The boss of Australia Post has resigned after authorising a A$20,000 (£10,500; $14,000) gift of luxury watches to four employees as a work reward.
Christine Holgate, chief executive of the national postal service since 2017, had been strongly criticised for what many saw as a waste of public money.
The gifts of Cartier watches in 2018 were revealed by a parliament inquiry last month, prompting an investigation.
Prime Minister Scott Morrison said he had been “appalled” by the spending.
Speaking last month, Mr Morrison said the British business executive “should go” from her role.
“Every dollar that goes to Australia Post is managed on behalf of Australian taxpayers and it should be done in a way that respects the taxpayers,” he said.
Australia Post is run by an independent board but is owned by the Australian government on behalf of taxpayers.
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On Monday, Ms Holgate announced she had offered her immediate resignation to the board.
She said she wanted to avoid being a “significant distraction” for the mail service before the busy Christmas season.
“I have made this difficult decision to leave to enable Australia Post to be able to fully focus on delivering for our customers,” she said in a statement.
Ms Holgate has consistently defended the gifts as a reward for performance, saying “you need to thank and reward positive behaviours”.
The work of those employees had secured a A$220m investment for Australia Post and “dramatically improved” its financial performance, she added.
“However, I do deeply regret that a decision made two years ago, which was supported by the Chair… has caused so much debate and distraction and I appreciate the optics of the gift involved do not pass the ‘pub test’ for many,” she said in her statement.
Australia Post has played a critical role during the pandemic as the primary delivery service for goods.
Ms Holgate said it had delivered 300 million parcels nationally and supported over 80% of online businesses in Australia since the virus began spreading locally.
Prior to joining Australia Post, she had been celebrated in the private sector for her success in leading Australian vitamin company Blackmores.
Her successor is yet to be announced.