LABOUR has called for an investigation into tax deals for managers at the Glasgow-based Student Loans Company (SLC) after the Sunday Herald found half the board were recently being paid as consultants.

As well as controversial boss Ed Lester, we can reveal three other members of the eight-strong executive board were rewarded through private companies instead of the staff payroll. The £350,000 of payments to the trio in 2010-11 could have saved them around £40,000 in tax.

The discovery adds to the pressure on Danny Alexander, the LibDem Chief Secretary to the Treasury, who has been under fire since it emerged last week that he allowed Lester's salary to be paid in a "tax-efficient" manner via a private company, potentially saving him £40,000. The arrangement started when Lester was brought in as interim chief executive to solve problems at the Student Loans Company in May 2010. He was paid through recruitment firm Penna plc.

His £900 daily fee then went to a private company he owns, rather to him personally, enabling him to pay corporation tax at 21% instead of income tax of up to 50%, saving up to £40,000 a year.

Ministers let the temporary arrangement continue when Lester became full-time SLC chief executive on a two-year contract in February 2011. The deal, although legal, was denounced as tax avoidance by Tory and Labour MPs, and students.

After the furore, Alexander told MPs on Thursday that the arrangement would stop. It was then revealed that Alexander himself had personally agreed to the unusual set-up.

The Sunday Herald has now discovered three of Lester's fellow SLC directors were paid £346,000 without deductions for tax via their own small private companies, potentially saving them around £38,000.

According to SLC's accounts, the quango paid £223,000 to MacDonald Wallace Ltd for the services of David Wallace in his role as chief operating officer between April 1, 2010 and March 7, 2011. This was even more than the £195,000 paid to Lester's company. Wallace, a 46-year-old accountant from Giffnock near Glasgow, is sole director and shareholder of MacDonald Wallace Ltd.

He was appointed SLC's deputy chief executive and director of strategic development in March 2011. SLC also paid £67,925 to Taroub Zahran's one-woman company TZ Partnering Ltd for her services as an independent consultant in the role of director of human resources and organisational development between September 20, 2010 and March 13, 2011.

Zahran was initially paid £77,825 directly for the period April 27, 2010 to September 17, 2010, but payments switched to TZ Partnering Ltd just five days after it was incorporated. Zahran, 50, a former chief executive of Glasgow Housing Association, became director of people and transformation at SLC in February 2011.

Since Wallace and Zahran became full-time staff at SLC, they have moved to regular salaries, making Lester's deal all the more unusual.

SLC also paid £55,000 to Harry Taylor Consulting Ltd for marketing work from April to July 2010 when its director, Harry Taylor, was designated director of marketing and communications at SLC. Harry Taylor, 57, is an actuary from Whitecraigs near Glasgow. He and his wife are the firm's sole shareholders.

Harry Taylor Ltd and MacDonald Wallace Ltd use the accountants Graham & Co in Bearsden, whose website says they help clients "pay the minimum tax required by law".

MSP Hugh Henry, Labour's education spokesman, who has called on Scottish ministers to say what they knew of the Lester deal, said the public spending watchdog Audit Scotland should now check on how money was being spent at SLC.

"This organisation needs to be examined. While there may be reasons for employing consultants for specific contracts, top officials should be employed on the same basis as other members of staff. Any attempt to minimise the tax for top officials when low-paid workers are bearing the burden of financial cuts is frankly unacceptable."

In a statement, SLC said: "The interim directors were hired at a time when the company was in extreme difficulty operationally. There was an immediate need for experienced senior managers - who could take control and manage the situation.

"Interim directors were responsible for their own tax, national insurance and pension arrangements. David Wallace and Taroub Zahran are now permanent employees of the SLC and their tax and national insurance are deducted at source."