We won’t kill Aust fighters in Iraq: ASIS

Australia’s shadowy overseas spy agency has rejected claims the government’s new anti-terrorism laws could give it the power to assassinate Australian Islamic State fighters.


The government’s bill seeks to improve co-operation between the Australian Secret Intelligence Service and the Australian Defence Force as part of efforts to crack down on foreign fighters.

The proposed measures have led to reports that ASIS could help the ADF locate and kill Australian jihadists on the battlefield in Iraq.

But the organisation says the new powers “will not enable ASIS to kill Australians or others”.

“The amendments will not change the role of ASIS in a way that may facilitate targeted killings,” it said in a submission to a parliamentary inquiry.

ASIS said the bill did not expand its functions or remove a ban on it planning or undertaking activities that involve violence.

“ASIS can and already does provide such assistance and co-operation to the defence force,” it said.

But it said it needed to act more “nimbly” in providing intelligence to the ADF and its international partners, saying recent terror threats have shown agencies will have little time to respond.

Among the changes are powers which would allow the prime minister, attorney-general, defence minister or foreign minister to give oral authorisation for emergency ASIS activities.

But if none is available at the time, the head of ASIS, the Australian Signals Directorate or the Australian Geospatial Intelligence Organisation, would be able to step in.

The emergency authorisations would expire after 48 hours but would help ASIS to quickly respond to threats, the agency said.

“The proposed changes would position ASIS well to provide timely assistance to the ADF, minimise loss of life and to assist other to respond to the threat,” it said.

Under current laws the agency has to seek ministerial approval in writing before launching an operation.

Without changes ASIS could be forced to act illegally “even to protect life”, the agency said.

The committee is due to report back on November 20.

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Morkel ready to take new ball for South Africa

The 30-year-old helped account for two more Australian wickets with fine catches as South Africa dismissed their hosts for a paltry 154 before squaring the series with a three-wicket victory at the WACA on Sunday.


Morkel bowled brilliantly after being handed the new ball in preference to Dale Steyn in a strike partnership with Vernon Philander — an experiment undertaken with one eye firmly on the Feb. 14-March 29 World Cup in Australia and New Zealand.

“The most important thing about this tour is that we are working towards the World Cup,” Morkel told reporters in Perth.

“We are trying different things, on the day a guy like Dale or Vernon might have the flu or some illness and I will need to be able to step up, it’s a role that I enjoy doing as well.

“I got the opportunity to go with the new ball today and I’m happy that I bowled well.”

After a disappointing display last Friday in the opening clash of the five-match series, Morkel felt South Africa’s bowlers had needed a bit of time to get back into their usual rhythm.

“The bowling unit had a bit of a break before this series, and although we had nets, the lack of time in the middle and finding rhythm probably showed on Friday,” Morkel added.

“The wicket was a little bit quicker today which helped us when we found our strides and rhythm. We bowled well in partnerships and with good intensity …”

The series continues in Canberra on Wednesday before concluding with matches in Melbourne and Sydney and Morkel said the Proteas would need to continue to strike in the first few overs against Australia’s powerful and deep batting.

“They are high quality attacking players and if you aren’t on the money they will make you pay,” he said.

“Luckily for us today we got the ball in the right areas and got the early wickets, that’s the most important thing in any one-day game.” 

(Reporting by Nick Mulvenney, editing by Peter Rutherford)

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Competition regulator wants NBN broken up

The competition regulator wants the National Broadband Network to be split into three parts before it’s privatised.


The former Labor government, which created NBN Co, had planned to sell the optical fibre network within five years of its completion.

The Australian Competition and Consumer Commission agrees the NBN should be privatised, on the proviso it is split up beforehand.

“Let me make a suggestion on separation timing,” the competition regulator’s chairman Rod Sims told an NBN conference on Monday.

“It should be done prior to any privatisation of NBN Co.

“After that time, it is highly unlikely that separation will ever occur.”

Mr Sims suggested it would be in Australia’s long-term interests to create three separate entities that could be sold to provide future infrastructure-based competition.

“I will always prefer competition between infrastructure providers rather than entrench a monopoly,” he said.

The Howard government declined to split up Telstra before privatising the first third of the telco in 1997.

Telstra is now a $71 billion listed company with a monopoly over Australia’s copper wire telephone network, after being fully privatised in 2006.

When it came to NBN Co, Mr Sims said the government should avoid restricting competition in a bid to maximise the proceeds from the sale.

“There is too much at stake for that,” he said.

Former prime minister Julia Gillard vowed in 2010 to refrain from selling the NBN to Telstra or its chief rival Optus.

Both major parties support an eventual privatisation of the NBN after completion, but Communications Minister Malcolm Turnbull has previously said this would be many years away.

The federal government is required to maintain ownership of the NBN until it is built and fully operational, under existing laws.

NBN Co doesn’t anticipate the network being completed until at least the end of 2020.

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Public warned against revenge after arson charge

As he was driven away from Morwell Magistrates Court on Friday, angry residents hurled abuse at the man who has been charged with arson causing death, intentionally or recklessly causing a bushfire, and possessing child pornography.


He could face 25 years in jail.

The accused man\’s lawyer said on Friday his client was in a fragile mental state.

“He should be seen to by a doctor,” the lawyer said. The man, who cannot be named, was taken from Morwell to Melbourne for his own safety and was remanded in custody to reappear in Melbourne Magistrate\’s Court on Monday.

“We have a very emotive environment out there,” Victoria Police Assistant Commissioner Dannye Moloney told reporters.

“People are pointing fingers, people are jumping to conclusions.

“Rumours and innuendo are being spread. We do not need that. “Let Victoria Police do its role and identify this person.

“We are prosecuting this person on behalf of the community.

“If we left a person there it would only be a situation where the people may go to where they believe him to be held and I don\’t think they need the trauma.” The court imposed a suppression order on all details of his identity.

Callignee resident Gavin Wigginton (Wigginton), who lost his home in the Churchill blaze, said he thought anyone convicted of arson was either insane or a murderer.

“If this person is not insane, then I think he should be in jail for a very long time,” Mr Wigginton told AAP.

“Essentially, if he\’s culpable, (if) he\’s all there, he must have known that this was going to kill people and that clearly is murder.”

Twleve people died in Callignee, four in Hazelwood and Koornalla, and one in Jeeralang.

Another Callignee resident, Daryl Payne, who also lost his home said arsonists should be forced to see for themselves the death and destruction they had caused.

“I reckon they should be going up there taking bodies out of cars,” he said.

Premier John Brumby said anyone who lit fires deliberately put the community and human life at great risk. “It\’s an unspeakable and heinous crime,” he told reporters.

Prime Minister Kevin Rudd had earlier in the week likened arsonists to mass murderers and said they should “rot in jail.”

The almost-36,000ha Churchill fire in the Latrobe Valley region of Gippsland remains out of control, but is no longer posing a threat to communities in the region.

Police also confirmed on Friday the Marysville blaze which killed up to 100 of the town\’s 500 residents was being treated as suspicious, along with the fires at Murrindindi, Buxton and Narbethong.

Police would like to speak to anyone who was near the Murrindindi Mill between the towns of Yea and Glenburn last Saturday.

The total death toll from the blazes that ripped through the central highlands and Gippsland last Saturday still stands at 181 but is expected to jump above 300.

On Friday, police said 1,831 houses had now been destroyed and more than 7,000 people had been made homeless by the fires.

The Marysville residents made homeless by the inferno which wiped out their entire community will be allowed back into the town for the first time on Saturday.

But any hope of being able to pick through the ruins of their lost homes will be dashed.

Aboard a fleet of shuttle buses, they will be accompanied by counsellors and police officers but will not be allowed off and will be told they cannot take photos, even from inside the vehicles.

“I want to go and look at the town, we are calling it ash-ville now,” Marysville resident Monica Raymond told AAP.

“I don\’t intend being emotional but it might not be pleasant on the bus with people emotional and having fits.”

Meanwhile, Mr Brumby has appointed former Supreme Court Justice Bernard Teague to chair a Royal Commission into Victoria\’s bushfires.

The commission will provide an interim report this year to allow recommendations to be implemented in time for the 2009-2010 bushfires season.

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Stimulus plans under scrutiny at G7 talks

Top economic powers urged action to help the world scramble out of a deepening recession, as their stimulus plans came under scrutiny on at downbeat talks of the Group of Seven finance leaders.


International Monetary Fund Chief Dominique Strauss-Kahn emerged from the opening dinner of the G7 summit saying that the mood was downbeat and observing that the world was in a “deep recession.”

“I can\’t say people are singing and dancing on the tables” at the gathering, he told reporters.

‘Exceptional and complementary’ measures sought

The United States urged “exceptional” measures as Treasury Secretary Timothy Geithner arrived for bilateral talks with several other top delegates from the seven leading industrialised nations.

“These extraordinary times call for exceptional and complementary measures by all,” Geithner\’s delegation said in a statement at the start of the two-day gathering of finance ministers and central bank heads.

“The Secretary will encourage his counterparts to take strong actions to address macroeconomic and financial sector challenges.”

Geithner was set to discuss his vast US financial stabilization plan, which received a sceptical reaction in the United States and has prompted calls for more details.

“There is still some need for more elaboration” on the US financial plan, Canada\’s Finance Minister Jim Flaherty told reporters in Rome as ministers gathered for the G7 opening dinner on Friday evening.

Stimulus plans compared, consensus explored

The G7 officials were to kick off their main talks on Saturday, comparing notes on stimulus packages and trying to forge a consensus on the next steps, including possible new rules for global finance.

“The first thing we need to do is make sure that our own financial systems in our countries are well regulated and therefore credible,” said Flaherty, who was due to meet with Geithner on Saturday.

“Then we need to have some sort of international cooperation where we have validation of that integrity of finance systems. That\’s going to be a major topic of conversation here.”

More measures of the crisis emerged on Friday, with data showing the eurozone economy slumped by 1.5 percent in the fourth quarter of 2008 and the European Union joined it and several individual EU countries in recession.

“The growth figures we have been given today are not really a surprise but are underlining the seriousness of the situation,” said Jean-Claude Juncker, head of the Eurogroup of eurozone finance ministers.

“We do have the strong hope that in the last quarter of 2009 growth will be back and that in the course of 2010 the situation will greatly improve, but … we have to live for a long period with the consequences of this crisis.”

Protestors rally

As the ministers gathered, tens of thousands of people thronged a square in Rome under a sea of red flags to protest against the economic crisis. Fresh data on Friday showed Italy too is deeper in recession than expected.

Ahead of the talks, several delegates voiced alarm over protectionism, which they fear may undermine efforts to ease the downturn.

Japanese Finance Minister Shoichi Nakagawa has warned that his G7 delegation would take a “resolute stance” against the “absolute evil” of protectionism — when countries take measures that favour their own economies at the expense of other.

Nakagawa said on Tuesday that the G7 nations — Britain, Canada, France, Germany, Italy, Japan, and the United States — were expected to discuss a sensitive “Buy American” clause in a pending US economic stimulus package.

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G7 sets sights on urgent economic reform

Italy\’s Finance Minister Giulio Tremonti called for a “new world economic order” as he wrapped up the crisis meeting of finance leaders from the Group of Seven leading economies over which he presided here.


In a joint declaration, the G7 called for “urgent reforms” of the international financial system and reiterated a bleak outlook for the world economy, after fresh data showed the eurozone recession deepening.

The G7 delegates in a joint statement vowed to avoid protectionism as they seek to stabilise the tottering world economy and financial markets and said stabilisation of the world economy was their “highest priority.”

The global crisis “has highlighted fundamental weaknesses in the international financial system and that urgent reforms are needed,” the statement said.

US Treasury Secretary Timothy Geithner made his debut on the world stage, after taking office last month and launching a vast US financial stabilisation plan that received a sceptical reaction in the United States.

He vowed that his country, the biggest economy in the world and the source of much of the financial drama in recent months, would work with other nations for a consensus on reforms.

“We need to begin the process of comprehensive reform of our financial system and the international financial system, so the world never again faces a crisis this severe,” Geithner said after the talks.

“The key elements are to make sure that we\’re making banks strong enough that they can be supportive of recovery,” he told reporters.

“It will require ways to bring in private capital, provide public capital when that\’s necessary and it\’s going to require direct action to try to get credit markets working again.”

Main problem for governments

Dominique Strauss-Kahn, head of the International Monetary Fund (IMF) – the body coming to the rescue of some crisis-hit countries – said restructuring banks damaged by the credit crunch was the main problem facing governments.

The G7 reiterated the view of several top delegates that protectionism – when countries take measures that favour their own economies at the expense of others – was a threat to stability.

The United States is among the countries that has prompted concern over protectionism due to a “Buy American” clause in a $787 billion stimulus package, passed by lawmakers late Friday with the sensitive clause toned down.

“The G7 remains committed to avoiding protectionist measures, which would only exacerbate the downturn, to refraining from raising new barriers” to business across borders, the joint statement said.

Geithner highlighted a line in the document that praised China for its “continued commitment to move to a more flexible exchange rate.” China has been accused of letting its currency slip to protect the price of its exports.

Grave economic stakes

The financial leaders from the G7 grouping of Britain, Canada, France, Germany, Italy, Japan and the United States plus Russia met amid mounting warnings of the talks\’ grave economic stakes.

Grim data on Friday showed that the eurozone economy slumped by 1.5 percent in the fourth quarter of 2008. The European Union overall and several individual EU countries – including G7 host Italy – are also in recession.

A grouping of 20 key advanced and emerging economies (the G20) is due to meet in April to discuss financial reform – reflecting the growing clout of rising economic powers such as China.

“We will work closely with our colleagues in the G7 and the G20 to build consensus on reforms that match the scope of the problems revealed by this crisis,” Geithner said.

Tremonti said a so-called set of “legal standards” discussed in Rome would be presented to the G20 and a summit of the Group of Eight (G8) world powers in July.

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Suspected US missile strike kills 27 in Pakistan

The strike, among the deadliest yet, defied Pakistani government warnings that the tactic is fuelling extremism in the nuclear-armed Islamic nation.


In an interview unrelated to the attack, President Asif Ali Zardari said the Taliban had expanded their presence to a “huge amount” of Pakistan and were even eyeing a takeover of the state.

“We\’re fighting for the survival of Pakistan. We\’re not fighting for the survival of anybody else,” Zardari said, according to a transcript of his remarks that CBS television said it would air on


Many Pakistanis believe the country is fighting Islamist militants, who have enjoyed state support in the past, only under pressure from Washington.

Remotely piloted US aircraft are believed to have launched more than 30 attacks since July, and American officials say al-Qaeda\’s leadership and ability to support the insurgency in Afghanistan has been significantly weakened. But Pakistani officials say the vast majority of the victims are civilians.

After Saturday\’s strike, Taliban fighters surrounded the flattened compound in the village of Shrawangai Nazarkhel and carried away the dead and wounded in several vehicles. The village is in South Waziristan, part of the tribally governed area along the Afghan frontier considered the likely redoubt of al-Qaeda chief Osama bin Laden.

The victims included about 15 ethnic Uzbek militants and several Afghans, said Pakistani intelligence officials, who spoke on condition of anonymity because they were not authorised to talk to the media. The seniority of the militants was unclear.

Two of the officials said dozens of followers of Pakistan\’s top Taliban leader, Baitullah Mehsud, were staying in the housing compound when it was hit. There was no indication that Mehsud was present.

Pakistan\’s former government and the CIA have named Mehsud as the prime suspect behind the December 2007 killing of former Prime Minister Benazir Bhutto. Pakistani officials accuse him of harbouring foreign fighters, including Central Asians linked to al-Qaeda, and of training suicide bombers.

No independent verification

The accounts of Saturday\’s incident could not be verified independently. The tribally governed region is unsafe for reporters. The US Embassy had no comment, while Pakistan\’s army

spokesman was unavailable.

The new US administration has brushed off Pakistani criticism that the missile strikes fuel extremist and anti-American sentiment and undercuts the government\’s own counter insurgency strategy.

“The government is doing everything possible to stop it and I hope that America listens to the voice of the people of Pakistan,” Pakistan\’s Interior Ministry chief Rehman Malik said Saturday.

Yet, many analysts suspect Pakistan has quietly agreed to the attacks in order not to endanger billions of dollars in American and Western support for its powerful military and its ailing economy.

The pro-Western government in Islamabad, led by Bhutto widower Zardari, has signed peace deals with tribal leaders in the northwest while launching a series of military operations against hard-liners.

However, government forces are bogged down on several fronts in the northwest, and Taliban militants have sustained a campaign that has included a string of abductions and other attacks on foreigners.

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Vidmar apologises for extraordinary outburst

Vidmar, named the league\’s coach of the year only a week ago, labelled Adelaide a “piss-ant town” and blamed internal politics for messing with his players\’ heads to such an extent that they looked a beaten team even before the start of the second leg at Telstra Dome, won 4-0 by the Victory.


A public apology was hastily issued in the wake of the outburst, though the damaging effect of Vidmar\’s words cannot be overstated.

“In the press conference immediately after our Melbourne Victory match, I regrettably said some things in the heat of the moment,” Vidmar said in a statement.

“I would like to apologise to the city and people of Adelaide for the discouraging comments I made. I grew up in Adelaide and I love the city and people.

“We have fantastic fans and support for the club and my comments were out of order for a club and city I care so much about.”

The damage-control nature of the statement contrasted greatly with Vidmar\’s unbridled fury after the game.

“It was a disgrace, an absolute disgrace. We owe the world an apology, a performance like that was a disgrace,” he said on Saturday night.

“Politics, that\’s what I put it down to. There are too many people in this club with hidden agendas. That\’s the problem. That 4-0 result tonight was politics, nothing else. Whether you are involved directly or indirectly you have an effect.

“Because of a piss-ant town, this club will never win anything until you get rid of that crap.”

The Reds\’ season of success in Asia and the the A-League has been irrevocably soured by events of the past few weeks, which saw the minor premiership slip through Adelaide\’s fingers before the hefty loss to the Victory, making it five defeats in as many matches against the Melbourne club in 2008-09.

“Things change very quickly in football clubs. If someone\’s not happy with something, they do whatever they can to fracture it. That\’s what they do. Whether it\’s jealousy or ego, whatever it is, it certainly smacks of that at our club at this point of time,” he said.

“Everyone is involved. I am not going to name names, everyone involved with the club is involved very heavily.

“I couldn\’t give a damn about my future. This club will never win anything until it gets rid of it (political infighting).

“I wanna be the coach, yes. We need to work in a happy environment, and this was a very happy place until a few weeks ago.”

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Israel’s Livni says she won’t be No.2

Foreign Minister Tzipi Livni said if she doesn’t become Israel’s next prime minister, she will lead her governing Kadima Party into the opposition – a move that could indefinitely stall Mideast peacemaking.


It wasn’t clear whether Livni, Israel’s chief negotiator with the Palestinians, was ruling out a coalition headed by Benjamin Netanyahu’s hawkish Likud Party – or angling for better terms for her centrist party should it choose to enter such a coalition.

Kadima captured 28 of parliament’s 120 seats in Israeli elections last week, barely edging out Likud, which won 27. But parties that take a hard line on concessions toward the Palestinians won 65 seats, versus 55 for the more moderate camp, meaning it would be easier for Netanyahu to put together a coalition government.

President Shimon Peres is allowed to assign the task to whatever party he thinks is best able to form a government, and is expected to announce his decision late this week. Both Livni and Netanyahu have called on each other to join a broad-based government, but neither has indicated readiness to serve under the other.

If Likud and Kadima don’t join forces in the next government, the kingmaker would be the ultranationalist Avigdor Lieberman, who wants to redraw Israel’s borders to place heavy concentrations of Israeli Arabs under Palestinian jurisdiction. Arabs who remain would be forced to sign a loyalty oath to the Jewish state or lose their citizenship. Lieberman’s Yisrael Beitenu is the country’s third-largest party, with 15 seats in parliament.

A new government dependent on Lieberman’s backing could cripple efforts to negotiate an accord with the Palestinians. That could put the new government into conflict with the US, where President Barack Obama has pledged to put Mideast peacemaking high on his agenda.

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Australia fly to South Africa on winning note

The Australian cricket team will leave for its tour of South Africa today buoyed by last night\’s thrilling Twenty20 win over New Zealand at the SCG.


The undermanned national side downed the Kiwis by one run with the match most memorable for a theatrical catch on the boundary by Adam Voges.

The Australian touring party starts its tour of South Africa with a three-day practice match in Potchefstroom from Friday.

The opening Test of Australia\’s three-match series against the Proteas for the No.1 world ranking begins on Thursday week in Johannesburg.

Voges\’ screamer helps Aussies across the line

Adam Voges took a dramatic outfield catch as Australia ended their tough home summer on a positive note with a one-run Twenty20 triumph over New Zealand.

With Brendon McCullum (61 off 47 balls) blasting the Black Caps towards the victory target of 151, Voges was more tightrope walker than cricketer on the boundary in the second last over at the SCG.

McCullum cracked a Ben Hilfenhaus delivery straight to Voges at deep mid-on.

The West Australian caught the ball but was overbalancing and feared going over the rope, so he threw it back in the field of play.

In his desperation to get the ball on the full, he tripped on the boundary rope before crawling his way and diving to catch the ball.

The Kiwis never completely recovered from the setback and finished up at 5-149 with Brendon McCullum\’s big brother Nathan hitting a four and six off the last two balls.

With Australia flying out to South Africa on Monday morning, skipper Ricky Ponting, Mike Hussey and Mitchell Johnson were all rested and Michael Clarke sat out the clash with a back injury.

The Kiwis were missing Ross Taylor, with a hamstring injury, but looked like they didn\’t need him for most of their innings.

In New Zealand\’s response to Australia\’s 7-150, paceman Peter Siddle (2-24 off four overs) warmed up for the tour of South Africa by trapping Martin Guptill in front for a second ball duck and dismissing Peter Fulton for 1.

At the other end man of the match Nathan Bracken (0-16 off four overs) turned up the pressure with the Kiwis not scoring a run against him until his 11th ball of the innings.

At 2-27 after five overs, Brendon McCullum took matters into his own hands by cracking a lofted cover drive that despite landing before the rope was signalled as six.

Neil Broom (36 off 26 balls) rejuvenated the Black Caps with his lusty hitting before McCullum started bamboozling Australian fielders.

The spin off his reverse sweep sent Voges the wrong direction but Voges was to end up getting his man.

The wicketkeeper enjoyed a life on 39 with David Hussey dropping a tough caught and bowled chance and the home side paid in the 17th over bowled by James Hopes with 20 coming off it.

That left the Kiwis needing 25 off the last three overs but Bracken allowed just five off the next six balls.

McCullum then smashed a ball to Voges who produced a theatrical effort to take the catch.

New Zealand needed 14 runs off the final over and James Franklin was run out off the first ball of that over by a delighted Haddin.

The Kiwis were just out of the hunt before the older McCullum brother made it the smallest of wins for Australia.

David Hussey (41 off 39 balls) earlier topscored for the Australians in their 7-150 with Kiwi spinner Daniel Vettori (1-23 off four overs) proving as difficult as ever to get away.

Moises Henriques (1) had his first bat for Australia but that didn\’t last long, he was run out second ball following a mix up.

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Bishop quits as Shadow Treasurer

Embattled Liberal deputy leader Julie Bishop has quit as opposition treasury spokesperson after only four months in the job.


Ms Bishop said she will remain as the deputy opposition leader and take over the foreign affairs portfolio.

Disquiet about Ms Bishop\’s failure to cut through on economic issues reached a fever pitch last week as some opposition MPs campaigned for her removal.

Ms Bishop, a former minister in the Howard government, had previously served as spokeswoman for workplace relations until Malcolm Turnbull won the leadership from Brendan Nelson in September last year.

Possible contenders for the treasury spokesperson\’s job include frontbenchers Joe Hockey, Peter Dutton and Andrew Robb.

Ms Bishop said she felt that she had fulfilled her obligations as opposition treasury spokesperson.

She told reporters that as deputy leader she had the option of choosing which portfolio she should step into, and that was foreign affairs.

“When our leader Malcolm Turnbull was elected last year, I chose the treasury portfolio because it had been something of a tradition in the Liberal Party for the deputy leader to hold that portfolio and because I believed that with Malcolm and others this would give the opposition a strong and effective team in the area of economic management,” she said.

Ms Bishop said the ongoing commentary about her role had been a distraction.

“While I believe I have carried out my duties as shadow treasurer diligently and competently, I have formed the opinion that the ongoing commentary on my role has been a distraction from the scrutiny that should have been applied to the government\’s reckless economic performance.”

Tough portfolio

Eralier frontbencher Dutton has refused to say whether Julie Bishop should continue as the federal party\’s treasury spokeswoman.

Pressure mounted on Ms Bishop after a series of blunders and recent polls showing the opposition is losing its mantle as a superior economic manager.

Opposition Leader Malcolm Turnbull had expressed complete confidence in Ms Bishop, but others in the party were believed to be pushing for a handover to limit damage caused by any forced transition.

Mr Dutton, assistant treasurer in the previous Howard government, said treasury was a tough shadow portfolio.

Bishop finds unlikely ally in Gillard

Julie Bishop is paying the price for the failings of her Liberal leader, Deputy Prime Minister Julia Gillard says.

But Ms Gillard said the coalition\’s inability to gain traction in debate on the economy was not Ms Bishop\’s fault, but rather due to the policy direction adopted by Mr Turnbull.

“I think Julie Bishop is being criticised for following Malcolm Turnbull\’s script,” Ms Gillard told the Nine Network on Sunday.

“Malcolm Turnbull\’s script about the global financial crisis has been no plans, no suggestions, wait and see, play politics.”

Ms Bishop had faithfully followed Mr Turnbull\’s directions, Ms Gillard said.

“And I do wonder whether it\’s Ms Bishop who should bear the criticism for Mr Turnbull\’s approach.”

However, Ms Bishop\’s predicament is also of her own making.

Since taking on the role of treasury spokeswoman in September, the Liberal deputy leader has been accused of plagiarism and has been responsible for a number of gaffes in relation to the economy.

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Japan \’facing worst crisis since WWII\’

Japan said it was trapped in its worst economic slump since World War II, as once-buoyant China and India issued stark warnings on the outlook and more job cuts were announced in Europe.


New data released showed the Japanese economy, the world\’s second largest, shrank for a third straight quarter in the three months to December.

It was the weakest performance since 1974 when the country was reeling from the first oil crisis, and the government said this slump would be even worse.

“This is the worst-ever crisis in the post-war era.

There is no doubt about it,” Japanese Economic and Fiscal Policy Minister Kaoru Yosano said.

The news came after a weekend meeting of the Group of Seven — Britain, Canada, France, Germany, Italy, Japan and the United States — which urged bold reforms to the world financial system and painted a bleak picture of the economy.

The G7 finance officials “appear to fully recognize the gravity of the current situation, and they have said the right things about the actions that need to be taken,” said Bill Witherell, economist at Cumberland Advisors. But he added that “the good words need to be matched by deeds, by prompt and effective action.”

Chinese President Hu Jintao warned the crisis was deepening and India\’s acting finance minister Pranab Mukherjee said “extraordinary economic circumstances” meant India had to ramp up its budget spending.

“The impact of the crisis on economies around the world is still deepening and its grave consequences will be felt more in the days to come,” Hu said in the Tanzanian capital Dar es Salaam during a tour of Africa.

Meanwhile the government in India, which like China is considered a global growth leader, abandoned its traditional fiscal caution and approved a sharp increase in budget spending in a bid to beat the crisis.

“Extraordinary economic circumstances merit extraordinary measures,” Mukherjee told a session of parliament.

“Employment generation schemes have to be expanded and social security nets have to be strengthened to protect the vulnerable sections of our society.”

In Europe, Ukraine suffered a fresh blow on Monday when international ratings agency Standard and Poor\’s warned of a possible credit rating downgrade as the ex-Soviet republic struggled to get International Monetary Fund credit. And Russia disclosed that its industrial production plunged by 16.0 percent in January compared with January 2008.

Russian officials have already warned that the economy will record a contraction in 2009.

There was more fallout from the crisis in Japan where hundreds of laid-off temporary workers protested and in Britain where German automaker BMW said it would shed 850 workers at a plant in England who help make the Mini car.

BMW said nearly a fifth of workers at its plant in Cowley, near London, would be affected by the downsizing starting on March 2 to coincide with a reduction in the working week to five days from seven.

“While Mini has been weathering the economic downturn, it is not immune from the challenges of the current situation,” BMW said in a statement. A trade union official said Dutch truckmaker DAF will slash its workforce in half at its Westerlo factory in northern Belgium, cutting 873 jobs.

In the United States, where financial markets were closed for a public holiday, President Barack Obama was preparing to sign a new massive economic stimulus plan on Tuesday.

Obama has said his 787-billion-dollar stimulus package, combining public works spending and tax cuts, is the only alternative to catastrophe.

Analysts also expected the US administration to announce a new plan to ease home foreclosures and to offer further details about a bank rescue plan announced last week.

An administration official said Obama is to set up a task force to steer the restructuring of the crippled US auto industry instead of relying on just one “car czar.”

As two giant automakers prepare to unveil painful recovery plans to the government on Tuesday, the official said the task force would be headed by Treasury Secretary Timothy Geithner and White House economic advisor Lawrence Summers.

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British, French nuclear subs collide in Atlantic

In what experts called an unprecedented incident, Britain\’s HMS Vanguard and France\’s Le Triomphant hit each other deep underwater in the middle of the ocean on February 4, according to British press reports.


The crash caused damage but no leaks from the vessels. Each is some 150 metres long and can carry up to 48 nuclear warheads on a maximum of 16 missiles. The total number of crew members involved in the incident was 250 sailors.

Confirming the media reports, Britain\’s First Sea Lord Admiral Sir Jonathon Band said the submarines “were conducting routine … patrols in the Atlantic Ocean.

“The submarines came into contact at very low speed… No injuries occurred,” he said in a brief statement to reporters.

“There was no compromise to nuclear safety.” The British sub was able to be towed to its Faslane base in western Scotland for repair, media reports said.

France\’s defence ministry initially said on February 6 that Le Triomphant had been damaged when it hit an object, thought then to be a sinking cargo container.

Le Triomphant, one of France\’s four nuclear-armed submarines, hit the object while submerging, and immediately returned to base at Ile-Longue, near Brest in northwest France.

The sonar dome on the front of the vessel was damaged, the navy said at the time, adding that the incident had not resulted in injuries among the crew and did not jeopardise nuclear security at any time.

But on Monday the the French ministry confirmed that the incident involved the British nuclear submarine.

“This is the first incident of its kind in more than 400 patrols that we have carried out,” Captain Jerome Erulin, a spokesman for the French navy, told AFP.

HMS Vanguard, launched in 1992, is one of four nuclear submarines operated by the British military as part of its Trident system, and one is always on deterrent patrol.

Stephen Saunders, of military information group Jane\’s said there were three possible causes.

The first was a possible procedural error: the submarines should have been subject to

“NATO waterspace management” which “deconflicts” such incidents, even if France is not part of NATO\’s military command structure, he said.

Secondly the two vessels may not have been able to hear eachother because of high-tech engineering designed to make them undetectable to enemies.

Thirdly was simple bad luck. “Even if two submarines do find themselves in the same area, it is still bad luck to have run into each other — i.e. to be in the same place at the same depth,” he said.

France and Britain are two of the world\’s five declared nuclear powers, along with the United States, China and Russia. France has maintained a sea-based nuclear deterrent force since 1971.

Britain is planning to renew its Trident submarine nuclear missile system, at a cost of about 20 billion pounds (now 30 billion dollars, 22 billion euros).

A French anti-nuclear group meanwhile attacked military authorities for taking so long to admit the collision.

“It appears obvious that once again the first reflex of the nuclear lobby is to hide the truth,” said Sortir du Nucleaire (Get Out of Nuclear).

“Nothing therefore has changed since the state lies about the Chernobyl cloud” in 1986, when the nuclear reactor in Ukraine melted down and sent a cloud of radioactive pollution into the atmosphere, it added. Saunders said the collision highlighted a serious management issue.

“The damage, while embarrassing, can be repaired,” he said. “No doubt there are a number of technical issues to be investigated. But the root of the problem appears to be procedural.

These submarines should not have been in the same place at the same time.”

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