THE Labour leader of North Lanarkshire Council should step aside while he is being investigated for corruption, the council’s SNP group said last night.

Councillor Jim Logue is the focus of a Police Scotland inquiry following allegations of corruption in connection with his directorship of two companies that he failed to declare.

The National can reveal that Airdrie councillor Logue may have been targeted because of his stance last year against the former leader Jim McCabe and his deputy Jim Smith who were replaced by Logue and Paul Kelly amidst findings of a massive £20m overspend on contracts awarded to companies with Labour connections. Officials were also disciplined.

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At the time, Logue told The National’s sister paper the Sunday Herald: “I instigated — with the chief executive — the internal audit investigation which has resulted in these deeply concerning findings.

“This reflects my determination that no stone is left unturned in investigating very serious allegations made to me.”

The council’s Head of Audit Ken Adamson has recently raised issues about the Labour leader in an internal report. The matters of which he reported were Logie’s holding of directorships of companies set up by North Lanarkshire Leisure — an Arms Length External Organisation or ALEO — while he was its chair.

Further questions have since been raised concerning travel and hospitality that included overseas trips by Logue.

The two private companies, ESCA UK Ltd and No Limits Leisure Ltd, were not declared on his register of interests. The National can reveal that Logue, 66, was appointed to their boards in December, 2011, and June, 2012, respectively — both companies have since been dissolved, according to records at Companies House.

It has been confirmed by Head of Audit Adamson that the board of North Lanarkshire Leisure did not formally approve the establishment of the two now defunct companies and that there were “significant weaknesses” in the governance of the ALEO.

It is understood that Logue said he did not have to declare he was a director of the companies as they were ‘subsidiaries’ of North Lanarkshire Leisure, from which Logue resigned on June 14 this year after he became leader of the Labour minority administration in North Lanarkshire with the support of the Conservative group.

The SNP won more seats than Labour — 33 to 32 — but were frozen out by the ‘unwritten’ Labour-Conservative pact. Perhaps ironically, in return for their group’s support, Tory leader Meghan Gallagher was made convener of the Audit and Scrutiny Committee which under local authority rules will have to examine Logue’s conduct after the police investigation is finalised — even if there are no court proceedings.

North Lanarkshire’s SNP business manager Councillor Allan Stubbs said: “Like everyone else in Scotland, Councillor Logue has the right to be considered innocent until proven otherwise and the SNP will be operating on that basis.

“However, given the seriousness of the allegations against him, it would be wrong for him to continue as Leader of the Council while the police conduct their investigations and risks bringing the whole council into disrepute. I am asking him to step aside as Leader while the investigation is carried out and until the police determine whether or not charges should be brought.”

A Police Scotland spokesman said: “We can confirm that Police Scotland have received a complaint of alleged corruption of an individual at North Lanarkshire Council and enquiries are ongoing to establish any criminality.”

Former Wishaw councillor Sam Love, leader of Independent Alliance North Lanarkshire, said: “Councillor Logue should be suspended by the Labour Party while further enquiries are carried out.

“They did the same during police investigations with other councillors in both North and South Lanarkshire, so why not here?”

Councillor Logue said: “The allegations of criminality made against me are completely spurious. Nevertheless I understand that the police have to look into allegations made to them.

“The police have not yet been in contact with me.

“I look forward to discussing the matter with them at their convenience.

“Any call by a former councillor for me to step aside is nonsensical.

“I remain focused on leading a forward-thinking council providing great services to North Lanarkshire.”