Hundreds of millions of pounds of Colonel Gaddafi's assets held in the UK must be used to compensate victims of Libyan-sponsored IRA terrorism, MPs have been told.
At least £900 million of the dead dictator's huge fortune has been frozen by the Government and an Act of Parliament could release it to those bereaved and injured in IRA bombs, according to a leading lawyer giving evidence to a select committee inquiry.
Jason McCue, who for 10 years has been attempting to extract compensation from Libya for the victims, also accused former Labour prime ministers Tony Blair and Gordon Brown of putting commercial and diplomatic interests ahead of justice in their deals with Muammar Gaddafi's regime.
He told members of the Northern Ireland Affairs Committee that while the US, France and Germany had negotiated multi-million pound settlements with Gaddafi for its citizens impacted by Libyan-directed terrorism, the UK failed to lobby for similar pay-outs for IRA victims for fear of jeopardising lucrative oil and arms deals.
"What you see is a policy of arms, oil and creating a partnership with Libya, Gaddafi, which puts justice issues and victims as a complete secondary class in everything," Mr McCue told the committee.
The lawyer was giving evidence at the start of the committee's inquiry into how the Government handled the issue of compensation for UK victims of IRA bombs manufactured with Semtex provided by Gaddafi.
He claimed Mr Blair prioritised a BP oil deal and a weapons agreement that would have seen Gaddafi purchase a Jernas missile defence system made by part UK-owned manufacturer MBDA, over the issue of compensation.
Mr McCue questioned the logic of this policy given the ultimate demise of Gaddafi and his regime in 2011.
"I would ask you to look at the facts now," he urged the MPs.
"Where is the Jernas £400 million deal? Not happened. Where is the BP deal that was going to make 13 billion? Not happening in that country any more. Where is our special relationship with Libya? Zero.
"What have we missed? £400 million to these people (the victims) who then could have been using this to recreate their lives after they were destroyed by this rogue regime. It is an incredible incompetence of positioning and strategy."
The lawyer, who said Mr Blair and Mr Brown should be called to give evidence to the inquiry, said the current government was refusing to act to release the frozen assets to compensate victims.
Claiming that the US Congress had put pressure on President George W Bush to gain compensation for its citizens, he said: "My belief now is Parliament's chance to be like Congress on the Libyan Claims Settlement Act is by pushing for an Act of Parliament which enables frozen assets of a terrorist/dictator, assets in this case of Gaddafi, to be used to pay the compensation to these victims.
"We have information that there is a fund of £900 million of Gaddafi funds here, which is sat not earning interest, which is in management, which we would like to be used."
Mr McCue said the Government controlled the assets but had refused to answer his Freedom of Information request asking exactly how much of the dictator's fortune was held in the UK.
Campaigner Willie Frazer, who lost five relatives in the Troubles, was one of a number of IRA victims who gave evidence to the committee after Mr McCue.
He suggested the sum of the frozen assets could be much greater than £900 million.
"There are numerous figures floating about," he said.
"There's billions, there's £900 million, there's £12 billion, there's £20 billion, there's £30 billion. The only people who can truly answer that is our own Government."
Conservative MP Oliver Colvile said a parliamentary question should be tabled to establish how much of Gaddafi's wealth was held in the UK.