Al-Qaeda gunmen kill Yemeni spy

SUSPECTED al-Qaeda militants have shot dead a Yemeni intelligence officer in Mukalla, capital of the southeastern Hadramawt province, says a security official.

"Al-Qaeda gunmen on a motorbike opened fire on the officer, Ibrahim Bameshel, as we was on his way back home, killing him immediately," the official told AFP on Saturday, adding that the assailants had fled.

Al-Qaeda militants were driven out of most of their strongholds in Yemen's south last June in an all-out offensive by government forces aided by local "resistance committees".

But local sources say jihadists from the al-Qaeda linked Ansar al-Sharia group have started distributing posters and leaflets in several towns across the province threatening members of the security forces and urging jihad.

Some of their posters showed pictures of masked gunmen on motorbikes.

Police and army officers come under frequent attack, with authorities blaming al-Qaeda for the assaults usually carried out by gunmen on unregistered motorbikes.

In a bid to clamp down on the increasing number of such attacks, authorities launched a campaign earlier this year ordering unlicensed bikes off the streets.

The militants took advantage of the weakness of Yemen's central government during a 2011 uprising against now-ousted president Ali Abdullah Saleh to seize large swathes of territory across the south, including most of Abyan province, which they controlled for a year.

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Polls open for Iraq provincial elections

Voting has begun in Iraq's first elections since US troops left, a test of the nation's stability. Source: AAP

IRAQIS have begun voting in the country's first elections since US troops departed, a key test of the nation's stability in the face of a spike in attacks that has claimed more than 100 lives.

Polls opened about 7am (1400 AEST) for the first vote since parliamentary elections in 2010.

An estimated 13.8 million Iraqis are eligible to vote for more than 8,000 candidates, with 378 seats being contested.

The lead-up to the vote has been blighted by a spike in violence that has left more than 100 people dead in the past week, and 14 election candidates killed since campaigning began.

Six of Iraq's 18 provinces will not be participating - two because authorities say security cannot be ensured, and four because of various political disagreements.

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Custody extended for Pakistan's Musharraf

A PAKISTANI anti-terrorism court has extended former military ruler Pervez Musharraf's judicial remand to a further two weeks in prison.

Musharraf was moved into police custody after being arrested on Friday, an unprecedented move against a former army chief of staff ahead of key elections.

The arrest relates to Musharraf's decision to sack judges when he imposed emergency rule in November 2007, a move that hastened his downfall.

He was brought to Islamabad court house in a white bullet-proof Land Cruiser by armed police and paramilitary rangers squads.

"The court has sent General Musharraf on judicial remand for two weeks," Muhammad Amjad, spokesman for Musharraf's All Pakistan Muslim League party, told reporters after the hearing.

"Our lawyers denied the allegations that General Musharraf sacked judges and kept them and their families under house arrest for six months. It is absolutely untrue," Amjad said.

"We had requested the court to send General Musharraf on judicial remand, so that we can go to higher courts for relief." Musharraf appeared before the anti-terrorism court amid tight security, as hundreds of lawyers opposing him scuffled with security personnel and shouted slogans against the former ruler.

He had spent the night at police headquarters in Islamabad, officials said, and was moved back there after his court appearance, but it was unclear whether he will be kept there or in a prison.

"It depends upon the district administration whether they send him to jail or keep him at any secure place," a senior police official told AFP.

Live television footage had shown Musharraf getting out of his SUV and being surrounded by dozens of security guards in the courthouse.

Lawyers have petitioned Pakistan's top court to try him for treason for imposing emergency law - which would be punishable by death or life in prison - but the state would have to initiate any trial.

Musharraf also faces charges of conspiracy to murder opposition leader Benazir Bhutto in 2007 and over the death of a rebel leader during a 2006 military operation.

His supporters say the arrest order was nothing more than a settling of scores for his dismissal of judges nearly six years ago.

On Thursday, Judge Shaukat Aziz Siddiqui added terrorism to the charges against him, accusing him of spreading "fear in the society, insecurity amongst the judicial officers, alarm in the lawyers' community and terror throughout Pakistan".

Musharraf seized power in a bloodless coup, which was widely welcomed at the time in Pakistan. But he was forced out and threatened with impeachment in 2008.

The elected prime minister he ousted, Nawaz Sharif, is now the front-runner in the general election campaign.

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$A higher on gold, stocks gains

THE Australian dollar is higher after gains on stock markets and in the gold price overshadowed a warning from the International Monetary Fund about the currency's value.

At 1700 AEST on Friday, the currency was trading at 103.43 US cents, up from 103.17 cents on Thursday.

CMC Markets senior trader Tim Waterer said the Australian dollar fell as low as 102.82 US cents on Friday morning after an IMF official said the currency was about 10 per cent overvalued.

But Mr Waterer said it rebounded thanks to improvements in the gold price and gains on stock markets.

Stock markets rallied across Asia, led by a two per cent gain on the Shanghai Composite Index.

"The IMF comments did not appear to have any lasting, negative impact with the Australian dollar instead taking its lead from the better risk sentiment on Asian markets today," Mr Waterer said.

He said movements on equities markets and in commodities prices would continue to drive the Australian dollar movement's during Friday's overnight session.

At 1700 AEST, the Australian dollar was trading at 102.21 Japanese yen, up from 101.10 yen on Thursday, and at 79.13 euro cents, up from 79.06 euro cents on Thursday.

Meanwhile, Australian bond futures prices finished the local session little changed.

Nomura head of fixed income Jon Linton said local bond futures had traded in a fairly narrow range during Friday's local session.

"It's been very quiet, the market hasn't really moved," he said.

At 1630 AEST on Friday, the June 10-year bond futures contract was trading at 96.800 (implying a yield of 3.200 per cent), down from 96.810 (3.190 per cent) on Thursday.

The June three-year bond futures contract was at 97.320 (2.680 per cent), unchanged from Thursday.

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Baghdad bomb kills 27 as unrest spikes

VIOLENCE spiked as Iraq readied for its first elections since US troops withdrew, with 27 people killed in a late-night bombing at a Baghdad billiards cafe frequented by young men.

The attack raises further questions about the credibility of Saturday's provincial elections, with 14 candidates already having been killed and a third of the country's provinces not even voting amid an ongoing political crisis.

The polls are seen as a key test of Iraq's stability and security, and will provide a gauge of Prime Minister Nuri al-Maliki's popularity as he grapples with infighting in his national unity government and months of protests by Iraq's Sunni Arab minority.

The latest bombing struck at 10pm on Thursday in the west Baghdad suburb of Amriyah, leaving 27 dead and more than 50 others wounded, security and medical officials said.

Among the dead were at least three children and a woman.

It exploded at the Dubai cafe, which lies on the second floor of a small shopping mall in the predominantly Sunni neighbourhood that is filled with families as it contains restaurants and clothes shops.

The cafe itself, however, is mostly frequented by young men playing billiards and video games.

Security forces restricted movements in Amriyah on Friday in the wake of the blast.

The bombing is the latest in a wave of violence, with 50 people killed in nationwide attacks on Monday, and March having been the deadliest month in Iraq since last summer, according to an AFP tally.

No group immediately claimed responsibility for the attack, but Sunni militants linked to Al-Qaeda frequently set off bombings in both Sunni and Shi'ite neighbourhoods across the capital, and the country, in a bid to undermine confidence in the government and security forces.

Officials and diplomats also complain that a long-running spat that has pitted Maliki against several of his erstwhile government partners has been exploited by insurgent groups who use the political differences to enhance their room for manoeuvre on the ground.

An estimated 13.8 million Iraqis are eligible to vote on Saturday for more than 8,000 candidates, with 378 seats being contested.

It is the first vote in Iraq since March 2010 parliamentary polls, and the first since US forces withdrew from the country in December 2011.

Diplomats have raised questions over the credibility of the vote, however, as attacks against candidates have left at least 14 dead and others withdrawing for fear of being targeted, while six of Iraq's 18 provinces will not be taking part, including two where authorities say security cannot be ensured.

Iraqi forces are solely responsible for polling day security, the first time they have been in charge without support from American or other international forces during elections since dictator Saddam Hussein was toppled in 2003.

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French hostages released in Cameroon

SEVEN French hostages kidnapped in northern Cameroon in February have been released, according to a government statement read on national radio and television.

Cameroon state broadcaster CRTV said the hostages, who were being held by Nigerian Islamist militant group Boko Haram, "are all safe," but did not give further details.

Tanguy Moulin-Fournier, an engineer with the GDF Suez energy company based in Cameroon's capital Yaounde, was abducted with his wife, four children and his brother near Cameroon's border with Nigeria on February 19.

Boko Haram last month ran an audio recording of Tanguy Moulin-Fournier, the father, in which he seemingly asked President Biya to free detained members of the al-Qaeda-linked group.

Boko Haram is believed to include a number of factions with various interests and shifting demands.

The group has in the past called for the creation of an Islamic state in Nigeria, where corruption is deeply rooted and most of the population lives on less than $2 per day despite its vast oil reserves.

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SA opts into full disability scheme

South Australia has agreed to fully implement the national disability insurance scheme. Source: AAP

SOUTH Australia has agreed to fully implement the national disability insurance scheme, DisabilityCare Australia, extending the benefits to 33,000 people across the state, Premier Jay Weatherill says.

South Australia was the first to sign up to the federal plan, with a trial to focus on children to begin in July this year until 2016.

The state government will now transition to the full scheme by the end of 2018-19.

Mr Weatherill says DisabilityCare Australia will make a massive difference to the lives of people with disabilities.

"People will get funding for all the services they need and will be empowered to choose for themselves the services they want," he said.

"It will recognise that, for some people, a disability is for a lifetime, so will take a lifetime approach to providing care and support, including intensive early support."

Under DisabilityCare Australia, South Australia's annual funding for disability services will grow from $345 million at present to $723 million in 2018.

The federal government will also contribute $760 million, taking total funding in SA to more than $1.4 billion.

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UAE busts al-Qaeda cell

AUTHORITIES in the United Arab Emirates have broken up an al-Qaeda cell comprising seven Arabs who were plotting attacks in the Gulf state, an official statement said.

The cell was "plotting acts that would have harmed the security of the country, its citizens and foreign residents," said Thursday's statement carried by WAM state news agency.

It was also "trying to extend its activities to reach some other countries in the region," it said.

An unnamed official added that the group was seeking to recruit new members and "propagating works of al-Qaeda."

The suspects were being questioned by state security prosecutors ahead of their trial, said the official.

Ninety-four people are already on trial in the UAE on charges of attempting to seize power in the Gulf state.

The UAE is one of the most stable countries in the Middle East, which has not seen any attacks by al-Qaeda, and has been spared in the wave of Arab Spring uprisings.

The population of the UAE, estimated at over eight million, is nearly 90 per cent foreigners lured by work opportunities in the wealthy country.

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Pakistan court orders Musharraf's arrest

A Pakistani court has ordered the arrest of former military ruler Pervez Musharraf. Source: AAP

A PAKISTANI court has ordered the arrest of former military ruler Pervez Musharraf for his controversial decision to dismiss judges when he imposed emergency rule in 2007, officials said.

It was not immediately clear if or when the retired general would be arrested.

Musharraf swept out of the Islamabad court on Thursday, facing no resistance from a heavy security contingent and driving away in a jeep escorted by his bodyguards.

Police confirmed that Musharraf had been driven to his farm house on the edge of the capital.

"The judge Shaukat Aziz Siddiqui ordered that the interim bail is dismissed," said Musharraf's defence lawyer Qamar Afzal.

The case is one of three against Musharraf in the Pakistani courts.

He is also accused of conspiracy to murder opposition leader Benazir Bhutto in 2007 and over the death of a Baluch rebel leader during a military operation in 206.

Musharraf returned to Pakistan on March 24 after four years of self-imposed exile in Dubai and London, vowing to contest May general elections having secured pre-arrest bail in connection with all three cases.

But his homecoming has been met by a dismal welcome from a support base that has all but evaporated since he stepped down in 2008 after nine years in office as the nuclear-armed country focuses on a key democratic transition of power next month.

On Tuesday, he was disqualified from contesting the May 11 polls because of the legal cases against him, ending his ambitions of a political comeback built on the promise that he alone could "save" the country from poverty and insecurity.

Musharraf has been in and out of courts in Karachi, Islamabad and Rawalpindi but judges have always previously extended his bail.

A spokesman for Musharraf's All Pakistan Muslim League said his supporters had been shocked by the arrest order.

"We were quite sure that the judge would extend the bail, but it came to our surprise when the judge said bail was dismissed and he should be arrested," said APML spokesman Muhammad Amjad.

The US-based watchdog, Human Rights Watch, called on the military authorities overseeing Musharraf's protection to ensure that he presents himself for arrest.

"General Musharraf's act today underscores his disregard for due legal process and indicates his assumption that as a former army chief and military dictator he can evade accountability for abuses," said HRW Pakistan director, Ali Dayan Hasan.

On April 12, the same Islamabad high court extended his bail over the judges' case in a 20-minute hearing accompanied by massive security to protect Musharraf, whom the Taliban have threatened to assassinate.

On Wednesday, a court in Rawalpindi also extended his bail until April 24 over Bhutto's killing.

The former prime minister died in a gun and suicide attack at the end of an election rally in the garrison city on December 27, 2007.

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Pink diamond sells for $US40m at auction

A 34.64-CARAT pink diamond has sold at auction in New York for nearly $US40 million ($A38.68 million), setting a new record for Christie's auction house.

Dubbed the "Princie Diamond", the gem is "one of the largest and finest pink diamonds in the world", with a "fabulous provenance", Christie's jewellery chief Francois Curiel said ahead of the sale.

An anonymous telephone bidder paid $US39,323,750, or more than $US1 million per carat, for the stone from ancient diamond mines in southern India, the auction house said in a statement on Tuesday.

The pink gem was once owned by the royal family of Hyderabad and, since 1960, by the London branch of Van Cleef & Arpels.

The exclusive jewellery firm originally paid STG46,000 for it, equivalent to $US1.3 million today, Christie's said, indicating a hefty profit after Tuesday's sale.

All told, bidders paid more than $US80 million for the jewels at the New York auction, including just under $US4.5 million for a 30.32 carat rectangular cut D colour diamond and $US3.3 million for a Harry Winston diamond ring.

Previously, the most paid at Christie's for a diamond was $US24.3 million, for the 31-carat Wittelsbach diamond, in 2008.

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Aust shares close higher

THE Australian share market turned positive again after two days of losses, with investors buoyed by strong overseas leads.

The ASX200 cracked the 5000-point mark for only the third time in 20 days of trading.

Consumer staples stocks shot up, including supermarket owner Woolworths, which lifted 84 cents, or 2.4 per cent, to $35.60 while rival Wesfarmers gained $1.21, or 2.97 per cent, to $41.89.

Telco Telstra also had a day out, gaining 2.7 per cent, or 13 cents, to $4.82.

CommSec market analyst Steve Daghlian said the stock was up 10.3 per cent in 2013 and trading at a five-year high.

However the news was not all good, with traders still shunning mining and energy stocks, with the steep commodity price drops still fresh in people's minds, according to CMC Markets senior trader Tim Waterer.

Mining stocks were down for the fifth day in a row, as was the biggest resources stock BHP Billiton, which lost nine cents to $32.06.

That came after the company maintained its production guidance for 2012/13 in its latest quarterly report despite weather-related disruptions.

Australia's largest gold miner Newcrest Mining made gains, firming 10 cents to $17.10 after heavy falls so far this week due to record plunges in the price of gold.

The major banks posted strong gains, with ANZ 23 cents higher at $29.09, Commonwealth Bank gained $1.15 at $69.29, National Australia Bank improved 41 cents to $32.24, and Westpac was 32 cents richer at $31.82.

KEY FACTS

* At Wednesday's close, the benchmark S&P/ASX200 index was up 53.8 points, or 1.09 per cent, at 5,004.6 points.

* The broader All Ordinaries index was up 49.5 points, or 1.0 per cent, at 4,993.6 points.

* The June share price index futures contract was up 56 points at 5,002 points, with 27,472 contracts traded.

*The price of gold in Sydney was $US1,379.20 per fine ounce, up $US2.10 on Tuesday's closing price of $US1,377.10.

* National turnover was 1.36 billion securities worth $4.16 billion.

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Four found guilty over Villawood riot

FOUR men have been found guilty of rioting at the Villawood Detention Centre in 2011 when three buildings were burnt down and pillows and bins set alight.

Twelve men went on trial in February, after being charged with riot and affray at the centre in Sydney's southwest on April 20, while another was accused of aiding and abetting them.

On Wednesday a jury found four of the men guilty of rioting.

At least two others were found guilty of the lesser charge of affray, while others were acquitted altogether.

Previously Justice Hulme had directed the jury to acquit two other men.

On the opening day of the trial, Crown Prosecutor Greg Farmer SC told the NSW Supreme Court that the protest began at 8am with two men sitting on a building's roof at the centre.

By around midnight it had escalated to such a point that staff feared for their safety and decided to evacuate.

Shortly after, Mr Farmer said burning wood was thrown through a window and an office caught fire.

During the protest, it was alleged tiles from the centre's roof were pelted at staff, while a bonfire of pillows, bins and other material was ignited on the centre's soccer field.

The men found guilty on Wednesday were granted bail to return to Villawood, and will be sentenced at a later date.

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NSW planning overhaul prompts criticism

A NSW government paper recommends speeding up the approval process for many types of developments. Source: AAP

CRITICS say a long-awaited overhaul of NSW's planning laws will silence local communities and create a developers' paradise.

But the government claims the most significant revamp of the system in more than 30 years has public consultation as its centrepiece.

"The community will be able to own this planning system. They will own what happens in their local area," said NSW Planning Minster Brad Hazzard.

New laws will require the state government and councils to consult early with the community in developing the long-term planning ground rules for their region.

About 80 per cent of development proposals will be fast-tracked under the agreed system, estimated to save businesses and families about $174 million a year.

Most of those applications, including new homes and extensions, will be determined in less than 25 days.

Residents will be informed but not consulted about such projects, and the state's 152 councils won't have the power to knock them back.

Greens MP David Shoebridge said the legislation was intended to benefit developers, while local councils would be "utterly sidelined".

They will also be outnumbered by ministerial representatives on regional planning boards in a 'four-against-one' system.

"Local councils will become government patsies. They will just implement the decisions being made by the regional planning boards," Mr Shoebridge said.

Opposition Leader John Robertson said the planning laws gave developers everything they wanted.

"It will exclude local communities from having a say at the most critical point of the planning process - that is, when the detailed development applications go to a council and no one in the local community will have a say on anything."

Mr Hazzard said a "modest levy" would be imposed for the first time on builders of new homes and apartments in existing suburbs, to provide funding for schools, roads and other infrastructure.

The new charge would help spread the costs more evenly across the state.

Currently, only developers in greenfields areas need to pay such levies. The minister said the government was slashing millions of dollars in red tape, making new homes cheaper to build.

Social media, such as Twitter and blogs, will be used to encourage people to get involved in the community consultation process, although Mr Hazzard conceded it would be "a mighty challenge" to get people to switch on at such an early stage.

Mr Shoebridge warned if the reforms became law, the first notice most people would have that a new house was being built next door "is when the bulldozers arrive".

The white paper is now open for community consultation for the next ten weeks. Legislation will be introduced to parliament in the second half of this year.

Ray Donald, joint president of Local Government NSW (LGNSW), said the proposed processes were top heavy and the new emphasis on early community consultation may replace the rights of neighbours to be involved with local development decisions.

"We support a new planning system that listens to the voice of communities through the well understood councillor representation system," he said.

"This provides transparency and accessibility to communities and a much needed 'check and balance' to an overly bureaucratic system."

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'We just hugged': Aussies survive carnage

IN the moments after twin bomb blasts tore through the Boston Marathon finish line, Australians caught up in the drama hugged and thanked their "lucky stars".

The attack on Boston's great race killed three people - including an eight-year-old boy - and maimed at least 120 more.

But authorities do not believe any of the 153 Australians who lined up for the event alongside 24,000 other runners were injured.

Prime Minister Julia Gillard said the safety of Australians who could have been caught up in the destruction was of "paramount concern".

"At this stage we are not aware of any Australian victims, so we do not have any evidence of course at the moment that any Australians have been hurt in this incident," Ms Gillard told reporters in Canberra.

Late on Tuesday afternoon (AEST) the Department of Foreign Affairs and Trade told AAP this information had not changed.

A department travel warning for Australians travelling to the US was updated, but not upgraded, in the hours after the blasts.

Foreign Minister Bob Carr said fears the incident was a terrorist attack were legitimate.

"We know that home-grown terrorists have been a feature of life in Europe, the US and here," Senator Carr said.

"It's legitimate to be concerned about the prospect that this does represent a domestic terrorist strike."

Among the Australian runners was Perth woman Trish Farr, who was safely back at her hotel when she heard the bombs go off 30 seconds apart.

She told AAP she and fellow contestants thought they were fireworks.

But when the sound of fire engines filled the air, they realised something was terribly wrong.

"We just hugged each other and spoke to and texted our families, and thanked our lucky stars we all had our skates on and didn't dawdle," Ms Farr told AAP.

Australia's number one ranked marathon runner Jeff Hunt finished eighth and Lee Troop came 15th, while Paralympians Kurt Fearnley and Christie Dawes came fifth in their respective wheelchair races.

Fearnley tweeted about the explosions but did not grasp the extent of the carnage until later.

He said he was "sickened".

Former Boston Marathon winner and 1983 world champion Robert de Castella was in town supporting Australian athlete Emma Cameron, who competed as part of his Indigenous Marathon Project.

"There was obviously a fair bit of chaos and pandemonium at the finish line," said Mr de Castella when he confirmed Ms Cameron was safe.

Their team is preparing to return home.

Sydney woman Louise Kring was the last Australian to finish the race before the bombs went off, crossing the line five minutes prior to the blasts, but was not affected and safely made it to her hotel.

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Jurors challenged in Michael Jackson case

Some potential jurors in the Michael Jackson wrongful death case had to be excused. Source: AAP

THE extensive connections of Michael Jackson, his family and friends have been a challenge for a US judge trying to select an impartial jury for his mother's wrongful death lawsuit against the company that promoted Jackson's ill-fated This is It concert.

As individual questioning finally began on Monday, some jury prospects who had passed the written portion of the process had to be excused because of personal connections.

Among them was David Walsh, a Canadian singer-songwriter who said he had met members of the musical Jackson family and was friends with Lisa Marie Presley, Jackson's ex-wife. He said his own manager was on the witness list.

"I've had friends in Michael's band and my best friend was a backup singer on the This is It concert," Walsh said.

Walsh said he had formed opinions about the case that were probably unshakeable.

Katherine Jackson's suit claims AEG endangered Jackson's life by hiring an incompetent doctor, Conrad Murray, to look after the superstar singer.

AEG lawyers are expected to argue that Jackson was complicit in his own demise by insisting on hiring Murray and demanding the anaesthetic propofol to help him sleep.

The latest phase of jury selection came after jurors filled out questionnaires about their views on Jackson, his family and his life and death.

A preliminary group of 104 prospects was immediately reduced by six when members reported hardships or acquaintances on the witness list.

By day's end, 17 prospects had been excused, most because the extended length of the trial would cause them financial hardship. The case is expected to last for months.

More panellists sent notes to Superior Court Judge Yvette Palazuelos before court recessed for the day, asking to be excused.

One member of the jury pool said he had met Dr Conrad Murray at a barbecue sometime after Jackson's death and they had a social conversation. But he said he didn't realise who Murray was, and once he did he stopped talking to him. He remained on the panel.

Murray is serving a prison term after being convicted of involuntary manslaughter in Jackson's death from an overdose of propofol. Jackson died in his bed in June 2009 at the age of 50.

Complicating the case is the fact that neither Jackson nor AEG had signed Murray's $US150,000 ($A146,092)-a-month contract. Jackson died before Murray was paid.

Katherine Jackson's lawyers contend AEG was negligent in failing to investigate Murray's qualifications before hiring him.

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PNG asylum centre needs upgrade: DIAC

AUSTRALIA'S immigration department says its asylum seeker processing centre on Papua New Guinea's Manus Island is cramped, lacks proper amenities and needs an urgent upgrade.

The island's temporary facility currently houses 227 asylum seekers, including family groups.

But the Department of Immigration and Citizenship (DIAC) says the facility provides little in the way of recreation and lacks a reliable power supply.

It warns the "problematic living arrangements" on the facility could lead to increased tensions among transferees.

"This includes an increased risk of self-harm, mental health problems and problematic behaviour," the immigration department said in a submission into a parliamentary inquiry into the processing facility.

"Past experience in the Australian immigration detention network indicates that limited amenity and space quickly leads to behavioural changes which in turn can lead to substantial increases in health and security costs."

The temporary centre was cramped and recreation facilities were "limited and in a poor state".

"Humidity is high and the tents are still very hot due to the average daytime temperature ranging between 26 and 38 degrees centigrade," the submission said.

"In addition the site is in a low lying swampy area subject to localised inundation which encourages mosquito breeding."

The department also noted that the PNG government was expecting a permanent centre "as a priority" once a site has been approved.

"The PNG government will only support the use of tents, and the existing temporary facility for a limited period of time."

The department says it wants to build a permanent facility on the island to house families and other vulnerable groups while their refugee claims are processed.

The centre, once built, will be able to accommodate 600 people and is expected to cost around $172 million.

The centre will include a basic gym, sports fields, multi-faith rooms, computer rooms and a library.

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Aust carbon emissions down slightly

THE federal government is facing calls to broaden the scope of its carbon tax, as new figures show Australia's greenhouse gas emissions fell only slightly last year.

The National Greenhouse Accounts data, released on Monday, shows Australia's total carbon pollution in 2012 dropped just 0.2 per cent from the previous year.

The dip stemmed largely from a decline in emissions from the electricity sector, which experienced lower demand amid an increase in clean energy sources.

Pollution from industry was also down, but emissions in most other sectors rose.

However, the government said emissions in all the major sectors covered by the carbon pricing mechanism had fallen since the scheme introduced last July.

Climate Change Minister Greg Combet said the carbon price, renewable energy target (RET) and other policies had helped drive down emissions from the power sector since federal Labor was elected in 2007.

But opposition climate action spokesman Greg Hunt accused the government of "airbrushing" and falsely attributing a drop in emissions to the carbon tax on large emitters.

A combination of the global recession, the high Australian dollar and lower overseas demand for Australian manufactured goods also kept electricity-sector emissions down, he said.

The flooding of Victoria's brown-coal fired Yallourn Power Station last June also had an impact.

"It is time that the minister is honest with the facts," Mr Hunt said in a statement.

The National Greenhouse Accounts figures exclude emissions from land use, land-use change and forestry.

The Climate Institute said if those aspects were included, total emissions would have gone up almost one per cent.

Institute CEO John Connor said the government's carbon policies needed strengthening.

"The unevenness of improvement underscores the need to have a comprehensive policy framework that addresses the sectors where emissions are increasing," he said in a statement.

Sectors such as transport were partly exempt from the carbon tax, and their emissions were rising, he said.

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Sydney man dragged under truck after row

A LABOURER remains in hospital with serious injuries after he was dragged 15 metres under a truck following an argument with the driver in Sydney's southwest.

The incident occurred on Friday afternoon following a dispute over removalist fees after the 31-year-old victim had helped to move furniture to a home in Padstow, police allege.

It is alleged that the man was struck by the truck and dragged about 15 metres after arguing about payment.

The driver did not stop to help, and the victim remains in Liverpool Hospital where he was treated for serious injuries.

Following an investigation, the 32-year-old driver of the truck handed himself in to police at Bankstown Police Station on Monday.

He has been charged with causing grievous bodily harm with intent and driving while suspended.

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School funds needed to fix Tas mess: Oppn

THE federal goverment's extra schools funding will only replace what the Tasmanian government has taken out, the state opposition says.

Prime Minister Julia Gillard on Sunday unveiled plans for an extra $14 billion - mostly commonwealth money - to be pumped into the nation's schools from next year.

Tasmania would receive an extra $400 million.

Opposition education spokesman Michael Ferguson said the state government had already ripped out $190 million from the state's schools.

"The funding announced today will largely be swallowed up to fill that black hole," Mr Ferguson said.

Tasmanian Premier Lara Giddings said her government would back the reforms if the funding was directed towards schools with the greatest need.

"The firm funding commitment announced by the prime minister today is a significant step," she said.

"We want to see Tasmania's strong and vibrant public schools continue to grow and prosper."

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Big states baulk at school funding model

Prime Minister Julia Gillard is set to announce a $14.5 billion boost to schools funding. Source: AAP

THE Liberal states are baulking at federal government calls to expand their education budgets in return for billions of dollars in schools funding, with one premier describing the plan as "nuts".

Prime Minister Julia Gillard wants to pump an extra $14.5 billion over the next six years into the national education system, with the commonwealth contributing 65 per cent.

Ms Gillard said federal funding along with $5.1 billion from the states would help Australia reach its goal to be ranked in the world's top five for reading, mathematics and science by 2025.

"It's a lot of money, but I believe it is a wise investment in our children's future and our nation's future," she told reporters in Canberra on Sunday.

But Western Australia, Queensland, Victoria and NSW aren't so sure, setting the scene for a showdown with Ms Gillard on Friday when state leaders head to Canberra for the Council of Australian Governments (COAG) meeting.

WA Premier Colin Barnett said while the plan gives his state an extra $300 million, NSW gets a massive $5 billion and base funding per student would be less than what his government already offers.

"I would have to be nuts to sign up to something like that," he told Sky News television.

Labor's needs-based National Plan for School Improvement builds on the recommendations of the Gonski schools funding review released last year and comes ahead of the expiry of the current funding agreement early next year.

Under the proposed school resource standard, the amount for 2014 would be $9271 per primary school student and $12,193 for every secondary pupil.

Public schools would be the big winners with $12.1 billion in extra funds, while the Catholic system would receive $1.4 billion and private schools $1 billion.

The federal government also proposes to boost commonwealth schools funding by 4.7 per cent a year, but only if the states and territories agree to increase their education budgets by a corresponding three per cent.

Queensland Premier Campbell Newman said he would go to COAG with an open mind, but chided Ms Gillard for not speaking to him first about her funding plan.

"I know the state of Queensland doesn't have the money they're talking about," he said.

Victorian Education Minister Martin Dixon said Labor was holding the states to ransom.

"Basically they're saying, 'here's a whole bunch of money, but you've got to do it our way'," he told reporters in Melbourne.

NSW Education Minister Adrian Piccoli said he needed more time to "examine the details".

"We continue to work constructively with the commonwealth to turn this review into an opportunity for all of our students," he said in a statement

The NT is also uncertain, but South Australia, Tasmania and the ACT broadly support the plan.

Ms Gillard warned if funding wasn't addressed schools would be $5.4 worse off because of a widening gap between spending commitments by the states and the commonwealth.

But if the states agree, there would be extra money per student and loadings for schools with disadvantaged pupils, including indigenous children or those with disabilities.

The Australian Education Union supports the reforms while the Independent Schools Council of Australia (ISCA) says it will await the outcome of COAG.

Opposition education spokesman Christopher Pyne said the plan was a "con".

"This package delivers only about $600 million a year in new education money or one-tenth of what was expected," he said in a statement.

Labor will use savings from $2.8 billion in cuts to tertiary education and $900 million from changes to superannuation tax concessions to help pay for its share of the funding boost.

Independent MP Andrew Wilkie said the Gonski recommendations provided the government a once in a lifetime opportunity to reform education funding, but instead they'd gone with a political fix.

The fact Labor cut into university funding to pay for its schools plan was "genuinely appalling", he added.

"The bottom line is that the federal government has turned out to be a terrible disappointment on education," Mr Wilkie said in a statement.

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Pell jets to Rome after appointment

AUSTRALIA'S most senior Catholic Cardinal George Pell says he'll work with seven other high ranking churchmen appointed by the Pope to a new Vatican panel to bring "better discipline" to the church and avoid "Vatileaks" type scandals.

Cardinal Pell, 71, is being hailed as a voice for Oceania on the permanent advisory group.

He was appointed by Pope Francis on Saturday night alongside six other cardinals and one Monsignor.

Cardinal Pell said in his new role he would help the Pope in "anyway I can".

"I am very sure the Holy Father will be working for a better discipline," Cardinal Pell told the ABC on Sunday.

"There has been a spot of bother as we know in the Vatican, with the butler leaking the papers and other allegations.

"Most of the people working in the Curia are very, very fine people, but there were one or two mishaps."

Reform of the Roman Curia - the Church's governing body - was a much-cited issue during the run-up to the conclave that elected the new pope last month.

After Pope Benedict's historic resignation in February, Cardinal Pell criticised the Curia and its governance during Vatileaks, the 2012 scandal involving leaked papal papers that shed light on alleged infighting and financial impropriety among leading Curia members.

A spokeswoman for the Sydney Archdiocese told AAP that the scandal would likely be on new committee members' minds.

"There is no definitive agenda at this stage," she said on Sunday.

"It's only just happened, but there hopefully will be (scope) to avoid, for example, any future Vatileaks."

She said Cardinal Pell was flying to Rome on Sunday evening as part of a pre-arranged visit and would likely consult widely in the Catholic community ahead of the panel's first meeting from October 1-3.

"I think he's looking forward to the additional role, and whatever contribution he can make," she said.

He will remain based in Sydney but will travel to Rome.

Australia's first resident ambassador to the Holy See, Tim Fischer, said the panel appointments were an "inspirational" choice.

"I congratulate Cardinal George Pell on his appointment and note that every continent in the world is represented in the skilful selection made by Pope Francis in just his first month in office," Mr Fischer told AAP on Sunday.

"Certainly this new cabinet, or council, of cardinals of advice is a beacon pointing the way ahead by the new Pope in relation to re-balancing and revamping the church."

The other cardinals selected are from Europe, Africa, North and South America, and Asia.

The panel make-up has been interpreted as an indication that Pope Francis wants to reflect the universal nature of the church in its core decision-making.

Cardinal Pell welcomed the mixture of ideas that would come with the different backgrounds of advisers.

"I think different perspectives will be useful and a few English-speaking perspectives won't hurt."

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