The end game: The fate of Lockerbie bomber

OF ALL the numbers in the contacts book of US secretary of state Hillary Clinton, it is fair to assume that up until last week that of one time Tartan Army regular and reformed fitness freak Kenny MacAskill was not among them.

In his short reign as justice secretary in the SNP Government, MacAskill has never been shy of courting controversy, most notably by threatening the drinks industry with a series of draconian restrictions on alcohol sales. But when the world's best known female politician came on the line on Friday afternoon, asking to know what exactly he was up to, MacAskill might well have been excused for reaching for a nip of the strong stuff himself.

Elsewhere in the Scottish Government offices on Friday it was business as usual – ministers were launching a consultation into the problem of high hedges. But in MacAskill's office and that of First Minister Alex Salmond, a genuine geopolitical dilemma of the very first degree was emerging. Less than 48 hours earlier, the BBC had reported that MacAskill had decided to release the Lockerbie bomber, Abdelbaset Ali Mohmed al-Megrahi, convicted in 2001 of the killings of 270 people who died after Pan Am Flight 103 exploded over the skies of southern Scotland. Not known for taking "flyers", the BBC report was treated as fact, despite the insistence of MacAskill and the entire Scottish Government that, in fact, no decision had yet been taken.

On Friday lunchtime, Megrahi's lawyers announced that an appeal against his conviction was being dropped. Charges of a cover-up emerged immediately. On both sides of the Atlantic, total confusion reigned. In Washington, lawyer Frank Duggan, who represents the Victims of Pan Am Flight 103 group, received a call from Edinburgh to inform him that, yes, Megrahi's appeal was not going ahead but no, a decision on his release had not yet been made. After the call, Duggan declared it "inconceivable" that MacAskill – whom he had talked to a few weeks earlier – was preparing to release the bomber. And yet, in Edinburgh, there was barely anybody to support his view. Before the end of this month, the Scottish Government will announce its decision. This weekend, the age-old question of politics is being asked: cock-up or conspiracy? If MacAskill has agreed to Megrahi's release, why? And, furthermore, why did it emerge in the bizarre way it did last week?

It was last October that confirmation came through that Megrahi, who is serving out his life sentence in a specially built cell in Greenock prison, had advanced prostate cancer. Three months earlier, the Criminal Cases Review Commission had agreed that he deserved a second appeal. Now the issue of the Libyan's health was to complicate the case further.

The appeal was due to begin in earnest next month, and those who have followed the Lockerbie case for the last two decades were waiting with anticipation. For two years, ever since the Scottish Criminal Cases Review Commission (SCCRC) had agreed the appeal should go ahead, there had been speculation about the evidence it might bring forward. Scotland on Sunday reported in 2007 that Megrahi's lawyers would put forward new evidence that a key witness in the case, Maltese shopkeeper Tony Gauci, had been paid a 2m reward by US investigators for giving crucial prosecution evidence. We also reported how a retired CIA agent had provided new evidence which suggested that Iran was behind the bombing, and had then paid a terrorist group known as the Popular Front for the Liberation of Palestine to carry out the attack. Perhaps most damning of all, there was talk that evidence had been tampered with by Scottish and American police so as to lead to Megrahi's conviction.

Despite this, the Crown Office and many senior legal figures in Scotland remained convinced that the police had nailed their man and that Megrahi was undoubtedly involved in the atrocity – even if other unknown forces were just as guilty. Many legal figures were eager for the appeal to go ahead to quash what they claimed were conspiracy theories and press-driven leaks. That was the position at the beginning of the summer.

But Megrahi's health was worsening. Libya had already applied for him to be released under a prison transfer scheme, with Colonel Gaddafi chasing up the matter personally with Gordon Brown at the G8 summit in Rome last month. Then the Libyan also applied for release on compassionate grounds, claiming he had only weeks to live. Both entirely separate decisions fell to MacAskill to clear up. The justice secretary went about the case with customary zeal. In July, he held a teleconference call with the American relatives of the Lockerbie dead, where he was told in no uncertain terms on either basis – on a prison transfer agreement or on compassionate grounds – they were opposed to him moving. Then, a few weeks later, MacAskill took the controversial step – in the full gaze of the media – of deciding to meet Megrahi himself.

Speculation was already rife that MacAskill was softening his stance. But it still came as a jolt on Wednesday evening when, on its late night news bulletin, the BBC suddenly announced that he had decided to let Megrahi go. The man convicted of killing 270 people would be back home for Ramadan, which starts this Friday. The reason: "compassionate grounds".

So have SNP ministers, as is widely assumed, backed Megrahi's release? Publicly, they insist not. As we reveal today, sources say the decision will not be taken this week, because MacAskill still has further submissions of evidence, from Megrahi's prison governor and the parole board, to study. Taken at face value, this suggests that Scottish ministers have indeed yet to make up their minds.

But for many, the decision of Megrahi's lawyers to ditch his appeal last week, was proof in itself that a deal had been done. SNP MSP Christine Grahame stepped forward, claiming to have seen a Scottish Government e-mail which said that al–Megrahi had been put under pressure to drop his appeal before his compassionate release would be granted. Oliver Miles, a former British ambassador to Libya, declared yesterday: "It's pretty likely there was a deal." Others close to the case say that there would have been strong pressure from within the Scottish Government's justice department and the Crown Office to ensure that, at all costs, the appeal be dumped. One senior justice figure said: "They (the Scottish Government] don't want an appeal to pick over the justice system and show it to have been wanting. Don't forget that Kenny (MacAskill] is part of that system. He is a legal man through and through. This is an administration which places great stock in establishing its competence. They don't want to see the Scottish justice system dragged through the mud".

First Minister Alex Salmond was at pains to deny the speculation yesterday. "We have no interest in pressurising people to drop appeals. Why on earth should we? That's not our position – never has been." Those who put forward the case that the SNP Government brokered a deal also have to ask whether Salmond and MacAskill would really want to incur the wrath of the wildly popular Obama administration.

That the SNP pair are facing such an acute dilemma was the source of some wry comment in Whitehall last week. Many recall that it was only two years ago that Salmond had complained that a deal on release was being stitched up by Tony Blair behind his back.

But why, ask the conspiracy theorists, has the news of Megrahi's release been dangled out into the public so obtusely? Why has the matter been allowed to drag on? Might it be that Salmond is revelling in the quandary? After all, not only has the affair given the SNP Government the fleeting chance to show that Edinburgh can hold the world's attention, the dilemma may also offer Salmond a substantial bargaining chip. Insiders point out that both the Foreign Office and the British Intelligence services will be content for the entire matter to go away. Former MP Tam Dalyell, a long-time campaigner for al–Megrahi, also pointed out yesterday that, while the Americans may be angry in public, officials in Washington and at the CIA will be delighted that the matter now looks set to disappear. Gaddafi will be making capital out of Megrahi's release. In two weeks, he addresses the United Nations, and next month he marks the 40th anniversary of his "revolution".

So what capital might Salmond be making? Yesterday, there were reports that if MacAskill does release Megrahi, oil giant BP will be freed up to join in the oil rush in Libya, where vast reserves remain untapped. Is the Scottish Government going to let this moment of unprecedented global influence pass without securing some form of payback? One source said: "I think a few months down the line, there'll be an announcement of some investment relating to Libya, or some concession to the SNP. And then we'll be asking, was that related to Lockerbie?"

The speculation is sure to carry on. And yet, this sweeping global drama may soon all end if, as is widely thought, Megrahi dies before it reaches its conclusion. In Greenock jail, the Lockerbie bomber is no longer being treated, sources say. So advanced is his cancer that doctors are simply offering pain relief. The end is nigh – and may come before MacAskill reaches his decision.

It might be seen as a fitting end to a case which, for 20 years, has never provided the answers that the relatives of those who died deserved. For them, justice looks as far away as ever.

Moves for Megrahi's release

Abdelbaset Ali Mohmed al-Megrahi was jailed for life in 2001 for killing 270 people when New York-bound Pan Am 103 blew up over Lockerbie in December 1988.

• He was handed over with fellow suspect, Al-Amin Khalifa Fahima, under a UN-brokered deal in April 1999. He is being held in Greenock Prison.

• In November 2008, Megrahi's lawyers asked a court to free him on bail because he has advanced prostate cancer.

• Libya lobbied for Megrahi's release this year. In July, Libyan leader, Colonel Muammar al-Gaddafi asked Prime Minister Gordon Brown for help with the case

• Megrahi was reportedly born in Tripoli and is married with five children.

• His wife, Aisha al-Megrahi, and sons pleaded for compassion from the people of Scotland when they took part in a "walk for justice" to the Scottish Parliament in December.

• Justice Secretary Kenny MacAskill, right, is considering whether Megrahi should be released on compassionte grounds or through a prisoner transfer agreement.