HIGH-EARNING directors at beleaguered North Lanarkshire council could be facing the loss of their jobs following a shake-up of departments, it emerged yesterday.

Mr Andrew Cowe, North Lanarkshire's #91,000-a-year chief executive, was yesterday preparing a report for councillors outlining radical changes to the way the council is run at its Motherwell headquarters.

Mr Cowe is understood to have called in directors and senior managers on Tuesday and outlined his views on how restructuring - at director and deputy director level - could work.

He has now ordered directors to take a look at their own departments with a view to merger or restructuring.

Departments he suggested could be restructured or merged included finance, environmental services, planning, personnel and leisure services.

The latter is already under scrutiny because it has been allowed to spend #10m more than Scottish Office grant aid guidelines. Its director and deputy director - husband and wife team Norman Turner and Ann Malloy - have already accepted senior posts on two separate London councils and will leave at the end of the month. If they are not replaced leisure services could be vulnerable to a merger with another department.

Mr Richard Lyle, SNP group leader, said yesterday: ''Four top officials will either lose their jobs or not be replaced.

''This restructuring may result in hundreds of thousands of pounds being paid out in golden handshakes to a number of top officials who are long term employees with protected employment rights and pensions.

''Our group suggested at the last council meeting that the council decentralise to such an extent that we [do] not even need any directors of departments. It's strange this action comes a month after our suggestion.''

Neighbouring South Lanarkshire council carried out similar restructuring in the first 18 months of its life - halving the number of directors and separate departments, with an immediate saving of #7m. It also cut 300 senior and middle-management posts.

North Lanarkshire is keen to be seen trying to recoup some of #7m lost in the DLO deficit scandal.

Labour leaders at the council faced a fresh call yesterday for a public inquiry into the deficit.

It comes after the sackings of top officials in the department, which is to be scaled-down drastically under a deal hammered out between the council and the Scottish Office, putting hundreds of jobs on the line.

SNP councillor Gordon Murray claimed that investigations into the deficit so far have ''only scratched the surface''.

Mr Murray, former Cumbernauld Provost, has now written to the Accounts Commission for Scotland claiming regulations have been ''constantly flouted''.

He said that managers within the DLO were only carrying out an ''over-zealous council policy on promoting Direct Labour at all costs''.

''I am astounded that no public inquiry has been ordered,'' he said.

''Certain officials have lost their jobs because they were carrying out council policy.

''The present councillors appointed all the officials, yet they are claiming innocence.''

He went on: ''This is a direct denial of responsibility. Harry McGuigan resigned as council leader but others must share the responsibility.

''Committee conveners and vice-conveners accepted their generous allowances and responsibility for policy must rest with them, not officials and workers who are being used as scapegoats.''

The Accounts Commission for Scotland said on December 27 that it would not be holding a public inquiry into the loss.

Mr Harry McGuigan, who was leader of the council when the DLO deficit came to light, said: ''I have always called for a public hearing into this, and that remains the council policy to this day. It is the only way that all the details can be heard in an open forum.''