Guardian News and Media/London

Sir David Nicholson, the NHS chief executive caught up in the Stafford hospital scandal, has announced he will step down from his post next March.

Nicholson came under intense political pressure after publication of the Francis report, which looked at scandalous lack of care at the hospital for four years from 2005.

He was briefly head of the local strategic health authority when the first of the serious concerns about Mid Staffs began to emerge.

Campaigners led by Julie Bailey and Cure the NHS whose family members died “unnecessarily” at Stafford hospital called for him to go and the Daily Mail branded him as “the man with no shame” for staying in post.

Despite the pressure some applied by Conservative cabinet ministers, Nicholson retained the support of Downing Street.

The veteran of the NHS told a “surprised” Jeremy Hunt of his decision at noon and staff at NHS England were told yesterday afternoon of his retirement. A successor will be found over the next 11 months.

Nicholson was appointed NHS chief executive in 2007.

In the coalition’s new NHS, he controlled more than £95bn of health spending. Sources say his announcement gives the chair of the NHS, Prof Malcolm Grant, time to plan an “orderly” succession.

In a letter to Grant, Nicholson said: “I have only ever had one ambition and that is to improve the quality of care for patients. I still passionately believe in what NHS England intends to do. My hope is that by being clear about my intentions now this will give you and the board the opportunity to attract candidates of the very highest calibre so they can appoint someone who will be able to see this essential work through to its completion.”

A former student communist, Nicholson wore the badge of “Stalinist” lightly. He was brought in by Labour’s health secretary Patricia Hewitt when the NHS was struggling to keep its finances in order.

New Labour had originally wanted a US healthcare boss to step in, but Nicholson got the top job.

Surprised to be in post, he proved remarkably effective. Under his leadership NHS spending was reined in while waiting times were brought down. He also successfully brought in a programme to tackle hospital infections. His encyclopedic knowledge of the NHS meant new health secretaries always relied heavily on his advice. When the coalition talks were under way, Nicholson occupied the health secretary’s seat at the department of health, joking: “We are real masters now.”