19/05/2014 The Papers


19/05/2014

No need to wait to see what's in the papers - tune in for a lively and informed conversation about the next day's headlines. With Clive Myrie.


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retirement. We look back on Jonny Wilkinson's fabulous career. That's

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all in Sportsday, in 15 minutes after the papers.

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Welcome to our look ahead to what the papers will be bringing us

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tomorrow. With me are the former State Department official, Colleen

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Graffy, and Jason Beattie, the political editor of the Mirror.

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Let's look at some of the front pages now. We start with the

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Independent, it warns that millions of householders could become what it

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calls mortgage prisoners, if interest rates start going up. The

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Metro carries the story of a man who discovered his critically ill wife

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was still alive three days after he'd agreed to have her life support

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switched off. The mistake was only revealed when he phoned the hospital

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to arrange her funeral. The Express ` scientists say that

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short high`intensity workouts can help prevent diabetes.

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The Guardian ` it claims that Pfizer is giving up on the planned takeover

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of AstraZeneca after the latest bid was rejected.

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The telegraph ` Abu Hamza found guilty in an American court of

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terrorism charges. The Daily Mail ` a test that could

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help prevent thousands of heart attacks a year will be rolled out

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across the NHS in the next few months.

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We start with the Independent. Millions face become mortgage

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prisoners. We're all mortgage slaves, now we're going to be

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prisoners. Yes. It's quite dangerous. This is a report by a

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think`tank called the Iran resolution Foundation. It was set up

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specifically `` called the Resolution Foundation. There are

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alarming figures. A small interest rate rise could hurt 700,000 people.

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They could be in severe financial trouble. Interest from 0. 5% to 3%

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could affect one in four of all mortgage holders, about 2. 2 million

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people. Why is this important? It's the pain and worry it will cause

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anybody who has a mortgage. A lot of them got it on low equity. And

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there's a political headache as well. We're coming up to an

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election. If this happens before an election, that's awkward for George

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Osborne. Now the pressure is on Bank of England governor, Mark Carney. He

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has to make that decision. Now it's a highly charged political decision.

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Mark Carney has made it clear, at some point, when the economy

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normalises interest rates will go up. He can't say when. He made the

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point that when they do go up, they will go up slowly, and reach nowhere

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near the levels they were before the crash. That's right. We're getting

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mixed messages about this. One day we'll be told that interest rates

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will not be rising, then the have a headline like this. A word to the

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wise is sufficient. To be looking at how you can be paying down your

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mortgage, more from interest only mortgage into one that's fixed. Even

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though it will be more expensive, now might be the time to do. It I'm

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talking to myself as well here. I thought so. I'm grateful for

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financial advice. Give us more. We all know it's coming. It's comfort

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being to know it's not going to be as high as once `` as it once was.

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When it will happen and being prepared is important. It's like

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quantitative easing in the United States, they just got so used to it

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happening, all this cheap, free money, but at some point, the music

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has to stop when you have to find a seat to sit down on. It's the same

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here. Interest rates have been low for a long time. Have. The other

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thing here, why were people allowed to get mortgages with such low

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levels of equity? We have much lower rates in London than in Scotland or

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Northern Ireland. It's something like 35% equity in Northern Ireland

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compared with as low or 5% or 2% here. We were creating a subprime

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market when we said we would not let it happen again. But how do people

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get into the housing market, so they can afford the payments, even at a

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fixed rate, but they can't afford, if they can't get four times their

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salary they're not going to get anything. It's a double bind for

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everyone. Going to the business section of the Telegraph, US accuses

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China of spying on metal groups and the US Attorney`General has laid

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charges against some Chinese military officials for stealing US

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business secrets. This is a big story. We've known it for some time

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in the United States that the Chinese have been stealing secrets.

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China has been put on notice behind closed doors, subtly, out of public

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view, saying this has to stop. The Chinese have insisted on saying that

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it's not happening, that they want evidence that this is happening. So

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now, a firm has gotten specific evidence that these five individuals

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in particular, who were named, with the military, out of a union nit

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Shanghai have been responsible `` unit in Shanghai have been

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responsible for hacking US steel, nuclear, aluminium, and so this,

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well, this has repercussions for the UK. One of the companies was westing

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house. They were involved with the nuclear reactors, I think three of

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them are in Cumbria, the project by New Generation. What information do

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the kienees have about this nuclear reactor ` Chinese. This could be a

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security issue. The Attorney`General's office that has

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laid out the charges. You used to work in the State Department. This

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is a headache for you guys. You are the international arm of American

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foreign policy. You guys have got to deal with the Chinese on a

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day`to`day basis. Oh, yes. How will this affect that relationship?

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Chiepees foreign `` Chinese Foreign Minister says it's a pack of lies,

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there's no evidence of this and that it's going to hurt some of our

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projects we're working on, cyber security, for example, and one of

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the things you have to do is just take the heat. It's so important for

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American and global business that you don't have these secrets stolen

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by governments and therefore, pulling the rug out from competition

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and the market that you just have to take the heat on the diplomacy side.

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I suspect the Chinese would say one, we didn't do this any way, so these

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are all allegations. They would say that, wouldn't they? Secondly, they

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probably will say that everyone's doing it. Yes, interestingly,

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although what's interesting is that the Americans have named and shamed,

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British Secret Service have been sound is the alarm bell on this

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issue for a long time. There are known cases of the Chinese trying to

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hack in or successfully hacking into British firms to steal intellectual

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property rights. When David Cameron was in China in December, it was

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raised there. There were kerbs about `` concerns about tie`ups with

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Chinese firms and whether this telecoms company would then, by

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using Chinese technology, would gain British companies and British

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institutions. There is a wider issue. This is platant what they're

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doing. They may `` blatant, they may deny it. They're very etents. It's

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the military, so it's efficient. They're doing this with businesses.

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Are they doing it with military hardware. Is this going to lay the

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ground for cyber technology? We have become more open. The risks are

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higher. The big industry in the United States were trying to move

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into non`fossil fuels, one of the companies was a solar company. They

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were constantly getting under cut with the pricing from Chinese

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companies. Now they've learned it's because they had all the information

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about what their pricing strategy was. So it's really caused some

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difficulty for that industry in the United States. The Chinese would

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also say famously, the Obama White House has decided in foreign policy

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terms to pivot towards Asia. As a result, try to hem in the Chinese.

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Obama went to Asia, not to Beijing, he went to all the other countries

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and we know that there are territorial disputes reason Asia.

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This is all part of trying to keep the Chinese down. I think that might

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be what they say. What it's really about is that they have a huge

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population that is trying to have a rising standard of living. They have

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got to have an increase in their GDP. The only way of doing that is

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stealing secrets, keeping ahead of industry of all the other countries

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so that they can accommodate all of this rising demand. That's what it's

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really about. They don't do that, they have civil unrest, they have

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issues, sectarian, religious, environmental. Need growth rates of

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8% just to stand still. Exactly. Let's go on to the Guardian. Pfizer

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pulls out of Astra battle. US drugs giant walks away from bid rejected

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and billions wiped off AstraZeneca's share price today. One way of

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looking at this, this was like two dinosaurs trying to mate. It was

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going to be unsuccessful whatever happened. I don't like the optics on

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that one. They're both firms which are wholly reliant on the patent

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business with the drugs they produce. The patents are expiring.

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Therefore this merger was predicated on two things that Britain had a low

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tax base. Pfizer wanted to save some money and it could then move in on

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the Astra's research and development, was left of it, snap up

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the atents. Actually the real `` patents. The work in pharmaceuticals

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is done on a smaller level. That's where the big development is taking

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place. It would be better if they'd spent this money on actually

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encouraging more research or micro esearch rather than these huge

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aggressive takeovers. Some Americans are always welcome over here! UK

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Government has specifically put in this incentive of lower tax so that

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this kind of thing would happen. Pfizer made a very lucrative offer

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and there is a patent box that the Government put in place, meaning a

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10% tax value means they have to have all the management of the

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patents and the work done within the United Kingdom for exactly that

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reason, to protect research and development, that it is managed and

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done here. So it is a little bit inappropriate to say that we want to

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bring new business into the United Kingdom with tax incentives and then

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start going, oh, we like science. This is a slap in the face of the

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George Osborne's ideal of the economy. He is trying to turn us

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into a tax haven and an extraordinary free market economy.

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This whole proposed merger throughout all those issues. A low

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tax regime is not necessarily the best regime? Why is it bad?

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AstraZeneca are going to be in deep trouble if they don't increase their

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earnings and their board members and shareholders will be pretty upset.

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Why didn't we do this merger? New blood and money. Some of them are.

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So could we get a hostile take`over? Unless AstraZeneca turnaround before

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the 28th, then Pfizer needs to wait six months before making another

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offer. They went up from 53 to 55 and they are not that far away from

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58p. But 65 billion off the stock market? That is the requirement of

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the Government, that research and development has to be managed. That

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is an interesting point because there was talk about research and

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development jobs going but the bottom line today was a did not

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offer enough cash. If they had, AstraZeneca did not really care. I

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am putting words into their mouths now, but the suggestion was it was

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all about money fundamentally. Getting a higher share. We will

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continue this later. I did not even get to do my work`out! OK, you guys

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will be back in an hour for another look at the stories behind the

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headlines. Many thanks for that. Stay with us on BBC News because at

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the top of the hour we will be live in New York, where the radical

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Islamist cleric Abu Hamza faces a possible life sentence after being

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convicted of terrorism charges. Now it is time the Sportsday.

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No need to wait to see what's in the papers - tune in for a lively and informed conversation about the next day's headlines. With Clive Myrie.


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