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George Osborne has imposed austerity measures on every family in Britain after announcing a £40bn package of emergency tax increases, welfare cuts and Whitehall spending restraint designed to slash the budget deficit by the end of the parliament.

The chancellor said the "unavoidable budget" required a VAT rise from 17.5% to 20% next January, higher capital gains tax, a levy on banks, a two-year public sector pay freeze and less generous benefits, but insisted the package was needed to prevent the financial markets from turning on Britain.

In his debut budget speech, Osborne pleased the ratings agencies and the Organisation for Economic Co-operation and Development by intensifying the £73bn squeeze already planned by the last Labour government. But he signalled a second dose of gloom in October, when a three-year comprehensive spending review will spell out the size of the cuts for individual government departments.

Osborne warned today that ring-fencing the NHS and international development meant non-protected departments would face average real cuts of 25% but that some clemency would be shown to education and defence.

The Treasury will raise more than £12bn from the increase in VAT, but the chancellor sought to soften the blow from the toughest budget in modern times by raising personal allowances by £1,000, linking pensions to earnings and raising child credits for the next two years.

He said a four-year phased cut in corporation tax would help the private sector become the engine of growth, and the economy would have to rely more heavily on investment and exports over the coming years.

Seeking to pin the blame for the tough measures on Gordon Brown, the chancellor said: "Today we have paid the debts of a failed past. And laid the foundations for a more prosperous future. The richest paying the most and the vulnerable protected. That is our approach. Prosperity for all. That is our goal."

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LOS ANGELES – Erin Jacobs once traded her brand new bicycle for tickets to see Michael Jackson. Now, more than 25 years later, it’s her time, organizational skills and gas money that she’s giving to the King of Pop.

As an organizer of two major fan groups, Jacobs is just one of thousands of supporters keeping Jackson’s legacy alive — along with the pursuit of justice for his untimely death a year ago this Friday.

Since then, the singer’s notoriously loyal followers have traded vigils at the hospital and family home for pilgrimages to his tomb and protests at the courthouse where the doctor charged with killing Jackson will be tried.

"It’s absolutely humbling that he has so much support from fans," Jacobs said in a recent interview.

A travel agent who lives in Yorba Linda, California, Jacobs made her first 50-mile (80- kilometer) trip to the Forest Lawn cemetery in Glendale, California, shortly after Jackson was buried there in September. It was a personal trip.

These days, Jacobs has gone on to coordinate monthly pilgrimages to the cemetery by the Official Michael Jackson Fans of Southern California.

Hundreds are expected at Forest Lawn on Friday to commemorate Jackson’s death. The singer’s tomb inside the cemetery’s gothic Great Mausoleum remains closed to the public, and Friday’s memorial won’t change that.

But through the efforts of Jacobs and others, it’s become a place where Jackson’s international fan base comes to grieve. Many who can’t make it in person send letters, poems, artwork and other gifts so that Jacobs and others can deliver them to the cemetery, where they are placed at the singer’s tomb until new items arrive.

"A year later, it feels like it was yesterday," Jacobs said.

Another focal point for Jackson fans has become the downtown Los Angeles courthouse where Dr. Conrad Murray will be tried on an involuntary manslaughter charge for Jackson’s death.

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VIENNA – Long a thorn in the Vatican’s side, Austrian Catholics have ramped up their quest for a more liberal church in the wake of the global clerical sex abuse scandal.

And while much of the push for change comes from the grassroots, the country’s powerful cardinal recently caused a stir with strong gestures in support of reform, raising the stakes in the confrontation between the Vatican and dissidents pushing to allow priests to marry and women to be ordained.

What is particularly troubling for Rome is that Austria — historically a major symbol of Catholicism in Europe and a bulwark against the Protestant Reformation — is losing worshippers in record numbers as calls for reform grow stronger.

Tens of thousands of Austrian Catholics — many of whom still consider themselves devout believers — are leaving the church each year, disgusted by the priestly sex abuse scandal and frustrated by what they see as the Catholic hierarchy’s outdated ways.

For 76-year-old Erwin Bundschuh, who left the church about six weeks ago, the main problem today is an ivory tower mentality that rejects dialogue and cuts itself off from the realities of the modern day.

"You can’t redesign a religious community every day but you also can’t pretend as if nothing has happened in 2,000 years," said Bundschuh as he strolled past Vienna’s famous St. Stephen’s Cathedral. "There should be an open dialogue about certain things but it’s always choked off."

Earlier this week, the head of the Vienna archdiocese’s church tax office estimated that up to 80,000 of Austria’s roughly 5.5 million Catholics could leave the church this year — a new record. Last year alone, 53,216 people formally had their names removed from church registries, a 31 percent increase compared to 40,654 in 2008.

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MOSCOW – Oil prices fell below $78 a barrel Wednesday as downbeat economic data from Europe and a drop in U.S. crude supplies suggest a recovery in demand is likely to remain uneven.

Benchmark crude for August delivery was down 37 cents to $77.48 Wednesday morning in London in electronic trading on the New York Mercantile Exchange. The contract gained 76 cents to settle at $77.85 on Tuesday.

The drop in oil prices mirrored losses in stocks. Britain’s FTSE 100 was down 0.6 percent in London after the Dow Jones industrial average closed 1.4 percent lower overnight.

The euro remained around Tuesday’s values, near $1.2280 on Wednesday morning.

Crude has hovered above $77 a barrel this week as traders ponder whether global oil demand is strong enough to justify extending a rally from $64 on May 25. U.S. oil supplies had fallen in recent weeks before last week’s gain.

Analysts noted that the weak euro and grim economic statistics are making it difficult to sustain a four-week rally in oil prices.

"Most of the data released over the last two or three weeks has not been consistent with the idea of a gathering economic recovery," Cameron Hanover said in a note.

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Just three years ago, Apple wasn’t in the mobile-phone business at all. Since then, its game-changing iPhone has become the most influential smartphone in the world. Now, on June 24, the company will roll out the fourth generation of the device, called the iPhone 4.

While attractive, capable new smartphones emerge regularly from competitors, a new iPhone deserves special attention for two reasons. First, the device lies at the center of a huge ecosystem of 225,000 apps, plus popular related gadgets like Apple’s iPod Touch connected media player and iPad tablet, which collectively are approaching 100 million units sold. Second, the iPhone’s multitouch, gesture-based interface; elegant Web browser; sophisticated music and video playback; and other features have been emulated on many competing devices, so what Apple does affects the whole industry.

I’ve been testing the iPhone 4 for more than a week. In both hardware and software, it is a major leap over its already-excellent predecessor, the iPhone 3GS.

It has some downsides and limitations—most important, the overwhelmed AT&T network in the U.S., which, in my tests, the new phone handled sometimes better and, unfortunately, sometimes worse than its predecessor. I’ll get into that below. But, overall, Apple (AAPL) has delivered a big, well-designed update that, in my view, keeps it in the lead in the smartphone wars.

The iPhone 4 is a dramatic redesign. It manages to pack a radically sharper screen; a second, front-facing camera; a larger battery; a better rear camera with flash; and a faster processor into a body that is 24% thinner, a bit narrower, and retains the same length and weight as its predecessor’s. In fact, Apple claims that the iPhone 4 is the world’s thinnest smartphone and sports the world’s highest-resolution smartphone screen.

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Israeli commandos have attacked a flotilla of aid-carrying ships off the coast of the Gaza Strip, killing up to 10 people on board.

Dozens of others were injured when troops raided the convoy of six ships, dubbed the Freedom Flotilla, early on Monday.

Israel said activists on board attacked its commandos as they boarded the ships, while the flotilla’s organisers said the Israeli forces opened fire first, as soon as they stormed the convoy.

Binyamin Netanyahu, the Israeli prime minister, gave his "full backing" to the military forces after the raid.

The raid by Israel troops "was to prevent the infiltration of thousands of rockets, missiles and other arms that could hit our cities, communities or people," he said.

"I give my complete backing to the army, the soldiers and commanders who acted to defend the state and to protect their lives."

He also said Israel regretted the loss of life in the raid.

Israeli media reported that many of the dead were Turkish nationals.

Organisers of the Freedom Flotilla say it was carrying 700 activists and 10,000 tonnes of humanitarian aid with the aim of breaking the Israeli siege of Gaza.

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VENICE, La. (Reuters) – Oil from BP’s out-of-control Gulf of Mexico oil spill could threaten the Mississippi and Alabama coasts this week, U.S. forecasters said on Monday, as public anger surged over the nation’s worst environmental disaster.

U.S. government and BP officials are warning that the blown-out deepwater well feeding the catastrophic spill may not be shut off until August as the company begins preparations on a new but uncertain attempt to contain the leaking crude.

The disaster, in its 42nd day on Monday, is already the largest oil spill in U.S. history and officials are treating it it as the country’s biggest environmental catastrophe.

Although Louisiana’s wetlands and fishing grounds have been the worst hit so far by the spill, the National Oceanic and Atmospheric Administration said moderate southerly and southwesterly winds this week may start moving oil closer to the Mississippi Delta.

"Model results indicate that oil may move north to threaten the barrier islands off Mississippi and Alabama later in the forecast period," NOAA said in its 72-hour prediction on the expected trajectory of the huge oil slick.

INSIDER TV: http://link.reuters.com/wuw64k

Graphic: http://link.reuters.com/neh56k

Mississippi and Alabama have escaped lightly so far, with only scattered tar balls and "oil debris" reaching its coasts.

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This historic sea-town is the first port-of-call for anyone interested in Malay culture and cuisine. It epitomises Malaysia’s multi-cultural history. Not only does it display the country’s more common Islamic, Chinese and Indian influences, it also harbours a rich European history too.

Why go?: Over the centuries Malacca (Melaka in Malay) has been colonised by the Portuguese, Dutch and British and there is plenty of evidence of its chequered past. Its strong historical importance has earned Melaka UNESCO World Heritage status and its small size makes it easy to navigate the shaded alleys and passageways by foot or trishaw.

The colonial heart of the city is situated on the east side of the Melaka river (Sungai Melaka) and boasts ruins of the old Portuguese fort ‘Porta de Santiago’ and St Paul’s Church. St Paul’s Hill provides great views over the city. The town square offers reminders of Melaka’s Dutch past and the old Stadhuys (Town Hall) and Christ Church look like a small slice of Amsterdam.

It’s not all ruins and architecture though. Visitors can also fill up on some renowned local cuisine called Nyonya, which is hard to find anywhere else. It’s a fragrant fusion of Chinese and Malay cooking that was formed over centuries of mixed marriages in this area.

Top tip: A 15 minute walk to Kampung Morten in the north of the city is worth an evening visit. A stroll along the riverside boardwalk provides views of traditional Melakan fisherman’s homes and some interesting river wildlife, including monitor lizards and the bizarre mudskipper fish. The whole area is also beautifully lit up at night.

Price: The Porta de Santiago and St Paul’s churches are free. Entrance to the Stadhuys is RM5.00

Getting there: It’s a two hour drive south from Kuala Lumpur down the North-South expressway, or there are half-hourly buses from Puduraya bus station for RM12.30 one-way. There are also a lot of tour operators that organise day trips to Melaka from around RM120.

Read more: Top 5 day trips from Kuala Lumpur | CNNGo.com

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(Wired) — For its next Apple TV, Apple may ditch the set-top box form factor and instead cram a media player into a tiny device running the iPhone OS, according to Engadget.

The blog cites an anonymous tipster who claims the next Apple TV has been described as "an iPhone without a screen," containing only two ports — the power socket and the video-out — and the same internal architecture as an iPhone (A4 CPU).

The next Apple TV is also rumored to feature 16GB of Flash storage and support for 1080P HD.

The device will cost only $100, according to the tipster — significantly lower than the current $230 system. Engadget did not provide a time frame of when to expect the device.

Most interestingly, Engadget claims the device will have a strong focus on cloud-based media, meaning most video you view will be streamed from the internet.

That’s plausible, given that Apple is building a gigantic data center and the company recently acquired streaming-music service Lala. Some sources have also said that Apple is planning to reboot iTunes into a streaming media center.

Read More on CNN.com

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(PEOPLE.com) — For Celine Dion, the sixth time was the charm, but her hope to expand her family was an arduous year-long journey.

"I feel like I’ve been pregnant more than a year," Dion, 42, whose previous IVF attempts had failed, told the French-language Le Journal de Montreal. "I never gave up. But I can tell you that it was physically and emotionally exhausting."

"Everyone knows that Celine has guts and is determined," adds husband, René Angelil. "These treatments were truly hard on my wife’s body. It wasn’t simple at all."

But the perseverance paid off when the couple found out they are expecting twins. "There were truly great emotions after all our efforts," says the singer.

Those efforts included traveling from her Florida home to New York for months of treatments and also turning to acupuncture from a Montreal-based specialist.

"My doctors had to constantly reassure me. I [wanted] to see the babies," she says. "Each week I had sonograms. I heard their heart beats."

Read More on CNN.com

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