The council’s leader and chief executive have resigned from their positions as directors of an outsourcing project with Capita.

The pair stepped down from the board of the Regional Enterprise (Re) joint venture due to a “potential conflict of interest” created by a review of the deal.

Council leader Cllr Richard Cornelius was appointed to a directorship of Re in 2013, while chief executive John Hooton became a director in 2016.

The council is entitled to appoint two representatives to the board under the terms of the joint venture, in which it has a 49 per cent stake.

But with the council set to decide whether to bring a range of services previously outsourced to Capita back in-house, the pair decided to resign “so that they can focus solely on the interests of the council”.

Their decision to stand down is revealed in a report to the constitution and general purposes committee, which is set to meet on Tuesday (July 24).

The report states that council officers are considering appointing people who are not involved in the review to the vacant posts.

It adds: “It should be noted that the joint venture agreement sets out an extensive range of matters on which the agreement of both shareholders is required, thus preventing the board of directors from taking any decisions that would have a significant impact on the company without the council’s agreement.”

The Re deal with Capita was signed in 2013 and covers a range of services, including environmental health, regeneration and highways.