Scotland's government faces a fight for its survival as the furor over its decision to free the Lockerbie bomber escalated last night.

Opposition parties north of the Border are preparing to hold a confidence vote over the decision by Kenny MacAskill, the Scottish Justice Secretary, to free Abdul Baset Ali al-Megrahi. Alex Salmond, the First Minister, has confirmed that he would resign if the Holyrood vote went against him.

The development comes after a weekend of fierce criticism from the United States of the decision on the ground of compassion to return al-Megrahi to Libya, where he was received as a hero on his return.

Admiral Mike Mullen, the Chairman of the Pentagon’s Joint Chiefs of Staff, said he was appalled by the freeing of al-Megrahi, echoing the earlier attack by Robert Mueller, the FBI Director, who accused Scotland of "making a mockery of the rule of law" and giving "comfort to terrorists around the world." Threats by Americans to boycott Scottish goods and services on the back of the al-Megrahi decision are being taken seriously by the British Government.

Alistair Darling, the Chancellor, who is standing in for the Prime Minister, has told aides that the prospect of an American boycott was of concern and "something that we need to keep an eye on."

Brown has been criticized by David Cameron, the Conservative leader, for refusing to make any statement on al-Megrahi. The Prime Minister had discussed the possible release when he met Muammar Gadaffi, the Libyan leader, at a G8 summit in Italy last month.

Lord Mandelson, the Business Secretary, is also facing questions about his interests in al-Megrahi’s release after it emerged that he had met Saif Gaddafi, the son of the Libyan leader, twice in the past four months.

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