The shock departure of Aberdeen City Council’s chief executive has prompted calls for the scrapping of the controversial management structure he introduced, which left the authority without an education director.

Douglas Paterson, who announced his early retirement on the opening day of the Accounts Commission’s public hearing into the authority’s financial management, was the architect of the Aberdeen Futures project. It saw the city divided into three “neighbourhood divisions” and the disbandment of traditional departments and posts of education and social work director.

But Grant Bruce, Aberdeen branch secretary of the Educational Institute of Scotland, told the hearing the city was too small for the “neighbourhood” format and it had led to wasteful “triplication” of resources. It had been a mistake to lose a number of experienced staff at a time of radical change, he said.

Earlier this year, the council said it would have to impose cutbacks of pound;27 million. Schools have been hit particularly hard by demands for savings, with plans to cut teacher numbers and subject options.

Robin Jackson, an educational consultant who has written in The TESS on the impact of Aberdeen’s budget problems, called on the new chief executive to reassess the way education and social services are administered “as a matter of urgency”. He said: “There is a compelling case for the re-introduction of directorial posts for both these critically important services.

“The appointment of individuals who can speak with the authority based on proven managerial experience and relevant professional knowledge and expertise is long overdue. Had such individuals been in post over the past few years, some of the problems confronting the city council could have been avoided.”

Scepticism about Aberdeen Futures appeared to be vindicated last year when HMIE tempered praise for the council’s “bold decisions” by describing leadership and direction of education services as “weak”.

Auditors at the hearing this week confirmed that the council was in a “precarious” financial position and claimed that pound;70 million had been taken from reserves. The council disputed this, saying only pound;12 million had come from reserves and pound;59 million from capital receipts.

Details of a draft copy of a social work services audit report, to be published next month, were also revealed by auditors. They said the council’s score in five out of 10 indicators was “weak”, two were “unsatisfactory” and the remaining three “adequate”.

City schools were upset last month by a report in an Aberdeen newspaper that, in a leaked email, Mr Paterson had described their performance as “mediocre to OK”, before accusing heads and parent groups of painting a misleadingly negative picture of funding and staffing.

Mr Paterson has been chief executive since Aberdeen City Council came into being in 1996. He trained as a primary teacher and moved rapidly up the ranks before achieving a meteoric rise in local government, including a short spell as education director at Grampian Regional Council before it was replaced by Aberdeen, Aberdeenshire and Moray councils.

“He was the most driven and committed person I have worked with,” said John Stodter, general secretary of the Association of Directors of Education in Scotland.