Obama Signs Order To Start Spending Cuts

Barack Obama signs an order authorising $85bn spending cuts, as the US reaches the so-called sequester deadline without a deal.

The cuts are kicking in after the White House and congressional Republicans could not overcome bitter disagreements and come up with a better plan to tackle the country's $11.7trn debt.

They are part of a law passed two years ago designed to be so off-putting to both Democrats and Republicans as to force a compromise. But things did not go to plan.

"Let's be clear, none of this is necessary," President Obama said after the White House meeting ended in deadlock.

He said it was "a choice Republicans in Congress have made" to avoid to closing tax loopholes that benefit the wealthy.

The immediate impact of the cuts on the public is uncertain, but they will carve 5% from domestic agencies and 8% from the Pentagon between now and October 1.

Several major programmes will be unaffected, including the Social Security pension programme, the Medicaid health care programme for the poor and food stamps.

The daily consequences could be severe for Americans.

The busiest airports could close some runways, causing widespread flight delays and cancellations.

Hundreds of illegal immigrants already have been freed from jail across the country.

A military aircraft carrier's tour of duty to the Persian Gulf has been delayed.

The cuts are just the first of a series of budget crises that will confront Congress and the White House before the summer.

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Queen 'Suffering From Gastroenteritis'

The Queen has cancelled an engagement in Swansea as she is suffering from the symptoms of gastroenteritis.

Buckingham Palace confirmed the Queen is unwell and will "be assessed in the coming days".

The 86-year-old monarch was due to visit Wales tomorrow to present St David's Day leeks to 3rd Battalion The Royal Welsh.

She is currently at Windsor Castle, where she is spending the weekend "as usual", the palace said in a statement.

The Queen is due to travel to Rome on March 6 to visit Italy's President Napolitano.

She last had to cancel an event - an investiture ceremony at Windsor Castle - due to chronic back pain in October 2012.

She also missed a church service at Sandringham two days before Christmas last year because she was "getting over the tail end of a cold".

The Queen presented Olympic stars, including Jessica Ennis, Nicola Adams and Greg Rutherford, with honours at Buckingham Palace on Thursday.

Jessica Ennis beamed as the Queen presented her with a CBE on Thursday

A palace spokesman said the Queen's visit to Rome was still due to take place but a decision would be made after further assessment of her condition.

Meanwhile, Swansea Council said the ceremony would go ahead tomorrow as planned with the Lord Lieutenant of West Glamorgan, Byron Lewis.

A council spokesman said: "Due to minor illness, Her Majesty The Queen is unable to attend Saturday's event.

"The ceremony will continue as planned and will be carried out by the Lord Lieutenant of West Glamorgan, Mr Byron Lewis.

"The Lord Lieutenant will be met upon arrival at the Guildhall by Brigadier Philip Napier, Colonel of the Regiment.

"The parade will present arms for a royal salute and play the national anthem before the Lord Lieutenant is invited to present leeks to a representative body of the regiment.

"Following the parade, the Lord Lieutenant will attend a reception with members of the battalion and their families, before proceeding to the George Hall for lunch.

"The event will take place in and around the Brangwyn Hall and public viewing areas will be available."

Gastroenteritis is an infection of the stomach and bowel, with common symptoms including vomiting, diarrhoea and dehydration.

In England, the two most common causes of gastroenteritis in adults are the norovirus and food poisoning, according to NHS Choices.

The Queen has rarely missed events during her 61-year reign, even though she carries out more than 300 engagements a year.

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Pope's Reign Ends After Emotional Farewell

More than a billion Catholics are without a leader after Benedict XVI officially resigned, saying he will now simply be a "pilgrim".

At 8pm local time the doors of Castel Gandolfo closed and the famous Swiss Guard that ceremonially watch over the pope's summer residence marched away.

It signalled the end to Benedict's eight-year papacy and that the position of pope is now vacant.

He keeps his current name but from now on will be known as Pope Emeritus, or referred to as "his holiness", as he devotes his days to prayer and meditation.

The outgoing pope speaks to well-wishers at Castel Gandolfo

Just hours earlier, in an emotional goodbye to the faithful, he declared himself a mere "pilgrim" in his final public appearance as Pope.

He arrived at the villa at the lakeside town to find a 7,000-strong crowd gathered in the main square waving yellow and white paper pennants in Vatican colours to greet him.

There were huge cheers as he briefly stepped out onto the main balcony, wearing a white robe, and spoke to the faithful with a final apostolic blessing.

Benedict saw stunning views of Rome as he was flown away by helicopter

"I am very happy to be here with you, surrounded by the beauty of the world. Thank you for your friendship and your affection," he said.

"You know that this day of mine has been so different from many others.

"I am no longer Pope from 8pm this evening. I am just a pilgrim on his last leg of his pilgrimage on this earth.

"I would like to work to work for the good of the Church and for humanity with my heart, faith, love, reflection and interior strength, and I feel supported with your kindness."

He went on to say: "From the bottom of my heart I bless you ... Thank you and goodnight."

Thousands of well-wishers pack the main square of Castel Gandolfo

Balloons spelling out his name were strung up across a shop window and banners thanking Benedict for his service were held aloft.

Earlier, he left the Vatican for the final time as leader of the Catholic Church, pledging "unconditional reverence and obedience" to whoever succeeds him.

He gave thanks to his closest aides who have been by his side during his papacy in an emotional parting ceremony, before stepping out from his apartments for the last time. Many of his staff had tears in their eyes.

As he bid the Vatican farewell as the Pope, he tweeted: "Thank you for your love and support. May you always experience the joy that comes from putting Christ at the centre of your lives."

Staff lined the route of his motorcade and applauded as the 85-year-old was driven to the Vatican helipad.

Benedict waves before boarding the helicopter out of the Vatican

There he boarded a white Italian air force helicopter emblazoned with the Vatican flag and was flown in a spectacular journey over Rome to Castel Gandolfo - the papal summer residence on the outskirts of the city.

He is expected to spend the first two months of his retirement at the complex of villas boasting lush gardens, a farm and stunning views over Lake Albano in the volcanic crater below the town - before he retreats from public life for good.

The bells of St Peter's Basilica and churches rang out as the helicopter circled Vatican City against a backdrop of the Rome city skyline and golden setting sun.

Every minute of Benedict's departure was shown by Vatican television, including live pictures from the helicopter, as it flew over the Colosseum and other iconic landmarks.

The Apostolic Palace of Castel Gandolfo - the pope's summer retreat

It came 17 days after Benedict shocked the world when he announced he no longer felt mentally or physically able to continue as the 264th successor to St Peter. It broke centuries of precedent in which it became traditional for only death to end a pope's reign.

Earlier on Thursday, more than 100 cardinals said their personal farewells to Benedict at a gathering in the Clementine Hall in the Apostolic Palace.

In an unexpected speech, he urged them to stay united behind his successor.

He told them: "Among you there is the future pope, to whom I today declare my unconditional reverence and obedience."

Benedict will eventually move into the newly renovated Mater Ecclesiae Monastery of cloistered nuns inside the Vatican.

A total of 115 cardinals are expected to elect his successor in the secretive conclave process in the next few weeks, with the aim of having a new pope installed in office by Easter.

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Eastleigh By-Election: Lib Dems Triumph

The Liberal Democrats have won the Eastleigh by-election - as the UK Independence Party pushed the Conservatives into third place.

Local councillor Mike Thornton claimed 13,342 votes for the Lib Dems, with 11,571 for Ukip's Diane James and 10,559 for Conservative candidate Maria Hutchings.

Labour's John O'Farrell was fourth with 4,088 votes.

Mr Thornton said in his acceptance speech that the result represented a "great night" for his party nationally.

"A strong signal of support for (leader and Deputy Prime Minister) Nick Clegg, an affirmation of our role of national interest within the coalition and a huge boost to our party's mission in government to build a stronger economy in a fairer society so that everyone can get on in life," he said.

He said it showed those who had "written off" the Lib Dems had been proved wrong, adding: "We have done it and we will do it again."

A by-election was called in the Hampshire constituency following the resignation of disgraced Lib Dem MP Chris Huhne.

The result comes after influential Tory backbencher David Davis warned the Prime Minister that third place would represent a "crisis" for the party.

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CPS Taxi Fraud: Charges Over £1m Plot

Two workers at the Crown Prosecution Service are facing charges over a fraud plot involving false taxi claims worth at least £1m.

Finance manager Lisa Burrows, 41, from Birminigham, and an administrative officer who has not been named, work for CPS West Midlands.

The allegations concern false claims for witness care taxi services to the value of at least £1m when no such services had been supplied, the CPS said in a statement.

Malcolm McHaffie, deputy head of special crime for the CPS, said the charges followed a complaint by the Crown Prosecution Service and a subsequent investigation by West Midlands Police into two members of CPS staff.

"I have now concluded that it is appropriate to charge both Burrows and the other individual with conspiracy to commit fraud," he said.

Mr McHaffie added that while the administrative officer had not yet been charged, Burrows was due appear Birmingham Magistrates' Court on Thursday.

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Sex Claims Peer: Woman Clashes With Clegg

A former Lib Dem activist has told Sky News she offered to make an official complaint that the party's then-chief executive had made inappropriate sexual advances towards her.

The claim by Alison Smith contradicts accounts from Lib Dem leader Nick Clegg and the party's senior leadership that no formal allegations were made about Lord Rennard.

Several women have come forward to accuse him of inappropriately touching and propositioning female party workers. Lord Rennard denies all allegations of wrongdoing.

Ms Smith told Sky News she first reported a complaint about the peer to Paul Burstow, then the chief whip, in April 2007.

"That wasn't listened to so I took the matter to various other people and really kept hitting brick walls," she said.

"At the time, I didn't have any ambitions for a political career, so I felt less prohibited coming forward and complaining.

"I said from the very first instance to Paul Burstow that I was willing to take (my complaint) all the way. I told him I was willing to put it in writing and to go to the police if he thought that was the right thing to do."

Ms Smith said the matter was dealt with informally in 2009.

Mr Clegg earlier conceded that his party made "very serious mistakes" in failing to deal properly with complaints of sexual harassment against the peer.

The Deputy Prime Minister admitted women in his party were "let down" when their allegations of sexual harassment against the peer were not listened to.

Lord Rennard issued a fresh denial of any wrongdoing this week and has said he is ready to "co-operate with any properly-constituted inquiry".

The statement said "that in 27 years of working for the Liberal Democrats he received no complaint or allegation about his behaviour".

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Egypt Balloon Explosion: Britons Killed

Two Britons and a UK resident were among 19 people who died when a hot air balloon exploded near the ancient Egyptian city of Luxor.

Mrs Rennie died in the crash

Sky sources named the British nationals who were killed as Yvonne Rennie, from Perth, and Joe Bampton, 40.

Mrs Rennie's husband, Michael, 49, survived the crash and is in hospital in Cairo in a stable condition. 

Mr Rennie is thought to have survived the crash by jumping out of the blazing basket as it fell to the ground.

The UK resident who was killed was Mr Bampton's partner, Hungarian-born Suzanna Gyetvai, 34, the Press Association said.

The couple lived in Clapham, London.

The only other survivor was the pilot, an Egyptian man, who is in hospital with burns to 60% of his body.

Mr Rennie arriving at a hospital in Cairo

He jumped from the basket when it was 10-15 metres (yards) from the ground, said Ahmed Aboud, the head of an association representing Luxor balloon operators.

A witness told the Press Association that people were jumping out of the balloon from "about the height of a seven-storey building".

A security official said the balloon, which was carrying 20 tourists and the pilot, had been preparing to land when it caught fire after a cable got tangled around a pipe.

Neighbours leave flowers at the Rennie house in Perth

The fire triggered an explosion in its gas canister and the balloon then plunged some 300 metres (1,000 feet) into sugar cane fields.

France's Foreign Ministry confirmed two French nationals died in the crash.

One Egyptian was also killed, Health Minister Mohamed Mostafa Hamed said.

Japanese citizens as well as nine tourists from Hong Kong are believed to be among the other casualties.

Authorities have suspended all balloon flights in Luxor

Mr and Mrs Rennie's neighbour Linda Kettles said the couple were "very, very nice people who kept themselves to themselves".

She added: "They were really looking forward to getting away. I'm totally devastated by the news. I really feel for their families."

Mrs Kettles said the Rennies were looking forward to the holiday

She said the couple moved from Dundee to Perth about 10 years ago, and although they had been together for a "long time" they were only married recently.

Mrs Rennie worked as a hospital receptionist while Mr Rennie works in the construction industry, she said.

The UK resident who is believed to be from Hungary initially survived the crash, but died in hospital.

In confirming the "tragic deaths", the Foreign Office said: "The next of kin have been informed and our thoughts are with them and their families at this difficult time.

"We are providing them with consular assistance. We can also confirm that one other British national was involved and is in a stable condition.

"We have had consular officials in Luxor since early this morning who have been focused on providing consular assistance and supporting the Egyptian authorities.

"Our ambassador to Egypt has met the injured British national and has offered our assistance."

Shoes amongst the wreckage of the crash

Witness Christopher Michel was travelling in one of several balloons in the air above Luxor early on Tuesday morning.

He told Sky News: "I was in one of about eight balloons that were flying that morning. We were approaching landing ... coming down in a remote field just outside of Luxor.

"We heard a loud explosion behind us, and I looked back and saw lots of smoke. It wasn't immediately clear that it was a balloon. We were surrounded by the balloons that had been flying with us.

The site at Luxor 40 minutes before the crash (Pic: @chrismichel)

"Then we could see the reaction of the pilot on the balloon and he said that this hasn't happened in a long time."

The Britons involved in the accident had been on holidays booked through Thomas Cook, which has temporarily suspended sales of hot air balloon rides in Egypt.

The tour company said: "As well as Thomas Cook's experienced team on the ground in Luxor, the tour operator is sending a specialist welfare team to support all of its customers in resort.

"Counselling services will be provided to any guests who want them and Thomas Cook's experienced reps are also visiting hotels regularly to speak to customers." 

Ballooning in Luxor is very popular with tourists visiting its temples

Luxor Governor Ezzat Saad has imposed an immediate ban on all hot air balloon flights in the province as Prime Minister Hesham Qandeel ordered an investigation into the accident.

Hot air ballooning is popular with tourists who go to Luxor to visit its ancient temples and the tombs of the Valley of the Kings.

But the activity is not without its dangers. In April 2009, 16 people were hurt - including two British women - when a balloon crashed during a tour of Luxor.

:: Thomas Cook UK has opened a hotline for families who have relatives in Egypt: 0800 107 5638.

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Belfast: Rocket Launcher And Warhead Found

A rocket launcher and a warhead have been discovered by police investigating dissident republicans in West Belfast, police said.

Officers found the weapons, which were intended to kill, while searching a house in Hawthorn Street, said a spokesman from the Police Service of Northern Ireland (PSNI).

The spokesman said: "These weapon systems are clearly intended to kill and we should be in no doubt that the recovery of these items has saved lives."

Dissidents have been linked to a series of attempts to kill members of the security forces, including soldiers, police and a prison officer.

The weapons were found in west Belfast

Earlier this month Irish police intercepted a suspected dissident republican haul of rocket launchers and explosives in Co Tipperary which were believed to be en route to Northern Ireland.

The police spokesman said: "Detectives from PSNI serious crime branch have this evening recovered a rocket launcher and warhead from a house.

"The search was conducted in relation to ongoing dissident republican activity."

The items have been taken away for forensic examination. Police have been on high alert for more attacks in Northern Ireland for some time.

Earlier officers expressed concern about helping police at the G8 this summer in Northern Ireland because of the danger.

PSNI chief constable Matt Baggott has warned he needs more officers to cope with the security threat and other unrest.

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CCTV Punch Attacks: Michael Ayoade Jailed

A man who punched a teenage girl and a female student, leaving them unconscious on the ground, has been jailed for four years.

Michael Ayoade, 35, was caught on CCTV staging the random attacks in Plaistow, east London.

In the second attack on November 13 last year, he jogged up behind a 16-year-old girl in the High Street and punched her in the head. The teenager fell to the ground, breaking three of her teeth.

A year earlier, Ayoade punched a university student in the side of the head at Plaistow tube station. His victim, Daniella Montieth, was taken to hospital with a broken tooth.

Passing sentence at Inner London Crown Court, Judge Roger Chapple said Ayoade, of Greengate Street, Plaistow, had launched "vicious, unprovoked attacks on young, lone females".

He said: "These images are indeed worth many thousands of words. The footage captures graphically the shocking violence of these attacks.

"In both cases there was but one blow. In the case of (the 16-year-old) it can plainly be seen from the CCTV footage that the force behind the blow was massive.

"The ferocity of the blow that you struck to her after running up behind her with full force was truly shocking.

"In both cases the force of the blow was such as to render the victims unconscious albeit mercifully not for long."

Ayoade, who is originally from Nigeria, followed the teenager for 800m before attacking her.

Prosecutor Joel Smith told the court Ayoade said she had "looked at him in a rude way" and that he could not go through the rest of the day having taken "an insult from a little person like that".

Ayoade, who was arrested shortly after the attack, admitted two counts of assault causing actual bodily harm and one of possessing cannabis after a bag of the drug was found at his home.

Defending, Gillian Frost said Ayoade, who had smoked three or four cannabis joints and drunk a cup of vodka before attacking the teenager, had not wanted to cause more serious harm to either woman.

He was jailed for four years for the attack on the teenager and 19 months for punching the student, although the two sentences will run concurrently.

There was no separate penalty for the cannabis charge.

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Rennard Sex Claims: Police Investigate

How The Rennard Story Developed

Updated: 7:17pm UK, Monday 25 February 2013

Here is how the claims about Lord Rennard grew into a full-blown crisis for Nick Clegg amid questions about exactly what the party leader knew and when.

2008: Nick Clegg says this was when he became aware of "indirect and non-specific concerns" about Lord Rennard's behaviour.

The leader says his then chief-of-staff Danny Alexander confronted the peer and told him "any such behaviour was wholly unacceptable".

Lord Rennard "categorically denied" the claims.

2009: Lord Rennard resigns as party president due to ill health.

February 19, 2013: Channel 4 tells the Lib Dems about the allegations ahead of its programme.

February 21, 2013: Channel 4 broadcasts claims by two women alleging Lord Rennard touched them inappropriately.

Alison Smith, a Lib Dem activist who is now an Oxford University lecturer, said she spoke to chief whip Paul Burstow and Jo Swinson, party spokesman for women and equality, but that no action was taken.

Lord Rennard, who resigned as party president in 2009 due to ill health, says he is "deeply shocked" by the allegations which he "strongly disputes".

The party insists Nick Clegg first knew of the allegations when it was approached by Channel 4 about the planned broadcast.

February 22, 2013: A new report on Channel 4 News says more women have come forward with similar stories about the peer.

February 23, 2013: Lib Dem president Tim Farron says he is "sure" Mr Clegg did not know about the claims.

February 24, 2013: Pressure grows on Mr Clegg after the Mail on Sunday reports a Facebook exchange from January 2009 in which one party worker wrote: "I just don't know how Nick can know and not do anything."

A Lib Dem spokesman repeats: "Nick Clegg only knew of these allegations when we were contacted by Channel 4 News."

Speaking on the BBC's Andrew Marr show in the morning, Business Secretary Vince Cable also denies that he or Mr Clegg knew about the allegations before the Channel 4 report.

In the evening, Mr Clegg - back from a family holiday in Spain - issues a dramatic clarification, admitting he had known about the rumours for five years.

But he says: "I would like to make one thing crystal clear. I did not know about these allegations until Channel 4 informed the party of them shortly before they were broadcast."

February 25, 2013: Mr Clegg insists he has "nothing to hide" about how the case was handled. "Until last week, no very specific allegations were put to me," he says.

Lib Dem President Tim Farron admits the party has "screwed this up". "There are individuals out there who we had a duty of care towards and we did not fulfil that duty of care," he says.

Scotland Yard announces it is investigating "whether or not criminal activity has taken place" following the allegations against Lord Rennard.

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Lord Rennard Concerns: Nick Clegg Knew

By Sophy Ridge, Political Correspondent

Lib Dem leader Nick Clegg has admitted that he knew of concerns over Lord Rennard's behaviour more than four years ago.

Several women have accused the party's former chief executive of inappropriately touching and propositioning female party workers, which he strenuously denies.

In a statement this evening, Mr Clegg said he did not know about the allegations, but admitted that his office was aware of "indirect and non-specific" concerns about Lord Rennard's conduct in 2008.

He said: "I am angry and outraged at the suggestion that I would not have acted if these allegations had been put to me. Indeed, when indirect and non-specific concerns about Chris Rennard's conduct reached my office in 2008, we acted to deal with them.

Lord Rennard strenuously denies the claims

"My chief of staff at the time, Danny Alexander, put these concerns to Chris Rennard and warned him that any such behaviour was wholly unacceptable.

"Chris Rennard categorically denied that he had behaved inappropriately and he continues to do so. He subsequently resigned as chief executive on health grounds."

Lib Dem President Tim Farron, who is conducting a review into the way the party dealt with the allegations, conceded the party may have failed to deal with the claims when they were first made.

He told Sky News: "The issue that's been made very clear this last few days is that not only were a number of women potentially victims in this appalling set of circumstances. but also potentially they raised their concerns with people within the party - some of them at a reasonably high level - and they may have made those concerns known to people and that they weren't acted upon."

Mr Clegg said Danny Alexander put the concerns to Lord Rennard

"My guess is that the party has indeed let itself down in the past and not dealt with these complaints when they were put."

Earlier, aides had said the Deputy Prime Minister only learned about the specific complaints being made against Lord Rennard following a Channel 4 News report earlier in the week.

The women claim they reported Lord Rennard's alleged behaviour to senior party officials at the time, but no further action was taken.

The peer was a key party strategist and adviser to a succession of Liberal Democrat leaders before standing down due to ill health in 2009.

He said he was "deeply shocked" by the allegations, which he "strongly disputes" and regards as a "total distortion" of his character.

Lib Dem MP Vince Cable said: "It's obviously wrong if there are women there who have made complaints and felt they weren't dealt with properly, so we are now setting up a proper investigative process - we want an independent element to that - and we'll get to the bottom of it."

He was asked on the BBC's Andrew Marr Show whether he knew about the Lord Rennard allegations prior to the Channel 4 programme, and replied: "Absolutely not."

Former Lib Dem head of press Mark Littlewood said: "Nick Clegg is definitely going to have to outline and spell out in exact detail what he knew and when and what actions he took."

Journalist Michael White told Sky News: "I've never heard any of these rumours about Rennard, and I've known him slightly for years."

Labour's shadow minister for equalities and women, Kate Green, said the statement raised more questions than answers.

She said: "After days of total denials - some only hours ago from Lib Dem MPs Vince Cable and Jeremy Brown - Nick Clegg has now been forced to admit that he did know of what he calls 'indirect concerns' about Lord Rennard in his role Chief Executive of the Liberal Democrats.

"Nick Clegg's statement raises more questions than it answers about his judgement and the willingness of the Liberal Democrats as a party to properly investigate such serious allegations at the time they were made.

"At issue is not just a series of serious allegations from a number of women, but how the Liberal Democrat Party responded to those allegations.

"Only with a fully independent investigation can the public have confidence that the truth will prevail and lessons learned for the future."

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Oscars: Winners Crowned In Hollywood

The 85th Academy Awards are taking place in Hollywood where Steven Spielberg's Lincoln is going to head-to-head with Ben Affleck's Argo for best picture.

Christoph Waltz won the first award at the Dolby Theatre for his role in Django Unchained.

In a choked voice, Waltz offered thanks to his character and "to his creator and the creator of his awe-inspiring world, Quentin Tarantino".

It is the second time in three years he has won the category - his first Oscar was for his role in Tarantino's Inglourious Basterds.

Waltz beat off stiff competition from Alan Arkin, Robert De Niro, Philip Seymour Hoffman and Tommy Lee Jones.

Brave, the story of a rebellious, red-headed princess, won the Oscar for best animated feature.

Amour, the French-language film about an elderly couple won best foreign language film. One of its stars Emmanuelle Riva, 86, is the oldest woman to ever be nominated for best actress.

Shirley Bassey wowed the audience in the theatre

And there was a strong start for British talent with Jacqueline Durran winning for her costume design on Anna Karenina and the makeup and hairstyling award went to Lisa Westcott and Julie Dartnell for Les Miserables.

Other British hopes largely lie with Daniel Day-Lewis who is hot favourite to complete an historic hat-trick.

The actor is nominated for best actor for his performance in US historical drama Lincoln - his fifth nomination in the category which he has already won twice - in 1989 for My Left Foot and in 2007 for There Will be Blood.

Halle Berry - a one-time Bond girl - introduced a tribute to the Bond films and music made up of classic clips of 007's adventures. And 76-year-old Dame Shirley Bassey took to the stage to sing Goldfinger which received a standing ovation.

Spielberg's presidential drama has the most nominations this year, with 12, but Iran hostage crisis drama Argo is bidding to win the coveted best picture statuette after taking a string of pre-Oscar award show prizes.

This year's ceremony is being hosted by Family Guy creator Seth MacFarlane who started the show with a joke about Affleck, who was nominated for best film but failed to win a best director nomination, quipping that he was "unknown to the Academy".

William Shatner made a guest appearance as his Star Trek character Captain James Kirk, appearing on a giant screen above the stage during MacFarlane's monologue, saying he came back in time to stop the host from ruining the Oscars.

Earlier scores of A-list celebrities posed on the red carpet in front of the world's cameras as the biggest night of the film industry's calendar got under way.

Adele, who is nominated for her Bond theme Skyfall, posed for photographers along with stars including best actress nominee Jessica Chastain, Les Miserables star Eddie Redmayne and Charlize Theron.

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AAA Credit Rating Lost: Osborne Defiant

George Osborne has come under attack over what Labour calls his "catastrophic economic policy failure" after the UK lost its top-grade AAA credit rating.

International agency Moody's downgraded it by one notch to AA1, citing slow growth and a rising debt burden.

The Chancellor said the coalition would not "run away" from its economic problems and it was determined to stick by its plan for recovery.

The downgrade is a major blow for Mr Osborne, who has been coming under increasing pressure to take action to stimulate the economy.

In the last election, Mr Osborne made safeguarding Britain's credit rating one of his key pledges.

He has used maintaining the rating for government bonds as one of the main arguments for the Government's austerity programme.

The Chancellor insisted the Government was delivering on its commitment to tackle the UK's debt.

He said: "We have a stark reminder of the debt problems facing our country - and the clearest possible warning to anyone who thinks we can run away from dealing with those problems.

"We are not going to run away from our problems, we are going to overcome them."

He added: "In the end, the test of our credibility as a country is there every day in the markets when we borrow money on behalf of this country from investors all around the world.

Moody's said it did not expect Britain's slow recovery to change

"At the moment we can do that very cheaply with very low interest rates precisely because people have confidence that we have got a plan, we've got to stick to that plan and we are going to deliver that plan."

Labour's shadow chancellor Ed Balls told Sky News: "They (the Government) are paying the price for an absolute catastrophic failure of economic policy and everybody can see that now pretty much other than the chancellor and the prime minister.

"Until they face up to reality, we're just going to have more of the same."

Moody's said Britain's recovery was proving to be significantly slower than previous rebounds from recession and it did not expect the situation to change.

"(There's) increasing clarity that, despite considerable structural economic strengths, the UK's economic growth will remain sluggish over the next few years," it said.

Moody's is the first of the major credit rating agencies to knock the UK off of its top rating.

The ratings agency also cut the Bank of England's AAA rating by one notch, also to AA1. The US' top credit rating was downgraded by one notch in 2011.

Sky's Economics Editor Ed Conway said: "The fact that Britain has lost its AAA crown for the first time since credit ratings were given to the UK back in the 1970s, is a really big blow to Britain's reputation.

"It's something of an economic blow, but in a way it's more of a political problem for George Osborne. He made a key part of the Conservative election pledge to safeguard Britain's credit rating."

Moody's said that the British economy is constrained both by the troubled global economy and the drag from businesses and the Government slashing its debt burdens.

"Moreover, while the Government's recent Funding for Lending Scheme has the potential to support a surge in growth, Moody's believes the risks to the growth outlook remain skewed to the downside," it said.

Labour has insisted that withdrawing demand from the economy has put it more at risk by stunting growth.

Mr Balls said: "This credit rating downgrade is a humiliating blow to a prime minister and chancellor who said keeping our AAA rating was the test of their economic and political credibility.

"In the Budget the government must urgently take action to kick-start our flatlining economy and realise that we need growth to get the deficit down. If David Cameron and George Osborne fail to do so and put political pride above the national economic interest we face more long-term damage and pain for businesses and families."

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Pistorius: Oscar 'Will Never Be The Same'

Oscar Pistorius says he just wants to "be alone" since his release on bail and is feeling "a lot of remorse" over the death of his girlfriend Reeva Steenkamp.

The Olympic athlete is staying at his uncle's home in Pretoria after a court banned him from returning to the luxury home where he shot Ms Steenkamp through a bathroom door.

His spokeswoman in South Africa told Sky News: "He told me, 'I just want this time to be alone'. He is in his room, he's spending time alone and he's feeling a lot of remorse."

Barry Steenkamp, left, at his daughter's funeral

The athlete's family has also released a new statement, saying: "Oscar will never be the same ... having to live with the knowledge that he caused the death of the woman he loved, and that he can never undo the immense pain and loss this has caused Reeva's family and friends".

His uncle Arnold added: "We are acutely aware of the fact that this is only the beginning of a long road to prove that, as we know, Oscar never intended to harm Reeva, let alone cause her death."

Pistorius, 26, is accused of premeditated murder after the Valentine's Day shooting. He denies murder.

Lawyers for the defence and prosecution are starting work on the trial phase of a case that is likely to grip South Africa and the world, with the next hearing set for June 4.

The athlete arrived at his uncle's house on Friday after paying 10% of his one million rand (£73,000) bail at Pretoria's Brooklyn police station, where he had been held for a week.

Ms Steenkamp was killed on Valentine's Day

Meanwhile, Ms Steenkamp's father has told a South African newspaper that Pistorius will "suffer" if he is lying about how she died.

The Beeld newspaper quotes Barry Steenkamp as saying Pistorius will have to "live with his conscience" if his assertion that he accidentally shot the 29-year-old law graduate is false.

He said: "There are only two people who really know what happened and it's Oscar Pistorius and the Lord.

"It does not matter how much money he has and how good his legal team is, he must live with his conscience if he let his lawyers tell lies on his behalf.

"He will have to live with his conscience. But if he speaks the truth, I can perhaps someday forgive him."

Pistorius is staying with his uncle Arnold

Horse trainer Mr Steenkamp said he might be able to forgive Pistorius one day if the double-amputee Olympian is telling the truth.

Her mother said that Pistorius' family had sent a card and flowers offering condolences for the death of her daughter but she added it meant little because: "They are not to blame."

However, her uncle Mike Steenkamp said the timing of the family's actions was poor and that they had not initially tried to contact Reeva's bereaved parents.

Chief magistrate Desmond Nair approved bail for Pistorius on Friday at the end of a two-hour summary in which he found the accused was unlikely to skip bail, be violent or approach any witnesses.

Nair said he had been influenced by Pistorius' decision to submit a detailed affidavit, in which he claimed he accidentally shot Ms Steenkamp through the bathroom door at his home in the east of Pretoria, thinking she was an intruder.

Under his bail conditions Pistorius must surrender any firearms and his passport and can not enter any international departure hall.

He is also is banned from using any prohibited substance or alcohol and must report to police twice a week as part of his bail conditions.

:: It has also emerged that the Twitter account of Pistorius' brother, Carl, was hacked and a false message, purporting to be from the sprinter and thanking supporters, was posted.

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