Michael Frater's track record was described as 'second to none'

Mr Frater, who has been unavailable for comment, is the third chief executive to leave the post in six years.

He was heralded by Nottingham City Council as having a track record which was "second to none" when he was appointed in July 2006.

Councillor Graham Chapman told the BBC the pay-out would be a year's salary plus three months pay.

This means Mr Frater, whose salary is �185,000 a year, will receive �225,000.

Mr Chapman said: "He asked to go. He thought it in the best interests of the city. The alternative may have been a long a long drawn-out process which could have cost just as much in lawyer's fees."

"He's cleared his desk, but not yet signed an agreement."

'Big reputation'

Telford and Wrekin Council, which Mr Frater had been chief executive of before coming to Nottingham, was rated as "excellent" by the Audit Commission.

And two years before taking up his job in the city he was appointed a CBE for his services to local government.

Alistair Robertson of the Association of Local Authority Chief Executives said the situation reflected very badly on the council.

"If Michael can't do it, what would make anybody with the sort of experience that was necessary think that they could do it?" he said.

"He's got a big reputation in local government, and central government think highly of him, and regardless this damages him a bit.

"I'm sure people will think that the council is fundamentally the problem here, but nevertheless it's not good news for him and I'm sure it's the last thing that he really wanted."