US rethinks its aid to Libya in backlash over Lockerbie

The US is rethinking a decision to give $2.5million (£1.56million) in aid to Libya because of the "hero's welcome" the country gave to the Lockerbie bomber freed from a Scottish prison.

American politicians have written to Hillary Clinton asking the State Department to cancel the plan.

They also accused the Libyan leader Colonel Gaddafi of showing "flagrant disrespect" for the 270 victims of the 1988 bombing during his visit to New York this week to attend the UN General Assembly.

Nita Lowey, a New York Democrat, and Kay Granger, a Texas Republican, wrote to the US Secretary of State: "The celebration that president (Gaddafi) recently held in honour of the only man convicted in the bombing of Pan Am Flight 103 showed just how little remorse he has for the terrorist attacks that killed 270 civilians."

Mrs Lowey chairs the influential House of Representatives appropriations subcommittee that oversees funding for the State Department and US foreign assistance. Mrs Granger is the subcommittee's top Republican.

While the State Department could reject their request, it is unlikely to do so because of the power that the sub-committee has over its budget.

State Department spokesman PJ Crowley said it was rethinking the funding, which sources said had included donations for two foundations run by Col Gaddafi's sons. One foundation is said to promote civil society and the other women's empowerment.

Mr Crowley said: "The decision to appropriate the money was made some time ago but, in light of recent events, we will be taking another look at these decisions."

Mr Crowley was referring to the reception Abdel Basset al-Megrahi received on his return to Libya last month after being freed by Scottish authorities on compassionate grounds because of his terminal cancer.

The scenes of jubilation in Libya provoked acute embarrassment in Britain and sparked diplomatic rows between Scotland and England. It put the "special relationship" between the US and the UK under further strain and was seen by some as the reason the White House rejected repeated requests for one-to-one meetings between Gordon Brown and President Obama in New York this week.

Col Gaddafi's US visit has further upset some relatives of the Lockerbie victims, who resented his unsuccessful efforts to get permission to pitch a Bedouin tent in Central Park before he delivered a rambling speech to the UN General Assembly.

However, in an interview with the Wall Street Journal, he said he could "comprehend" the anger directed at him by victims' families.