Former Prime Minister Tony Blair said compensation for victims of Libyan-sponsored IRA attacks – which included those affected by the 1996 Docklands bomb – had been dealt with.

The former PM told the Foreign Affairs Committee it “was accepted not just in my Government but previous ones” that the matter had been dealt with.

He said: "The compensation for IRA victims were handled under the compensation provisions that were in place under a previous Government.

"And I think that was the position as it was accepted not just in my Government but the previous Government as well."

Mr Blair briefly spoke about the issue while he was questioned over his Government’s relationship with Libya and the late dictator Muammar Gaddafi.

He made the comments about the IRA victims after speaking about the Lockerbie victims and police officer Yvonne Fletcher, who was murdered during a protest outside the Libyan embassy in 1984.

He said his Government had secured compensation for the Lockerbie victims and Miss Flectcher's death but the matter of compensation for the IRA victims “was a wholly separate question”.

He then added that he believed his Government has "not lay these issues aside" and that talks with Libya had meant "we brought them from a position from where they were sponsoring terrorism to cooperating with us and fought against it."

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He said talks with Libya were necessary to try to bring an “evolution rather than a revolution” for political change and it was nothing to do carrying out a commercial deal.

He also claimed talks led to Libya giving up its chemical weapons.

He also spoke about why he rang Gaddafi, after getting permission from Prime Minister David Cameron, ahead of British and American military intervention in 2011 that saw the tyrant’s empire toppled

He said he made “two or three” phone calls to him but was “not trying to save Gaddafi” and made the calls as a “concerned private citizen” to “get him out of the situation so that a peaceful transition could take place”.

Despite trying to play down the “so-called deal in the dessert” he admitted Gaddafi “for some reasons saw me as his route into the west”.

He said: "(Gaddafi) would speak very frankly to me about his views. He was an individual who had been shut off from the world so he had theories on resolving the Israel Palestine issue he had theories on Third Way politics he would talk to me about.”

He also admitted that Syrian President Bashar al-Assad’s reluctance to work with the UK could be down to the fate of Gaddafi after he co-operated with the British Government.

He said: “There’s evidence that Assad took the view that Gaddafi cooperated and that he should learn from that – and, of course, he didn’t give up his chemical weapons because he used them on his own people.”

Afterwards, victims of IRA bombs used Libyan-supplied Semtex branded the former Prime Minister’s evidence a “whitewash”.

Suzanne Dodd, 39, whose father was killed in the Harrods bombing, told the Telegraph: “I think it was a complete whitewash – the question was completely ignored.”