A health authority chair has resigned in protest at the government's claim that Budget money would bypass HAs.

Bradford HA board members were 'gob smacked' when Dr Joan Firth announced her decision last week.

Before retiring in 1995, Dr Firth was deputy director of NHS finance at the Department of Health, which she joined in 1967.

She said she had been 'appalled' at the way in which health secretary Alan Milburn had used his powers to instruct HAs to pass the£600m cash injection directly to trusts and primary care groups.

She told HSJ that she objected to the idea that 'we weren't to be trusted to hand the funding on'. HAs were being left out of discussions between trusts and primary care groups, which were being 'performance-managed' by NHS Executive regional offices. In a terse response, Mr Milburn told Dr Firth to go immediately, despite her offer to stay in post for another week.

He rejected her claims: 'You are quite wrong to imply that the excellent partnership work in Bradford does not continue to enjoy the full support of ministers. It does.'

Her resignation seemed to be based 'on a misunderstanding of the way new resources are going to be channelled via health authorities to frontline services', he added.

In the wake of the Budget, ministerial advisers briefed newspapers that the immediate£600m cash boost would go straight to frontline trusts and PCGs. In fact, the money will go through HAs, but with strict instructions to pass the whole amount on.

Dr Firth said ministers saw HAs as 'impediments' to progress. 'We have been working very hard with PCGs to put all these changes into place. Why can't the government get the bad HAs properly performance-managed rather than demotivate us all?'

Senior managers have criticised the way the Budget cash was presented, destroying the initial welcome for the pledge of 6.1 per cent above inflation funding increases for the next four years.

Dr Firth said government rhetoric was 'anti-HA'. 'Bradford is a very deprived area, so when the Budget was announced we were very excited. The backlash really hurt us.

We really felt knocked back.' She was 'shocked' by Mr Milburn's 'mean-spirited' response to her resignation: 'It was so discourteous that I must have upset him.'

Dr Firth said she had been driven to take an extreme course: 'I felt that if you just write letters no-one takes any notice.'

The government should spell out what its plans were for the future of HAs, as PCGs and primary care trusts took over commissioning care, she said.

'Ministers need to be far clearer about where they see HAs going and the timescale for getting there.' There were 'conflicting signals' about the strategic role of HAs overseeing the local health economy and drawing together health improvement programmes. 'We don't know where we are and what our new role will be.'

Bradford HA chief executive Ian Donnachie said the board was 'very sorry to lose Dr Firth', who deserved much of the credit for leading Bradford in NHS modernisation. HA vice-chair Dr Christine Parkinson has taken over as acting chair.