OPPOSITION councillors are calling for the leader of City of York Council to resign over a damning report into the handling of the former chief executive's £400,000 payout.

York Labour group leader councillor Danny Myers says the Liberal Democrat council leader Keith Aspden "must resign immediately for the good of the council and the city".

The Lib Dems have hit back accusing Labour of a "politically-motivated witch hunt".

Independent auditors took the unusual step of issuing a Public Interest Report into the council's handling of the payment, in which they say former chief executive Mary Weastell had filed an employment tribunal claim against Cllr Aspden over accusations of bullying and intimidation. Cllr Aspden denies the accusations.

The auditors say Cllr Aspden should have left the room during the secret meeting at which the payout for the former chief executive was agreed as it “presented a clear ethical threat”. They say he was advised he had no direct pecuniary interest as insurance arrangements were in place, but was advised to consider his position in declaring an interest.

The report warns of "recurring themes of conflicts of interest and standards of member behaviour that have led to audit action or media coverage in recent years" and makes recommendations.

The leaders of York's Labour and Conservative groups have both called for Cllr Aspden to stand down.

Labour's Cllr Myers said: “The independent report findings confirm what Labour has already said about the council leader’s role in the Lib Dems’ bumper payoff scandal; Cllr Aspden’s position is untenable and he must resign immediately for the good of the council and the city.

“The fact this issue has been classed as warranting a Public Interest Report (PIR) is hugely significant, reserved only for failings so significant that the public must be made aware within 28 days.

“It’s difficult to think this independent report could be any more damaging to this administration and to the council as a whole in terms of how it is being run at the highest level.”

“If we disregard this, then it sends the message that senior ruling councillors can operate by their own set of rules, and that would be quite wrong."

“The independent report findings confirm what the viewing public has known for some time; in the words of the independent auditors: the Lib Dem council leader ‘prioritised political interests’ in the use of public funds."

"The auditors further question the legality of the £400k,000 severance payment made to the former chief executive and that the council leader ‘had a clear personal interest’ and should ‘have left the room when the matter was considered’."

But Lib Dem councillor Anne Hook slammed Labour councillors, saying: “We see no need to take lectures from the York Labour group, who during their period of control wasted taxpayers’ money on vanity projects and bodged bridge closures.

"It is time for the Labour party to develop real policies which would deliver for residents, rather than waste time, as they have done with their comments to date on their politically-motivated witch hunt.

“As local councillors, we are elected to represent our communities rather than spend time on personalised party-political games.

"That is why the Localism Act was passed in 2011 to ensure that councillors, particularly those with senior responsibilities, are able to “get on with the job” without fear from politically-motivated accusations."

“By delivering on our manifesto promise to streamline management structures at the council, £1 million in savings will be achieved in the next five years.

"My residents would rather the council was focused on fixing roads and investing in communities, than spending money on senior management. It is disappointing, but perhaps not surprising, that the Labour group seem to disagree with this.”

The report will be discussed at a council meeting on May 4.