Libya: LSE feared 'embarrassing' Gaddafi's son over donation

The London School of Economics faced fresh criticism last night after it emerged academics refused to return a £1.5m donation to Libya for fear of causing “personal embarrassment” to Col Gaddafi’s son.

Saif al-Islam Gaddafi addresses the country on state television Photo: AFP

Leaked documents show that the university's ruling council was warned against accepting the donation from a charity run by Saif-al-Islam Gaddafi because of controversy over the release of the Lockerbie bomber.

The disclosure comes just 24 hours after Sir Howard Davies resigned as the university's director after accepting that its reputation had been damaged by a decision to take the money.

The Daily Telegraph has also learned that Tony Blair, the former Prime Minister, made a personal contribution to Saif Gaddafi's thesis when he was studying at the LSE. Mr Blair gave him an interview in which he described how corrupt states can be made more transparent.

There was growing pressure last night for the whole of the university’s ruling council to step down.

Robert Halfon, the Conservative MP for Harlow who is demanding a government inquiry into the donations, told the Telegraph: “The only way the LSE can restore its name is for the entire council to resign.