AN investigation into a shortfall in the commercial operations department of East Ayrshire Council is expected to be completed by the end of next week, writes David Steele.

Initial estimates - when the problem was uncovered in February and two senior officials were suspended on full pay - put the shortfall at #1.9m, but it is understood that the final figure could be higher.

A senior member of the council's legal team is carrying out an independent inquiry into the problem and is likely to pass a full report to chief executive David Montgomery towards the end of next week.

While senior councillors, who have prided themselves on the openness of government in East Ayrshire, are anxious to release as much information as possible, they may be restricted if the Scottish Secretary takes a closer interest or if disciplinary issues should emerge from the initial report.

In his current mood, Mr Donald Dewar will be watching the East Ayrshire situation closely and is likely to react swiftly if the figures rise alarmingly above the already worrying figures quoted at the start of the probe.

Some council members of the Labour-dominated authority, which is made up of the former Kilmarnock and Loudoun and Cumnock and Doon Valley councils, are anxious not only at fingers being pointed by some sections of the media but also by the amount of time the inquiry has taken to complete.

A council spokesman pointed out, however, that since the inquiry began around 19 senior officials and councillors have been interviewed at length.

Only one of the suspended officials, commercial operations director Des Tierney, has been interviewed while his deputy, Charles McIvor, has been unable to co-operate for personal reasons.

The East Ayrshire situation has been mirrored in other local authorities and is likely to highlight problems of council departments underestimating costs.

The Association of Direct Labour Organisations, a UK-wide organisation, will hold a conference in Glasgow this week. Although the problems in North Lanarkshire and East Ayrshire are not on the agenda, given the Secretary of State's recent statement it is expected that some debate will take place on the current crisis.