Auditors have defended their scrutiny of Inverclyde Council following the failure of a scheme intended to save the authority hundreds of thousands of pounds.

Four senior officers at the council were suspended as part of an investigation into the council’s pioneering future operating model (FOM), which was intended to generate efficiency savings across the council by modernising working practices.

An assurance and improvement plan carried out by Audit Scotland and fellow scrutiny bodies last summer identified “no significant scrutiny risk” in the vision and strategic direction of the council, although it noted that the council needed “to ensure that the FOM delivers the projected efficiency savings and the intended improvements in service delivery”.

The shared risk assessment is part of a drive by regulators to reduce the scrutiny burden on local authorities, with high performers rewarded with a “lighter touch”.

But Audit Scotland said it had warned that strong leadership would be necessary to generate efficiencies and that savings would not be made if the main programmes were delayed. “We made clear that efficiencies were reliant on the FOM and other large-scale projects and we highlighted that delivery of these programmes would be challenging,” said a spokesperson.

Developments at the council would be “closely monitored” as plans for this year’s audit of Inverclyde are drawn up, she added.

Inverclyde chief executive John Mundell said that although “alternative savings options” had been identified, job reductions at the council would not exceed 250 over the next two years, fewer than previously anticipated. “We continue to work very closely in a productive and positive manner with our trade union colleagues to manage any necessary reductions in our workforce in a planned and sensitive way, avoiding compulsory redundancies if at all possible,” he said.

He stressed that the operating model formed only a part of the council’s modernisation programme, which would go on delivering essential efficiency savings while protecting the quality of services.