Matt Falloon http://blogs.reuters.com/matt-falloon Matt Falloon's Profile Wed, 19 Dec 2012 15:45:10 +0000 en-US hourly 1 http://wordpress.org/?v=4.2.5 Nearly half of UK forces to leave Afghanistan in 2013 http://www.reuters.com/article/2012/12/19/us-britain-afghanistan-idUSBRE8BI0O520121219?feedType=RSS&feedName=everything&virtualBrandChannel=11563 http://blogs.reuters.com/matt-falloon/2012/12/19/nearly-half-of-uk-forces-to-leave-afghanistan-in-2013/#comments Wed, 19 Dec 2012 15:14:33 +0000 http://blogs.reuters.com/matt-falloon/?p=638 LONDON (Reuters) – Britain will withdraw nearly half its troops from Afghanistan by the end of 2013, the government said on Wednesday, as part of a security handover to Afghan forces more than a decade after the U.S.-led invasion.

Nearly all of Britain’s 9,000 soldiers are due to pull out when the NATO mission finishes in late 2014, ending a long, costly and unpopular war that has cost the lives of 438 UK troops.

Like the United States, Britain will leave behind an undisclosed number of soldiers after 2014 to help local forces face threats from the Taliban and its al Qaeda allies.

“Because of the success of our forces and the Afghan National Security Forces … we’ll be able to see troops come home in two relatively even steps – 2013 and 2014,” Prime Minister David Cameron told parliament. He had discussed the plan with U.S. President Barack Obama by phone on Tuesday.

Britain, which has the second biggest foreign force in Afghanistan after the United States, says it has helped to stabilize the country and prevent militants from finding a safe haven.

But the war’s critics say Afghanistan is far from stable after years of violence and they question why Britain has spent so much money on the war at a time of tight public finances.

Britain’s defense budget, like that of other NATO members, is under pressure, forcing the Ministry of Defence to spend less on troop numbers and equipment.

‘UNWINNABLE WAR’

Polls for the BBC and several UK newspapers over the last two years suggest a majority of British voters think the conflict is “unwinnable” and that its soldiers should leave Afghanistan ahead of schedule.

Some Afghans fear the withdrawal could lead to an escalation in violence or even civil war. However, Afghan President Hamid Karzai has dismissed those concerns.

A resilient Taliban, ethnic tensions and competing warlords all pose a threat to Afghanistan’s security before presidential elections due in 2014. Attacks on NATO forces by rogue Afghan soldiers and police have raised tensions.

An Afghan defense ministry spokesman said its forces could fill the gap left by the withdrawal of foreign troops.

“There will not be any security gap and we are fully prepared to provide security,” General Zahir Azimy told Reuters.

British Defence Secretary Philip Hammond sought to allay fears there would be a fast pullout that could threaten Afghanistan’s security.

“There will not be a cliff-edge reduction in troop numbers at the end of 2014,” he said. “There remain huge challenges ahead for the Afghan people. Our combat mission is drawing to a close, but our commitment to the Afghan people is long term.”

(Additional reporting by Hamid Shalizi in KABUL; Editing by Andrew Heavens)

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Osborne tries to sweeten pill for austerity Britain http://www.reuters.com/article/2012/12/05/us-britain-economy-osborne-idUSBRE8B400820121205?feedType=RSS&feedName=everything&virtualBrandChannel=11563 http://blogs.reuters.com/matt-falloon/2012/12/05/osborne-tries-to-sweeten-pill-for-austerity-britain/#comments Wed, 05 Dec 2012 00:04:05 +0000 http://blogs.reuters.com/matt-falloon/?p=636 LONDON (Reuters) – More austerity looks certain when British finance minister George Osborne presents a half-yearly budget statement on Wednesday, even if he tries to juggle some spending around to ease the pain.

A darker economic outlook means Osborne is likely to commit to further spending cuts years into the future to save his flagship deficit reduction plan, though he also plans some new investment to sweeten the pill in the short term.

Osborne, who will update parliament with new growth and budget deficit figures just after 1230 GMT, may have to admit borrowing will rise this year – a big embarrassment for a man who put frugality at the heart of the government’s policy.

His austerity targets are under threat, and a sluggish economy has played havoc with the Conservative-Liberal Democrat coalition’s original plan to eliminate a large structural budget deficit before the next parliamentary election due in 2015.

Depending on how bad the independent Office for Budget Responsibility’s growth and borrowing forecasts turn out to be, Britain could before long be in danger of losing its prized triple-A credit rating.

The chances of Osborne masterminding a strong recovery in time for voters to feel the benefits before a 2015 election appear to be shrinking.

“The picture of stagnation is a problem,” said Rob Wood, an economist at Berenberg Bank, arguing that Osborne will probably have to announce more austerity for the years after the 2015 election. “Deficit reduction has gone into reverse this year.”

The economy grew one percent in the third quarter, bouncing back from three quarters of decline, but few expect a roaring recovery next year without some solution to the protracted debt crisis in the euro zone – Britain’s main trading partner.

In the absence of the strong growth predicted when Osborne took the reins of the Treasury in 2010, he has been forced to extend spending cuts well beyond the next election. He may have to stretch out those cuts even further into the future.

Back in March, the OBR forecast growth of 0.8 percent this year, 2 percent in 2013 and nearly 3 percent thereafter. Economists polled by Reuters now expect output to fall 0.1 percent this year, followed by 1.1 percent growth in 2013 and 1.7 percent in 2014.

CUTTING TOO FAST?

Critics accuse Osborne of strangling growth by cutting government spending too fast and, in turn, scuppering any hopes of reaping the tax revenues needed to swiftly deal with Britain’s budget deficit – which hit a record above 11 percent of GDP shortly before the 2010 election.

“Wednesday’s Autumn Statement on the economy is a chance for Chancellor (of the Exchequer) George Osborne to recognize things haven’t worked out as he promised and try a different approach,” Ed Balls, economy spokesman for the opposition Labour Party, said on Monday.

“He should take the opportunity to do so, because the country will not forgive him if he puts political pride first and ploughs on recklessly with a failing plan.”

Osborne’s supporters say that changing course now would unsettle financial markets, drive up the cost of borrowing and put Britain’s economy in even greater jeopardy.

Instead, the Conservative will juggle the numbers to find money for investing in infrastructure, while holding fast to his austerity plan – even if that means more spending cuts to make up for lost tax income.

“It’s clearly taking longer to deal with Britain’s debts, it’s clearly taking longer to recover from the financial crisis than anyone would have hoped,” Osborne told the BBC on Sunday.

“But … to turn back now … would be a complete disaster for our country.”

He will detail 5 billion pounds ($8 billion) of spending on schools and transport on Wednesday, largely paid for by cuts across government departments over the next two-and-a-half years, and flesh out plans for a new clampdown on tax avoidance.

A strategic plan for Britain’s gas production industry is also expected, following an October announcement of tax breaks for the fledgling shale gas sector.

Osborne will argue that the burden of any extra austerity must be spread across society, with further cuts to the welfare budget and some form of taxation on the wealthy – possibly a property tax and a limit on pension tax relief.

It is unclear how a 35 billion pound windfall from the Bank of England’s 375 billion pound asset purchase scheme will be accounted for in the public finances, but it is a timely gift for Osborne and will reduce Britain’s debts.

The OBR may well extend the time needed before Britain’s structural current budget returns to balance by a year to 2017/18 – though this will keep Osborne within the five-year rolling horizon he set himself in 2010.

However, he may be forced to abandon one of his key fiscal policy rules – to see debt falling as a percentage of Britain’s national output by 2015/16. He could replace that rule with something less specific to keep markets on side.

($1 = 0.6213 British pounds)

(Additional reporting by David Milliken; editing by Stephen Nisbet)

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Stagnation haunts Osborne’s growth gamble http://uk.reuters.com/article/2012/11/28/uk-britain-economy-osborne-idUKLNE8AR02J20121128?feedType=RSS&feedName=everything&virtualBrandChannel=11708 http://blogs.reuters.com/matt-falloon/2012/11/28/stagnation-haunts-osbornes-growth-gamble/#comments Wed, 28 Nov 2012 13:56:43 +0000 http://blogs.reuters.com/matt-falloon/?p=634 LONDON (Reuters) – Chancellor George Osborne is expected to defend his faltering austerity plan next week as the only credible way of solving the government’s biggest political problem – its failure to deliver a strong recovery.

No matter how Osborne presents the sums in his December 5 “Autumn statement”, he cannot hide a simple fact: the stagnating economy has played havoc with his ambitious plans to cut Britain’s debts before the next election in 2015.

In his economic statement to parliament, the Chancellor may even have to predict higher borrowing this year. This would be deeply embarrassing for a man who promised the Conservative-led coalition would virtually eliminate a record budget deficit by 2015, arguing that the previous Labour government let Britain’s finances get out of control.

Osborne’s supporters pin most of the blame on the euro zone debt crisis, and the International Monetary Fund says he is right to let some areas of spending rise while tackling the fundamental causes of heavy borrowing.

But his critics say austerity has disproportionately sapped demand and that he is running out of time to fix the economy soon enough for any benefits to be felt before the election. The Conservatives need an alternative “plan B” for the economy, they say.

“If they go on as they are, they face certain defeat,” said Simon Lee, a lecturer in political economy at Hull University Hull. “The conclusive proof is that plan A is not working.”

The failure of Prime Minister David Cameron’s government to nurse the economy back to strong growth after the financial crisis has fuelled attacks from Labour, which polls show would regain power if an election were held now.

In a sign of the frustration, a handful of Conservatives have called for Osborne to be replaced before it is too late to turn the government’s fortunes around.

HIGHER BORROWING?

Inheriting Britain’s biggest budget deficit since World War Two, Osborne said he had to cut borrowing sharply to ensure bond investors would continue to lend to the government and to achieve a lasting recovery.

Conservative lawmaker Mark Garnier, a former fund manager who sits on a parliamentary committee scrutinising Treasury policy, urged Osborne to hold firm. “Stick with plan A,” he said. “The key thing is to absolutely deliver the right message to the people who are financing running this government, which is the international bond market.”

But weak tax receipts mean Osborne may have to admit borrowing will rise this year, which is likely to encourage those who argue that too much austerity is self-defeating.

The independent Office for Budget Responsibility, which makes the forecasts in Osborne’s statements, may also predict he will fail to get public sector debt falling as a proportion of national output by 2015/16.

That in turn could endanger Britain’s triple-A credit rating, which Osborne has promised to defend vigorously.

To reach the OBR’s forecast of cutting borrowing to 120 billion pounds this year, the deficit must fall by 1.2 percent. It is now 7.4 percent higher than at the same time in 2011.

While Britain emerged from recession in the third quarter, Bank of England Governor Mervyn King has warned that growth will remain sluggish on a “long and winding” road to recovery.

“Looking out into future years, the key challenge for the Chancellor is that the budget 2012 forecasts were based on optimistic growth forecasts,” said Rob Wood, an economist at Berenberg Bank. “It is likely they will have to revise that down, which will reduce tax receipt growth in the future as well, and therefore mean deficit overshoots are here to stay.”

DEBT CRISIS

Battered by the euro zone crisis and drained by overdependence on troubled banks, the weak economy means Osborne may have to cut more spending or extend the period of austerity once again beyond the current 2016/17 to meet his targets.

“The choice would be when to announce that. Do you use the extra year and pencil in a further tightening for 2017/18 or does he go for something quicker than that?” said Gemma Tetlow, a programme director at the Institute of Fiscal Studies.

Neither is likely to go down well with voters hurt by austerity imposed by a government which is cast by critics as run by wealthy “posh boys” who are out of touch.

Osborne cannot risk repeating the blunders of his budget in March, a public relations disaster that taxed cheap hot food, hit the elderly, cut taxes for the highest earners and hurt the Conservatives’ poll ratings.

Last month, Osborne said he supported infrastructure investment in railways, airports, power plants and communications but gave few clues on who would finance it.

There may be more announcements on cutting welfare spending and a move to assuage those who say the government has not asked the wealthy to do enough in the deficit reduction plan so far.

Much may depend on how proceeds from a Bank of England bond -buying programme are dealt with in the public finances. A decision to move to the Treasury 35 billion pounds made on the quantitative easing programme could buy Osborne more time to get the austerity plan back on track.

“Fortunately for the government, it could raid the piggy bank,” Nomura economist Philip Rush said, predicting the windfall should “broadly offset the underlying fiscal deterioration over the next several years”.

(Additional reporting by David Milliken and Mohammed Abbas; Editing by Guy Faulconbridge and David Stamp)

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Canada’s Carney named as surprise Bank of England chief http://in.reuters.com/article/2012/11/26/britain-boe-idINDEE8AP0DU20121126?feedType=RSS&feedName=everything&virtualBrandChannel=11709 http://blogs.reuters.com/matt-falloon/2012/11/26/canadas-carney-named-as-surprise-bank-of-england-chief/#comments Mon, 26 Nov 2012 17:39:19 +0000 http://blogs.reuters.com/matt-falloon/?p=632 LONDON (Reuters) – Britain named Canadian central bank chief Mark Carney on Monday as the next governor of the Bank of England, springing the surprise choice of a foreigner to help steer the world’s sixth-largest economy out of stagnation.

A former Goldman Sachs investment banker who as central bank head guided the Canadian economy through the global economic crisis, Carney will succeed Mervyn King who retires next July.

“He is quite simply the best, most experienced and most qualified person in the world to be the next Governor of the Bank of England,” finance minister George Osborne told parliament in announcing the appointment.

During the crisis, Carney helped to make Canada’s recession one of the shallowest of the world’s richest nations. No Canadian bank needed government help, and the country recovered all the jobs it lost in the downturn relatively rapidly.

By contrast, Britain had to bail out some of its biggest banks and the economy is struggling to achieve growth four years after the crisis broke.

Carney also heads the Financial Stability Board (FSB), a Basel-based body that sets global banking rules.

“This will be a very important transitional phase for both the institution itself, the Bank of England, but above all for the British economy,” Carney told a news conference in Ottawa.

From next year the BoE will take charge of British financial regulation, almost doubling its size. This boosted the case for a governor with strong management skills and financial market experience, rather than someone in King’s academic mould.

Carney said he would help the British economy as it tries to reduce its reliance on financial services.

“I can play a constructive role … in relaunching this institution with its new responsibilities, contributing to price stability, to financial stability and to ensuring that the rebalancing of the UK economy – which is underway – … is seen through over the course of the next five years.”

Carney’s past as a Goldman Sachs investment banker has been a double-edged sword, as he fought to prove his loyalties lie with ordinary citizens, not his high-flying banker ex-colleagues. He clashed memorably last year with JPMorgan Chase & Co Chief Executive Jamie Dimon in Washington as the banker argued against new regulations for the financial sector.

HUGE SURPRISE

Until now, Carney had strongly played down the possibility of heading the British central bank. “(It’s a) surprise, huge surprise,” said Peter Dixon, an economist with Commerzbank. “That was the one guy I didn’t have in the running.”

The athletic-looking Carney will now become Britain’s most powerful unelected public figure, responsible for setting interest rates and looking after the banking sector.

Britain’s government had been widely expected to pick Deputy Governor Paul Tucker as the new chief, ignoring calls for a more radical option to shake up the central bank.

“Mr Carney is unique amongst the potential candidates in combining long experience of central banking, huge international credibility in economics, deep expertise in financial regulation and a first hand experience of private sector financial institutions,” Osborne said.

The foreign exchange market passed a rapid judgment on the announcement with sterling rising against both the U.S. and Canadian dollars. The pound hit to a 2-1/2 week high against the Canadian dollar to C$1.5950 from C$1.5898 beforehand.

Pressure on Carney will be high and financiers in the City of London would expect him to act quickly to jolt Britain’s $2.5 trillion economy out of stagnation, prevent bubbles and keep the financial sector safe.

Carney is not a British national, although Osborne said he would apply for UK citizenship. He studied at Oxford University.

Carney will serve at the Bank of Canada until May, and then starts at the Bank of England in July. He will serve a five-year term, rather than the eight-year term that had been expected for the next BoE governor.

“Perhaps one factor in Carney’s favour is the Canadian banks were very highly regulated before the credit crisis and accordingly the Canadian banking system is in good shape,” said Philip Shaw of Investec.

“One thing we would expect is the new governor sets about delegating responsibility very quickly, given the enormity of the tasks that the Bank of England is taking on.”

Other figures earlier named as possible successors had included Financial Services Authority chairman Adair Turner, John Vickers, author of a government report on bank reform, and Terence Burns, a former top finance ministry civil servant.

(Reporting by Matt Falloon, David Milliken, Kate Holton; Writing by Maria Golovnina; editing by David Stamp)

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UK to announce new BoE governor around 1530 GMT http://www.reuters.com/article/2012/11/26/britain-boe-idUSL5E8MQ7TP20121126?feedType=RSS&feedName=everything&virtualBrandChannel=11563 http://blogs.reuters.com/matt-falloon/2012/11/26/uk-to-announce-new-boe-governor-around-1530-gmt/#comments Mon, 26 Nov 2012 15:23:42 +0000 http://blogs.reuters.com/matt-falloon/?p=630 LONDON, Nov 26 (Reuters) – Britain is expected to name a new
governor of the Bank of England at around 1530 GMT on Monday,
with insider Paul Tucker tipped to get the job of helping to
steer the world’s sixth-largest economy out of stagnation.

Finance minister George Osborne is due to make a statement
on the Bank of England after defence questions in parliament,
which start at 1430 GMT and last around an hour.

The incumbent governor, Mervyn King, will retire next July,
leaving the second most powerful economic job in Britain up for
grabs at a time when the economy is struggling to achieve solid
growth.

Osborne is widely expected to pick Deputy Governor Tucker as
the new chief, ignoring calls for a more radical option to shake
up the central bank.

Tucker, 54, has spent his career at BoE, building up a
detailed knowledge of both monetary policy and markets. He is
believed to be well connected in London’s banking community,
unlike King, who cuts a more distant figure.

Other figures named as possible successors include Financial
Services Authority chairman Adair Turner, and John Vickers,
author of a government report on bank reform. But they are seen
as less likely to be chosen.

A further possibility is Terence Burns, a former top finance
ministry civil servant and chairman of Spanish bank Santander’s
British unit, while the only woman known to have
applied is Sharon Bowles, chair of the European Parliament’s
economic and monetary affairs committee.

Tucker has spent much of his time at the BoE in King’s
shadow and confines his appearances to dense regulatory speeches
or mandatory news conferences and hearings where King has centre
stage.

But the favourite of the financiers in the City of London
will be expected to jolt Britain’s $2.5 trillion economy out of
stagnation, prevent bubbles and keep the financial sector safe.

Tucker told lawmakers this month that he doubted a full
separation of investment banking would improve financial
stability more than a partial one, as the collapse of a
stand-alone investment bank would still cause major damage.

On the economy, Tucker has said Britain may need to adopt
more unconventional policies to revive its economy, though he
has given few details on what those policies may be and is
broadly seen as a middle-of-the-road candidate on monetary
policy.

(Reporting by Matt Falloon and David Milliken; Writing by Maria
Golovnina)

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UK may face deeper government spending cuts -IFS http://uk.reuters.com/article/2012/11/26/uk-britain-deficit-ifs-idUKBRE8AP00520121126?feedType=RSS&feedName=everything&virtualBrandChannel=11708 http://blogs.reuters.com/matt-falloon/2012/11/26/uk-may-face-deeper-government-spending-cuts-ifs/#comments Mon, 26 Nov 2012 00:11:16 +0000 http://blogs.reuters.com/matt-falloon/?p=628 LONDON (Reuters) -Chancellor George Osborne may have to announce more spending cuts and tear up one of his key austerity goals next month, the Institute for Fiscal Studies said on Monday, warning government borrowing was likely to rise this year.

Osborne, who updates parliament with the latest official borrowing and growth forecasts on December 5, has struggled to keep his austerity targets on track because of the economic malaise.

The Conservative has already extended the planned period of spending cuts by two years, well beyond the next election in 2015, and warned of further cuts to welfare spending.

Poor economic performance since the March budget means more bad news could be on the way next month, including the embarrassment of higher borrowing this year compared to last.

“Since the budget, the outlook for the UK economy has deteriorated and government receipts have disappointed by even more than this year’s weak growth would normally suggest,” said IFS deputy director Carl Emmerson.

“The planned era of austerity could run for eight years – from 2010-11 to 2017-18.”

The IFS estimates that Osborne may have to find a further 11 billion pounds of tax increases or welfare cuts for that post-election period, in addition to extrapolating the same squeeze on public spending already planned and the extra welfare cuts already announced.

If the trend for the public finances seen so far this year were to continue, the IFS said, borrowing would come in at 133 billion pounds for the year ending March 2013 – 13 billion above the Office for Budget Responsibility’s forecasts in March.

“This would mean that underlying borrowing rose between 2011-12 and 2012-13 rather than fell as the Chancellor George Osborne had intended,” the IFS said.

Rising borrowing would prove a blow for the Conservatives who promised to all but eliminate a record budget deficit by the time of the 2015 election and to get Britain’s public sector net debt falling as a percentage of national output by 2015/16.

The IFS said Osborne, whose official title is Chancellor of the Exchequer, may have to scrap the latter target.

“The Chancellor would likely be best advised to abandon the rule and consult on replacing it with something that better ensures long-run sustainability rather than engage in significant further fiscal tightening in order to remain on course to comply with this target,” it said.

(Editing by Greg Mahlich)

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BBC pay out 185,000 pounds over false abuse claim http://www.reuters.com/article/2012/11/15/britain-abuse-idUSL5E8MFK9X20121115?feedType=RSS&feedName=everything&virtualBrandChannel=11563 http://blogs.reuters.com/matt-falloon/2012/11/15/bbc-pay-out-185000-pounds-over-false-abuse-claim/#comments Thu, 15 Nov 2012 20:41:38 +0000 http://blogs.reuters.com/matt-falloon/?p=626 LONDON, Nov 15 (Reuters) – The BBC agreed to pay 185,000
pounds ($295,000) on Thursday to a former treasurer of Britain’s
Conservative Party wrongly accused of child sex abuse as a
result of one of its reports.

The settlement came as media reports said one of the BBC’s
former stars had been arrested as part of an ongoing police
investigation into sex crimes centred on the publicly funded
broadcaster.

Lord Alistair McAlpine, an ally of former Prime Minister
Margaret Thatcher, was widely named on the internet as being the
unidentified senior politician accused in a report by the BBC’s
flagship Newsnight programme of abusing boys in social care.

The flawed film sparked one of the worst crises in the
broadcaster’s 90-year history and claimed the scalp of Director
General George Entwistle, after the abuse victim central to the
BBC investigation said McAlpine was not one of his attackers.

“I am delighted to have reached a quick and early settlement
with the BBC,” McAlpine said in a statement.

“I have been conscious that any settlement will be paid by
the licence fee payers, and have taken that into account in
reaching agreement with the BBC.”

His lawyer warned others who had sullied his client’s
reputation to get in touch before they too faced litigation, a
threat which could ensnare hundreds of Twitter users and
bloggers who wrongly named McAlpine.

“We will now be continuing to seek settlements from other
organisations that have published defamatory remarks and
individuals who have used Twitter to defame me,” McAlpine said.

TWITTER USERS IN THE FRAME

One of the first who could face action is Sally Bercow, the
flamboyant wife of Britain’s parliamentary speaker who keeps
lawmakers in order during debates.

She had tweeted: “Why is Lord McAlpine trending? *innocent
face*” as speculation mounted after the Newsnight report. On
Thursday, she wrote: “I’m getting legal advice. Shocked that I’m
first person Lord McAlpine coming after though.”

The controversy convulsed the national broadcaster just as
it was trying to grapple with revelations that a former star
presenter, Jimmy Savile, who died last year aged 84, was one of
Britain’s most prolific sex offenders.

Police investigating claims against Savile, said on Thursday
they had arrested a fourth man, aged in his 60s, on suspicion of
sexual offences and added the number of victims who had come
forward with allegations had now risen to 450.

The BBC and other media named the arrested man as radio
presenter Dave Lee Travis, who once appeared on the same TV show
and radio station as Savile and whose radio show Myanmar’s
opposition leader Aung San Suu Kyi said had provided her with
comfort during her many years in captivity.

A Reuters photographer reported there were a number of
police officers outside the home of Travis, 67, a short distance
north of London. Travis publicly denied any allegations of
impropriety when claims first surfaced last month.

“HORRENDOUS SHOCK”

The BBC’s much-criticised handling of the Savile allegations
and the mistaken child abuse report on Newsnight prompted BBC
Trust Chairman Chris Patten to warn that the world’s biggest
broadcaster was doomed unless it reformed.

Patten, a former Conservative minister who is best known for
handing back Hong Kong to China in 1997, was due to meet the 11
other BBC trustees on Thursday to try to plot a way out of the
crisis and find a successor to Entwistle, who quit on Saturday.

McAlpine, who is 70 and in poor health, said in a BBC
interview it had been a “horrendous shock” to find out that he
was being linked to a claims of a high-level paedophile ring.

He said the BBC should have called him about the allegations
before airing the report.

“They could have saved themselves a lot of agonising and
money, actually, if they’d just made that telephone call,”
McAlpine said. “I would have told them exactly what they learnt
later on … That it was complete rubbish.”

At the height of the frenzy following the Newsnight show on
Nov. 2, a presenter on a chat show on the ITV channel
brandished a list of alleged abusers during an interview with
Prime Minister David Cameron.

Britain’s media regulator said it was investigating both the
Newsnight report and ITV, which said it too had received a
letter from McAlpine’s legal team.

Peter Fincham, ITV’s Director of Television, said what his
channel’s show had done was “wrong” and “misguided”, and that
“appropriate” disciplinary action had been taken.

The regulator, Ofcom, could theoretically fine ITV a maximum
of up to 5 percent of annual turnover while the maximum fine for
the BBC, not an Ofcom licensee, would be 250,000 pounds.

Other penalties open to Ofcom are directing the broadcasters
not to repeat the allegation, or to issue a correction.

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McAlpine nears deal with BBC for false abuse claim http://www.reuters.com/article/2012/11/15/us-britain-abuse-idUSBRE8AE1A520121115?feedType=RSS&feedName=everything&virtualBrandChannel=11563 http://blogs.reuters.com/matt-falloon/2012/11/15/mcalpine-nears-deal-with-bbc-for-false-abuse-claim/#comments Thu, 15 Nov 2012 16:36:58 +0000 http://blogs.reuters.com/matt-falloon/?p=624 LONDON (Reuters) – A former treasurer of Britain’s Conservative Party, wrongly accused of child sex abuse, edged closer to a settlement with the BBC on Thursday and his lawyer said those who had sullied his client’s reputation should get in touch and reach deals.

The threat may ensnare hundreds of Twitter users and bloggers who wrongly named Lord Alistair McAlpine, an ally of former Prime Minister Margaret Thatcher, as the unidentified Conservative accused in a BBC report of abusing boys in social care.

The flawed report sparked one of the worst crises in the broadcaster’s 90-year history and claimed the scalp of Director General George Entwistle, after the abuse victim central to the BBC investigation said McAlpine was not one his attackers.

“What we’re basically saying to people is, look, we know – in inverted commas – who you are, we know exactly the extent of what you’ve done,” McAlpine’s solicitor, Andrew Reid, told the BBC.

“And it’s easier to come forward and see us and apologies and arrange to settle with us because, in the long run, this is the cheapest and best way to bring this matter to an end.”

The BBC has apologized for the McAlpine report and Reid said he hoped to reach an out-of-court settlement with the corporation on Thursday.

The controversy convulsed the national broadcaster just as it was trying to grapple with revelations that a former star presenter, the late Jimmy Savile, was one of Britain’s most prolific sex offenders.

Police investigating child sex abuse claims against Savile, who died last year aged 84, said on Thursday they had arrested a fourth man. Police did not disclose the name of the man, who is in his 60s.

“HORRENDOUS SHOCK”

The BBC’s much-criticized handling of the Savile allegations and the mistaken child abuse report on Newsnight prompted BBC Trust Chairman Chris Patten to warn that the world’s biggest broadcaster was doomed unless it reformed.

Patten, a former Conservative minister who is best known for handing back Hong Kong to China in 1997, was due to meet the 11 other BBC trustees on Thursday in an attempt to plot a way out of the crisis and find a successor to Entwistle, who quit on Saturday.

McAlpine, who is 70 and in poor health, said in a BBC interview it had been a “horrendous shock” to find out that he was being linked to a claims of a high-level pedophile ring.

“It gets into your bones… it makes you angry. And that’s extremely bad for you to be angry. And it gets into your soul and you just think there’s something wrong with the world.”

McAlpine said the BBC should have called him about the allegations before airing the report.

“They could have saved themselves a lot of agonizing and money, actually, if they’d just made that telephone call,” McAlpine said. “I would have told them exactly what they learnt later on… That it was complete rubbish.”

At the height of the frenzy following the Newsnight show on November 2, a presenter on an ITV chat show brandished a list of alleged abusers during an interview with Prime Minister David Cameron.

Britain’s media regulator said it was investigating both the BBC Newsnight report and ITV.

The regulator, known as Ofcom, could theoretically fine ITV a maximum of up to five percent of annual turnover while the maximum fine for the publicly funded BBC, which is not an Ofcom licensee, would be 250,000 pounds ($396,200).

Other penalties open to Ofcom are directing the broadcasters not to repeat the allegation, or to issue a correction.

(Additional reporting by Stephen Addison; Editing by Jon Boyle)

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UK pedophile scandal risks becoming gay witch-hunt: David Cameron http://www.reuters.com/article/2012/11/08/us-britain-abuse-idUSBRE8A70OM20121108?feedType=RSS&feedName=everything&virtualBrandChannel=11563 http://blogs.reuters.com/matt-falloon/2012/11/08/uk-pedophile-scandal-risks-becoming-gay-witch-hunt-david-cameron/#comments Thu, 08 Nov 2012 19:08:21 +0000 http://blogs.reuters.com/matt-falloon/?p=618 LONDON (Reuters) – Speculation about the identity of a senior Conservative party member accused of child sex abuse could descend into a “witch-hunt” of homosexuals, British Prime Minister David Cameron said on Thursday.

Cameron ordered an investigation this week after a child abuse victim said a prominent member of the prime minister’s party had abused him during the 1970s, prompting Internet speculation over who the politician might be.

The claims, which follow the unmasking of late BBC star presenter Jimmy Savile as one of Britain’s most prolific sex offenders, have stoked concern that a powerful pedophile ring may have operated in Britain in the 1970s and 1980s.

“I have heard all sorts of names bandied around and what then tends to happen is of course that everyone then sits around and speculates about people, some of whom are alive, some of whom are dead,” Cameron said during an ITV television interview.

“It is very important that anyone who has got any information about any pedophile no matter how high up in the country go to the police,” he said.

Britain’s interior minister warned lawmakers this week that if they named suspected child abusers in parliament they risked jeopardizing future trials.

MPs benefit from “parliamentary privilege” – meaning they can speak inside parliament freely without fear of legal action on sensitive issues that might otherwise attract lawsuits.

“TRIAL BY TWITTER”

The allegations could prove damaging to Cameron’s party – which rules in an uneasy coalition with centrists – and tarnish the image of the era of Margaret Thatcher, prime minister from 1979 to 1990.

When the ITV interviewer passed Cameron a piece of paper with the names of people identified on the Internet as being alleged child abusers, Cameron said: “There is a danger, if we are not careful, that this could turn into a sort of witch-hunt, particularly against people who are gay.”

“I am worried about the sort of thing you are doing right now – giving me a list of names you have taken off the Internet,” Cameron said.

Steven Messham, one of hundreds of victims of sexual abuse at children’s care homes in Wales over two decades, said in a TV program last week that he had been sexually abused by a prominent Conservative political figure.

However, the BBC reporter said he could not publicly identify the accused person as there was “simply not enough evidence to name names”.

A host of Conservative politicians have been named as alleged child abusers on blogs and social media, often without evidence.

“There are lots of accusations flying around on the Internet, lots of names on the Internet. We need to be very careful,” Cameron’s spokesman told reporters.

“We should not have people just throwing accusations around and trial by Twitter.”

Meanwhile, police said they had arrested two men in northern England, including Savile’s former housemate Ray Teret, on suspicion of rape, following allegations of sexual abuse many years ago.

Officers in London are looking into claims made by hundreds of victims that Savile and accomplices abused them. They have already questioned former glam rock singer Gary Glitter and comedian Freddie Starr as part of their investigation.

Both men have been released on bail.

(Additional reporting by Michael Holden; Writing by Guy Faulconbridge; Editing by Andrew Osborn and Robin Pomeroy)

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Paedophile scandal risks becoming gay witch-hunt – Cameron http://uk.reuters.com/article/2012/11/08/uk-britain-abuse-idUKBRE8A70OR20121108?feedType=RSS&feedName=everything&virtualBrandChannel=11708 http://blogs.reuters.com/matt-falloon/2012/11/08/paedophile-scandal-risks-becoming-gay-witch-hunt-cameron/#comments Thu, 08 Nov 2012 18:58:25 +0000 http://blogs.reuters.com/matt-falloon/?p=622 LONDON (Reuters) – Speculation about the identity of a senior Conservative party member accused of child sex abuse could descend into a “witch-hunt” of homosexuals, Prime Minister David Cameron said on Thursday.

Cameron ordered an investigation this week after a child abuse victim said a prominent member of the prime minister’s party had abused him during the 1970s, prompting Internet speculation over who the politician might be.

The claims, which follow the unmasking of late BBC star presenter Jimmy Savile as one of Britain’s most prolific sex offenders, have stoked concern that a powerful paedophile ring may have operated in Britain in the 1970s and 1980s.

“I have heard all sorts of names bandied around and what then tends to happen is of course that everyone then sits around and speculates about people, some of whom are alive, some of whom are dead,” Cameron said during an ITV television interview.

“It is very important that anyone who has got any information about any paedophile no matter how high up in the country go to the police,” he said.

The Home Secretary warned MPs this week that if they named suspected child abusers in parliament they risked jeopardising future trials.

MPs benefit from “parliamentary privilege” – meaning they can speak inside parliament freely without fear of legal action on sensitive issues that might otherwise attract lawsuits.

“TRIAL BY TWITTER”

The allegations could prove damaging to Cameron’s party – which rules in an uneasy coalition with centrists – and tarnish the image of the era of Margaret Thatcher, prime minister from 1979 to 1990.

When the ITV interviewer passed Cameron a piece of paper with the names of people identified on the Internet as being alleged child abusers, Cameron said: “There is a danger, if we are not careful, that this could turn into a sort of witch-hunt, particularly against people who are gay.”

“I am worried about the sort of thing you are doing right now – giving me a list of names you have taken off the Internet,” Cameron said.

Steven Messham, one of hundreds of victims of sexual abuse at children’s care homes in Wales over two decades, said in a TV programme last week that he had been sexually abused by a prominent Conservative political figure.

However, the BBC reporter said he could not publicly identify the accused person as there was “simply not enough evidence to name names”.

A host of Conservative politicians have been named as alleged child abusers on blogs and social media, often without evidence.

“There are lots of accusations flying around on the Internet, lots of names on the Internet. We need to be very careful,” Cameron’s spokesman told reporters.

“We should not have people just throwing accusations around and trial by Twitter.”

Meanwhile, police said they had arrested two men in northern England, including Savile’s former housemate Ray Teret, on suspicion of rape, following allegations of sexual abuse many years ago.

Officers in London are looking into claims made by hundreds of victims that Savile and accomplices abused them. They have already questioned former glam rock singer Gary Glitter and comedian Freddie Starr as part of their investigation.

Both men have been released on bail.

(Additional reporting by Michael Holden; Writing by Guy Faulconbridge; Editing by Andrew Osborn and Robin Pomeroy)

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