Saatchi assistant 'not a fantasist'

A FORMER personal assistant of Nigella Lawson and her art dealer ex-husband Charles Saatchi, who is accused of defrauding the couple, has denied she was a fantasist and a "shopaholic".

Francesca Grillo, 35, and her sister Elisabetta, 41, are alleged to have spent STG685,000 ($A1.26 million) on credit cards belonging to the TV cook and the multimillionaire Saatchi.

On Wednesday, the court heard that the siblings bought designer clothes, shoes and luxury holidays on the cards.

The younger sister was accused by prosecutor Jane Carpenter of lying about her expenditure on a work credit card having been authorised by Saatchi and Lawson, who divorced earlier this year.

"I haven't lied to this court," said Grillo. "I don't think I'm a fantasist as Ms Lawson suggested. I would have to disagree."

Carpenter said Grillo had admitted being a "shopaholic" in a phone call after the allegations of fraud came to light, but the defendant said of that claim: "I don't think so."

Addressing claims that she took advantage of her position and felt she was "on to a good thing", Grillo replied: "I didn't have to feel like I was part of a good thing.

"They were my family. I was very, very lucky. They loved me, I loved them back. Despite being here defending myself ... I still have feelings for them."

The seven men and five women on the jury were shown pages from Lawson's latest cookbook, Nigellissima, for which Grillo said she and her sister contributed a recipe for lasagne which was published.

"She refers to two friends from Calabria, or two sisters," added Grillo.

She claimed that during her trips to her native Italy while employed by the family, she would use the company card to buy food items and props for Lawson which were used in the book.

Asked why she offered to pay back money to the Saatchi-Lawson family when she was confronted with allegations of misusing the credit card, Grillo said she had hoped things would get back to normal.

She added: "It's difficult for people to understand how close I was to these people ... It's not like any person down the street. You want to make things better."

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Merkel says EU must be ready for changes

Chancellor Angela Merkel has been sworn in to a third term as Germany's head of government. Source: AAP

GERMAN Chancellor Angela Merkel says European Union members must be open to treaty changes to strengthen joint economic governance in the 28-nation bloc.

Merkel was speaking on Wednesday, a day after starting her third term as leader of Europe's biggest economy and ahead of a visit to Paris, followed by a two-day EU summit in Brussels.

She told parliament that the EU needs to work toward more centralised financial and economic governance, where members can be compelled to meet certain fiscal targets, even if this requires changes to key EU treaties.

"Since the Lisbon Treaty we have a situation in Europe where everyone says, 'we can develop everything but we can't change the treaties'," Merkel said.

"I don't think that we can build a truly functioning Europe that way."

French President Francois Hollande has rejected changing EU treaties, pushing for more pro-growth policies and less austerity within the existing European charters.

Other EU members are also sceptical about renegotiating treaties, which may require referendums, amid rising euroscepticism in many countries.

Merkel, making her case for evolving charters in the EU, said "we have a situation in Europe where Germany is often accused of resisting certain developments. This is not the case.

"We are among those who say that we must, if treaties are no longer sufficient, develop those treaties."

"Those who want more Europe must be ready for new rules on some competencies," she added.

Merkel was sworn in for a third term on Tuesday, almost three months after winning September 22 elections, leading a "grand coalition" with the centre-left Social Democrats.

Addressing the Bundestag legislature, Merkel said that her new government wants for Germany, as a founding member of the EU, to continue "to take a responsible role and one that promotes integration in Europe".

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Helicopter maker issues safety alert

HELICOPTER manufacturer Eurocopter has issued a worldwide safety alert after a fault was found in the model of craft that crashed into a Glasgow pub, killing 10 people.

The company said there was a problem with the fuel indication system on some of its EC135 aircraft, the same type as the police helicopter involved in the Clutha bar tragedy in Glasgow last month.

Operator Bond Air Services temporarily suspended flights of its 22 EC135 helicopters last week after a fuel gauge fault was discovered on an air ambulance in the North West of England.

The suspension affected air ambulance and police helicopters across the UK, many of which have now resumed flights.

Eurocopter has now issued a safety information notice after tests revealed other aircraft may be affected by similar issues.

A statement said: "Eurocopter has been informed by Bond Air Services of an issue involving the fuel indication system experienced during normal operations by one of its EC135 EMS aircraft.

"Following this incident, fuel system functionality tests performed by Bond Air Services and two other EC135 operators in Europe have revealed possible similar supply-tank fuel gauging errors on some aircraft.

"This incident is currently under in-depth investigation by Eurocopter. The first analysis shows that the indication of the fuel quantity in the supply tanks could be over-estimated."

The safety notice warns crews that in the "worst case" scenario, a red low fuel warning could appear without any amber fuel caution beforehand.

In a statement, Bond said: "We note that Eurocopter has today issued a safety information notice to operators of the EC135 across the world confirming that some of their aircraft have a fault in the fuel indication and alert system which means that warning system may not work properly.

"This was a fault discovered by Bond during normal service operations on Wednesday 11th, which we immediately reported to Eurocopter and the appropriate authorities.

"We understand other operators have since conducted similar tests and found similar problems with their aircraft.

"As soon as we discovered this issue, in line with our commitment to the highest standards of safety, we took the prudent decision to temporarily suspend service operations whilst we conducted checks on our fleet of EC135s.

"The results of these tests were subsequently validated by Eurocopter, and appropriate repairs made before returning the aircraft to service."

The company said it had ordered that all its EC135s should have a minimum of 90kg of fuel on board at all times.

An initial report from the Air Accidents Investigation Branch (AAIB) into the Glasgow crash said there was "no evidence of major mechanical disruption of either engine" of the Police Scotland helicopter.

In addition, the helicopter still had 95 litres of the 400kg of fuel that it had taken off with from Glasgow City Heliport.

The three people on board the Bond-operated aircraft and seven people in the pub died when it crashed on November 29.

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Knox 'afraid' to front Italian court

US murder suspect Amanda Knox has emailed an Italian court to say she is "afraid" to show up for her trial on charges of killing British student Meredith Kercher, judge Alessandro Nencini says.

Knox, who is a defendant, along with her former Italian boyfriend Raffaele Sollecito, is letting herself be tried in absentia.

She has signalled she would not return to Italy to serve her sentence if she is found guilty.

"I am not in the courtroom because I am afraid," Knox said in a message in Italian that was read out in court by Nencini on Tuesday.

"I am afraid that you will be influenced by the vehemency of the accusations, that you will be blinded by their smokescreens."

The judge dismissed Knox's email as "unorthodox" and said those who "want to speak at a trial should come to the trial".

He said lawyers for the defence vouched for the authenticity of the message.

Ms Kercher was 21 when she died.

She was found on November 2, 2007, half-naked and with multiple stab wounds, in the apartment she was sharing with Knox and two other female students in the central Italian university town of Perugia.

Knox and Sollecito were arrested days after the crime.

In 2009, they were jailed for 26 years and 25 years, respectively, after Perugia judges concluded in a first instance ruling that the pair, along with a third person, had killed Kercher during a group sex game.

They were acquitted in 2011 after an appeal court deemed incriminating DNA evidence to be unreliable.

Freed from prison, Knox returned to her home city of Seattle.

But the verdict was annulled in March by Italy's top appeals body, which ordered a retrial and moved proceedings from Perugia to Florence.

Judges are expected to issue a new ruling in January, but it could be appealed again.

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'White powder in Nigella's handbag': PA

A London court has heard TV cook Nigella Lawson was unhappy in her marriage to Charles Saatchi. Source: AAP

NIGELLA Lawson's former personal assistant "frequently" found rolled-up banknotes with white powder on them in her handbag, she has told a court.

Francesca Grillo, who along with her sister Elisabetta is on trial accused of defrauding Lawson and former husband Charles Saatchi, said she never saw Lawson taking drugs although she did find evidence of drug use on many occasions.

She said she first saw the rolled-up notes at the food writer's Shepherd's Bush home, in the kitchen after a party and also in a guest bedroom.

One of her jobs as Ms Lawson's aide was to exchange items between her handbags, and she would find rolled-up banknotes in those, she told Isleworth Crown Court in west London on Tuesday.

Asked how often she found the banknotes, Grillo said: "Frequently. Every time I went through her handbag there was some notes. It was very frequent."

Asked if she ever raised the issue of drugs, she replied: "No. I didn't think it was my place."

Lawson would tell Francesca "you're good at finding things" and ask her to look for belongings in her handbags, the jury heard.

Lawson would sometimes come downstairs with white powder on her nose and Francesca would point it out to her, but would be told by the cook it was make-up.

Asked by defence counsel Karina Arden if the substance could have been make-up, Grillo replied: "Too white to be make-up."

She also noted that the TV cook often had a runny nose, the court heard.

Francesca Grillo, 35, and her sister Elisabetta, 41, are accused of defrauding the celebrity couple by spending 685,000 euros ($A1.06 million) on credit cards belonging to them.

The court has heard the siblings bought designer clothes, shoes and luxury holidays on the cards.

Francesca also recalled how she improvised an excuse to protect her employer when a child discovered a hollow book containing what the employee thought were drugs.

The defendant told the court: "She (the child) said 'Look what I found in (the) book!'.

"It was a small plastic bag with white powder. I made up something."

Grillo said the clandestine book also contained items of jewellery belonging to Lawson's late husband John Diamond.

She said she found cannabis in a child's room in the home, and the television cook would swig from bottles containing liquid medication.

She told the court: "Tazepam, Xanax ... Ms Lawson had medication for depression.

"She would take it directly from the bottle."

Asked by Arden how frequently she would see Lawson take medication in this way, Francesca said: "Very often. She had one bottle in the kitchen and one bottle in the bedroom."

She told the court she did not originally mention the alleged drug use in her first statement to police, but did so after photographs of Saatchi and Lawson at Scott's restaurant in Mayfair emerged in the press during the year.

"The one that stuck in my mind was the one of him picking her nose. Maybe he found something relating to drugs.

"I maybe thought if he didn't know that, he probably didn't know about the authorisation - the allowance - of the signatures (by Ms Lawson, on personal expenditure)."

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Two stabbed in Sydney

TWO men are in hospital after being stabbed in what police believe are related incidents in Sydney's southwest.

Emergency services were called to Meredith Street in Bankstown at 9pm on Tuesday following reports of a stabbing.

A man, aged in his 20s, was taken to Liverpool Hospital with multiple stab wounds and in a serious condition.

At about the same time, an 18-year-old man arrived at Bankstown Hospital with a stab wound. He has since been transferred to Liverpool Hospital.

Police are investigating the incidents, and say they may be linked.

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China zookeeper killed by tiger

A KEEPER at Shanghai's zoo has been mauled to death by a rare South China tiger after entering its enclosure, officials and colleagues say.

In brief statements on their Twitter-like microblogs, the zoo and Municipal Landscaping Administration said investigators were looking into the cause of the attack.

The administration said the tiger was a 9-year-old male with no prior record of aggression against people.

It said the attack occurred at the zoo's breeding facility where safety procedures are in place.

State media reports identified the victim as a 56-year-old man surnamed Zhou.

They cited unidentified colleagues as saying the man entered the tiger enclosure to clean it and "did not come out again".

The highly endangered South China tiger is considered effectively extinct in the wild after decades of being hunted as a pest.

Only a few are kept in zoos.

Built on a former golf course, Shanghai's zoo is one of China's largest and most popular urban animal parks.

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AWE rejects oil and gas suitor Senex

SENEX Energy chief executive Ian Davies says he is no longer interested in a merger with AWE following the company's move to make preliminary dealings between the companies public.

AWE said it had rejected a $752 million takeover offer from fellow Australian oil and gas producer Senex in a statement to the ASX on Monday after it had already been reported in the media.

The offer significantly undervalued it, without an appropriate premium for control, said AWE.

Mr Davies told AAP the non-binding takeover proposal had only been a friendly and informal conversation opener.

"They saw fit to make it public and leak it that way," he said.

He said the door was shut on an offer now but did not completely rule out future discussions.

AWE complained in its statement that its shareholders would only be getting 47 per cent of the merged group's equity.

However AWE would be contributing 70 per cent of proven reserves, 90 per cent of production and 67 per cent of sales revenue and before tax earnings.

Mr Davies countered that he regarded Senex as contributing far more growth prospects through its onshore oil and gas assets in central Australia's Cooper Basin and coal seam gas assets in Queensland.

A merged company would be among the top five oil and gas companies on the ASX with a market capitalisation of $1.5 billion.

He said he regarded AWE and its mostly offshore assets in Australia, New Zealand and Indonesia as "ex-growth" but its strong cashflow made it attractive and would complement Senex's oil and gas growth prospects.

AWE said it had gone public because Senex had already started buying shares and it believes its shareholders should know that.

However Mr Davies said the company's stake was below three per cent and immaterial.

Senex's offer implied a price for AWE shares of $1.44.

That is above its current price, with AWE shares coming out of a trading halt on Monday and climbing 8.5 cents to $1.27 AEDT while Senex shares slumped 6.5 cents to 70.5 cents.

However AWE's shares are valued by analysts at above $2.

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Pressure grows for NSW pub lockouts

EMERGENCY service workers and doctors are demanding NSW government action to stop the carnage caused by alcohol-fuelled violence.

NSW confirmed it was the capital of drunken violence at the weekend, with 540 arrests during a trans-Tasman operation meant to curb the problem.

The NSW opposition is renewing its calls for a trial of reduced trading hours and lockouts in the state's licensed venues after the success of those measures in Newcastle.

The Last Drinks coalition, a group representing concerned emergency department staff, police and paramedics, has joined the chorus.

Its spokesperson, Australian Salaried Medical Officers' Federation president Dr Tony Sara, says the pressure is firmly on the government.

Dr Sara says a trial in select trouble spots would show positive results in a short time.

He said measures in Newcastle cut alcohol violence by 37 per cent and emergency department admissions by 26 per cent, so were worth a try in Sydney.

He challenged NSW Premier Barry O'Farrell to explain what harm a trial could do, believing the government was under the thumb of the powerful liquor lobby.

"How could it hurt?" Dr Sara told AAP.

"It might reduce profits a bit, but either they lose some money or we continue to have people hurt and maimed.

"I think the community comes before profits."

But Mr O'Farrell rejected calls for tougher laws, arguing authorities had done their part.

"Police and government agencies are doing their bit and the hotel industry, by and large, is responsibly getting on with their task," he told reporters on Monday.

"What we now need is for the community to come to the party."

NSW Opposition Leader John Robertson says police tell him privately they support tougher measures such as pub lockouts.

Police Commissioner Andrew Scipione agreed that cultural shift was crucial.

"Police will never arrest our way out of this problem," he said.

"If we don't start today we will lose a generation of young people to this love affair with alcohol."

Mr Scipione said a 23-year-old man who was punched and stomped on in front of dozens of revellers at Bondi Beach at the weekend was no longer in a critical condition.

The Australian Hotels Association NSW would not comment.

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Aurizon to cut rail fleet, cancel project

FREIGHT and coal haulage operator Aurizon will take a hit of almost $200 million as it cuts the size of its rail fleet and cancels a major Queensland project.

The company, previously known as QR National, is reducing its locomotive fleet by 28 per cent and cutting the number of wagons by 12 per cent in a bid to bring down fuel and maintenance costs.

Aurizon's downsizing will appear as an asset impairment expense of $130 million to $150 million in its accounts for the first half of the 2013/14 financial year.

The company will also incur a $47 million impairment on recent changes to several projects, including Glencore Xstrata's decision to stop the Wandoan project because of weakening thermal coal prices.

Aurizon had proposed a 210 kilometre Surat Basin rail corridor from the Wandoan mine in a joint venture with the Swiss multinational.

"There's not any job losses that are related to that," chief executive Lance Hockridge told reporters on Monday.

In July, Aurizon launched a second voluntary redundancy program in a bid to save $230 million by 2015.

Some 248 voluntary redundancies have since been accepted.

"I think the bulk of it is done," Mr Hockridge said.

More than 2,000 employees have left the company since it was privatised by the former Queensland Labor government in 2010.

Mr Hockridge said he was "cautious but confident" about the thermal coal sector, as well as the future of projects in Queensland's Galilee Basin, where Aurizon has agreed to develop a rail project for the GVK-Hancock joint venture involving billionaire Gina Rinehart.

Aurizon shares dropped two cents to $4.68.

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