AV, I had a similar situation to this in Chiswick High Road a couple of years ago, with someone turning across in front, and a bike coming up the inside. Except this was a motorbike whizzing up a bus lane (not then allowed). I didn't flash the turner but left a gap, and left it to the turners choice to turn (rather than block a turning to a side road). I was a witness and in evidence said that in my opinion both biker and driver were at fault.
In the case you show, the cyclist must expect cars etc. to turn across in a busy built-up environment like that. Yes the Pug shouldn't turn without checking, but the cyclist should not be bombing up the inside. Cyclist mostly at fault, in my book.
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