LIVERPOOL chief executive Colin Hilton will leave his post with around £350,000 – and is set to be replaced by LDL boss David McElhinney.

Mr Hilton, who decided to take early retirement after the Labour group took control of the council, will receive his pension entitlements but no additional pay -off.

Massive severance deals for officers has previously been a source of much conflict within the council.

In 2008, it was revealed that former chief executive David Henshaw, finance chief Phil Halsall and Culture company boss Jason Harborow left with £1.6m between them.

Labour group leader Cllr Joe Anderson has repeatedly criticised the size of so-called “fat cat” staff bonuses.

The Daily Post understands Mr Hilton’s sum comprises, his pension entitlements, a six-month notice period salary and leave payments.

The likely appointment of Mr McElhinney – widely dubbed “Mack the Knife” for his no-nonsense disciplinarian style – has sent shivers down many staff.

The Liverpool Direct boss, currently “seconded” to the BT-backed firm, is expected to be named as the interim chief executive today.

Mr Hilton earned more than £200,000 a year.

Education director Stuart Smith, environment head Cath Green, regeneration boss John Kelly and Mr McElhinney are thought to have been competing for the post.

But only Mr McElhinney and Mrs Green applied.