Spain train diver facing charges

The driver of a speeding train that crashed in Spain has refused to respond to police questioning. Source: AAP

THE driver of a train that hurtled off the rails killing 78 people in Spain faces possible charges as doctors work to identify the last three victims of the country's worst rail disaster in decades.

As Spain mourned on Saturday, the city of Santiago de Compostela where the crash occurred is preparing a funeral for Monday in its cathedral, a destination for Catholic pilgrims from around the world.

Police have accused the driver, identified by media as Francisco Jose Garzon Amo, 52, of "recklessness" in Wednesday night's devastating crash.

They said late on Friday that he refused to answer their questions in his hospital bed and the case has been passed to the courts.

The train was said to have been travelling at more than twice the speed limit when it hurtled off the rails and slammed into a concrete wall, with one carriage leaping up onto a siding.

Smoke billowed from the gutted cars as bodies were strewn across the tracks. Locals said they came running from their houses to drag passengers from the wreckage.

The grey-haired driver, who reportedly boasted of his love for speed online, was under police surveillance in hospital, said Jaime Iglesias, police chief in the northwestern Galicia region.

The driver faces criminal accusations including "recklessness", Iglesias told a news conference, but has not yet been charged.

A police spokesman later said the driver had refused to respond to police questioning on Friday and the courts would now decide on judicial action.

Spanish media published photographs of the man they identified as Garzon after the crash, with blood covering the right side of his face.

Leading Spanish newspaper El Pais said the driver of the train had been unable to brake in time.

Seventy-eight passengers perished, three of whom have yet to be identified, and 178 were injured, regional authorities said.

Following the crash, weeping relatives waited in a conference centre in the city for news of their loved ones, attended by counsellors.

At least seven foreigners are among the dead - a US citizen, an Algerian, a Mexican, a Brazilian, a Venezuelan, an Italian and a national of the Dominican Republic, a judicial source said.

Most of the injured are Spanish, but at least eight were foreigners from Argentina, Britain, Colombia, the US and Peru.

The number of people still in hospital dropped to 81, including 28 adults and three children who were in critical condition, Galician Health Minister Rocio Mosquera said.

The driver, while still trapped in his cab, told railway officials by radio that the train had taken the curve at 190 kilometres an hour, more than double the 80 km/h speed limit on that section of track, El Pais said, citing unidentified sources in the investigation.

"I was going at 190! I hope no one died because it will weigh on my conscience," he was quoted as saying.

He has reportedly been with state rail company Renfe for 30 years, including 13 years of experience as a driver.

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1267 boat people arrived since PNG deal

More than 1000 asylum seekers are waiting on Christmas Island to be transferred to PNG. Source: AAP

THE number of asylum seekers arriving by boat since the government announced its hardline resettlement policy more than a week ago has climbed to 1267.

Home affairs Minister Jason Clare released two statements on Saturday evening revealing details of two more boats intercepted on Friday.

One had 94 passengers and two crew on board, while the other was carrying 123 passengers and two crew.

People on both vessels have been taken to Christmas Island for initial identity and health checks before they are transferred to Papua New Guinea.

A spokesman for Mr Clare confirmed a total of 1267 arrivals on 16 boats since the government introduced the new PNG policy on July 19.

Under the federal government's deal with PNG, people arriving by boat will be denied resettlement in Australia, taken to Manus Island for processing and if their refugee status is approved, resettled in PNG.

More than 1000 asylum seekers are already waiting on Christmas Island to be transferred to PNG.

Meanwhile, an independent investigation into riots that burnt down accommodation at the Nauru detention centre and allegations of asylum seekers being raped on Manus Island will be set up this week.

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Syrian forces make gains in Homs

REGIME forces backed by Hezbollah now control half of the Khaldiyeh district of Homs after ousting rebels in fierce fighting in the central Syrian city, a watchdog says.

"Loyalist forces backed by fighters from Hezbollah have advanced over the last 24 hours and now control 50 per cent of Khaldiyeh," the Syrian Observatory for Human Rights said on Saturday.

Its chief, Rami Abdel Rahman, said "there was continuous heavy mortar and artillery fire" and the rebel district was still being pounded.

He said rebels were putting up "fierce resistance" amid "very intense clashes".

Militant network the Syrian Revolution General Commission also reported heavy fighting in the district that has been besieged by regime forces for more than a year.

"Khaldiyeh is being targeted by an uninterrupted heavy bombardment, and on the ground there is fierce fighting between Free Syrian Army fighters and regime forces backed by Lebanon's Hezbollah trying to take the district," an SRGC statement said.

It and the observatory both said the Old City district of Homs - dubbed the "capital of the revolution" against President Bashar al-Assad - was being pummelled too.

The latest regime offensive on besieged rebel-held neighbourhoods of Homs is now in its fourth week.

Government forces are seeking to secure another victory like the one in Qusayr near the border with Lebanon in June, when Hezbollah was key in retaking the strategic town.

Hezbollah, the most powerful military force in Lebanon and a staunch ally of the Assad regime in Syria, has had its military wing blacklisted by the European Union as a terrorist group.

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Funeral for Tunisian opposition leader

Tunisia has marked a day of mourning after gunmen killed a leading opposition figure. Source: AAP

THOUSANDS of Tunisians have taken to the streets for the funeral of an assassinated opposition leader, as tensions soar after anti-government protests.

Draped in the red and white Tunisian flag, Mohamed Brahmi's coffin was saluted by soldiers as the cortege left his home in the Tunis neighbourhood of Ariana for El-Jellaz cemetery on Saturday.

Emotions were high as supporters of Brahmi, who included members of his family, lifted the coffin to their shoulders before carrying it away under armed escort.

A military helicopter overflew the capital as a sea of flags fluttered among the crowd waiting for the funeral procession along Mohamed V Avenue, an AFP correspondent reported.

"For our soul, with our blood, we will avenge the martyr," the crowd shouted in unison.

Brahmi, 58, was shot dead outside his home on Thursday with the same weapon used to gun down fellow opposition politician Chokri Belaid in February, Interior Minister Lotfi Ben Jeddou said.

He will be buried next to the grave of Belaid, in line with a wish he had expressed before his death.

Brahmi's state funeral was being held in the absence of any representatives of the government led by the Islamist Ennahda party.

Hours before the funeral got under way, a bomb exploded near a police post in the port of Tunis on Saturday, damaging a police jeep, the interior ministry said.

A resident said the blast, the first known attack of its kind against a military vehicle in Tunisia, slightly wounded a policeman and caused panic among some residents of La Goulette district.

The ministry said nobody was hurt.

The bombing comes a day after a general strike and an anti-government demonstration during which one person was killed.

Brahmi was an MP with the leftist and nationalist Popular Movement, but on July 7 quit the party he founded, saying it had been infiltrated by Islamists.

His widow Mbarka told AFP he would be buried next to Belaid, the leftist politician assassinated in February whose funeral was attended by tens of thousands and turned into an anti-Ennahda protest.

The families of both men have accused Ennahda of being implicated in the deaths, but the authorities said on Friday the investigation pointed to extremists with links to al-Qaeda.

The powerful General Union of Tunisian Labour, or UGTT, called Friday's general strike in protest at "terrorism, violence and murders", while national airline Tunisair and some European carriers cancelled flights to Tunis.

The state prosecutor's office said an autopsy found Brahmi had been hit by 14 bullets.

Balkis Brahmi, 19, one of Brahmi's five children, told AFP her father had been killed by two men in black on a motorbike.

"At around midday, we heard gunfire and my father crying with pain. We rushed out - my brother, mother and I - to find his body riddled with bullets at the wheel of his car parked in front of the house," she said.

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Spain train driver detained over crash

The driver of a train that derailed in Spain is being questioned after admitting to speeding. Source: AAP

SPANISH police say they have formally detained the driver of a fast-moving train that flew off the tracks, killing dozens of people, while they revised down the death toll.

"He has been detained since 8pm (on Thursday). He is accused of crimes related to the accident," said Jaime Iglesias, the chief of police in the northwestern region of Galicia where the accident happened, on Friday.

Police also said on Friday they had found 78 bodies and have been able to identify 72 of the victims.

Government officials in Galicia in northwestern Spain had earlier put the death toll from Wednesday's accident at 80.

The driver, identified by local media as Francisco Jose Garzon Amo, 52, is in hospital after the train hurtled off the tracks late on Wednesday while apparently going at twice the legal speed limit in one of Spain's worst rail disasters ever.

He was still being treated for light injuries sustained in the crash on the outskirts of the pilgrimage city of Santiago de Compostela, a police source said.

State train company Renfe said the driver was a 30-year veteran of the firm with more than a decade of train driving experience.

The train's data recording "black box" and other documents were passed over to the judge in charge of the investigation on Thursday.

Attention has so far centred on Garzon Amo, one of two drivers on the train, after media reports described him as a speed freak who once gleefully posted a picture on his Facebook page of a train speedometer showing it was travelling at 200km/h.

Below the photo he wrote the caption: "I am on the edge, I can't go faster or else I will be fined."

His Facebook page has since been taken down, but Spanish newspapers quoted another of his posts as saying: "What fun it would be to race the Guardia Civil (police) and pass them, causing their radar to blow up hehehe. What a huge fine that would be for Renfe."

The El Pais newspaper, citing sources close to the investigation, said the driver stated immediately after the crash that he had been travelling at 190km/h on a curve with a speed limit of 80km/h.

"I am going at 190! I hope no one died because it will weigh on my conscience," he reportedly told supervisors over the radio while trapped inside the cab after the eight-carriage train flew off the tracks on a curve at 8.42pm.

Dramatic video footage from a security camera showed the fast-moving train, which was travelling from Madrid to the port of Ferrol, slamming into a concrete wall at the side of the track as the engine overturned.

On Friday, the paper reported the driver was unable to brake in time.

"The railway warning systems detected that Francisco Jose Garzon Amo, the driver of the Alvia train that departed Madrid, was travelling at 190 kilometres an hour when it should not exceed 80," El Pais wrote.

"The driver acknowledged that the alarm went off in the control panel and he tried to brake but was not able to avert the tragedy," the newspaper added.

Prime Minister Mariano Rajoy, a native of the city, declared three days of national mourning after visiting the scene of the accident.

Renfe president Julio Gomez-Pomar Rodriguez told Cadena Cope radio station that it was too early to speculate about the cause of the disaster, but the Spanish secretary of state for transport, Rafael Catala, said excessive speed appeared to be the culprit.

"The tragedy that happened in Santiago de Compostela seems to be linked to excessive speed, but we are still waiting on the judicial investigation," he told radio station Cadena Ser.

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Hong Kong shares end 0.31% higher

HONG Kong shares have closed up 0.31 per cent following small gains on Wall Street and with China unveiling measures to help boost the mainland economy.

The benchmark Hang Seng Index added 67.99 points on Friday to 21,968.95 on turnover of HK$44.43 billion ($A6.24 billion).

Extending a week of quiet trade in the Chinese city, volume totalled HK$44.43, down from HK$45.33 billion on Thursday.

At the start of the week turnover was just HK$38.49 billion, the market's lowest point since September.

The slow trade has meant hope the market might push the 22,000 points barrier this week prove elusive.

"We still believe 22,000 is a kind of resistance," Steven Leung, head of institutional sales at UOB Kay Hian, told Dow Jones Newswires.

Investors, he added, were still in profit-taking mode after the index rallied more than 2 per cent on Tuesday.

Financial shares were one of the few areas that saw some gains.

Mainland bank shares closed mostly higher. China Construction Bank rose 0.4 per cent to HK$5.78 and Bank of China gained 0.3 per cent to HK$3.28.

Shares of Hong Kong insurer and index heavy AIA rose 0.4 per cent to HK$35.85 after reporting first-half results that comfortably beat expectations.

The company reported a 26 per cent jump in the value of new business, topping the 22 per cent growth expected by analysts.

Chinese shares ended down 0.51 per cent on Friday due to persistent worries over the health of the domestic economy, dealers said.

The benchmark Shanghai Composite Index fell 10.32 points to 2,010.85 on turnover of 65.5 billion yuan ($10.7 billion).

The index rose 0.91 per cent for the week on hopes for policies to boost economic growth.

"The market will likely be stuck in consolidation mode before there are signs of an economic recovery," Zheshang Securities analyst Zhang Yanbing told AFP.

A government plan to cut excess production capacity in 19 sectors hit coal producers and steel firms.

Qinghai Jinrui Mineral Development lost 4.29 per cent to 7.81 yuan while Yanzhou Coal Mining fell 2.28 per cent to 9.87 yuan.

Inner Mongolia Baotou Steel Union dropped 2.03 per cent to 3.87 yuan and Chongqing Iron & Steel shed 1.06 per cent to 2.79 yuan.

Heavyweight financial shares also fell.

Industrial Securities lost 2.01 per cent to 9.26 yuan, Agricultural Bank of China fell 1.20 per cent to 2.48 yuan and China Life Insurance slid 0.61 per cent to 13.13 yuan.

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Aussie getaways cheaper despite $A fall

Domestic travel and hotel prices have become cheaper despite a fall in the currency. Source: AAP

AUSTRALIAN holidays have become cheaper despite a sharp fall in the local currency.

Domestic travel and hotel prices dropped by four per cent during the June quarter, even as the Australian dollar fell from a peak of 105 US cents to below 92 US cents.

A weaker currency potentially encourages more overseas and local tourists to holiday within Australia, which in theory drives up accommodation costs.

Despite this, local holiday expenses posted the biggest decrease in three years, Tourism Research Australia figures show.

Meanwhile, international travel costs rose by half a per cent.

Tourism Australia (TA) managing director Andrew McEvoy says cheaper flights are stimulating competitive.

"Campaigns and offers being run by the airlines and travel operators are helping to drive down prices and offer domestic travellers great value for money," he said.

TA has launched a campaign to encourage families considering an overseas trip to instead stay in Australia.

A recent survey of 1000 people by TA found Australians preferred local beach holidays to overseas getaways.

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Coalition would delay schools funding

The coalition says it won't change new school funding arrangements for at least a year if elected. Source: AAP

A COALITION government will let Labor's Gonski-based funding system stand for a year if it can't get legislation repealing it through parliament.

Opposition Leader Tony Abbott has written to school principals across the country explaining he has "deep reservations" over the government's new Better Schools funding model.

He said a coalition government would use the year to figure out how to "get the model right" as leaders in Western Australia and the Northern Territory continued to criticise the $15 billion plan.

WA Premier Colin Barnett emerged from a one-hour meeting with Prime Minister Kevin Rudd on Friday without a breakthrough and said the legislation was "inadequate".

He has consistently said the state would not become part of the program until concerns about control were addressed, claiming other states had been "bullied" into it.

Mr Rudd dismissed Mr Barnett's concerns as "nonsense" as he urged WA to sign up.

NT Chief Minister Adam Giles announced he had rejected the plan, which he said was "con".

He said the federal government continued to release misleading calculations based on false assumptions about how much funding Territory schools currently received.

Victoria was expected to sign up on Friday after Premier Denis Napthine revealed on Wednesday he was willing to be flexible.

But no agreement was announced.

In the letter to school principals, Mr Abbott and opposition education spokesman Christopher Pyne said if there was no national agreement on school funding in place if the coalition was elected, they would move to delay the start of the proposed model by one year.

"If Labor and the Greens use the parliament to stop our plan to delay the new model, the coalition will allow it to operate for one year (until 2015) while we work out how to get the model right," the letter states.

Though previously they have been inconsistent on the conditions under which they would keep the plan.

Mr Abbott has said all jurisdictions would have to sign up, while Mr Pyne said it needed an overwhelming majority.

But the commitment has been slammed as cruel and worthless by the union representing Australia's public school teachers.

Australian Education Union federal president Angelo Gavrielatos says the coalition's continually shifting position makes the latest commitment worthless.

"Let's be clear what this letter actually means - at best it merely delays the massive funding cuts of ripping up Gonski to 2015 instead of 2014," he said on Friday.

"What a cruel thing it would be for additional Gonski funding to flow to schools for just one year, before being ripped away from students."

So far only NSW, the ACT, South Australia and Tasmania have signed up to the $15 billion better schools plan.

Independent and Catholic schools have also endorsed it.

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Abbott lands in Tassie classroom

OPPOSITION leader Tony Abbott has been forced to defend his approach to school reforms after a Q&A with Tasmanian voters turned into a virtual classroom.

Around a third of the questions asked at the Launceston session came from teachers keen to know the fate of what were previously known as the Gonski reforms.

Mr Abbott repeated his mantra that no school would be worse off under a coalition government but expressed serious concerns about funding the renamed Better Schools Plan.

Tasmanians, teachers or not, are keen to know the fate of the extra $380 million the state recently signed up to.

"We think that there is a rather more sophisticated way forward than simply more money," Mr Abbott told the audience of around 100 in the marginal seat of Bass.

"More money is important but a lot of money has been thrown at schools over the last few years and if you look at the academic results, the international comparisons, our performance if anything has gone backwards."

Mr Abbott said $6.5 billion was needed annually to "do Gonski properly".

"I just don't know where that money is going to come from," he said.

NSW is the only Liberal state to have signed onto the reforms, which were the baby of former prime minister Julia Gillard.

Speculation has Victoria close to becoming the second coalition state to sign on but Mr Abbott is not committing to the scheme if that occurs.

"Let's wait and see what Gonski turns out to be," he said.

"At the moment there are four or five Gonskis."

A measured performance from Mr Abbott over an hour of questioning didn't stop him pointing out that more than one teacher had not not done their homework.

One accused him of remaining a climate sceptic, which he dismissed, while another said she had read about his plans for spending cuts.

"I think you've been reading the wrong material," Mr Abbott said.

Little was revealed personally, although Mr Abbott lamented the number of his daughters' parent/teacher nights and sport he had missed by being a politician.

The session did include a spirited defence of politicians - even Greens - who Mr Abbott said in the main acted in good faith and were "patriots" despite the parties' "enormous disagreements".

The forum completed northern Tasmania's day of heavyweight political battle after Prime Minister Kevin Rudd earlier visited Launceston and Devonport.

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Govt keeps mum on budget cuts

The government is not revealing budget cuts ahead of Treasurer Chris Bowen's economic statement. Source: AAP

THE federal government has refused to come clean on what areas of the budget could face the chop as Treasurer Chris Bowen puts together an economic statement ahead of the looming election.

Assistant Treasurer David Bradbury said the government's expenditure review committee was looking at a "range of options" to pay for its asylum seeker resettlement plan in Papua New Guinea.

Shadow treasurer Joe Hockey said there were suggestions the government was planning to abolish its school kids bonus - the cash payment of up to $820 to parents to help pay for school related expenses, to help fund the resettlement program.

There's also speculation the government may consider further changes to superannuation arrangements, he said.

"The Labor party is made up from A to Z of hypocrites," Mr Hockey told reporters in Sydney.

"You cannot run a budget and you cannot run an economy like this."

But Finance Minister Penny Wong said the school kids bonus is a "very important policy area".

"But I am certainly not going to be drawn ahead of the economic statement on ruling things in, or ruling things out," she told reporters in Melbourne.

Instead she launched a stinging attack on her opposition counterpart Andrew Robb.

He's questioned the relevance of Australia's top level triple-A credit rating because Lehman Brothers had the same when it succumbed to the global financial crisis in 2008.

She accused the shadow finance minister of warning investors off Australia.

"It's irresponsible, dishonest, it's damaging to confidence," she said.

Australia is one of only eight countries in the world with a triple-A rating from all three global agencies - Standard & Poor's, Fitch Ratings and Moody's Investors Service.

However, Mr Hockey believes the triple-A rating is important because since the GFC it has become more closely linked to the standing of financial institutions and directly affects the cost of borrowing.

Opposition Leader Tony Abbott said Australia's rating was due to the sustained reforms of the former Howard government and those of the Bob Hawke and Paul Keating governments.

He says it owes nothing to the spending spree of the current government.

He labelled Prime Minister Kevin Rudd Australia's "world champion, gold medal fiscal vandal".

"We cannot have a strong economy without strong and profitable private businesses and that means getting taxes down, getting regulation down and means having a government that lives within its means," he told reporters in Brisbane.

He told a small business conference he would install people with small business experience on the Board of Taxation, the Australian Competition and Consumer Commission and the Fair Work Commission.

Australian Chamber of Commerce and Industry chief executive Peter Anderson said Mr Abbott had offered a practical solution to one problem.

"It's a good plan," he said in a statement.

But he said issues such as red tape reduction, simplifying tax compliance, making it easier to employ and building better infrastructure also have to be acted upon.

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