Papers unpalatable for Blunkett

If Home Secretary David Blunkett devours the papers with his breakfast on Wednesday he could well end up with indigestion.

Not only do they pass stern judgement on Tuesday's defeat of his anti-terrorism legislation, which ruled that nine suspects were being detained illegally, they also report on apparently major flaws on other Home Office bills.

The Independent says Tuesday's decision leaves the anti-terror legislation, rushed through after 11 September, in disarray.

While The Mirror says the government was warned the legislation was full of holes and is learning the hard way it cannot break the law.

In its editorial, The Independent says being condemned for breaches of human rights is becoming an occupational hazard for Mr Blunkett.

Legal problems

And there are more legal problems heading the home secretary's way according to The Times and The Guardian.

The Times says he has been warned key parts of his asylum bill may fall foul of human rights laws.

Whitehall sources tell the paper he is resigned to losing small parts of the bill.

But the paper says he may also face a big rebellion in the House of Lords over some of the more contentious measures.

The Guardian reports the sweeping powers given to police and intelligence agencies to check on telephone and internet records may also be illegal.

Long-term solution

Government plans to offer teachers in England a three-year pay deal make the lead in The Times.

It says ministers will spell out the details later this week.

The Times says the move is part of a concerted effort to sign up public sector workers to pay deals that extend beyond the next election.

It says plans for similar deals with other public sector staff are also in the pipeline.

The paper notes that, in a period of growing trade union militancy, a showdown over pay in election year could be very damaging for Labour.

Money men

Money matters make the lead in The Independent and The Financial Times.

The Independent reports American tycoon Phillip Anschutz, who has taken over the Millennium Dome, has become embroiled in the latest accounting scandal to hit the United States.

It says he made a windfall of $1.5bn (£0.95bn) by selling his stock when the company of which he was chairman was exaggerating its profits.

The FT has an interview with the man seen by many as a leading contender for next governor of the Bank of England - Andrew Crockett - currently at the bank for International Settlements.

In it, he warns against a knee-jerk reaction to the turmoil in the financial markets.

Moat it be

After three years of waiting, The Mirror reveals the design it says has won the competition to be built as a memorial to Princess Diana.

And it is not a fountain, as expected, but a shallow moat, with fast-moving water on one side and a slower flow on the other.

The design was created by American landscape artist Kathryn Gustafson.

The stone oval will be built at Hyde Park in London by September next year.

The Mirror says Ms Gustafson sees it as "historic, formal, contemporary and relaxed".

But the paper feels many will wonder how such a near-anonymous monument could cost £3m.

And its royal correspondent James Whitaker fears there is just not enough "wow factor".