Businessman resigns as chair of funds quango.
ABUSINESSMAN appointed by the prime minister to head a quango managing public funds has resigned after it emerged he had been declared bankrupt.
Tony Caplin has resigned as chairman of the Public Works Loan Board (PWLB).
The organisation is responsible for multi-million pound loans to local councils for infrastructure projects.
A Conservative spokesman said Mr Caplin "should have declared he was bankrupt", and Labour described his appointment as "astonishing".
The Mail on Sunday reported that Mr Caplin had been made bankrupt in 2012.
The Treasury were pursuing Mr Caplin for hundreds of thousands of pounds" Chris Leslie Shadow chief secretary to the Treasury Whitehall rules require anyone serving on a public body who is declared bankrupt to inform the relevant minister immediately.
Set out in a guide to government departments making and managing public appointments, the rules state: "Any publicly appointed person who becomes bankrupt should immediately notify the chair of the body, the person who appointed them or the sponsoring department.
"The sponsoring department should then examine the terms and conditions of the appointee and whether there is a mandatory or discretionary statutory bar on remaining in office."
A Conservative Party spokesman insisted Mr Caplin had no role in the Conservative Party, nor was he contributing to the manifesto.
"He was appointed to a number of public bodies by the previous government," he said.
"He was re-appointed to the PWLB by the prime minister.
"He should have declared he was bankrupt.
"This has been pointed out to him, and as a result he has resigned."
Prime Minister David Cameron has been accused of a "serious error of judgement" over the matter.
Shadow chief secretary to the Treasury Chris Leslie said the government had questions to answer about what it knew, and when.
"The Treasury were pursuing Mr Caplin for hundreds of thousands of pounds," Mr Leslie said.
"He was in charge of billions of lending by the Treasury and he's clearly at the centre of a long web of connections across the Conservative Party.
He added: "He was their chief operating officer. I think we need to know now who knew what and when - and we'll be pressing No 10 to say so."
Mr Caplin was appointed to the PWLB - which originated in 1793 - by the Labour government in 2003.
He was then reappointed to the board and made chairman by Mr Cameron 10 years later.
According to the PWLB website, Mr Caplin's appointment had been due to end in 2015.
The former Conservative Party chief operating officer has also served on a number of public bodies, including the North West London Hospitals NHS Trust, where he was chairman until January last year.
Mr Caplin, who is a former chairman of stockbrokers Panmure Gordon, is also reported to have left his post on the Medical Research Council.
Senior Labour MP Margaret Hodge, who chairs the Commons Public Accounts Committee, told The Mail on Sunday the revelations raised "serious questions" that should be investigated.