The head of Perth and Kinross Council has insisted it is “business as usual” after three independent councillors walked out on his administration.
Xander McDade, Michael Barnacle and Rhona Brock announced they will form a new political group with sole Labour councillor Alisdair Bailey.
The shock announcement followed a controversial decision by leaders to remove Mr McDade from two committees, in favour of recently elected Conservative councillor John Duff.
The walk-out means that while the Tory and Lib Dem coalition retain power, its majority has been considerably reduced.
Council leader Murray Lyle, said: “It’s unfortunate, but I don’t see this as a big disaster going forward.”
He said Xander had wanted to resign in January. “It was accepted that he could not sit on these committees as part of the administration,” he said.
“Last week was the first chance we had to remove him. I feel it would have been inappropriate to do so, so soon after (former leader) Ian Campbell’s death in February.”
Mr Lyle said: “It is regrettable that the other independent councillors have decided to resign with him. But they have parted on good terms and we look forward to continuing to work with them.
“It’s an unfortunate situation, but it is not of it is not of my making. If Xander hadn’t wanted to resign, all this could have been avoided.
“As far as I’m concerned it is business as usual at the council.”
SNP councillor Dave Doogan, leader of the opposition group, said he was not surprised the independent councillors had taken this decision.
“It must have been bad enough being taken for granted within the Tory administration but after last Wednesday, the Tories went even further and attempted to diminish their positions as individual councillors,” he said.
“The way this has come about beggars belief but it seems to me the Liberal Democrat tail is now well and truly wagging the Tory dog in Perth and Kinross.”
He added: “The cracks are now very evident within this Tory administration which has barley lasted a year.”
Local SNP MSP and Deputy First Minister John Swinney added: “After the shocking behaviour of the Tory Administration of Perth and Kinross Council last week, I am not at all surprised by this move.
“It is clear by their actions that the administration has contempt for local democracy and I am glad to see there is now growing opposition to their approach.”