Justine Greening to attend firm's AGM to vote against executive payout ? though Labour says she is failing to use full powers

The transport secretary, Justine Greening, is planning to vote against a proposed £20m bonus pool for Network Rail executives. But she was accused by Labour of failing to use her powers to put a stop to the payments.

On Friday, she will attend Network Rail's annual general meeting to vote against a package which could see chief executive Sir David Higgins collect a £340,000 payout in addition to his £560,000 basic salary.

Greening's intervention will put pressure on Network Rail to reduce the bonuses which have been paid annually to executives for many years. The company that operates most of Britain's railway structure has faced criticism over its safety record and poor track conditions.

"I'm going to go to the meeting next Friday, I'm going to vote against them," said Greening on the BBC's Sunday Politics programme. It will be the first time that a minister of state has voted against bonuses at Network Rail.

Despite her vote against the company, she claimed that she would not have the powers to stop the payments from going through. "The governance structure that the last government set up means I can go and vote against it. The problem we have got is that won't actually change the result," she said.

However, Labour is claiming that the Department for Transport has powers over remuneration and incentive schemes thanks to its position as Network Rail's "special member".

Maria Eagle, the shadow transport secretary, said: "Greening is wrong to say that she cannot block these bonuses ? It is difficult to see why Network Rail would have felt able to propose this new bonus package without knowing if it had ministerial backing."

Those close to Greening hit back, saying that Labour has misinterpreted company documents. "Justine can't block bonuses, because she has one vote among 80. Labour knows that the government doesn't have a power of veto and when in office repeatedly said that bonuses were an issue for Network Rail and not for government," a source said.

Higgins will also share in a long-term bonus scheme which could be worth up to £15.6m over the next three years for the rail group's six executive directors. The six will also earn £2.3m a year in salaries plus a maximum of £4.2m in bonuses.

On the same day that Greening casts her vote, Barclays will announce an estimated £1.7bn bonus pool, some 30% less than last year but a sum that will see staff at its Barclays Capital arm remain among the highest-paid UK workers, earning an average of £210,000 each.

Barclays, one of the world's largest investment banks, is forecast to report profits of £6bn, barely changed on a year ago despite the eurozone crisis.

While the bonus of its chief executive, Bob Diamond, is unlikely to be revealed until March, he could get up to £11m.

The latest round of payouts will fuel the controversy around City pay, which prompted Royal Bank of Scotland's chief executive, Stephen Hester, to waive his near-£1m bonus a week ago.

More than 20 MPs have signed a Commons motion saying Network Rail had been "found by the Office of Rail Regulation to be in breach of its licence" and had been responsible for "major asset failures, congested routes and poor management of track condition".

Last week, the company admitted health and safety breaches over the deaths of two teenagers killed at a level crossing in Essex in 2005.

A Network Rail spokesperson said that no decisions have yet been taken on any potential bonuses. "Friday's vote is not on whether directors will receive a bonus but on a proposed scheme, the shape of which is a result of discussions with our regulator. The independent remuneration committee will have full discretion on any decision to award bonuses."

Syrian opposition groups dispute number of dead but residents claim new type of artillery shell is being used against restive city

Syrian forces persisted with one of the deadliest attacks of the 11-month uprising on Sunday, pounding parts of Homs even as residents combed through rubble looking for victims of a sustained barrage over the weekend that killed dozens, if not scores of people.

Homs residents said the flashpoint area of Bab al-Amr was under sustained attack throughout the afternoon, with up to six people killed. There was also a renewed bombardment of the nearby neighbourhood of Khalidiyeh, centre on Friday night of one of the most violent assaults thus far by Bashar al-Assad's forces.

Residents were still trying to come to terms with the savage firepower aimed at their district during a six-hour barrage early on Saturday.

"We counted 300 explosions, at least, in that time," said a Bab al-Amr resident, who calls himself Omar Shakir. "There was nothing we could do for the people there, there are two regime checkpoints between us and them. And today it was our turn."

Mortars fired from an elevated area around a mile and a half away accounted for almost all of Friday nights casualties. The numbers of dead are disputed. A hospital in Homs and two Syrian opposition groups say 250-300 may have died. A third group, the Local Co-ordination Council said the toll may be 50-60. Either way, with many civilians caught up in the onslaught, including women and children, it was an offensive that marked a grim low point in the confrontation between Assad's forces and the protesters and armed deserters now ranged against him.

Residents said a new weapon was being used ? possibly artillery shells, which have a distinctive whine as they approach their target. "They are very unusual sounds, the explosions," said Shakir.

"We have not heard them before in Bab al-Amr. And we have heard a lot of explosions here."

A Khalidiyeh resident, Fadi, said local people had been able to leave their homes to bury the dead and look for survivors.

"There was random shooting into civilian areas. It was indiscriminate and it went on for six hours. The smell in the streets is completely awful," he said. "The blood is everywhere and it is difficult to find all the parts of the people."

Videos posted on the internet purported to show men digging makeshift graves in which to bury unclaimed body parts.

"We were not expecting that the Syrian army would attack in this way," said Fadi of the mounting horror as Friday night's bombardment intensified. "We thought it was some kind of exaggeration that would be over soon, but the explosions kept coming and coming."

By daybreak, the small neighbourhood, which had been closed off to regime forces by the Free Syrian Army lay in partial ruins, with the roofs of numerous buildings pancaked onto the floors below. Dozens of people are still believed to be trapped, with residents having no equipment other than shovels with which to rescue them.

A hospital in a rebel-held area of Homs was also reported to have been hit with at least one mortar round , causing extensive damage to part of a ward.

The Syrian government has denied bombarding Homs and says "terrorist gangs" are responsible for the deaths. Syrian officials say some of the bodies had been kidnapped by opposition elements who had killed them in an attempt to persuade Syria's allies, Russia and China, to move against them in the UN security council.

"They are stupid to suggest that we have mortars like that," said the brother of one man linked to the Free Syria Army, which is comprised mainly of defectors carrying light weapons they used while serving in the regular military.

"Anyone who knows anything about military operations knows that mortars are fired from a fixed position (and are) easy to track by radar, or even through lenses. They can be destroyed by artillery, or helicopters within minutes. This went on for six hours."

Rising public resentment blamed on government focus on alleged 'scrounger' fraud and inflammatory media coverage

The government's focus on alleged fraud and overclaiming to justify cuts in disability benefits has caused an increase in resentment and abuse directed at disabled people, as they find themselves being labelled as scroungers, six of the country's biggest disability groups have warned.

Some of the charities say they are now regularly contacted by people who have been taunted on the street about supposedly faking their disability and are concerned the climate of suspicion could spill over into violence or other hate crimes.

While the charities speaking out ? Scope, Mencap, Leonard Cheshire Disability, the National Autistic Society, Royal National Institute for the Blind (RNIB), and Disability Alliance ? say inflammatory media coverage has played a role in this, they primarily blame ministers and civil servants for repeatedly highlighting the supposed mass abuse of the disability benefits system, much of which is unfounded.

At the same time, they say, the focus on "fairness for taxpayers" has fostered the notion that disabled people are a separate group who don't contribute.

Scope's regular polling of people with disabilities shows that in September two-thirds said they had experienced recent hostility or taunts, up from 41% four months before. In the last poll almost half said attitudes towards them had deteriorated in the past year.

Tom Madders, head of campaigns at the National Autistic Society, said: "The Department for Work and Pensions is certainly guilty of helping to drive this media narrative around benefits, portraying those who receive benefits as workshy scroungers or abusing a system that's really easy to cheat."

He added that ministers such as the work and pensions secretary, Iain Duncan Smith, were being "deeply irresponsible" in conflating Disability Living Allowance (DLA), which helps disabled people hold down jobs, and Employment and Support Allowance (ESA), a payment for those unable to work. This "scrounger rhetoric" was already having an impact on people's lives, Madders said, citing a woman who rang the charity to say a neighbour who formerly gave lifts to her autistic child had stopped doing so following press articles about disabled people receiving free cars under a government scheme.

Some disabled people say the climate is so hostile they avoid going out, or avoid using facilities such as designated parking bays if they "don't look disabled".

The government has committed to making significant cuts to disability benefits, including a 20% reduction in the DLA bill by 2015/16. Much of its public focus has been on alleged fraudulent claims or cutting benefits to those whose conditions have improved.

Charities point to a series of ministerial statements arguing that the "vast majority" of new ESA claimants are able to work, while the disabilities minister, Maria Miller, said last month that £600m of DLA was overpaid each year, not mentioning that a greater sum is saved by others not receiving what they are due.

This is "playing directly into a media narrative about the need to weed out scroungers," said Richard Hawkes, chief executive of Scope. "Our polling shows that this narrative has coincided with attitudes towards disabled people getting worse.

"Disabled people tell us that increasingly people don't believe that they are disabled and suddenly feel empowered to question their entitlement to support."

David Congdon, head of policy at Mencap, said the charity feared where this could lead. "We are concerned that this narrative of benefit scroungers or fakers connected to the welfare reform bill does risk stigmatising all people with a disability," he said. "The worry would be that this could lead to an increase in resentment against disabled people, and even an increase in hate crimes."

There was "an incredibly strong focus on benefit fraud within the DWP", said Guy Parckar, policy manager for Leonard Cheshire. "It is mentioned at all possible opportunities. Of course, whenever there is fraud you want that to be tackled, but there should be some serious thought given to the long-term impact that this has. There is the impact of potential hate crime, and issues around that."

Neil Coyle, head of policy for Disability Alliance, said his organisation was being told of increasing levels of verbal abuse, and worried this could lead to attacks.

"There's a lot of concern that the level of abuse and harassment goes unrecorded because it's seen almost as a norm. It seems to be growing as a result of a mis-perception of much more widespread abuse of benefits than actually exists. That's being fed by the DWP in their attempts to justify massive reductions in welfare expenditure."

A DWP spokeswoman said the department was committed to supporting disabled people but needed to "do more to change negative attitudes", and had begun a cross-government consultation on tackling discrimination.

She said: "Our welfare reforms are designed to restore integrity into the benefits system and to ensure that everyone who needs help and support receives it."

David Gillon from Chatham in Kent, said: "I think we've lost all the progress we made in the last 30 years in terms of acceptance." Gillon, whose chronic back condition forced him to give up a job with British Aerospace, recounts walking on crutches past a pub in the middle of the day and receiving shouts of: "We're going to report you to the DWP." He said: "When there's a bad article in the press, the next day you think, 'Do I really need to go out of the house?' We're being forced back into the attic, locked away from society."

Fazilet Hadi, head of inclusion for the RNIB, said she also felt the tone was set by ministers: "I think they should be more careful. At the moment it feels like the government is not on the side of disabled people. Most people don't have that much exposure to disabled people. They don't see us in the lifestyle pages, they don't see us in the fashion pages. The only reference they see is in these stories. And that's why the language is so important."

London hearing to decide whether radical cleric should be freed after extradition to Jordan was blocked by Europe court

A radical Muslim cleric described as a grave threat to Britain's national security could walk free on Monday.

Abu Qatada, who is being held at Long Lartin high-security prison in Worcestershire, will apply to be released on bail as he fights deportation to Jordan.

Lawyers for the home secretary, Theresa May, are expected to oppose bail while British diplomats continue to seek assurances from the Jordanian authorities that evidence gained through torture would not be used against him.

Such evidence is the main reason Qatada, once described by a Spanish judge as "Osama bin Laden's right-hand man in Europe", won an appeal to the European court of human rights in January. The judges ruled that sending Qatada back to face terror charges without such assurances would deny him his right to a fair trial and be a "flagrant denial of justice".

May has vowed Qatada, held for six and a half years, will be kept behind bars while she considers all legal options to send him back. The Home Office has said he "poses a real risk to national security".

At a hearing in central London, Qatada's defence team will urge an immigration judge to release him. The judge, Mr Justice Mitting, has said: "Six and a half years of detention requires the eligibility for bail to be considered urgently.

"I accept that it's possible that negotiations with the Jordanian government may produce a rapid solution but past experience ... leads me to believe that is likely to be an unrealistic expectation."

The Special Immigration Appeals Commission (Siac) will hold a full bail hearing on Monday morning.

January's verdict is the first time the Strasbourg-based court has found that an extradition would be in violation the right to a fair trial as required by the European convention on human rights, which is enshrined in UK law under the Human Rights Act.

The home secretary has three months to lodge an appeal with the court's grand chamber.

The Henry Jackson Society thinktank has said the ECHR ruling "undermines national security" while the former home secretary David Blunkett said Qatada was "extraordinarily dangerous and we don't want him on our streets".

Qatada, 51, is also known as Omar Othman. He featured in hate sermons found on videos in the flat of one of the 9/11 bombers.

Since 2001, when fears of the domestic terror threat rose in the aftermath of the attacks, he has challenged and ultimately thwarted every attempt by the government to detain and deport him.

Law lords ruled almost three years ago that he could be sent back to Jordan and Lord Phillips, now president of the supreme court, said torture in another country did not require the UK "to retain in this country, to the detriment of national security, a terrorist suspect".

But the European went against that judgment, agreeing with a 2008 decision of the UK court of appeal that there were reasonable grounds for believing Qatada would be denied a fair trial in Jordan.

Prime minister Lucas Papademos faces an uphill struggle to win the backing he needs to avoid a disorderly default in March

Greece's economic future hung in the balance on Sunday as the debt-laden country's technocrat prime minister, Lucas Papademos, met party leaders in a last-ditch effort to rally support for the stringent reforms Athens must enact in return for aid.

With at least one political leader in the coalition government publicly refusing to endorse the rescue package, it was far from sure whether Papademos would win the backing to keep bankruptcy at bay.

Before the meeting, the Greek finance minister, Evangelos Venizelos, described negotiations with foreign lenders as being "on a razor's edge". To avert a disorderly default Greece must secure financial support by 20 March when it faces ?14.5bn (£12bn) of loan repayments.

"The moment is very crucial," Venizelos said after emerging from 12 hours of "tough" talks with officials representing the EU, the European Central Bank and the International Monetary Fund, the "troika" propping up the near-insolvent Greek economy.

"Crucial issues which concern the future of the country and the Greek people remain [unresolved]. The distance separating the procedure being completed with success from stalemate ? is very small. It's a very fine line. We are on a razor's edge," he said.

A subsequent teleconference with finance ministers from the eurozone had been "very difficult", Venizelos said. "There is great impatience and great pressure not only from the three institutions that make up the troika but also from eurozone member states," he added.

In recent weeks international frustration has mounted with the country's tardiness in delivering on reforms.

Addressing reporters over the weekend, Venizelos said the "hour of truth" had come for the political leaders backing Papademos's interim national salvation government.

"We are at the point where they must decide and commit," he said.

Wage and pension cuts are at the heart of the discord.

While international creditors remain adamant that the reduction of the minimum wage and abolition of two salaries granted to workers as bonuses in the private sector are key to boosting competitiveness, the government has called the measures "a red line" across which it cannot go.

Other controversial demands include a 35% drop in supplementary pensions and the axing of 150,000 public sector jobs in organisations due to be closed down.

Greek officials have argued that the cutbacks will be self-defeating by deepening a recession that has already brought the economy to its knees. Party leaders, trade unions and employers' associations have predicted social upheaval if the measures are applied.

"If it doesn't suit us and the troika doesn't budge we will not take the package," said Giorgos Karatzaferis, who heads the populist, far-right Laos party before heading into the meeting. "We will not give in to ultimatums."

With general elections due to take place in the spring, politicians are keen not to be associated with policies that have spawned such popular opposition.

But highlighting the gravity of the moment, Jean-Claude Juncker, who chairs the eurogroup of finance ministers, voiced the possibility of default. "If we were to establish that everything has gone wrong in Greece there would be no programme and that would mean that in March they have to declare bankruptcy," he said, in comments to the German news weekly Der Spiegel.

Greek insiders confirmed that the possibility of bankruptcy loomed larger than at any other time.

"The troika is not negotiating, it's dictating," an insider said. "When you negotiate you expect both sides to move, but they're like a rock. They're basically saying it's this or default. Our sense is that they would prefer the shock of a Greek default than throwing money into a country they have come to see as a bottomless pit. The problem is the measures are so hard, so painful, that it is hard to see how all three leaders will accept them."

Heavy snowfall causes transport chaos with trains delayed, cars abandoned and flights cancelled across Britain

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Heathrow airport cancelled half of its flights as the snow and cold weather continued to cause problems across the UK, stranding motorists and leaving roads icy and treacherous.

The travel chaos ensuedon Sunday as the worst of the wintry showers came to an end across the country and forecasters predicted dry conditions and a partial thaw.

Although the snow flurries are now expected to move eastwards, swaths of the UK were on "amber alert" on Sunday, the Met Office's second highest severe weather warning, with icy conditions across much of England, Scotland and Wales.

Church Fenton in North Yorkshire and Wattisham in Suffolk recorded 16cm of snow, while up to 15cm was forecast for parts of Cumbria, Lincolnshire, East Anglia, North Yorkshire, the Peak District and the Midlands.

The icy spell has seen daytime temperatures plummet four or five degrees lower than average for February, traditionally the coldest month of the year.

Heathrow, which had initially cut only 30% of its flights, said the decision was intended to minimise disruption and was made in anticipation of freezing fog.

Although the runways, taxiways and stands had been cleared of snow, only half of the 1,300 scheduled flights went ahead. The London airport, however, said its snow plan had worked "far better" than in previous years, adding that it would operate a normal flight schedule on Monday.

A spokesman said Heathrow, which operates at 99.2% capacity, was "getting back to normal" as it worked to clear the backlog of flights. "We took the decision with airlines and air traffic control yesterday to reduce the flight schedule in advance," he said.

"By cancelling flights in advance airlines have been able to rebook some people on to flights that are departing, and passengers have had better quality information about whether they can fly or not."

Extra staff were being drafted into terminals to help passengers rebook flights, he added.Inbound flights to the airport were also affected, with six transatlantic flights from the US redirected to Shannon airport in Ireland because of the cold snap disruption.

Some were in UK airspace or on approach to London when they were ordered back over to Ireland.

Shannon Airport Authority confirmed arrangements were being made for 400 stranded passengers to stay overnight. The affected routes included Heathrow-bound services from Dallas, Miami, Houston, Washington, Denver and Atlanta.

The transport secretary, Justine Greening, said the authorities at Heathrow were taking the right approach to the problems created by the weather.

"Actually cancelling flights in advance so passengers don't get to the airport and then find their flight being cancelled was one of the main recommendations of the inquiry that Heathrow held into the debacle last year when we saw huge disruption," she told the BBC Sunday Politics programme.

"They are clearly trying to manage the airport and I think the most important thing is making sure that we put safety first. We've got to get planes up into the air and down on to the ground safely.

"That does take a little bit more time to make sure wings are de-iced and that the runways are clear, but over all they're trying to do their best."

The airport came in for heavy criticism following severe weather in December 2010 when Heathrow almost ground to a halt and thousands of passengers were forced to camp overnight in terminals. At the height of the chaos on 19 December, it was able to handle only around 20 flights.

A BAA-commissioned report later concluded the operator's response to the pre-Christmas snow was "initially ineffective" and that the potential impact of the weather had not been fully anticipated in the days before the worst of the snow.

A spokesman for Gatwick said the airport was not experiencing "any major delays" on Sunday and had had to cancel only nine flights. "We're taking a business as usual approach," he added.

Stansted, Birmingham, Luton and Manchester airports were forced to suspend operations for a period on Saturday night as snow piled up on the runways, but normal service was expected to resume on Sunday.

A total of sSix flights were cancelled yesterday in Birmingham, where some passengers were forced to spend the night in thea terminal. But aA spokesman said the airport would catch up todayon Sunday, providing temperatures did not drop too much furtherlower.

In Luton, flights were "fully operational" with some delays due to snow clearing.

A couple of departures were cancelled at Stansted, but a spokesman for the airport said there was "movement" on and off the runway, adding: "Flights are subject to delays of up to about one hour". Although the worst of the snowflurries will move eastwards, swathesswaths of the UK have been placed on amber alert, with the On the roads, motorists faced what the RAC described as a "dangerous cocktail of driving conditions" and were urged to stay at home. Some minor routes were closed altogether. Drivers on sections of the M25 in Hertfordshire were trapped in gridlock throughout the night.

One motorist, Tom Jones, was stranded in his car for more than seven hours. He told the BBC: "We joined the back of a tailback, never realising we would be spending the night on the motorway."

He added that the Highways Agency had to deal with much bad driving, and that he had seen several cars stuck in ditches and many blocking the hard shoulder.

Thames Valley police said the snow had caused a tailback between junctions nine and four southbound on the M40 from about 9pm until the early hours of Sunday.

Police in Kent warned people not to travel unless absolutely essential, and urged people not to cause an obstruction if forced to abandon their vehicles.

The Highways Agency has issued an amber alert, advising people to take extra care while travelling because of "the increased risk of adverse driving conditions".

The AA said it dealt with about 1,500 callouts an hour on Saturday.Rail services have also been affected, with disruption set to continue throughout Sunday.

Southern Railway said trains were subject to delay and cancellation, with journey times extended by up to 30 minutes.

In London, all bus routes were operating on Sunday morning after a few "curtailments" to night bus services, Transport for London said.

Tube services were said to have started well but delays and suspensions soon set in on most lines.

A Met Office yellow alert, which warns people to be aware, was in place for the Highlands and Northern Ireland.

The Department for Transport has said it was better prepared than ever for severe weather. Salt stocks across Britain stand at more than 2.4m tonnes, a million more than last year.

Monarch reminds Britain of 'spirit of togetherness' as Republic group prepare to demonstrate against 60th anniversary pageant

The Queen is issuing a message of thanks to the public on Monday morning on the 60th anniversary of her accession to the throne.

In a statement from Buckingham Palace, the 85-year-old monarch promises to dedicate herself anew to the service of the country, and echoes a call that she made in her Christmas message for the restoration of a national spirit of togetherness.

The Queen and Duke of Edinburgh will spend the day at Sandringham, the Norfolk mansion where her father, George VI, died in his sleep on 6 February 1952.

The couple were out in the snow on Sunday, for a service at West Newton church, on the estate and being greeted with flowers from well-wishers. They visited the local Sunday school in the village hall, but a 90th anniversary parade by the Royal British Legion, in King's Lynn, which the duke had planned to attend, was cancelled due to the weather.

The Queen's message says: "Today, as I mark 60 years as your Queen, I am writing to thank you for the wonderful support and encouragement that you have given to me and Prince Philip over these years and to tell you how deeply moved we have been to receive so many kind messages about the diamond jubilee.

"In this special year, as I dedicate myself anew to your service, I hope that we will all be reminded of the power of togetherness and the convening strength of family friendship and good neighbourliness, examples of which I have been fortunate to see throughout my reign and which my family and I look forward to seeing in many forms as we travel throughout the UK and the wider Commonwealth.

"I hope also that this jubilee year will be a time to give thanks for the great advances that have been made since 1952 and to look forward to the future with clear heads and warm hearts as we join together in our celebrations. I send my sincere good wishes to you all."

Responding, David Cameron praised the Queen's dignity and authority, guiding and uniting Britain and the Commonwealth over six decades. To view her as a glittering ornament was to "misunderstand" the constitution. "Always dedicated, always resolute and always respected, she is a source of wisdom and continuity," he said.

Cameron, the 12th PM of the reign, who was not even born until she had been on the throne for more than 14 years, added: "All my life and for the lives of most people in this country she has always been there for us. Today and this year we have the chance to say thank you."

The main focus of the celebrations will be the first weekend in June, extended by two successive bank holidays, when there will be a riverboat pageant of 1,000 vessels sailing down the Thames through London, expected to be attended by a million spectators, an open-air concert at Buckingham Palace, and a service at St Paul's Cathedral.

anti-monarchy group Republic, which said its members would demonstrate peacefully against the pageant, argued that schools and the BBC should not be overly enthusiastic about the celebrations.

The Queen and duke are due to visit many areas of Britain and Northern Ireland in the summer, and other members of the royal family are visiting Commonwealth nations, starting in March with Prince Harry in his first official solo tour, to the Caribbean and Latin America.

On Mondaya jubilee website, is being launched with news about events during the year and two newly commissioned photographs of the Queen. There will also be commemorative postage stamps and a charitable diamond jubilee trust, led by Sir John Major, to raise money for medical research and education across the Commonwealth.

The former prime minister said the trust would "identify charitable projects that would enrich the lives and opportunities of all its citizens to provide a lasting legacy".

The anniversary was not met entirely with unalloyed joy however as some economists said the June holiday could dent GDP by 0.5% in the second quarter as firms closed and people took extra leave, though they conceded this could be made up by sales of jubilee souvenirs, food and drink purchases for street parties, and tourist revenue.

Beijing hardens line against European Union emissions levy that is also opposed by the US and India

China has banned its airlines from paying the new European Union carbon charge, state news agency Xinhua has reported ? stepping up the international battle over the scheme.

The new levy applies to all airlines flying to and from EU countries. Companies that do not comply face fines and ultimately could be banned from using EU airports.

The Civil Aviation Administration of China (CAAC) said on Monday that airlines were not allowed to pay the EU charge, increase freight costs or add other fees, according to Xinhua. It cited authorisation from the state council, China's cabinet.

Hinting at possible retaliation, Xinhua added: "China will consider adopting necessary measures to protect interests of Chinese individuals and companies, pending the development of the issue."

The EU's ambassador in Beijing, Markus Ederer, told a press briefing that it hoped to resolve the issue through negotiation. Beijing's announcement comes one week before a China-EU summit.

Although the scheme came into force from 1 January, fees do not have to be paid until March 2013. Supporters believe including aviation in the emissions trading scheme is crucial because the industry's carbon output is soaring.

China, the United States, India and others are bitterly opposed to the scheme, leading to warnings that it could spark a trade war.

A US attempt to overturn the scheme was rejected by the European court of justice in December.

Chinese airlines have already vowed to ignore the scheme. China argues it is unreasonable to apply the levy to developing nations and wants the costs of reducing carbon to be passed on to aircraft manufacturers.

Critics also argue that regulation of the industry should be negotiated at the United Nations' International Civil Aviation Organisation. But European leaders say they have been waiting for years for the ICAO to act.

Connie Hedegaard, the EU's climate action commissioner, has stressed that the scheme allows for "equivalent measures" ? other forms of carbon reduction ? to be taken into account.

Chai Haibo, deputy secretary of the China Air Transport Association, told Bloomberg: "I believe all sides will negotiate again and find a solution ... I can't imagine that the worst case, such as the EU grounding Chinese flights, could happen."

Collapsing wall kills child and tsunami alert is issued but no evacuations ordered

One child died and a local tsunami alert was issued after a magnitude 6.7 earthquake followed by two aftershocks struck off the Philippines island of Negros on Monday morning.

The Philippines Institute of Volcanology and Seismology said it warned residents along coastal areas to be on the watch for unusual waves as it raised a tsunami alert at level two but did not order evacuations.

The institute warned structurally weak buildings may sustain damages. The US Pacific Tsunami Warning Centre said that based on all available data a Pacific-wide tsunami was not expected.

People rushed out of schools, malls and offices during the quake. Officials in some areas suspended work and cancelled classes.

A child died when a concrete fence of a house collapsed in Taysan town in Negros Oriental province, said Benito Ramos, who heads the Office of Civil Defence.

A mall in San Carlos city in neighbouring Negros Occidental province was damaged when its windows were shattered by the shaking, he said. The quake was also felt in Cebu, where it lasted about 30 seconds.

The Philippines is located in the Pacific "Ring of Fire" where earthquakes and volcanic activity are common. A 7.7-magnitude quake killed nearly 2,000 people in Luzon in 1990.

The quake was about 6.2 miles underground and centred three miles off the shore of Tayasan, Negros Oriental. It was felt at magnitude 7 in Dumaguete City and intensity 6 in Bacolod City, according to the institute.

The US Geological Survey put the quake at 6.7 in magnitude and a depth of 12.4 miles.

Half an hour later there were wo aftershocks, of 4.8 and 5.6 magnitude on the USGS scale.

"Damage is possible in areas hit by at least intensity 5 and if the buildings are structurally weak," said Renato Solidum, head of the volcanology and seismology institute.

US president doubts Israel has yet decided on whether to strike, but America keeps all options open

Barack Obama has said that the United States will work in "lockstep" with Israel to prevent Iran from becoming a nuclear power, but he did not believe Israel had decided whether to launch a military strike.

The US president's comments appeared to be an attempt to downplay speculation that Israel was preparing to attack Iran following a report last week that the US defence secretary, Leon Panetta, believes an Israeli strike could happen this spring.

Obama told NBC television in an interview from the White House on Sunday that Israel is "rightly" very concerned about Iran's nuclear program, but said: "I don't think that Israel has made a decision on what they need to do".

He said that he hopes that the crisis will be resolved diplomatically but reiterated that the US has removed no option from consideration.

Asked about a potential attack by Iran on the US minlanbd, Obama said, "We don't see any evidence that they have those intentions or capabilities right now."

Tensions between Israel and Iran have continued to ratchet up in recent days. The Israeli defence minister Ehud Barak claimed on Thursday that there is a "wide global understanding" that military action may be needed, while Iran's supreme leader, Ayatollah Ali Khamenei, called Israel on Friday a "cancerous tumor that should be cut [out] and will bet".

Meanwhile, Obama said during the same interview that he deserves re-election, despite the difficulties of the US economy, adding that his administration is creating more than 250,000 jobs a month, the most since 2005, and a reversal from the 750,000 jobs the economy was losing three years ago.

The president said US manufacturing still needs a boost: "We have got to make sure we are pushing American energy, not just oil and gas, but clean energy."

Obama also said the country needed to return to "old-fashioned American values," so "everyone gets a fair shake".

Three years ago, Obama had said if the economy hadn't turned around by this time, his presidency would be "a one-term proposition".