Sir James Ackers, a personal friend of Kenneth Clarke and Norman Fowler, the former secretaries of state for health, stepped down from the post he had held for 10 years. The Department of Health confirmed that Sir James, who received pounds 20,925 a year for his part-time job, was discussing a financial settlement on his departure.
The Commons public accounts committee will next month press Sir Duncan Nichol, NHS chief executive, over loans and payments to private companies by the authority, dating back several years.
It became clear this week that the Audit Commission had investigated a pounds 300,000 loan in January 1991 to a health computer software firm, the Birmingham-based Financial Information Packages. FIP was established in June 1990 with a regional loan of pounds 630,000, and grew out of a small division of the health authority.
Last year, Qa Business Services, formed after a management buy- out of the health authority's computing division, collapsed with a deficit of pounds 2.2m. The health authority had already been criticised by the National Audit Office, for wasting pounds 4m of public money.
In his letter of resignation to Virginia Bottomley, the Secretary of State for Health, Sir James, 57, acknowledged the 'public disquiet' caused by investigations into the authority's finances. He wrote: 'Now that the task of rectifying matters is almost complete, I am quite certain that it is in the interest of the RHA to have a clean sheet and a fresh start.'
Mrs Bottomley thanked him and said: 'It is characteristically good of you to make way for some new blood to take forward the work you have begun.'
Last October the National Audit Office, the public spending watchdog, criticised the health authority over a consultancy contract and associated 'expenses amounting to pounds 350,000 (which) contained such items as leased houses in London for firms' executives and their wives, the hire of aircraft to come to work and lavish entertainment'.
David Blunkett, Labour's health spokesman, who has repeatedly called for Sir James's resignation, urged Mrs Bottomley to make a statement to the Commons next week. He said: 'There are a number of investigations still under way, including one into possible unlawful loans by the RHA, and these must now be completed as a matter of urgency.'
Sir Donald Wilson, 70, chairman of the Mersey health authority, will replace Sir James.