Prime minister Lucas Papademos faces an uphill struggle to win the backing he needs to avoid a disorderly default in March

Greece's economic future hung in the balance on Sunday as the debt-laden country's technocrat prime minister, Lucas Papademos, met party leaders in a last-ditch effort to rally support for the stringent reforms Athens must enact in return for aid.

With at least one political leader in the coalition government publicly refusing to endorse the rescue package, it was far from sure whether Papademos would win the backing to keep bankruptcy at bay.

Before the meeting, the Greek finance minister, Evangelos Venizelos, described negotiations with foreign lenders as being "on a razor's edge". To avert a disorderly default Greece must secure financial support by 20 March when it faces €14.5bn (£12bn) of loan repayments.

"The moment is very crucial," Venizelos said after emerging from 12 hours of "tough" talks with officials representing the EU, the European Central Bank and the International Monetary Fund, the "troika" propping up the near-insolvent Greek economy.

"Crucial issues which concern the future of the country and the Greek people remain [unresolved]. The distance separating the procedure being completed with success from stalemate … is very small. It's a very fine line. We are on a razor's edge," he said.

A subsequent teleconference with finance ministers from the eurozone had been "very difficult", Venizelos said. "There is great impatience and great pressure not only from the three institutions that make up the troika but also from eurozone member states," he added.

In recent weeks international frustration has mounted with the country's tardiness in delivering on reforms.

Addressing reporters over the weekend, Venizelos said the "hour of truth" had come for the political leaders backing Papademos's interim national salvation government.

"We are at the point where they must decide and commit," he said.

Wage and pension cuts are at the heart of the discord.

While international creditors remain adamant that the reduction of the minimum wage and abolition of two salaries granted to workers as bonuses in the private sector are key to boosting competitiveness, the government has called the measures "a red line" across which it cannot go.

Other controversial demands include a 35% drop in supplementary pensions and the axing of 150,000 public sector jobs in organisations due to be closed down.

Greek officials have argued that the cutbacks will be self-defeating by deepening a recession that has already brought the economy to its knees. Party leaders, trade unions and employers' associations have predicted social upheaval if the measures are applied.

"If it doesn't suit us and the troika doesn't budge we will not take the package," said Giorgos Karatzaferis, who heads the populist, far-right Laos party before heading into the meeting. "We will not give in to ultimatums."

With general elections due to take place in the spring, politicians are keen not to be associated with policies that have spawned such popular opposition.

But highlighting the gravity of the moment, Jean-Claude Juncker, who chairs the eurogroup of finance ministers, voiced the possibility of default. "If we were to establish that everything has gone wrong in Greece there would be no programme and that would mean that in March they have to declare bankruptcy," he said, in comments to the German news weekly Der Spiegel.

Greek insiders confirmed that the possibility of bankruptcy loomed larger than at any other time.

"The troika is not negotiating, it's dictating," an insider said. "When you negotiate you expect both sides to move, but they're like a rock. They're basically saying it's this or default. Our sense is that they would prefer the shock of a Greek default than throwing money into a country they have come to see as a bottomless pit. The problem is the measures are so hard, so painful, that it is hard to see how all three leaders will accept them."

The National Portrait Gallery's tremendous show celebrates the unexpected moments that were ever present in the artist's work

Lucian Freud painted strange, uneasy, figures, from first to last. Maybe they were uneasy because he was painting them. There was as much violence as tenderness in his stare, and in the ways he devised to paint.

This tremendous show tracks Freud's inquisitiveness and inventiveness, his constant returns to the mystery of presence. Almost everything Freud did was a portrait of a situation or a confrontation as much as it was a body in a room, whether the body belonged to a lover, a daughter, the artist's mother, a baron, a bank robber or the Queen.

Freud was 18 in 1940 when he painted his art college tutor Cedric Morris , the earliest work in this large, though far from complete exhibition, planned in close co-operation with the artist himself during the last five years of his life.

Freud's final painting, of his pet dog and his studio assistant David Dawson, was left unfinished on the easel when Freud died last year at 88. Its incompleteness is extremely affecting.

The first of these two paintings is small, querulous and faux-naive (though it is hard to imagine Freud naive at any stage in his life), the last full of eccentric impetuosities: Dawson looks up; Freud's eye circles like a bird of prey, quartering its subject from above. The painting runs the gamut from sketchy indications of what might have been, to revised and much reworked detail. Dawson's head is an encrusted eruption of granular pustules of paint. I churn too, as I look at it.

In his very late works Freud seems to have got fixated on certain details. There is an enormous, disjunctive, variety in Ria, Naked Portrait 2006-7. Ria's head is a coarse impastoed lump, the bedcover a fastidious off-white rumpled plain, its pattern emerging and disappearing. The painting is marvellous and terrible at the same time, both exhilarating and awful. There's frailty and failure as well as richness and complexity there, which makes it all the better.

Through a sequence of larger and smaller rooms, Freud's portraiture is unpacked, in all its variety, from the thinly-painted acuteness of his 1950s work to his affecting, grand and vulnerable portraits of the performance artist Leigh Bowery, and the mountainous and magnificent Sue Tilley (Big Sue, the Benefits Supervisor). Each has a room devoted to them.

Elsewhere, however, earlier, smaller, works are hung too close together. In some rooms there are too many confrontations and painted intimacies to take in. It's going to be tough when the crowds arrive.

Neither a realist nor an expressionist – though there is as much reality as there is expression in his art – Freud depicted the psychological tensions between himself and his subjects. His paintings are full of life. There is always a palpable atmosphere, even if it is often conjured from dead time in the studio, his models' lassitude or alertness, a sense of someone waiting for those interminable sittings at their appointed hours to be over.

Freud almost always found something new, or a new way to describe, the experience of being in a room with someone else. It was usually the same room, with the same bits of furniture and piles of paint-soiled rags.

Details as much as whole paintings arrest me. So many details! The weave of a wicker chair, the paisley pattern on his mother's suit, the halo of light reflected behind a head on a leather seat, the Paddington skyline rippling in the windowpane, iridescent blue nail varnish flickering on a woman's toes.

Freud's paintings always have great and often unexpected moments, things the eye snags on. His was a process of describing sensation and presence, people and things and spaces and light, through the language of painting.

He was continually trying to find new ways to describe the familiar: clasped hands, a man's dangling cock, a cheekbone, a turn of the head. His touch is almost never dutiful or rote.

Freud would steer through a sitter's boredom, their disquiet or their flamboyance or their awkwardness, to find something new in their introspection, their nakedness. His art is wonderfully perverse, and perversity was the method by which it constantly reinvented itself.

Being Sigmund Freud's grandson did not give Lucian any particular insights into his sitters, and he disparaged familial comparisons, but like his grandfather his work was largely concerned with being alone in a room with another, delving into the silence that falls between them, analysing the ongoing situation. This exhibition is unmissable. Go more than once, if you can.

• Lucian Freud Portraits is at the National Portrait Gallery, London, from 9 February to 27 May

Rating: 5/5

Syrian opposition groups dispute number of dead but residents claim new type of artillery shell is being used against restive city

Syrian forces persisted with one of the deadliest attacks of the 11-month uprising on Sunday, pounding parts of Homs even as residents combed through rubble looking for victims of a sustained barrage over the weekend that killed dozens, if not scores of people.

Homs residents said the flashpoint area of Bab al-Amr was under sustained attack throughout the afternoon, with up to six people killed. There was also a renewed bombardment of the nearby neighbourhood of Khalidiyeh, centre on Friday night of one of the most violent assaults thus far by Bashar al-Assad's forces.

Residents were still trying to come to terms with the savage firepower aimed at their district during a six-hour barrage early on Saturday.

"We counted 300 explosions, at least, in that time," said a Bab al-Amr resident, who calls himself Omar Shakir. "There was nothing we could do for the people there, there are two regime checkpoints between us and them. And today it was our turn."

Mortars fired from an elevated area around a mile and a half away accounted for almost all of Friday nights casualties. The numbers of dead are disputed. A hospital in Homs and two Syrian opposition groups say 250-300 may have died. A third group, the Local Co-ordination Council said the toll may be 50-60. Either way, with many civilians caught up in the onslaught, including women and children, it was an offensive that marked a grim low point in the confrontation between Assad's forces and the protesters and armed deserters now ranged against him.

Residents said a new weapon was being used – possibly artillery shells, which have a distinctive whine as they approach their target. "They are very unusual sounds, the explosions," said Shakir.

"We have not heard them before in Bab al-Amr. And we have heard a lot of explosions here."

A Khalidiyeh resident, Fadi, said local people had been able to leave their homes to bury the dead and look for survivors.

"There was random shooting into civilian areas. It was indiscriminate and it went on for six hours. The smell in the streets is completely awful," he said. "The blood is everywhere and it is difficult to find all the parts of the people."

Videos posted on the internet purported to show men digging makeshift graves in which to bury unclaimed body parts.

"We were not expecting that the Syrian army would attack in this way," said Fadi of the mounting horror as Friday night's bombardment intensified. "We thought it was some kind of exaggeration that would be over soon, but the explosions kept coming and coming."

By daybreak, the small neighbourhood, which had been closed off to regime forces by the Free Syrian Army lay in partial ruins, with the roofs of numerous buildings pancaked onto the floors below. Dozens of people are still believed to be trapped, with residents having no equipment other than shovels with which to rescue them.

A hospital in a rebel-held area of Homs was also reported to have been hit with at least one mortar round , causing extensive damage to part of a ward.

The Syrian government has denied bombarding Homs and says "terrorist gangs" are responsible for the deaths. Syrian officials say some of the bodies had been kidnapped by opposition elements who had killed them in an attempt to persuade Syria's allies, Russia and China, to move against them in the UN security council.

"They are stupid to suggest that we have mortars like that," said the brother of one man linked to the Free Syria Army, which is comprised mainly of defectors carrying light weapons they used while serving in the regular military.

"Anyone who knows anything about military operations knows that mortars are fired from a fixed position (and are) easy to track by radar, or even through lenses. They can be destroyed by artillery, or helicopters within minutes. This went on for six hours."

First exit polls show Sauli Niinisto pulling well ahead of Finland's first openly gay presidential candidate Pekka Haavisto

Finland's former finance minister, Sauli Niinisto, was poised to become the country's next president on Sunday night after pulling well ahead of the first openly gay presidential candidate in Finland's history, Pekka Haavisto.

A first indication of voting from around one-third of the electorate soon after polls closed gave Niinisto, of the Conservative National Coalition party, 65.4% of the vote to 34.6% for the Green candidate. It was the first time for 30 years that Finns picked a president who was not a Social Democrat. Niinisto, 63, who was finance minister when Finland adopted the euro in 2002, was generally popular among older voters and for many represented continuity.

Haavisto, a trailblazer of Finland's environmental movement, became Europe's first government minister from a Green party when he was given the environment portfolio in 1995. He draws support from a core of young, liberal, urban voters.

The Finnish president has a largely ceremonial role with fewer powers than in previous decades, and is not directly involved in daily politics.

However, the head of state takes the lead on non-EU matters of foreign policy, is seen as an important shaper of public opinion, and plays a role as a "brand ambassador" of Finland overseas. Surveys have shown Niinisto as a clear frontrunner after beating seven others in the first round of the election on 22 January, but failing to get the required majority of more than 50% of the votes.

Experts query effect of 20 detectives based at Wapping for internal investigations into hacking and payments to police

The Metropolitan police has a team of up to 20 detectives based at News Corporation's internal investigation unit in Wapping, a move which leading media and human rights lawyers say puts press freedom in jeopardy.

The revelation comes as Sue Akers, the Met police's deputy assistant commissioner, returns to the Leveson inquiry to provide further details about the three major inquiries into alleged illegal activity by newspapers: Weeting into phone hacking, Elveden into payments to the police and Tuleta into computer hacking.

The Scotland Yard detectives are working in Wapping alongside the management standards committee (MSC) of News Corp, News International's parent company, and their lawyers Linklaters.

The MSC was set up in July in the wake of the phone-hacking scandal and reports directly to News Corp in New York. It is in a building adjacent to News International's newspaper offices in Wapping and the MSC says it is working independently of the Sun, the Times and the Sunday Times. Up to 100 people, including lawyers from Britain and the US, as well as computer forensic specialists work at the MSC.

Experts say allowing police into a media company is unprecedented and raises concerns about the protection of journalistic material which, under law, is privileged. Police need a court production order in normal circumstances to access any journalistic material.

Geoffrey Robertson QC, a UN judge and leading media and human rights lawyer, said: "Media organisations have a duty to assist police when they investigate serious allegations, but they must take care to protect the rights of their employees, especially the rights of individual journalists – because potentially news sources will not talk to journalists if they cannot trust their company to maintain confidentiality.

"The law gives special protection against police seizure of journalistic material and media corporations should always claim it when press freedom is at stake. The problem when a newspaper company invites the police into its premises is that they can then seize any journalistic material they find, without the public interest protection of having to obtain a court order."

The 15-20 Scotland Yard officers are based in the News Corp office in a separate room within the same office block.

Sources familiar with their operations said this was being done in order to achieve a speedy resolution to the phone-hacking scandal that has engulfed the organisation and said there was a "hygienic" separation between the detectives and the MSC team.

But Mark Stephens, a leading media solicitor said he was "deeply troubled" by the activities of the police and the MSC.

He said: "I think any investigative journalists at News International if they have any documents and material which they would not want the police to come across inadvertently ought not to have it in their office or at home – which is a highly unprecedented state of affairs."

Scotland Yard refused to comment. The Yard also refused to comment on an apparent change in arrest tactics in the operations over the last weeks and months. Whereas before, individuals, including Andy Coulson and Rebekah Brooks – have been arrested by appointment, the most recent arrests of Sun and News of the World journalists were dawn raids involving eight to and 14 officers at each home address.

Robertson said these were inappropriate. "Dawn raids should be used either for dangerous criminals or where there is a real likelihood evidence will be destroyed," he said. "If the police are trying to do this to impress the Leveson Inquiry I suspect it will have the opposite effect."

News International also declined to comment.

As well as Akers, the Leveson inquiry will hear on Monday from Paul Dacre, the editor in chief of the Daily Mail. He is expected to deliver a powerful defence of his newspaper despite sustained criticism from celebrities and public figures during the inquiry about the paper and other titles.

Mitt Romney now clear favourite to win Republican presidential nomination after winning three out five opening contests

Newt Gingrich scrambled on Sunday to keep his presidential bid alive after a heavy defeat in the Nevada caucus, vowing as a conservative to hound frontrunner Mitt Romney to the last.

But the exit polls in Nevada showed Gingrich's support among the very conservative and among evangelicals bleeding away, as Republican voters of various shades latch on to Romney as the best prospect of beating Barack Obama.

Romney took 48% in Nevada, a more than twice Gingrich's 23%. Ron Paul was not far behind with 18.5%, and Rick Santorum fourth with 11%.

Nevada establishes Romney as the clear favourite for the nomination, coming after his decisive win in Florida and taken with what is expected to be a run of wins in six other states scheduled to vote this month. He has now won three out of five opening contests.

Gingrich abandoned the usual post-results speech for a press conference during which he angrily accused Romney of running a ruthless and dishonest campaign, dismissing rumours he was about to quit. Gingrich said he would fight all the way to the nomination convention in Florida in August, arguing that his more conservative philosophy would ultimately appeal over Romney's "moderate" policies.

Elaborating on NBC's Meet the Press on Sunday, Gingrich said Romney's record on abortion, gun control and taxes would disqualify him in the minds of conservatives.

"My goal over the next few weeks is to draw a very sharp distinction between Romney's positions, which the Wall Street Journal described as timid and, in terms of tax policies, as being like Obama."

"The challenge is to say: do you really want to go in to a fall election with a moderate candidate? The last two times we nominated a moderate – 1996 and 2008 – we lost badly. A conservative candidate can offer a much greater contrast with President [Barack] Obama."

Gingrich acknowledged that the coming votes would be difficult, but said that his goal is to keep the campaign alive until Super Tuesday on 6 March when several conservative states are among 10 having contests, and he is "in much more favourable territory".

"We want to get to Georgia, to Alabama, to Tennessee, to Texas. We believe by the time Texas is over [in April], we'll be very, very competitive in delegate count. The key from my standpoint is to make this a big choice campaign," he said.

But Gingrich faces a struggle to reestablish himself as a credible candidate. Exit polls showed support falling away among conservatives, evangelicals and Tea Party supporters who delivered him victory in South Carolina and Florida; in Nevada they swung heavily towards Romney.

However, the polls also showed little enthusiasm for Romney. Four out of 10 Republican voters in Nevada said they were principally focused on getting Obama out of the White House, suggesting many are prepared to compromise some ideological beliefs to back the man they best believe can do that. Romney is also more trusted on the economy.

In Nevada, Gingrich painted himself as the anti-establishment candidate, taking on not just Washington but the leadership of his own party.

"I was surprised by the degree to which the establishment has closed ranks and made quite clear that they're desperate over the prospect of a Gingrich presidency," he said.

Gingrich may also find his single most important source of support drying up. The New York Times reported that the billionaire casino magnate Sheldon Adelson, who has spent at least $10m on attack adverts for Gingrich, has he will back Romney if it is clear he will be the nominee.

Gingrich previously revived his campaign with strong performances in television debates, which helped his victory in the South Carolina primary, before Romney hit back hard in debates in Florida. However, there are no more debates until next month.

In his victory speech in Las Vegas, Romney, a former governor of Massachusetts, referred to his having won in Nevada during what turned out to be his failed bid for president four years ago, but said that this time it would be different: "This time I'm going to take it to the White House."