I have repaired HAL-related problems before by completely purging and reinstalling the hal and hal-trinity packages and their configuration files (literally, via "sudo dpkg --purge --force-all hal-trinity libhal-storage1 libhal1" followed by "sudo apt-get -f install"). You might want to give this a try, as HAL tends to have rather severe problems after a dist-upgrade in my experience.

I tried that but it didn't help. I also tried purging hal package but with no result.

One thing that changed after the upgrade is that kpowersave icon in the tray is greyed out when I log into Trinity, as if HAL was not accessable. Only after several seconds it becomes normal. Please note that kpowersave reports HAL as enabled and complains when I shut down hal daemon. So there seems to be some communication between them (just reading from HAL?). Is there any way I can debug this? I recall struggling with similar problem under KDE3 and OpenSUSE. Back then it was a matter of some dbus permissions.

This embarrassing situation was a strong motivator for the complete removal of HAL in R14. ;-)

This begs the question when will R14 be released.

Janek