A LETTER, seen for the first time, claims the Crown Office was aware of an application for reward money paid out to key Lockerbie witnesses.

The letter, from Detective Chief Superintendent Tom McCulloch – the senior investigating officer in the later stages of the case – to the US Justice Department, asks for a reward of $2 million for Tony Gauci and $1m for his brother Paul.

Most significantly, though, it states the Crown Office was aware of the plan to pay two of its key witnesses and had been consulted about it.

The revelation comes after an official biography of Abdelbaset Ali Mohmed al Megrahi alleged Justice Secretary Kenny MacAskill encouraged the Libyan to drop his appeal.

Mr MacAskill has denied the claims and will today mount a strong rebuttal before MSPs at Holyrood.

The letter was sent on April 19, 2002, after Megrahi's unsuccessful first appeal, but documents unearthed by the Scottish Criminal Cases Review Commission discovered financial rewards had been discussed with the Gauci brothers even before they gave their first statements.

However, the Crown Office has denied that they were complicit in any payments to witnesses.

Paying witnesses is not considered acceptable practice in Scotland – although it is common in the US.

If a witness was paid for giving evidence, the Crown would be expected to disclose the fact to allow for cross-examination by the defence.

The Scottish Criminal Cases Review Commission report says Mr Gauci's "alleged interest in financial payment" was capable of "affecting the course of the evidence and the eventual outcome of the trial".

The Crown denies payments were made before the outcome of the appeal, but arguably any information on Mr Gauci's alleged interest in financial payment should have been made available to the defence.

In the letter, Mr McCulloch states: "I am writing to confirm the submission by Dumfries and Galloway Constabulary for payment of a reward to Anthony and Paul Gauci.

"At the meeting on April 9, I proposed that $2m should be paid to Anthony Gauci and $1m to his brother Paul.

"Given the exceptional circumstances of this case, which involved the destruction of a United States aircraft with the loss of 270 innocent lives and the subsequent conviction of a Libyan intelligence agent for this crime, I would invite those charged with approving the reward to ensure the payments made to Anthony and Paul Gauci properly reflect not only the importance of their evidence, but also their integrity and courage.

"I have consulted with Crown Office about this application for payment of a reward.

"The prosecution in Scotland cannot become involved in such an application.

"It would therefore be improper for the Crown Office to offer a view on the application, although they fully recognise the importance of the evidence of Tony and Paul Gauci to the case."

A spokesman for the Crown Office said: "It is nonsense to suggest the Crown was complicit in the payment of rewards to witnesses or that it turned a blind eye to such matters.

"The letter from DCS McCulloch was sent to the US authorities after the conclusion of appeal process in 2002 and sets out clearly the Crown's position. No witness was offered any inducement by the Crown or the Scottish police before and during the trial and there is no evidence that any other law enforcement agency offered such an inducement."

A Government spokesman said Mr MacAskill was "extremely happy" to make a parliamentary statement to MSPs.