WASHINGTON (AP) – VA Secretary Jim Nicholson abruptly resigned Tuesday after months of the Bush administration struggling to defend charges of shoddy treatment for veterans injured in the Iraq war.

Nicholson, a former Republican National Committee chairman and a Vietnam veteran, was picked by President Bush to head the Veterans Affairs Department in 2005. Planning to return to the private sector, he said his resignation is to take effect no later than Oct. 1.

Nicholson, 69, is the latest in a line of senior officials heading for the exits in the final 1½ years of the Bush administration.

“It has been an honor and privilege to lead the VA during this historic time for our men and women who have worn the uniform,” Nicholson said. “We have accomplished so much and the VA is always striving to improve our services to veterans.”

Bush said in a statement that Nicholson “has served his country and his fellow veterans with distinction.”

His resignation comes amid intense political and public scrutiny of the Pentagon and VA following reports of shoddy outpatient care of injured troops and veterans at Walter Reed Army Medical Center and elsewhere.

It also ends a beleaguered two-year tenure in which Nicholson repeatedly fought off calls for his resignation over the VA’s unexpected $1.3 billion shortfall in 2005 that put health care at risk; last summer’s theft of 26.5 million veterans’ personal data in what was the government’s largest security breach; and, more recently, the award of $3.8 million in bonuses to senior officials who were responsible for the agency’s budget problems.

Walter Reed is a Pentagon-run facility. But charges of poor treatment relating to poor coordination quickly extended to the VA’s vast network of 1,400 hospitals and clinics, which serve 5.8 million veterans. The VA also has a severe backlog of disability payments to injured veterans, with overwhelming delays of 177 days that Nicholson has called unacceptable.

“Secretary Nicholson’s resignation should be welcome news for all veterans,” said Paul Rieckhoff, executive director of Iraq and Afghanistan Veterans of America. “The VA under Secretary Nicholson has been woefully unprepared for the influx of Iraq and Afghanistan veterans, consistently underestimating the number of new veterans who would seek care, and failing to spend the money Congress allotted to treat mental health issues.”

His departure comes at a critical time. Nicholson most recently headed a presidential task force charged with making immediate improvements to health care in which he pledged to take “personal responsibility.”

Both Congress and a presidential commission chaired by former Sen. Bob Dole, R-Kan., and former Health and Human Services Secretary Donna Shalala are planning to push sweeping changes in how care is administered.

A spokesman for the VA, Matt Smith, said Nicholson would work to facilitate a transition until a replacement is found. In the meantime, a strategic joint group of the Pentagon and VA is being headed by VA Deputy Secretary Gordon Mansfield to oversee coordination and other changes.

Political blogs have speculated for months that Nicholson might resign to run for senator or governor in Colorado, but a VA spokesman said Tuesday that Nicholson had ruled out any such bids.

Democrats quickly called for a replacement who would vigorously look after veterans.

“The fact is, veterans have been right to be disappointed in Jim Nicholson’s leadership at VA,” said Sen. Barack Obama, D-Ill., a member of the Senate Veterans Affairs Committee and a 2008 presidential candidate, citing in part backlogs of between 400,000 and 600,000 disability claims. “It is clear that Secretary Nicholson is leaving the VA worse off than he found it.”

Rep. Bob Filner, D-Calif., who chairs the House Veterans Affairs Committee, cautioned that Democratic lawmakers won’t stand for it if Bush tried again to “appoint someone who’s a good ol’ boy.”

“We need someone who can come in and say, ‘Here’s the plan,”‘ for addressing veterans’ issues, Filner said.

Throughout criticism of the VA, Nicholson has repeatedly defended the VA while acknowledging there was room for improvement.

He pledged to add mental health services at more than 100 VA medical centers. The VA is adding new VA-run Vet Centers, hiring more suicide prevention coordinators and hosting state mental health conferences to facilitate collaboration of veterans services.

“When you’re seeing over 1 million patients a week, you have to be very good, and if there is any one patient who doesn’t get the care that they deserve, that’s unacceptable,” Nicholson said in March.

Still, he added more recently, “the proof in the pudding is in the taste.” Talk to veterans, he said, and “they will invariably tell you they are really getting good care from the VA.”

Nicholson was national Republican chairman from 1997 through the 2000 elections and a former U.S. ambassador to the Vatican.

Within months of taking office at the VA, he had to deal with a $1 billion shortfall at the agency, requiring the Bush administration to appeal to Congress for emergency spending.

Republicans blamed the shortfall on unexpected health care demands from veterans. But Democrats said it was an example of what they said was the administration’s inadequate planning for the war in Iraq.

On Tuesday, Republicans praised Nicholson, saying he faced an uphill battle amid a burgeoning Iraq war. In private phone calls, Nicholson told them he was ready to move on after realizing he would be turning 70 early next year.

“Secretary Nicholson was willing to rise up and take on those challenges, and has worked tirelessly to fulfill VA’s mission,” said Sen. Larry Craig, R-Idaho.

AP-ES-07-17-07 1842EDT