(Adds details, comments) By Kristin Roberts WASHINGTON, July 17 (Reuters) - U.S. Veterans Affairs Secretary James Nicholson said on Tuesday he would step down, leaving an agency criticized for the care provided to veterans of the wars in Iraq and Afghanistan. Nicholson, whose resignation is effective no later than Oct. 1, said he wanted to return to the private sector. "This coming February, I turn 70 years old, and I feel it is time for me to get back into business, while I still can," he said in a prepared statement. Nicholson was sworn in on Feb. 1, 2005. He has also served in the Bush administration as U.S. ambassador to the Vatican and was a former chairman of the Republican National Committee. The Veterans Affairs Department (VA) and Pentagon have faced increasing criticism this year for the quality and level of care received by veterans of the Iraq and Afghanistan wars. Reports have shown that the rise in post-traumatic stress and traumatic brain injury among returning troops has not been met with more resources to deal with mental health problems. Some critics also say the Veterans Affairs Department is still unprepared and lacks the budget to care for a coming wave of Iraq and Afghanistan veterans who will draw on veterans care benefits when they leave the military. Also, during Nicholson's tenure, personal information on 26.5 million U.S. veterans was stolen from an agency employee who took the data home without authorization. That laptop was later recovered. "It is clear that Secretary Nicholson is leaving the VA worse off than he found it," said Illinois Sen. Barack Obama, a Democrat running for president. "He oversaw one of the most tumultuous periods in recent VA history, including billion-dollar budget shortfalls, ongoing cuts in services to certain groups of veterans, and the continuation of a dysfunctional bureaucracy that keeps many veterans from getting the disability benefits they deserve." White House spokesman Tony Snow said Nicholson could have served longer had he wanted to. "He certainly could have served longer if he had so desired," Snow said. "There's no back story here. He called up, said he wanted to leave and move on, and the president accepted his resignation." (Additional reporting by Tabassum Zakaria)
