Sir John Bourn will be replaced as head of the National Audit Office early next year, it has been announced.

The current deputy comptroller and auditor general, Tim Burr, will take over on February 1, 2008.

Thursday's announcement follows a row over Sir John's use of expenses while conducting meetings and travelling overseas.

While the Commons public accounts commission, which oversees the NAO, had cleared him of any misconduct, the Liberal Democrats had called for his resignation.

The public accounts commission has subsequently begun a review of NAO governance.

And the government announced that it would be make legislative space available in the Constitutional Reform Bill to enact, if necessary, reforms to the governance of the spending watchdog.

Liberal Democrat Cabinet Office spokesman Norman Baker said: "Sir John Bourn has made the correct decision and he should be thanked for the work he has done.

"But the next incumbent cannot end up in a position where he embarrasses the National Audit Office through expenses claims and perceived conflicts of interest."

Burr said his intention is only to serve as comptroller and auditor general until any NAO reforms are completed.