Ali Parsa has stepped down from his role as chief executive of Circle, the private healthcare provider that runs Hinchingbrooke Health Care Trust, it was announced today.

A statement released by the company this afternoon said that Circle’s head of mobilisation, Steve Melton, had taken on the chief executive role on an interim basis while the board recruited a permanent successor.

Mr Parsa will remain on the board as founder and non-executive director.

Michael Kirkwood, chairman of Circle Holdings, said:  “As many will know, Ali has a number of external interests and now will be able to spend more time fulfilling his passion for social entrepreneurship.”

Mr Parsa said he was “immensely proud of what has been achieved by Circle since it was founded” and that he wished to “step down from my executive leadership role so that I have the time I need for other projects that now require some of my focus”.

Earlier this year Circle began a 10-year franchise of Hinchingbrooke, making it the first NHS district general hospital to be managed by a private sector organisation.

In the period since Circle took on the contract it has fallen behind on its plans to turn around the trust’s financial problems, with Hinchingbrooke posting a deficit for the first half of 2012-13 of £4.1m - £2.2m more than planned.

A Circle spokeswoman told HSJ in October that the trust had chosen to “fix quality problems before turning to the finances”.

However, the National Audit Office subsequently raised questions about the procurement process for the franchise, stating that while “Circle has made early improvements in some clinical areas” at Hinchingbrooke, the company would “have to generate savings at an unprecedented level”.

Mr Parsa had been due to give evidence at a House of Commons public accounts committee hearing on the franchising of NHS trusts on Monday (10 December).

Circle said it did not “expect to make any additional structural changes or executive leadership changes in the near future”.