Alex Allan, the Government's e-envoy, has resigned after less than a year in office because of his wife's illness.
The news came ahead of next week's publication of the Government's state of the nation report into e-commerce and the launch of the UK government portal.
Allan, who was charged with driving forward UK e-commerce and halting the embarrassing string of government IT disasters, will leave Whitehall at the end of the month and return to Australia where he was British high commissioner.
Peter Sommer, an e-commerce specialist at the London School of Economics, said Allan's departure was "regrettable", while Nigel Hickson, the Confederation of British Industry's e-commerce specialist said Allan's resignation was a "great shock".
The Government aims to announce a successor by early November. John Higgins, director-general of the Computing Services and Software Association, said the new envoy must be able to overcome Civil Service inertia and have the clout to take on the Treasury.
Jim Norton, e-commerce specialist at the Institute of Directors is the early favourite to replace Allan. Norton was tipped for the post before Allan's appointment but Tony Blair opted for a Whitehall insider who would have more chance of getting his way with the civil service. Allan warned the prime minister in early summer of his possible departure.
Whatever the final verdict on Alex Allan, the e-envoy post needs a rethink. Allan was picked in preference to PIU report author Jim Norton because an "insider" was needed to stand up to Whitehall inertia. The next e-envoy should come from industry, not the civil service. And if Norton is prepared to take the hot seat, he will have the backing of the IT user community.