Liz Reid, who was appointed to turn around the troubled east London borough’s education services, is leaving her pound;85,000-a-year post after two-and-a-half years.

Her deputy, Michael Daniels, and the head of education finance, Andrew Rennison, have also resigned.

The departures are bad news for the Government, which made Hackney the first authority to have some of its services privatised, after it became the first to be “failed” by inspectors,

Heads in the borough were shocked by the announcements, made in letters that arrived on the first day of the new school year.

Angela Murphy, the National Association of Head Teachers’ representative for Hackney, said: “We are concerned that once again we are being cast adrift into uncertainty with no single education leadership at the core.

“We firmly believe that this is because of restructuring in the council, which has placed people in a position that was untenable.”

Mrs Reid, 53, refused to say that she was unhappy with an overhaul proposed by the new managing director, Max Caller.

She told The TES that she had always envisaged only being in her post for around three years, with the goal of laying the foundations for imrovement.

She would leave Hackney in November with its schools having just recorded large improvements in both GCSE and key stage 2 results.“With the council’s structure about to change radically, and ... (given that) we are hitting many of the targets the Government has set for us, it seemed the right time to go,” Mrs Reid said.

But in documents circulated to councillors over the summer, and seen by The TES, Mrs Reid claimed that Mr Caller’s proposals would “perpetuate the current impediments to policy development and management”.

In response, Mr Caller criticised alternative proposals put forward by Mrs Reid, saying they would mean a “significant expansion of her current remit”. Councillors backed his proposals.

In a statement, Mr Caller said he was “very disappointed” at Mrs Reid’s resignation.

In a letter to schools, Mr Daniels said he was in “disagreement” with the restructuring, which has seen key areas of work, including personnel and finance, removed from the education department.

Mrs Reid’s resignation comes 18 months after Tony Elliston, the council’s former chief executive, was forced to resign after his own management restructure was castigated by OFSTED. Mrs Reid clashed with him over it. When she was appointed in January 1998, the authority had been without a director of education for nearly two years.