shi'ite car salesman in the town of Muqdadiyah was shot dead, and eight people were wounded by a car bomb targeting a Shi'ite religious foundation's offices in the town of Tuz Khurmatu.

Shi'ites in Iraq typically use the Eid al-Adha holiday, which began on Friday, to either visit relatives, the graves of dead family members or shrines of key figures in Shi'ite Islam located across the country.

In the run-up to the holiday, authorities in several provinces, including Baghdad, announced tightened security for the holiday, apparently to no avail.

While no group has yet claimed responsibility for the attacks, Sunni militants frequently target Shi'ite pilgrims during Muslim holidays such as Eid or Shi'ite commemoration ceremonies.

In Mosul, 350km north of Baghdad, three attacks targeting the tiny Shabak community killed five people and wounded 10 others, officials said.

In separate shootings, gunmen burst into the homes of Shabak families and killed five people and wounded four others, including young children, while a bombing in the compound of a family home wounded six.

"The security forces are supposed to be responsible for protecting all the citizens of Mosul," said Qusay Abbas, a Shabak member of the provincial council of Nineveh, of which Mosul is the capital.

"This is a very troubling attack."

The Shabak community numbers about 30,000 people living in 35 villages in Nineveh. They largely follow a faith that is a blend of Shi'ite Islam and local beliefs.

The community was persecuted under former Iraqi dictator Saddam Hussein, and after the 2003 US-led invasion they were targeted several times by al-Qaeda.

Mosul is widely cited as one of the places where al-Qaeda Iraqi front still holds sway.

At least 49 people have been killed in a week since October 20, more than in the first 15 days of the month combined, according to an AFP tally.

At least 250 people have been killed as a result of unrest in each of the past four months.

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Rebels raid poultry farm

COMMUNIST guerrilla rebels raided a poultry farm in the southern Philippines and torched two buildings after the owner ignored their extortion demands, the military said on Saturday.

Thousands of chickens were killed after rebels from the New People's Army set fire to the buildings in a pre-dawn attack on Friday, military spokesman Captain Alberto Caber told reporters.

The rebels later contacted the farm owner Onyx Go by telephone, threatening to return with gasoline and matchsticks unless he agreed to pay up 60,000 pesos ($1400) a month, according to a military statement.

The raid marked the second such attack on businesses owned by Mr Go since last year, when his chicken shop in a nearby town was ransacked by the rebels, Captain Caber said.

The Maoist NPA has been waging a decades-old guerrilla campaign that has cost tens of thousands of lives.

Earlier this month the Philippine government said it hoped to resume peace talks with the communist rebels, after announcing a peace agreement with Muslim rebels who also operate in the restive south.

Talks with the communist rebels were suspended in November last year due to persistent demands by the rebels to free jailed comrades they claimed were consultants to the negotiations.

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Hong Kong to cool property market

HONG Kong announced it will raise real-estate purchasing and resale costs to cool its overheating property market down, in a move targeting non-local buyers and speculative activities.

The prices of small and medium sized residential flats in the southern Chinese city, famous for its sky-high rent, surged 20 per cent for the first nine months of the year, prompting the government to take action.

The new measures include the increase of special stamp duties for properties re-sold within the first three years of its purchase and imposing an extra 15 per cent transaction cost on non-local buyers and local and foreign companies.

The measures "targets speculative activities, and for most genuine homebuyers it would not affect them because they won't be reselling in a short period of time", said Financial Secretary John Tsang.

The extra 15 per cent transaction cost "will cause inconvenience to some non-local buyers. We hope that they will understand that this is an extraordinary measure introduced in exceptional circumstances," Mr Tsang said.

The new measures will go into affect today.

Mr Tsang attributed the substantial increase in the demand for property to low interest rates, adding that the city's economy is showing signs of slowing down due to a weak US market recovery and Euro sovereign debt crisis.

"It is apparent that the property market and the local economy are heading in different directions," he said.

Mr Tsang also acknowledged that the city was in short supply of residential units.

Hong Kong in August unveiled a series of measures to cool the red-hot property market, including to provide around 65,000 new units on the market in the next three to four years.

"Maintaining a healthy stable property market will be our ongoing endeavour," Mr Tsang said.

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Retail Adventures goes into administration

DISCOUNT store business Retail Adventures has gone into voluntary administration with jobs at risk and store closures expected.

Retail Adventures is the largest trader of discount stores such as Sam's Warehouse, Crazy Clark's, Chickenfeed and Go-Lo stores.

The company's board of directors made the decision to place the company in voluntary administration and appointed Deloitte's Vaughan Strawbridge and two of his partners to oversee the restructure of the business, the company said in a statement.

Under the restructure, the company's 238 stores and 5000 full-time staff will continue under the Sam's Warehouse and Crazy Clark's brands.

The company said 29 Crazy Clark's, Go-Lo and Chickenfeed stores have already been closed, with more store closures expected in NSW, Victoria and Tasmania.

It said 57 Chickenfeed and Go-Lo stores will be rebranded as Crazy Clark's stores.

Retail Adventures chief executive Penny Moss said all staff who lose their jobs will be paid their entitlements with alternate employment offered where possible.

"The infrastructure and overheads of both the distribution centres and our head office are currently unsustainable," she said in a statement on Saturday.

"The restructure is necessary to preserve value for the creditors and make sure the business is financially viable in the future."

The 238 continuing Sam's Warehouse and Crazy Clark's stores will be operated from Saturday under licence from the voluntary administrators by DSG Holdings Australia Pty Ltd, the current holding company of Retail Adventures.

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Sudan-Iran links scrutiny after blast

SUDAN'S links to Iran came under scrutiny after Khartoum accused Israel of a deadly missile strike on a military factory in the heart of the Sudanese capital.

The cabinet met in urgent session late Wednesday after the government said evidence pointed to Israeli involvement in the alleged attack at around midnight Tuesday on the Yarmouk military manufacturing facility in southern Khartoum.

Sudan accused the Jewish state of a similar raid 18 months ago.

Analysts, however, said they had not ruled out an accidental cause for the latest blast.

Israeli officials have expressed concern about arms smuggling through Sudan and have long accused Khartoum of serving as a base of support for militants from the Islamist Hamas movement.

Israel refused all comment on the Khartoum allegations, but Amos Gilad, a top Israeli defence official, called Sudan "a dangerous terrorist state."

Gilad, director of policy and political-military affairs at the defence ministry, refused to reply directly when asked whether Israel was involved in the attack, which Sudan said was conducted by four radar-evading aircraft.

"The regime is supported by Iran and it serves as a route for the transfer, via Egyptian territory, of Iranian weapons to Hamas and Islamic Jihad terrorists," he told his country's army radio.

"Sudanese President Omar al-Bashir is regarded a war criminal."

Bashir is wanted by the International Criminal Court for alleged crimes against humanity, war crimes and genocide in Sudan's Darfur region where a rebellion began in 2003.

His cabinet issued no statement after its late Wednesday meeting, where Bashir joined anti-Israel protesters in chanting "Allahu akbar" ("God is greater").

About 300 demonstrators denounced the United States and carried banners calling for Israel to be wiped off the earth.

"There was supposed to be an agreement between Sudan and Iran to produce some kind of non-conventional weapons," a diplomatic source told AFP on Thursday.

The source, asking not to be identified, said he was also told that the Yarmouk factory was involved in drone production.

But Jonah Leff, of Small Arms Survey, a Swiss-based independent research project, said he doubts such equipment is made locally.

Mr Leff's project has documented the presence of a drone, landmines and other Iranian weapons in Sudan but he thinks they were acquired directly from Iran.

"There's a lot of speculation that Iran has provided technical assistance to the Sudanese for their weapons manufacturing but I haven't been able to confirm that they're producing any Iranian weapons," he said.

On a visit to Tehran last August, Bashir described the relationship between Sudan and Iran as "deeply rooted".

Leff identified Yarmouk as part of Sudan's Military Industry Corporation, which claims to produce a variety of weapons from pistols to battle tanks.

"They're highly secretive... It's hard to know what exactly they're producing and what is propaganda," Leff said.

Information Minister Ahmed Bilal Osman told reporters that the factory made "traditional weapons".

Nearby residents said an aircraft or missile had flown overhead shortly before the area exploded in flames, sending bursts of white light into the night sky.

Sudan called on the UN Security Council to condemn Israel for what its envoy, Daffa-Alla Elhag Ali Osman, called "a blatant violation of the concept of peace and security" and the UN charter.

On Wednesday, before officials accused Israel, the governor of Khartoum state Abdul Rahman Al-Khider dismissed speculation that "other reasons" caused the explosion, which he said happened in a store room.

The diplomatic source said "the human factor" - a possible accidental cause - should not be ruled out although Sudanese officials are taking allegations of Israeli involvement seriously.

Mr Leff said it is just as likely that the Sudanese are blaming Israel to avoid embarrassment after an accidental blast.

In April last year, Sudan said it had irrefutable evidence that Israeli attack helicopters carried out a strike on a car south of Port Sudan.

That incident mirrored a similar attack by foreign aircraft on a truck convoy reportedly laden with weapons in eastern Sudan in January 2009.

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Pope's butler set to be jailed

THE Pope's butler Paolo Gabriele will be locked up in a Vatican police cell after the prosecution decided not to appeal against his 18-month prison sentence for leaking papal documents, the Vatican says.

Gabriele had been under house arrest since he was found guilty on October 6 of stealing documents from Pope Benedict XIV's apartments. A judicial source said later he would not be appealing against the verdict.

"Given that no appeals have been lodged against the sentence of October 6 in respect of Mr Paolo Gabriele, it becomes definitive," a statement from Father Federico Lombardi, the director of the Holy See press office, said on Thursday.

"As a result, on the warrant of the president of the court the prosecutor gave orders this morning for his imprisonment, in carrying out the sentence," the statement said.

"The warrant should be executed during the day."

The former butler was found guilty of leaking hundreds of sensitive Vatican documents in a case that has been dubbed "Vatileaks" and included allegations by a former governor of the city state of massive fraud within its walls.

A papal pardon has not been ruled out.

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Chinese investment in Australia slows

CHINESE investment in Australia has declined since 2009 while Australian investment in China almost tripled, a new report shows.

The latest Asialink Index, calculated by PricewaterhouseCoopers (PwC) and the Melbourne Institute, shows Australia's economic relationship with China soared to new highs, growing by 53.5 per cent in 2011.

This reflects buoyant growth in outward investment - up by 278 per cent in 2011 - from Australia into China and strong growth in tourism, the index released on Friday shows.

But Chinese investment in Australian projects fell by 51 per cent.

PwC partner Tim Cox said this was in stark contrast to widespread perceptions in public debate on foreign investment.

Australian investment in China now amounts to about $17 billion, just $2 billion shy of the flow of funds the other way.

"The recent increase in Australia's investment into China is encouraging as it demonstrates that Australian businesses are preparing to commit to deeper engagement - beyond exports - for the longer term," Mr Cox said in a statement.

"It also provides important context for some community concerns about Chinese investment in Australia."

The index shows Australia's engagement with Asia increased by eight per cent over the past five years, whereas engagement with the rest of the world declined by 13.3 per cent.

But Asialink CEO Jenny McGregor warned that the jump in engagement with China could mask the fact that more needed to be done to maintain relationships elsewhere in the region.

Ms McGregor highlighted the finding that engagement with ASEAN had been relatively flat over the past five years.

As well, the measurements of our economic relationships with Japan and Korea are down from positions of relative strength.

The index shows that in 2011 engagement in the education sector fell for the first time in a decade.

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Ecuador worried about Assange's health

ECUADOR is 'very concerned' about the health of Julian Assange after the WikiLeaks founder lost a lot of weight while staying at the country's embassy in London, a foreign ministry official said this week while in Moscow.

The deputy foreign minister of Ecuador, Marco Albuja, expressed his concern for Assange as he gave a briefing to Russian press after wrapping up his delegation's visit to Russia.

"Assange has visibly lost weight, and we are very concerned for his health," he said, quoted by the Voice of Russia radio.

"In case of his illness we will have to pick among two options: to treat Mr Assange at the embassy or to hospitalise him."

Ecuador has asked the British government for written assurances that Assange, who has been granted asylum by Quito and remains holed-up in the embassy building in London, will not be arrested in case of hospitalisation.

"So far Britain has not agreed to this request but is thinking it over," Mr Albuja said.

The Ecuadorean embassy in Moscow said on Wednesday that the delegation was in Moscow to meet with Russian foreign ministry officials and discuss bilateral affairs such as flower trade.

Former computer hacker Assange, 41, walked into the London embassy on June 19 claiming asylum in a bid to avoid extradition to Sweden, where he faces questioning over alleged rape and sexual assault.

He was granted asylum on August 16 but Britain refuses to grant him safe passage out of the country, and he remains in the embassy with Ecuador in a diplomatic stalemate with Britain.

Assange denies the sex crimes allegations and claims he could eventually be passed from Sweden to the United States for prosecution over the WikiLeaks website's publication of hundreds of thousands of classified US documents.

WikiLeaks enraged Washington in 2010 by publishing a flood of secret military files on the wars in Iraq and Afghanistan, as well as a huge cache of diplomatic cables from US embassies across the world.

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EU debt mountain continues to grow

EUROPEAN national debt levelsis continuing to rise way above EU limits, official data shows, as the eurozone debt crisis undermines government revenues.

The EU statistics agency Eurostat said total accumulated national debt in the 17 eurozone nations increased to 90 per cent of Gross Domestic Product (GDP) in the second quarter, up from 88.2 per cent in the first three months of the year.

In the full 27-member EU, debt rose to 84.9 per cent from 83.5 per cent.

The EU sets a 60 per cent cap on total debt and 3.0 per cent on annual public deficits but such limits have been under pressure for years in many states and the eurozone debt crisis has only made things worse.

The austerity policies adopted to cope with the crisis have cut government spending but in doing so they have also undercut growth sharply, with tax revenues falling in tandem.

Debt at levels approaching 100 per cent are widely seen as unsustainable for the long term but some countries such as Japan have lived with them much higher than that for years.

The most indebted nations at the end of the second quarter were Greece, with a debt to GDP ratio of 150.3 per cent and Italy 126.1 per cent, followed by bailed-out Portugal and Ireland at 117.5 per cent and 111.5 per cent.

Eurostat said Estonia at 7.3 per cent, Bulgaria 16.5 per cent and Luxembourg at 20.9 per cent had the lowest debt burdens.

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Prison, $6b fine for rogue trader

THE Paris appeals court has ordered former Societe Generale trader Jerome Kerviel to spend three years in prison and pay back a staggering 4.9 billion euros (about $6.2 billion) in damages for one of the biggest trading frauds in history.

The 35-year-old Kerviel, who never profited personally from his unauthorised trades, says he was a scapegoat for the bank and a victim of a financial system that runs on greed and profits.

His lawyer David Koubbi called the verdict "absolutely lamentable" and said his team will consider taking the case to France's highest court.

A lower court convicted Kerviel in October 2010 of forgery, breach of trust and unauthorised computer use for covering up bets worth nearly 50 billion euros in 2007 and 2008. By the time his trades were discovered and made public, he had amassed losses of almost 5 billion euro on those bets.

The sentence - a five-year prison term, with two years suspended, plus the payback of all the losses he incurred - shocked many in the French public. After a global financial crisis that many blamed on big banks, many believed Kerviel's claim that he was a victim of an unjust system.

The appeals court upheld the full conviction and sentence. It did not send Kerviel directly to prison, leaving him free pending his decision on whether to appeal to the Court of Cassation. He has five days to make that decision.

Kerviel arrived at the courthouse in a dark suit and looking tense and left through a back entrance without speaking to reporters. He had sought an acquittal, saying the bank had turned a blind eye to his exorbitant trades as long as they made money. Prosecutors and the bank say that isn't true.

Societe Generale lawyer Jean Veil said the verdict was "a great satisfaction." He suggested the bank wouldn't make Kerviel pay back the full multibillion-euro sum, and would take into account his income and assets.

"Societe Generale will look at it with realism," Mr Veil told reporters.

But he added, "It would have been indecent for Mr. Kerviel to be able to preserve revenues coming from the exploitation of his fraud" such as book or movie deals.

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Germany opens memorial for Roma victims

GERMAN Chancellor Angela Merkel has opened a sombre memorial to the half million Roma and Sinti murdered by the Nazis, as she warned of still rampant discrimination against the minority.

The long-delayed monument, a round pool of water with a stone triangle at the centre on which a single fresh flower will be placed each day, sits opposite the Reichstag parliament building in central Berlin.

A timeline recounting how the Nazi extermination drive unfolded stands next to the memorial, which after 20 years of wrangling was finally built with a federal government grant of 2.8 million euros ($A3.57 million.

Auschwitz, a haunting poem by Italian writer and composer Santino Spinelli, is inscribed in English and German around the rim of the dark pool, which on Wednesday reflected the golden autumn leaves in the Tiergarten park.

Built by Israeli artist Dani Karavan, 81, it is located near two other memorials for victims of Nazi barbarism, a sprawling field of pillars for the six million murdered Jews and a smaller monument for gay victims.

Merkel, who was visibly moved during a solemn inauguration ceremony, said this horrific chapter of German history filled her with "sorrow and shame". She hailed Karavan's design as "speaking both to the heart and the mind".

"This memorial remembers a group of victims that was too long ignored," she said, noting that the West German government only acknowledged the genocide in 1982.

"It commemorates the unspeakable injustice that was inflicted on you," she told the audience including several elderly survivors. Organisers provided light blue blankets to shield them against the October chill.

"Sinti and Roma still suffer from ostracism and condemnation," she said. "Protecting minorities is our duty, today and tomorrow."

Dutch-born Zoni Weisz, 75, fought back tears as he recounted his harrowing escape from deportation with the help of a courageous policeman while much of his family was packed onto a death-camp train.

He said Europe was not living up the responsibilities accorded to it after the slaughter of Sinti and Roma nearly seven decades ago.

"Society learned nothing, almost nothing," he said. "Otherwise they would treat us differently."

Weisz's parents, sisters and younger brother were murdered at Auschwitz while he survived in hiding.

The Nazis deemed the Roma and related Sinti like the Jews to be racially inferior, and unleashed a systematic campaign of oppression against them.

In 1938 SS chief Heinrich Himmler ordered the "final solution of the gypsy question".

Those caught in the sweep were confined to ghettos, deported to concentration camps and slaughtered. Many were subjected to grotesque medical experiments and forced sterilisation.

Historians estimate nearly 500,000 Roma men, women and children across Europe were killed between 1933 and 1945, halving a population with roots in Germany dating back six centuries.

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Greece wins extension on fiscal targets

DEBT-LADEN Greece has secured a long-sought extension from its creditors to meet its fiscal targets, Finance Minister Yannis Stournaras has told parliament.

"We have obtained the extension," Stournaras said, shortly after telling reporters that he had finalised with EU-IMF creditors a new austerity agreement, although it still needs coalition government approval.

Stournaras said he had agreed the 13.5 billion euros ($A17.21 billion) austerity package that is necessary to unlock stalled loans for struggling Greece.

A finance ministry source said two draft laws relating to the package would be presented to parliament next week, to be voted by November 12.

Prime Minister Antonis Samaras's political allies, the socialist and moderate leftist parties, have baulked at calls to lower severance pay and facilitate layoffs while the country faces record unemployment.

A finance ministry source had said earlier that the government hoped to present the deal to a Euro working group meeting on Thursday, ending a negotiation that has dragged on since July.

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Govt should rethink nuclear subs: analyst

THE government must consider the nuclear option for the next generation of submarines, with US Virginia class "nukes" far more capable and cheaper than anything else Australia could acquire, a new study says.

A paper by analyst Simon Cowan says leasing up to eight Virginias from the US would cost $24-27 billion, which was competitive with proposals under consideration for conventionally powered boats.

Mr Cowan, from the conservative think-tank the Centre for Independent Studies, said Labor had dismissed the nuclear option out of hand, principally because it wanted Australian industry to make the 12 new submarines. The coalition had left its options open.

Mr Cowan said nuclear boats offered far greater range and endurance, a higher top speed, more weapons and better sensors. As a result, a fleet of eight could do the job the government envisaged for 12 conventional craft.

The US Virginia class fast-attack submarine was in production and in US Navy service, giving Australia the benefit of operating the same equipment as the US.

"The nuclear-powered Virginia class is an altogether better submarine than any diesel-powered Collins Class replacement might be," he said.

The government is considering options for a Collins replacement. An evolution of the Collins design, to give greater range and endurance, had been billed as most likely, with various cost estimates going as high as $40 billion.

Mr Cowan said Virginias cost around $2.5 billion each. However, he favoured a lease deal, which covered acquisition, logistical support, upgrades and crew training.

At the end of the lease, Australia could hand back the vessels and avoid any issues relating to disposal of spent nuclear material.

He said on that basis Australia could acquire eight Virginias for $19-21 billion, with an all-up project cost, including support and facilities, of $24-27 billion.

Mr Cowan dismissed the risk of a nuclear accident on the grounds that US nuclear boats had visited Australia on numerous occasions without incident and the US Navy had a perfect safety record for operation of its nuclear vessels.

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Greens push for wheat export amendments

THE Greens hope to break a political deadlock on wheat export deregulation with a proposal to set up a new body to give quality assurance and information to growers.

Agriculture spokeswoman Rachel Siewert says the minor party's amendments would maintain checks and balances once the exports were fully deregulated.

A bill to fully deregulate the export market by September 2014 is currently before the House of Representatives.

The coalition opposes the legislation, but faces a split in its ranks with West Australian Nationals MP Tony Crook saying he'll cross the floor and NSW Liberal Alby Schultz planning to abstain.

They have accused the coalition of being under the thumb of the east coast Nationals in its opposition to the legislation.

Senator Siewert will propose changes to force the government to set up a new body by July 1, 2013 to provide accurate certification of grain quality and give information to farmers that would help them determine yield and quality.

She'll also seek to ensure a code of conduct that is currently being negotiated by industry participants is mandatory and enforceable.

"The government bill is pushing as quickly as possible to full deregulation, without regard to the issues that still need to be addressed," the West Australian senator said in a statement on Wednesday.

The Greens are unsure yet whether they will seek to move these amendments in the lower house, the Senate or both chambers.

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Construction watchdog says it's on the job

THE new construction industry watchdog says it is holding unlawful union behaviour to account and investigating more unlawful industrial action and coercion matters than its predecessor.

In Perth on Wednesday, Fair Work Building Construction (FWBC) chief Leigh Johns will tell a conference of the resource industry employer group, the Australian Mines and Metals Association (AMMA), that his organisation shares a lot of common ground with AMMA and its members.

The AMMA has previously expressed concerns FWBC would be less effective than its predecessor, the Australian Building and Construction Commission (ABCC), in holding militant construction unions to account for damaging and illegal behaviour.

Mr Johns says in a statement their common ground is the aim of good workplace relations practices that allow projects to be delivered on time, on budget, with no disruption.

He says it is important for industry to back the new regulator and to work with it as it did with the ABCC.

The FWBC is investigating more unlawful industrial action and coercion matters than in the past and is also pursuing other matters, Mr Johns said.

In the same statement, AMMA executive director Minna Knight welcomed the tough stance displayed by FWBC earlier this month.

" ...it was successful in prosecuting the CEPU, the CFMEU and the latter's notorious repeat offender, Joe McDonald," Ms Knight said.

AMMA members have been very concerned about a rise in militant industrial activity by construction unions since the ABCC was replaced with the FWBC, she said.

"We must maintain Australia's international reputation as a great place to invest in projects, employ people and work," Ms Knight said.

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Woman 'attacked grandchild with iron'

AN INDONESIAN woman accused of burning her eight-year-old step-granddaughter with an iron and a litany of other abuse was arrested and faces up to five years in prison, police said.

The girl's father reported the alleged abuse to police, saying his daughter had also been burnt with a metal spatula and cut several times in the head with small gardening shears.

"We questioned and arrested the woman, who will be charged under child protection laws," South Jakarta chief detective Hermawan said.

"The woman said she never accepted her son's second marriage nor the child he had with his second wife."

Mr Hermawan said the girl suffered burns on her chest, legs and feet, and had several cuts and bruises to the head.

"Her condition is improving, but she is still suffering trauma."

Police believe the 47-year-old woman, who is in custody, had abused the child over nine months.

The girl's case is also being handled by the national commission on child protection, which is providing her with psychological care.

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Fast Asian growth brings disaster risks

ASIA'S fast economic growth has increased the region's vulnerability to natural disasters, with new developments springing up in catastrophe-prone areas, the UN warned.

Asia-Pacific countries suffered "staggering" losses of $US294 billion ($285 billion) from natural disasters last year, with the Thai floods and Japan's quake-tsunami major contributors to the huge bill, the United Nations report said.

GDP per capita in the region has increased 13-fold since 1980 but disaster losses have risen 16-fold, it said.

"The region has been slow to be concerned by how the growth of disaster risks has been spurred by rapid economic growth," said the report from the UN Economic and Social Commission for Asia and the Pacific.

The UN noted a "pattern of recent growth where most new development in the region has been along coastlines and in floodplains, locations highly exposed to natural hazards".

The report, released at the start of a regional conference on reducing disaster risks being held in Yogyakarta, central Java, urged countries in the region to spend more to avert future catastrophes.

"The region has yet to commit adequate resources to reduce disaster risks and protect the development gains made possible by sustained growth," it said.

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Two Gaza militants killed in Israeli raids

ISRAELI air strikes have killed two Gaza militants as they clashed with troops from the Jewish state who crossed the border on the eve of a landmark visit to the Palestinian territory by the Qatari emir, medical sources say.

The flareup on Monday provoked threats of revenge from the Ezzedine al-Qassam Brigades, the armed wing of the ruling Hamas movement, and a pledge from Israeli Prime Minister Benjamin Netanyahu that there would be no immunity for those firing on the Jewish state.

Two air strikes took place around the northern town of Beit Hanun where militants were firing mortar shells at an Israeli tank and several military vehicles which had crossed the border into Gaza territory, witnesses and security sources said.

The first strike hit north of Beit Hanun, critically wounding four Qassam Brigades militants, one of whom later died of his injuries, medics and the militant group said.

As the clashes continued, Israel launched a second air strike east of Beit Hanun, killing a militant from the Popular Resistance Committees (PRC) and critically wounding another man, the same sources said.

The Qassam Brigades confirmed that the first strike had killed one of its militants and critically wounded another three, naming the dead man as Abderahman Abu Jalaleh, 25, and describing him as a local commander.

The second strike killed a PRC militant whom the group named as Yasser al-Tarabin. The identity of the injured man was not immediately clear.

The Israeli military said both strikes had targeted "a rocket launching squad".

"The squad was targeted in response to mortar shell fire at a routine IDF (army) patrol in the area, near the Israeli kibbutz of Nir Am," a statement said of the first strike. An identical statement was issued following the second.

The flareup comes on the eve of a high-profile visit by the emir of Qatar to the Gaza Strip, the first such trip by an Arab head of state since Hamas took over the territory in 2007.

The military refused to say whether troops were operating on the Gaza side of the frontier, saying only "they were near the security fence on a routine patrol".

Hamas militants usually observe a de facto truce on rocket fire targeting Israel, but the rare show of force appeared to be a direct response to the incursion.

"The Zionist enemy continues its crimes and arrogance against our land and people ... because of its desire to blow up the situation," the Qassam Brigades said.

"The enemy will not be able to tie our hands and his crime will not go unanswered."

Netanyahu also issued a warning of his own.

"The real thing we have is rockets. We've got Hamas, supported by Iran, firing rockets at us. We're not going to let anyone arm themselves and fire rockets on us and think that they can do this with impunity. They're not going to get away with it," he said on meeting with the Middle East Quartet envoy Tony Blair.

"We're going to prevent them from arming themselves. This is our policy. This is a very different policy that I put in. You don't let them get away with it. And they know that's what we're doing."

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LA Times endorses Obama for second term

A MAJOR US newspaper, The Los Angeles Times, has endorsed President Barack Obama for a second term in the White House, saying he has brought "steady leadership" to the office.

"The nation has been well served by President Obama's steady leadership. He deserves a second term," stated an LA Times editorial on Monday.

It added that while his opponents assailed him as a socialist, "he showed himself to be an adult, less an ideologue than a pragmatist, more cautious than cocky".

The paper also warned that Republican challenger Mitt Romney would exacerbate the economic situation in the country "by spending extravagantly on defence even as the last of the Bush-era wars ends".

It was referring to the wars that President George W. Bush launched in Afghanistan and Iraq.

"The alternative offered by Romney would neglect the country's infrastructure and human resources for the sake of yet another tax cut and a larger defence budget than even the Pentagon is seeking," the LA Times went on the argue.

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BBC editor steps aside over Savile probe

A TOP BBC editor has stepped aside while the broadcaster reviews its editorial decision to pull the plug on a segment about sexual abuse allegations against a prominent British children's television star, the late Jimmy Savile.

The BBC said on Monday the editor of the Newsnight program that opted not to broadcast the allegations, Peter Rippon, is "stepping aside with immediate effect".

The BBC said Rippon's explanation of his decision in a blog post earlier was "inaccurate or incomplete in some respects".

He is the first BBC figure directly blamed for the broadcaster's failure to properly report on abuse claims against Savile, who died last year at the age of 84 after a long career in children's television.

The BBC is facing criticism for providing different explanations for pulling the December segment that would have lifted the veil on Savile's abusive history, which had been rumoured but not reported on at the time.

Savile hosted the music program Top of the Pops and Jim'll Fix It. He was also active in numerous charities.

The BBC is set to air its own investigation of its failure to report on Savile's sexual abuses on Monday night on the Panorama show.

On the show set for broadcast on Monday, BBC correspondents claim the Savile segment was pulled because of pressure from senior management.

The fallout and allegations of a cover-up have damaged the BBC's reputation, and Savile's actions are also being investigated by police and other agencies.

Police say there may be more than 200 potential victims of the entertainer, known for his garish track suits and platinum hair.

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School funding to stay under wraps

SCHOOLS Minister Peter Garrett has "more than a vague idea" about how the bill for school funding reform should be split between the commonwealth and states.

But he has no intention of revealing the federal government's hand before negotiations.

"You'll have a clear announcement from this government in the early half of next year once we've concluded our negotiations with the states and education authorities," he told ABC's Q&A program on Monday night.

Host Tony Jones asked the minister if he could give "even the vaguest idea" of the percentages being talked about.

"I've got much more than a vague idea but I don't propose to canvas those quantums, which we would be negotiating with the states, here on Q&A," Mr Garrett said.

He said discussions were well under way about how the final funding formula, based on the Gonski panel's recommendations, would work.

Prime Minister Julia Gillard has said she wants to sign a deal with the states and territories at the first COAG meeting in 2013, expected to be held in April.

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Baby bonus cut penalises families: Hockey

SHADOW treasurer Joe Hockey has likened the government's decision to slash the baby bonus for second and subsequent children to China's one child policy.

The policy that has restricted urban Chinese families to a single child since the 1970s has been attributed with leading to a gender imbalance in that country, with male children often seen as more desirable.

The Labor government announced in its budget update it would cut the baby bonus to $3000, from $5000, for second and subsequent children, as it looks to save money to prop up its budget surplus.

The measure will deliver more than $500 million in savings over the forward estimates period.

Families Minister Jenny Macklin said the change, to apply from July 1, 2013, recognised families purchased durable, big-ticket nursery items when their first child was born.

Mr Hockey said the baby bonus was initially introduced by the Howard government to encourage people to have more children and arrest Australia's declining birth rate.

"Now the government seems to want to penalise anyone that has a second or third child," he told ABC television.

"I think that worked quite well in China, didn't it?"

Mr Hockey also said the government "hates private health insurance" since it has further cut the rebate paid to health fund members.

The coalition was unlikely to support this move.

"We want to see more Australians spend more of their money on their own health care," Mr Hockey said, adding that the rebate encouraged this.

The shadow treasurer also attacked government plans to make big companies pay their tax to the government each month, rather than each quarter.

The change will smooth government tax receipts and create a revenue gain of $8.3 billion over three years.

"The bottom line is $8.3 billion doesn't appear in Wayne Swan's accounts if it isn't coming out of someone else's pocket," Mr Hockey said.

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ANZ lags in customer satisfaction

EDS: Not to be used before 0001 AEDT Monday October 22

By Evan Schwarten

SYDNEY, Oct 22 AAP - ANZ remains in bottom place among the big four banks for customer satisfaction among business clients, 10 months after provoking outrage by shifting the timing of its monthly interest rate decision.

The monthly DBM Consultants' Business Financial Services Monitor (BFSM) shows the bank has improved its standing among business clients in the three months to September but continues to languish behind the Commonwealth Bank, Westpac and National Australia Bank (NAB).

"What we have noticed in the past is that if you are not tracking particularly well it takes you longer to recover, but if you are at the top of the pack you recover more quickly," DBM managing director Dhruba Gupta said.

"It seems that people tend to forgive you more if they already have a high regard for you."

ANZ began its slide from third to fourth place on the BFSM, which tracks satisfaction among the big four banks, in December 2011 after it announced it would make its interest rate decision on the second Friday of every month.

The move split ANZ from other lenders which typically made their rate decisions in the days following the Reserve Bank of Australia's board meeting, held on the first Tuesday of each month - except January when no meeting is held.

"The slide (in customer satisfaction) more or less coincided with that announcement," Mr Gupta said.

Mr Gupta said the recovery in satisfaction for ANZ had occurred most quickly among its larger clients (those with an annual turnover of more than $50 million) among whom it was now ranked in equal third place with NAB.

However, the bank continued to trail behind its competitors among medium, small and micro-size businesses.

The September BFSM showed Westpac remained in first place across all sectors, while the Commonwealth Bank was ranked first among large- and medium-size businesses.

The BFSM is based on a monthly survey of almost 20,000 business decision-makers.

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Ten appoints new chief of programming

EDS: Not for use before 0001 AEDT Monday, October 22

SYDNEY, Oct 22 AAP - Beverley McGarvey has been appointed Network Ten's new chief programming officer.

Ms McGarvey has been serving as acting chief programming officer for the TV network since the resignation of former programmer David Mott in August.

Mr Mott had been with the station for 16 years.

Ten's CEO James Warburton said the broadcaster was delighted to appoint Ms McCarvey to the job.

"Beverley is an outstanding television executive. Her creativity, strategic thinking and programming and scheduling skills will be invaluable in the renewal of our creative content," he said in a statement issued on Monday.

The appointment comes after a difficult few months for Ten. Just last week Ten Network Holdings announced 100 jobs would be axed from its newsroom after poor television ratings led to a full year net loss of almost $13 million.

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WA remains the economic powerhouse

WESTERN Australia is still the nation's economic powerhouse but a slowdown in the mining sector could lead to weaker spending and a softer jobs market.

A report shows WA leads the other states in four of eight criteria over the past three months.

"Western Australia remains Australia's best-performing economy, but Northern Territory is coming up fast, with the Inpex natural gas project providing strong momentum to the Top End economy," the CommSec State of the States report says.

It says WA is still first or second on seven of the eight indicators, coming out on top in construction work, retail trade, population growth and equipment investment.

Over the past quarter WA held its position while Tasmania remained fixed at the bottom end of the scale.

The NT passed the ACT to take second spot after WA, while NSW improved to rank alongside Victoria and Queensland.

There was a sizeable gap to South Australia and then another significant gap to Tasmania.

WA's economic output was 34 per cent higher than the decade average level. It also outperformed the other states in terms of equipment investment.

With an unemployment rate of 3.9 per cent, both the NT and WA have arguably the strongest job markets in the nation.

In terms of population growth, WA is the clear leader with an annual growth rate of 3.14 per cent.

The report says home prices are lower than a year ago in only half of the state capitals.

The strongest growth in home prices was in Darwin, where they are up by 2.9 per cent, followed by Sydney, up 0.9 per cent.

The weakest home prices are in Melbourne, down by 3.8 per cent on a year ago.

Real wages were positive in all state economies in the June quarter, with the strongest growth in WA.

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Budget 12/13 surplus not necessity: Access

THE federal government's promise to bring the budget back to surplus is based more on politics than economic necessity, a leading independent forecaster says.

As Labor prepares to release its mid-year budget review on Monday morning, Deloitte Access Economics director Chris Richardson says while the task of repairing budgets cannot be shirked, it shouldn't be rushed.

"Governments need to pay their way over time, but we still think that a surplus in 2012/13 is partly a political target rather than an economic necessity," he said in the company's business outlook released on Monday.

The government's Mid-Year Economic and Fiscal Outlook (MYEFO) is widely expected to stick to the May budget forecast of a $1.5 billion surplus this financial year, even though it needs to find further savings.

Mr Richardson said federal and state governments were all scrambling to repair "broken" budgets after spending the past decade dishing out the revenue proceeds of the commodity price boom.

"But a shockwave in commodity prices means the tax take will (now) stay soggy," he said.

At the same time, the fact the Australia dollar is still riding high when commodity prices are down is creating headaches across the industrial landscape.

"Some miners are losing money, and mining services ... are now feeling the pressure of cost cutting," he said.

New sectors were joining the "trouble list" of manufacturing, utilities and retail, at the same time as the government was "jumping on the anchors" of spending.

However, Mr Richardson said the engineering construction sector still had an enormous workload ahead because of increased mining investment.

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Growth could slow in 2014 with price falls

AUSTRALIA'S growth could slow in 2014 and deliver headaches for business as commodity price falls put a brake on mining construction projects.

Big mining projects that were approved a few years ago will drive output gains in the next two years, but the next round of project approvals will be a "pale shadow of the last lot", a Deloitte Access Economics report says.

"The strong bit of Australia's 'two speed economy' won't be as strong in a couple of years," the Business Outlook said.

Rising world prices for iron ore and coal had underwritten a lot of the gains in Australian incomes in the past decade, but those prices had fallen through 2012.

"There's a risk of a pothole in growth in 2014-15 as the surge in mining construction finishes before rising gas export volumes hit their straps," the report said.

"That's not the end of the world, but it suggests the difficult business environment of the last couple of years won't disappear any time soon."

A supply surge in commodities coincided with weaker demand from China, leading to faster than expected price falls.

The report also warned of complacency around the consensus view of a relatively rapid rebound in China and in its insatiable demand for commodities.

Still, Deloitte found there was a lot of import spending locked in to feed into massive resource construction spending this financial year and next.

But the same was not true of exports.

The study showed unemployment remained low, despite anaemic job growth, partly because workers have been discouraged by weak job gains.

"More Australians are retiring or otherwise staying out of the job hunt," it said.

"That buffer was only a respite and we see unemployment drifting up as governments and even the mining sector tighten their belts."

Deloitte predicts unemployment will top out in this cycle at 5.5 per cent.

Inflation prospects were less worrying, but a surge of "funny money" from the central banks underlined continuing financial fragility around the globe.

While fears for Europe had faded, concerns about China had intensified.

"Even if the US dodges the big bullet of the 'fiscal cliff', there's still going to be some fiscal headwinds in the US in 2013," the report said.

The global recovery would continue, but it would be dogged by difficulties that would leave global growth below trend in 2012 and 2013.

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