Known affectionately to friends and fans as 'Gabo', Garcia Marquez had just returned from hospital after suffering a bout of pneumonia, doctors have said.
Although "One Hundred Years of Solitude" was his most popular creation, other classics from Garcia Marquez included "Autumn of the Patriarch", "Love in the Time of Cholera" and "Chronicle of a Death Foretold".
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David Cameron said the measure, which will save £4 million by 2020, showed a commitment to his "all in this together" approach.