Marriage Tax Breaks: Cameron Faces Revolt

Tax breaks for married couples will not be part of next month's Budget, a senior Government source has said.

The news is likely to upset many Conservative backbenchers who have suggested the change should be included in Chancellor George Osborne's next Budget in return for their supporting plans to introduce gay marriage.

The Conservative general election manifesto pledged to introduce a marriage tax break, and the commitment was included in the coalition agreement.

It is expected that one member of a married couple or civil partnership would be allowed to transfer £750 of their tax-free personal allowance to their partner, reducing their tax bill. This would be worth around £150 a year to basic-rate taxpayers.

But the senior Government source flatly rejected the idea of a "quid pro quo" deal, and ruled out a marriage tax break featuring in the Budget.

"It won't be in the Budget but it will be in this Parliament," the source said. "This Budget obviously, with all that has happened in recent weeks and months, will be very much focused on growth in the economy".

Mr Cameron views the introduction of same-sex marriage - which is expected to split his MPs when it is put to a Commons vote next week - as the "Conservative Party delivering the promise it made".

"This is a difficult issue for some in the Conservative Party and he understands the strong feelings that people have, and of course it's a free vote," the source said.

"He is proud of the fact that it's a coalition Government with strong Conservative participation that is bringing forward a modern and progressive change.

"It is good to encourage people to come together and stay together."

David Cameron is said to have 'full confidence' in George Osborne

The source also said Mr Osborne had the "full confidence" of the Prime Minister - insisting he will still be Chancellor at the 2015 general election.

It came as some MPs are said to be circulating a letter demanding that Mr Osborne is replaced as the economy continues to falter.

"He is an extremely successful Chancellor. He is battling very difficult economic circumstances," the source said.

"George Osborne will be Chancellor at the next general election."

The issue of gay marriage is causing Conservative party members to quit in significant numbers, according to The Times.

Backbenchers insist the issue has sparked "serious unrest" among the party's rank and file and are claiming some constituencies have lost as many as 100 card-carrying Tories each.

Conservative headquarters, however, does not hold up-to-date membership records, the newspaper said.

Tory MP David Burrowes told The Times: "There's serious unrest in the grassroots. You cannot avoid the fact that the troops are unhappy. People are drifting away."

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Car Park Dug Up Around Marooned Mercedes

Workers were forced to resurface a car park around a stranded vehicle after its owner decided to move barriers to park there.

The area was blocked off by diggers at Edinburgh Waverley railway station, but when they turned up the next day, they found the Mercedes parked in the middle of the site.

Nonetheless, the workers got on with the job as planned and dug up the surface around the marooned blue car.

However, they also built a small ramp so the vehicle could be removed.

A Network Rail spokesman said: "Part of the car park had been cordoned off so we could begin resurfacing it and improve the lighting too.

"Whoever the driver was, he or she decided to move the barriers and park in the worksite anyway.

"We did the work but we left a ramp for them to exit and will be happy to return their vehicle if they contact us."

The scene was caught on camera by Twitter user Alice Robertson, who tweeted: "Not a good day to park in the Edinburgh Waverley car park."

The work is part of Network Rail's £100m refurbishment project of the station.

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Halal Prison Food Found To Contain Pork DNA

A company which supplies Halal meat to prisons has had its contract suspended after traces of pork DNA were found in pies and pasties.

The Ministry of Justice said it had withdrawn the products immediately, while justice minister Jeremy Wright said the Prison Service was investigating "as a matter of urgency".

It comes after traces of horsemeat were found in burgers sold by some UK supermarkets, including Tesco.

"All prisons have been informed about this very regrettable incident and we reported this issue to the Food Standards Agency immediately," a spokesman for the Ministry of Justice said.

"We are taking immediate steps to suspend the contract with the relevant sub-contractor."

Mr Wright said: "This is an absolutely unacceptable situation and one which we regret greatly.

"This must be distressing for those affected and they can be reassured we are doing everything we can to resolve the situation. The Prison Service is investigating this as a matter of urgency."

The company involved has not been named and it is not known where the firm is based.

Islamic law forbids the consumption of pork and prison rules dictate that Halal meat must be offered to inmates.

"The labelling system and adherence to the EU regulations of labelling must be stricter," said Masood Khawaja, from the Halal Food Authority.

"An enforcing agency like the Food Standards Agency should take action, it has happened many times."

Juliet Lyon, director of the Prison Reform Trust, said: "This lapse will have offended and distressed high numbers of Muslim prisoners and their families so apologising, suspending the supplier and investigating the incident are the right steps for the Ministry of Justice to take."

A spokesman for the Food Standards Agency said a local authority investigation would look into the cause of the contamination and determine where the products had been sent.

It is due to meet with retailers and suppliers to remind them of their responsibilities surrounding food labelling after the recent horsemeat scandal.

Burger King has dropped the Irish food processing plant which supplied the contaminated burgers.

The Silvercrest plant in County Monaghan, which is part of the ABP Food Group, has also lost contracts with Tesco, Aldi and the Co-operative Group.

A sample of Tesco's Everyday Value Beef Burgers was found to contain 29% horsemeat.

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Twitter Hacked: Up To 250,000 Passwords Taken

Around 250,000 Twitter users may have had their accounts compromised by computer hackers.

The social networking site said usernames, email addresses and encrypted passwords may have been taken during an "extremely sophisticated" attack on its systems.

It said one attack was shut down moments after it was detected, adding that the passwords of users who may have been affected had been reset.

In a blog, Bob Lord, director of information security at Twitter, said there had been "a recent uptick in large-scale security attacks aimed at US technology and media companies", with the New York Times among those targeted.

He said: "Our investigation has indicated the attackers may have had access to limited user information - usernames, email addresses, session tokens and encrypted/salted versions of passwords - for approximately 250,000 users.

"As a precautionary security measure, we have reset passwords and revoked session tokens for these accounts.

"This attack was not the work of amateurs and we do not believe it was an isolated incident.

"The attackers were extremely sophisticated and we believe other companies and organisations have also been recently similarly attacked."

One expert said the hackers may have gained access through an employee's home or work computer by exploiting vulnerabilities in Java, a widely-used computing language.

Ashkan Soltani, an independent privacy and security researcher, said such a move would give attackers "a toehold" in Twitter's internal network, potentially allowing them to track user information as it travelled across the company's systems or break into specific areas, such as the authentication servers that process users' passwords.

Although the hackers are unlikely to have gained any confidential information, Mr Soltani said the stolen credentials could be used to access other services for which a person has signed up using the same username and password.

Mr Lord said that although "only a very small percentage" of users were potentially affected, everyone who uses the site should ensure their password is secure.

He said passwords should be at least 10 characters long, contain upper and lowercase letters, numbers and symbols, and be different to passwords used for other online accounts.

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India Gang Rape Accused Plead Not Guilty

Five men accused of the brutal murder and gang rape of a 23-year-old medical student on a Delhi bus have denied the allegations.

They pleaded not guilty after being indicted on 13 charges in a special fast-track court in the capital.

The defendants are due back in court on February 5, when the prosecution will call three witnesses to the formal start of the trial.

The accused, aged between 19 and 35 and who have been named as Ram Singh, Mukesh Singh, Vinay Sharma, Akshay Thakur and Pawan Gupta, could face the death penalty if convicted.

They reportedly filed into the courtroom with their faces concealed with scarves amid heavy security.

Demonstrators have called for tougher punishments for sex crimes in India

A sixth 17-year-old suspect will be tried separately in a juvenile court where the maximum sentence is three years in a reform facility.

The victim was repeatedly raped and assaulted with a metal bar during the attack on December 16.

Her male companion was beaten up, before they were both thrown off a moving bus and dumped naked on the roadside.

The young woman died from her internal injuries two weeks later in a hospital in Singapore.

Her death has triggered nationwide protests about violence against women, and sparked debate about their treatment in India and the inability of law enforcement agencies to protect them.

Saturday's court hearing comes a day after India's cabinet backed harsher punishments for rapists, including the death penalty.

The changes are expected to become law as early as this weekend, but will also need to be ratified by parliament at a later date.

Law minister Ashwani Kumar said: "We have taken swift action and hope these steps will make women feel safer in the country."

Under the current law, a rapist faces a prison term of between seven and 10 years.

The changes would see the minimum sentence for gang rape, rape of a minor, rape by a police officer or a person in authority, double - and extended to life without parole.

New offences such as voyeurism and stalking are also set to be introduced.

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Alabama Hostage-Taker Bragged About Bunker

A neighbour of a man who has taken a child hostage in an underground bunker said he had been building it for months.

Police said Jimmy Lee Dykes killed school bus driver Charles Albert Poland, 66, on Tuesday before abducting a five-year-old boy and taking him to his home-made bunker at his rural Alabama property.

Since the standoff, negotiators have been trying to persuade the 65-year-old loner to surrender through a ventilation pipe connected to the bunker.

The Vietnam veteran has been described by neighbours as a menacing figure who held anti-government views.

More than 100 people gathered for a candlelight vigil on Thursday

Neighbour Michael Creel said the suspect spent two or three months constructing the bunker, digging into the ground and then building a structure of lumber and plywood, which he covered with sand and dirt.

He said Dykes put the plastic pipe underground from the bunker to the end of his driveway so he could hear if anyone drove up to his gate.

When Dykes finished the shelter a year or so ago, he invited Mr Creel to see it - and he did.

"He was bragging about it. He said, 'Come check it out'," Mr Creel said.

He said he believes Dykes' goal with the stand-off is to publicise his political beliefs.

"I believe he wants to rant and rave about politics and government. He's very concerned about his property. He doesn't want his stuff messed with," said Mr Creel.

Neighbours said Dykes once beat a dog to death with a lead pipe and threatened to shoot children for setting foot on his property.

Dykes had been scheduled to appear in court on Wednesday to answer charges he shot a gun at his neighbours in an argument last month about a speed bump.

James Arrington, police chief of the neighbouring town of Pinckard, said the storm shelter was about 4ft underground with about 6ft-by-8ft of floor space.

"It's pretty small, but he's been known to stay in there eight days," he said. "He will have to give up sooner or later because (authorities) are not leaving."

Officials have confirmed the boy has Asperger's and attention deficit hyperactivity disorder, or ADHD. Police do not believe he has been harmed.

Republican lawmaker Steve Clouse, who represents the Midland City area, said he visited the boy's mother on Thursday and that she is "hanging on by a thread".

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RBS Told To Pay Libor Fine From Bonus Pot

Chancellor George Osborne wants any fine paid by the Royal Bank of Scotland over the Libor scandal to come out of its bankers' bonuses.

RBS, which is majority-owned by the taxpayer, is expected to agree a fine of £400-500m next week with US and British authorities.

It is accused of attempting to rig benchmark interest rates.

Sky's City Editor Mark Kleinman said: "A Treasury source has told Sky News that the money that the US regulators will fine RBS will have to come out of the bank's bonus pot.

Sky's Mark Kleinman said the demand is politically important

"It's very important politically, I think, for the Chancellor to be able to say that the taxpayer is not bearing the financial cost of misconduct by bankers who work for a company that is majority-owned by the taxpayer.

"The Treasury is obviously playing hardball on this, and we'll find out exactly how much RBS is going to be paying in fines in the coming days."

The Treasury expects the fines to be paid not just from the bonus pot for 2012 - likely to be around £250m - but money from future years' bonus pots as well.

RBS - which is 81% owned by taxpayers - is also looking to claw back up to £100m from pay deals previously awarded to executives in its investment bank.

The bank's remuneration committee, which is chaired by Penny Hughes, a non-executive director, is assessing plans for a "flat tax" on the pay packets of hundreds of directors and managing directors in its markets business.

The idea would involve about 15% of prior-year pay awards to the relevant individuals being clawed back, netting a total of as much as £100m.

"George Osborne is sending out a clear signal: 'You're paying for this, not us'," said Sky's Glen Oglaza.

"What the Treasury are saying is there won't be bonuses paid this year, but actually your bonuses are going to be clawed back not just this year but probably next year and the year after as well."

Barclays was fined £300m last year for its role in the scandal.

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Blackpool Burning Body: Teen Stabbed To Death

A 16-year-old girl whose body was found burning in an alley was stabbed to death, a post-mortem examination has found.

Sasha Marsden's body was set on fire after she had died from stab wounds to the head and face, police said.

Police cordoned off the area in South Shore, Blackpool, after her body was discovered at 9pm on Thursday.

A 22-year-old man was arrested nearby and police have been granted a further 36 hours to question him.

A woman aged 20 was also held but later released without charge.

Police released this image of Sasha

A police spokesman said: "Following the death of Sasha Marsden, a Home Office post-mortem examination has been carried out and has found that Sasha died as a result of receiving significant stab wounds to the head and face.

"It also showed that attempts were made to set the body on fire and this was after Sasha had died.

"The results have been shared with the family, and specially trained officers are continuing to support them."

The teenager was on a childcare course at college (Facebook picture)

On Friday, specialist crime scene investigators carried out forensic searches of the alley behind Kirby Road and at the Grafton House bed-and-breakfast hotel on the same road, which is a few streets off the Promenade.

Carl Evans, owner of the nearby Kimber Guest House, told Sky News he spotted the fire when he walked out into his back garden on Thursday evening.

"I heard the alarms going and saw the smoke, but I thought it was just someone burning rubbish," he said.

He added that some residents had attempted to put out the flames before realising it was a body on fire.

The crime scene in Blackpool has been cordoned off by police

"The lass two doors up said someone seemed to have put something out - like a mannequin - but it turned out to be the body of a 16-year-old girl."

Sasha was in the first year of a childcare course at Blackpool and The Fylde College and lived with her parents in nearby Staining.

In a tribute to her, Mandy Pritchard, head of the college's school for society, health and childhood, said she was "a friendly, considerate individual who cared about her fellow students".

Numerous tributes were paid to the youngster on a Facebook page set up in her memory.

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Iran Space Monkey Photos Prompt Questions

Iran's claim that it successfully sent a monkey into orbit has been called into question after the release of contrasting before-and-after pictures of the primate space traveller.

The images, obtained from the Iranian Students News Agency (ISNA), appear to show two different animals.

Tehran claimed it had made a mistake and that one of the two official package of photographs depicted the wrong monkey - but insisted it had flown a primate into orbit and back safely.

Mohammad Ebrahimi, a senior Iranian space official, said photos of two different monkeys were released, but one was an archive photo of a back-up primate.

The voyage was heralded by the country's state TV channel on Monday.

The report said the primate was sent up in a Pishtam, or Explorer, rocket to a height of 72 miles. Iran says it is working toward manned space flight.

The US and its allies worry that the technology could also be used to develop long-range missiles that could potentially be armed with nuclear warheads.

In 2010, Iran said it launched a rocket into space carrying a mouse, turtle and worms.

But an attempt in 2011 to put a monkey into space failed, although no official explanation was given.

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George Osborne Backs Bank Break-Up Powers

By Mark Kleinman, City Editor

Misbehaving banks could be forcibly broken up, George Osborne is expected to warn the industry, in a move that will pave the way for a further fundamental shake-up of Britain's banking sector.

I understand that the Chancellor is preparing to back a call by the Parliamentary Commission on Banking Standards for regulators to have powers to split so-called universal banks such as Barclays and Royal Bank of Scotland (RBS) into their separate retail and investment banking components.

An announcement by Mr Osborne, which could come as soon as next week, will lay the foundations for arguably the most radical overhaul ever of British banking.

It would potentially go much further than a plan currently passing through legislation for a ring-fence to artificially separate retail and investment banks but allow both to exist within the same corporate entity.

A senior Treasury source has told me that Mr Osborne and Vince Cable, the Business Secretary, agreed in recent weeks that the Government should back the Parliamentary Commission's blueprint for 'electrifying' the ring-fence. Mr Cable is also expected to publicly support the move next week.

The news will delight Andrew Tyrie, chairman of the Parliamentary Commission, which was set up last summer by Mr Osborne and David Cameron in the wake of Barclays' £290m fine for rigging Libor benchmark interest rates.

The Chancellor is expected to outline his views in the same week that RBS settles with regulators for its role in the Libor scandal.

RBS, which is 82%-owned by the taxpayer, is likely to pay more than £400m in fines and is fighting to avoid a criminal prosecution by the US Department of Justice.

In the last few days, the industry's reputation has again been dragged through the mire when the City regulator ruled there had been widespread mis-selling of products designed to help small businesses manage the financial impact of sharp rises in interest rates.

"The Coalition is totally joined-up on this," one source said.

The precise detail of how Mr Osborne would want the new reserve powers to operate was unclear on Saturday.

However, he is likely to back the judgement of Mr Tyrie and his colleagues on the commission that the industry regulator should have the ability to identify individual banks which are abusing the ring-fencing framework and pursue – subject to a veto from the Treasury - full separation of that banking group's high street and investment (or "casino", as Mr Cable has dubbed it) divisions.

The Chancellor is also expected to endorse the idea put forward by Mr Tyrie that there should be periodic reviews of the effectiveness of the ring-fence across the banking industry, with the first independent review taking place four years after the new structure is in operation.

Mr Osborne has already set in process far-reaching reforms of bank regulation. The Financial Services Authority, which was created by Gordon Brown in 1997, is to be abolished, and its powers are to be divided between two new bodies: The Financial Conduct Authority and the Prudential Regulatory Authority, which will sit within the Bank of England.

In its interim report last month, the Parliamentary Commission warned that banks were likely to attempt to manipulate the ring-fencing system for their own benefit. Mr Tyrie said the current banking reform proposals "fall well short of what is required".

"Over time, the ring-fence will be tested and challenged by the banks. Politicians, too, could succumb to lobbying from banks and others, adding to pressure to put holes in the ring-fence," he said when the report was published in December.

"For the ring-fence to succeed, banks need to be discouraged from gaming the rules. All history tells us they will do this unless incentivised not to. That's why we recommend electrification. The legislation needs to set out a reserve power for separation — the regulator needs to know he can use it. Furthermore, we need periodic reviews of the sector to reassure us that the ring-fence as a whole is working."

The banking industry has lobbied furiously against the electrification move, claiming that the existence of such reserve powers to break them up will deter big City investors from buying their equity and debt.

A powerful City lobbying group, the Association of British Insurers, recently published a report on the investment case for the major UK banks in which it argued that regulatory uncertainty was among a number of factors preventing investors from being able to commit their money to the industry confident that they would secure a commercial return.

That message will have sting in the tail for Mr Osborne, who is responsible for tens of billions of pounds-worth of taxpayers' investments in Lloyds Banking Group and RBS.

If the investor groups are correct, and the electrification proposal exacerbates that uncertainty, it risks permanently impairing the value of those shareholdings and denting the chances of ever recovering the money injected during the 2008 financial crisis.

Whitehall insiders said that the endorsement of the Parliamentary Commission's report by Sir John Vickers, whose Independent Commission on Banking (ICB) came up with the ring-fencing proposals in 2011, had "tipped the argument in favour of backing Tyrie".

Mr Osborne's move will contain a silver lining for the big banks in that he will not be endorsing the most draconian approach to policing the industry, which would have meant implementing full and immediate separation of each group's retail and investment banking operations.

The Treasury declined to comment on Saturday.

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